Marketing Report for Pharmacy 777

Marketing Report for Pharmacy 777

Student Name and Number)

Subject Code and Name

Date of Submission

Facilitator Name

Contents

TOC o “1-3” h z u Introduction PAGEREF _Toc71045393 h 2Target Market Profile PAGEREF _Toc71045394 h 2Geographic PAGEREF _Toc71045395 h 3Demographic PAGEREF _Toc71045396 h 3Psychographic PAGEREF _Toc71045397 h 3Behavioral PAGEREF _Toc71045398 h 4Positioning Statement PAGEREF _Toc71045399 h 4Analysis of the Current Marketing Mix PAGEREF _Toc71045400 h 5Product Strategy PAGEREF _Toc71045401 h 5Three Product Levels PAGEREF _Toc71045402 h 5Product Classification PAGEREF _Toc71045403 h 7Product Portfolio PAGEREF _Toc71045404 h 8Pricing Strategies PAGEREF _Toc71045405 h 8Placement PAGEREF _Toc71045406 h 8Promotion PAGEREF _Toc71045407 h 8Recommendations PAGEREF _Toc71045408 h 9References PAGEREF _Toc71045409 h 10

IntroductionMarketing reports are a crucial tool for a business establishment because they help in figuring out whether the approaches to marketing currently in use are in the right direction and whether there is a need to make any improvements. The Australian pharmacy industry has a number of key players including Walmart Pharmacy, Pharmacy 777, Quay Pharmacy, and Chemist Warehouse. With the strategies applied by these major competitors, Pharmacy 777’s marketing approaches are affected. Therefore, the aim of this report is to, first, review the marketing strategy of Pharmacy 777 and analyze these approaches in terms of their effectiveness in relation to the industry. The report will identify the target market, create a positioning statement, and a marketing ix analysis. The recommendations made will stem from an application of marketing principles and information from Assessment 1. The overall aim is to help Pharmacy 777 grow the business. From the assessment, it can be noted that Pharmacy 777 is doing well in the Australian Pharmacy market, a situation that can be improved further by applying best practices in marketing and approaches intended to capitalize on the strengths and opportunities that the company is exposed to in the external and internal environments.

Target Market ProfilePharmacy 777’s target audience is based on its B2C model. The main decision making process on the company’s target market profile is founded on understanding the dimensions of different segments, potential segment, existing clients, organization category and target groups (Neumann, Tucker, & Whitfield). All these policy directions are underpinned by an understanding of who has the highest consumption of the product. In a segmentation focus and overview, Pharmacy 777 segmentation approach is made up of clearly identifiable small categories, derived from a list of segments that cannot overlap one another. Through an analysis of customer data, experience and intuition, looking at the groups that consume more products, and by adopting the ideas of the industry, Pharmacy 777 divides its market into geographic, demographics, psychographics, and behavioral segments.

GeographicPharmacy 777 divides this segment into smaller categories composed of city, density, language, climate, population, and area. The geographic segmentation approach is a simple yet effective method to divide up a market. People living in a given area or region in Australia are likely to have consuming or purchasing behavior and habits that are different from those in another location. For example, the industry patterns identify that lifestyle products including Viagra, hormonal replacement drugs, post-coital contraceptives, and menstruation postponement drugs sell very well for metro cities including Perth, Albany, Bunbury, Geraldton, and Fremantle among other locations. The same drugs do not sell very well in small towns and villages. The health needs of people in urban areas are different from those in rural and less busy establishments. Therefore, two key areas of the geographic segment are used: city (location), and density (population). Pharmacy 777 focuses on cities due to their high demand for various types of drugs, and the density in these cities means that the demand has more varieties.

DemographicDemographic variables considered by Pharmacy 777 include education, income, age, occupation, social status, gender, life stage, and family. In terms of age, the main considerations are the elderly, who are constantly battling health issues and condition related to different issues. Gender is also a crucial factor, because women have a high likelihood to be lifetime consumers based on their needs as they age and the needs of their families. Women are more likely to require pharmaceutical products in any age compared to men, due to gynecological management and reproductive issues (Grundström, Alehagen, Kjølhede, & Berterö, 2018). Therefore, the main focus for Pharmacy 777 in relation to demographics should be age and gender.

PsychographicUnder this segmentation element, Pharmacy 777 classifies segments according to their psychological composition. For example, variables such as concerns, values, lifestyle, personality, and attitude. Pharmacy 777 should specifically use attitude towards life and personal values. These two variables combine to dictate an individual’s views on health and related aspects. For example, there those individuals who are conservatives, traditionalists, achievers, early adopters, late majorities, and innovators. Innovators have more modern values and attitude on life and health in general. They are cosmopolitan individuals eager to try out new approaches to life. In the midst of the current COVID-19 pandemic, this group was the first to take on vaccination. Late majorities is the opposite of the innovators and are more conservative in their approach to life. They are cautious individuals and are late to adopt new ideas before it can gain public confidence (Stummer & Kiesling, 2021). Attitude and personal values inform the potential for an individual in the aforementioned categories to be a constant consumer or otherwise.

BehavioralIn this segmentation element, Pharmacy 777 considers purchase behavior, usage, intent, benefits, user status, engagement, and buyer stage. Specifically, Pharmacy 777 uses benefits sought and user status. Benefits sought in health products can be used to categorize customers. Individuals are likely to buy based on high quality products, sex appeal, low prices, good taste, and status and comfort ( ). In terms of user status, potential buyers are classified according to regular, occasional, or non-users. Pharmacy 777 should develop new products including new uses for older products by targeting these groups.

Positioning StatementPharmacy 777 bases its positioning statement on its product, price, promotion, and place. The main products include pharmaceuticals, health foods, variant medical devices, baby foods, maternity foods, different pharmaceutical products and products defined under the Australian Medicines License specifications. Additionally, Pharmacy 777 (2017) mention that it offers personalized health services, such as, health screenings, sleep apnea services, weight loss programs, dose management and assistance, and flu vaccination, among other health-related products. In terms of price, Pharmacy 777 is a medicine retail chain that uses largely consistent pricing strategy across its various stores. Pharmacy 777’s promotion is simple and addresses key points of difference and gives a compelling promise to the target markets: Pharmacy 777 is in the business of providing health products, services, and professional help and care to keep the customers healthy and at their best. According to Pharmacy 777 (2017), the slogan “Taking care of your health” is used to shape the perception of its consumers. Regarding place, Pharmacy 777 is available online, in 60 different locations across Australia, and also uses mobile personalized medical care.

In line with the above, the positioning statement for Pharmacy 777 based on the customer segmentation is as follows:

For adult men and women who must battle the changing environment laden with different health concerns, Pharmacy 777 is the drug store that takes care of health issues and demands because we are available near you, we are online, and for mobile personalized services, unlike our competition (Walmart) who insist on you having to travel long distances to seek help, Pharmacy 777 products offers the convenience of availability and friendly prices at your request.

Analysis of the Current Marketing MixProduct StrategyAccording to Kotler (2012), products go far beyond the simple provision of services or goods to include all elements provided to a marketplace with the intention to capture the attention of a market, acquire customers, and satisfy their needs or wants.

Three Product LevelsCustomers, therefore, attach value to products through a need, want, and demand. Needs are basic requirements that a customer lacks. Wants represent specific requirements for products to meet a particular need, for example, a customer prefers prescription medicine in liquid form for easier consumption. A demand represents a set of wants and the ability and desire to pay to have these satisfied. Image 1 below shows a summarized representation of the three product levels that help in understanding a product better. It requires examining products as though they were three different products made up of core benefits, actual product, and augmented product.

Image 1: Three product levels (Source: Kotler, 2012)

The core benefit of Pharmacy 777’s products (pharmaceuticals, health foods, variant medical devices, baby foods, maternity foods, different pharmaceutical products and products defined under the Australian Medicines License specifications) is to meet the customers need to stay healthy. These core products are not used in marketing because they do not have any competitive advantage. Every competitor has the same exact products meant to meet health needs of consumers.

The actual product includes the product design and features. For Pharmacy 777’s actual products, there are many features. For example, packaging, dispensation method, availability, and the state (liquid, tablets, capsules, injections, etc).

The augmented product includes any non-physical attributes of the product. For Pharmacy 777, the typical augmented products should include customer service, warranty, and guarantees. It is an important means to customize products to meet the needs of a specific market. Pharmacy 777’s augmented products should include free home delivery to senior citizens and free consultations to all walk-ins for the elderly consumers with the intention to create competitive advantage. The products also include a 24-hour return policy on all wrong prescriptions. Pharmacy 777’s products should also include a QR code that has a direct link for consultation with a health professional regarding how to use the different drugs and other issues.

Product ClassificationGajanova, Nadanyiova, & Moravcikova (2019) classified products into four man classes; shopping goods, convenience goods, unsought goods, and specialty products. Convenience goods are those products that customers buy repeatedly without much thought including condoms, contraceptive drugs, and artificial sweeteners. Once a customer chooses his/her brand of choice, they continue using the product unless a reason to switch emerges. These products should be made available on the checkout lines and on a separate tab on the company website.

Shopping goods require more research when buying. Drugs in this category will include specific medication for skin conditions, allergies, and other common problems. These products are higher priced. To market this, Pharmacy 777 should strategically provide high quality products and competitive pricing because consumers will weigh their options when buying these products. The price-value relationship will be considered by every consumer. Promotion of these products for Pharmacy 777 must focus on their separation from the competition for the customer to attach value.

Specialty products are unique and have already formed a loyal following from consumers. They already enjoy a relationship that is very difficult to alter. Consumers are willing to go to extensive lengths just to have these products. For these products, the customer rarely looks for attractive prices or value, but always seek out the one specific product that meets their need. For example, heart medication, cancer therapy, diabetes medication, and so on. For this products, consumers do not display any price sensitivity and are willing to pay the premium price where applicable. Promotion for Pharmacy 777’s specialty products must focus on demonstrating the products and where they can be bought and also show the status attached to the brand.

Unsought goods in the Australian pharmacy market include products that consumers rarely buy or do not know about. For example, immune boosters were not very common before the coronavirus pandemic. The key to marketing these products for Pharmacy 777 is to remind customers of the benefits of the product and convince them to buy in order to eliminate future problems. An emotional marketing strategy would help Pharmacy 777 market immune boosters of various types and pricing.

Product PortfolioThe product mix length points to the total number of items that Pharmacy 777 carries in the product lines. For example, the company has different brands for each line in the health foods, variant medical devices, and baby foods products. The product mix depth represents the versions available for every product in the lines. For example, baby foods and pharmaceuticals come in a number of variations and tastes. Products such as condoms may come in different versions and flavors such as color, texture, size, and so on. Consistency refers to the relations of the product lines in relation to product requirements, use, distribution, and other ways. Pharmacy 777 all relate to health and distributed in the same manner.

Pricing StrategiesIn terms of price, Pharmacy 777 is a medicine retail chain that uses largely consistent pricing strategy across its various stores. Pharmacy 777’s promotion is simple and addresses key points of difference and gives a compelling promise to the target markets. It is suggested that Pharmacy 777 uses a value-based pricing for products in the classified and shopping categories and a premium pricing for unsought products and specialty products. Value-based pricing would allow Pharmacy 777 to set prices based on the customers’ belief on the worth of the product. Premium pricing will help the high quality specialty and unsought products and services to get a high-income market. For example, new heart medicine or the door-to-door services of professional healthcare provider would serve the premium price well.

PlacementPharmacy 777 should apply visual placement to focus on the visual exposure and the number of times the products appear in a platform. This would be best to create brand and product awareness for various products in the specialty and unsought categories mentioned above. For example, new cancer management drugs can be advertised on billboards and locations were available mentioned consistently.

PromotionPharmacy 777 uses advertising, direct marketing, and sales promotions. Advertising includes paid communication for a product, services, and ideas. Sales promotions are incentive tools that are applied to drive up short-term sales. The focus is to create reasons for purchases. Direct marketing through social media and devices like telemarketing, mobile apps, and kiosks are used by Pharmacy 777 to communicate without using intermediaries.

RecommendationsBased on the analysis and discussion above, the following recommendations are made for Pharmacy 777:

That Pharmacy 777 targets elderly men and women for specialty and unsought products

That Pharmacy 777 adopts a two-strategy pricing approach made up of premium pricing and value-based pricing for the different categories of products

That the company adopts a positioning statement that focuses on the elderly market for different augmented products including personalized and home-based services

That the promotion strategy should include direct marketing and sales promotions to create a reason for purchases

ReferencesGajanova, L., Nadanyiova, M., & Moravcikova, D. (2019). The use of demographic and psychographic segmentation to creating marketing strategy of brand loyalty. Scientific annals of economics and business, 66(1), 65-84.

Grundström, H., Alehagen, S., Kjølhede, P., & Berterö, C. (2018). The double‐edged experience of healthcare encounters among women with endometriosis: A qualitative study. Journal of clinical nursing, 27(1-2), 205-211.

Kotler, P. (2012). Kotler on marketing. Simon and Schuster.

Neumann, N., Tucker, C. E., & Whitfield, T. (2019). Frontiers: How effective is third-party consumer profiling? Evidence from field studies. Marketing Science, 38(6), 918-926.

Review: Pharmacy 777: National roll out. (2017). Australian Journal of Pharmacy, 98(1159), 24–25.

Stummer, C., & Kiesling, E. (2021). An agent-based market simulation for enriching innovation management education. Central European Journal of Operations Research, 29(1), 143-161.