Case Notes/Answers
PRODUCT TEAM CIALIS GETTING READY TO MARKET by
Elie Ofek
Discussion Questions:
1. What are the most relevant dimensions along which to segment the patient market for ED
treatment? Of the segments identified, which would you target initially with Cialis?
2. What is Viagra’s positioning in the marketplace in 2002? How would you characterize the
Viagra brand?
3. What would be the most effective way to position Cialis in the marketplace?
4. What marketing mix activities should accompany the launch of Cialis?
a) What would be the most important messages to communicate to the target patients? To
physicians? To partners?
b) What medium would you use to reach each of these parties and what would your relative
resource allocation be to each?
c) How would you price Cialis? (assuming no health care coverage) What type of promotions
would you offer?
5. What competitive response do you anticipate from Pfizer? From Bayer-GlaxoSmithKline?
, 5-505-060
REV: MARCH 4, 2005
TEACHING NOTE
Product Team Cialis: Getting Ready to Market
Synopsis
Lilly and ICOS management are preparing for the launch of a new drug, Cialis, to compete against
Viagra. To best position against the incumbent firm Pfizer (that markets Viagra), and against
newcomer Bayer-Glaxo SmithKline (that will market Levitra), managers at Lilly and ICOS need to
determine how to segment the erectile dysfunction (ED) market and which target market to focus on.
A marketing plan has to be devised that best takes advantage of Cialis's medical profile vis a vis that
of competitors. Special attention needs to be given to the communication strategy to patients,
physicians and partners and to the pricing strategy of the drug. The analysis and plan of action
should take into account extensive market research and recent competitive developments.
Suggested Assignment Questions
1. What are the most relevant dimensions along which to segment the patient market for ED
treatment? Of the segments identified, which would you target initially with Cialis?
2. What is Viagra’s positioning in the marketplace in 2002? How would you characterize the
Viagra brand?
3. What would be the most effective way to position Cialis in the marketplace?
4. What marketing mix activities should accompany the launch of Cialis?
a) What would be the most important messages to communicate to the target patients? To
physicians? To partners?
b) What medium would you use to reach each of these parties and what would your relative
resource allocation be to each?
c) How would you price Cialis? (assuming no health care coverage) What type of promotions
would you offer?
5. What competitive response do you anticipate from Pfizer? From Bayer-GlaxoSmithKline?
, 505-060 Product Team Cialis: Getting Ready to Market
Teaching Objectives
This case is appropriate for an MBA-level introductory marketing course or for more advanced
courses on the marketing of innovative new products. In a first year core marketing course, the case
allows conducting a comprehensive analysis of customers, competitors, and company competencies.
It is particularly rich in illustrating the concepts of segmentation, targeting and positioning. Given
the above analyses, students should be encouraged to devise a complete marketing plan to
accompany the launch. In a marketing of innovations elective, the case serves as a vehicle to analyze
the set of considerations a second-mover needs to wrestle with and how to convert an objective
product performance improvement into commercial results.
The specific teaching objectives include:
• To understand the different criteria that can be employed when segmenting a market for an
innovative new product or service. Each of these criteria can be shown to produce different
inducements and/or barriers to adoption of a new product.
• To show that a market with an existing player introduces a new layer of segmentation- that of
familiarity and usage of the existing brand.
• To demonstrate that an objective product attribute improvement may not easily (or positively)
be perceived by all target segments or by all influencers. The relative importance of
improvements in different product attributes is dynamic and may change given familiarity
with the category.
• To examine the role of possible influencers and their impact on the adoption of a new product.
• To question conventional thinking that when consumers are dis-satisfied with a current
option this makes switching them to a competitor’s new product easier.
• To help students understand what data may be relevant to make decisions as a second mover
into a category.
• The case also exposes students to the emerging class of “quality of life” drugs and the
importance of marketing in this context.
Analysis
There are four main areas of discussion in this case. These include:
1. Identifying the criteria that can be used to segment ED patients and what considerations to
use in the selection of a target market for Cialis. Students should be prompted to insightfully
use the results of market research.
2. The evolution of the Viagra brand image. In particular, to identify which factors were
influenced by Pfizer and which factors were outside its control. To analyze possible ways to
position Cialis against Viagra.
3. The role, if any, of influencers for the drug. How their attitude towards the drug differs
from that of the ED patients.
4. Devising an integrated marketing plan for the launch of Cialis.
2
PRODUCT TEAM CIALIS GETTING READY TO MARKET by
Elie Ofek
Discussion Questions:
1. What are the most relevant dimensions along which to segment the patient market for ED
treatment? Of the segments identified, which would you target initially with Cialis?
2. What is Viagra’s positioning in the marketplace in 2002? How would you characterize the
Viagra brand?
3. What would be the most effective way to position Cialis in the marketplace?
4. What marketing mix activities should accompany the launch of Cialis?
a) What would be the most important messages to communicate to the target patients? To
physicians? To partners?
b) What medium would you use to reach each of these parties and what would your relative
resource allocation be to each?
c) How would you price Cialis? (assuming no health care coverage) What type of promotions
would you offer?
5. What competitive response do you anticipate from Pfizer? From Bayer-GlaxoSmithKline?
, 5-505-060
REV: MARCH 4, 2005
TEACHING NOTE
Product Team Cialis: Getting Ready to Market
Synopsis
Lilly and ICOS management are preparing for the launch of a new drug, Cialis, to compete against
Viagra. To best position against the incumbent firm Pfizer (that markets Viagra), and against
newcomer Bayer-Glaxo SmithKline (that will market Levitra), managers at Lilly and ICOS need to
determine how to segment the erectile dysfunction (ED) market and which target market to focus on.
A marketing plan has to be devised that best takes advantage of Cialis's medical profile vis a vis that
of competitors. Special attention needs to be given to the communication strategy to patients,
physicians and partners and to the pricing strategy of the drug. The analysis and plan of action
should take into account extensive market research and recent competitive developments.
Suggested Assignment Questions
1. What are the most relevant dimensions along which to segment the patient market for ED
treatment? Of the segments identified, which would you target initially with Cialis?
2. What is Viagra’s positioning in the marketplace in 2002? How would you characterize the
Viagra brand?
3. What would be the most effective way to position Cialis in the marketplace?
4. What marketing mix activities should accompany the launch of Cialis?
a) What would be the most important messages to communicate to the target patients? To
physicians? To partners?
b) What medium would you use to reach each of these parties and what would your relative
resource allocation be to each?
c) How would you price Cialis? (assuming no health care coverage) What type of promotions
would you offer?
5. What competitive response do you anticipate from Pfizer? From Bayer-GlaxoSmithKline?
, 505-060 Product Team Cialis: Getting Ready to Market
Teaching Objectives
This case is appropriate for an MBA-level introductory marketing course or for more advanced
courses on the marketing of innovative new products. In a first year core marketing course, the case
allows conducting a comprehensive analysis of customers, competitors, and company competencies.
It is particularly rich in illustrating the concepts of segmentation, targeting and positioning. Given
the above analyses, students should be encouraged to devise a complete marketing plan to
accompany the launch. In a marketing of innovations elective, the case serves as a vehicle to analyze
the set of considerations a second-mover needs to wrestle with and how to convert an objective
product performance improvement into commercial results.
The specific teaching objectives include:
• To understand the different criteria that can be employed when segmenting a market for an
innovative new product or service. Each of these criteria can be shown to produce different
inducements and/or barriers to adoption of a new product.
• To show that a market with an existing player introduces a new layer of segmentation- that of
familiarity and usage of the existing brand.
• To demonstrate that an objective product attribute improvement may not easily (or positively)
be perceived by all target segments or by all influencers. The relative importance of
improvements in different product attributes is dynamic and may change given familiarity
with the category.
• To examine the role of possible influencers and their impact on the adoption of a new product.
• To question conventional thinking that when consumers are dis-satisfied with a current
option this makes switching them to a competitor’s new product easier.
• To help students understand what data may be relevant to make decisions as a second mover
into a category.
• The case also exposes students to the emerging class of “quality of life” drugs and the
importance of marketing in this context.
Analysis
There are four main areas of discussion in this case. These include:
1. Identifying the criteria that can be used to segment ED patients and what considerations to
use in the selection of a target market for Cialis. Students should be prompted to insightfully
use the results of market research.
2. The evolution of the Viagra brand image. In particular, to identify which factors were
influenced by Pfizer and which factors were outside its control. To analyze possible ways to
position Cialis against Viagra.
3. The role, if any, of influencers for the drug. How their attitude towards the drug differs
from that of the ED patients.
4. Devising an integrated marketing plan for the launch of Cialis.
2
