Assignment#6

12/2/2015

New Product Development

Nikita Ubale

Case Levitra
One cannot argue about the choice of spokesperson or advertising message, nor
about GlaxoSmithKline and Bayers ability to launch a new product into the global
marketplace effectively. What does the case tell you about first mover advantage?
ED being the obvious social stigma for many men there were few choices of
treatment over it prior to 1988. There was an opportunity to develop oral
medication in the market that would increase blood flow and thereby provide the
desired effect. Pfizer launched Viagra the first effective and safe oral treatment for
ED. Being the first company in business to sell oral medication provided competitive
advantage. Being market pioneers provided Viagra with benefits such as dominance
as and higher than average profitability. First mover may benefit from technology
leadership by applying patents for their technology to prevent other companies
from copying it. It has the opportunity to shape consumer preferences to offer a
product of acceptable quality to earn loyalty. It could be benefited by developing the
product first as it led to obtain greater market share. A firm that is already strong in
marketing and distribution may be better able to sustain a lead with a new product.
Similarly the first mover product gains more identification in market and makes little
difficult for the other entrants to take over the place of popular and well known
product in marketplace. However the first mover firm also has disadvantages that
the later entrant can take the advantage of the emerging market and develop
better product by improving the flaws in the product.
Is Levitras sustainable advantage assured?
In my opinion the Levitras sustainable advantage is not assured. As the other drug
companies could hardly fail to take notice of emerging market. Later entrants can

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

avoid mistakes made by Levitra and develop a better product. Later mover can take
advantage of changing customer needs and can develop a better product cheaper
and faster .Investments made by Levitra to develop promising new product. Later
entrant would benefit from informed buyers without having to spend much on
education of the product. Similarly with strong marketing and promotional support
used by Levitra the other movers can use the promotional support and launch the
product.
If youre managing this brand for GlaxoSmithKline, what would you be most
concerned about, and what could you do?
While managing the brand for GSK, patent infringement needs to be considered
carefully. As Pfizer is assessing whether Levitra constitutes a patent infringement on
Viagra. This would affect the companys brand image. Similarly GSK should try to
protect its product by developing patent of its own. So that the later entrant cannot
take advantage of the technology and the resources used by Levitra. At the same
time taking advantage of its strong marketing and distribution it needs to consider
continuous development of the product to be able sustain a lead in new product. It
needs to find opportunity for the continuous improvement of the product by
overcoming the disadvantages of its current product and meeting the change in the
customer preferences. Post launch of the product GSK should continue to after
action review AAR to capture the events leading up the product launch and try to
understand the thinking behind the actions taken. In order to assess how well the
new product did or whether it achieved its planned targets.
Contribution of design to the new product - Importance of the design plays an
important role to achieve a broad spectrum of new product goals. In my opinion

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

Levitra followed design to meet customer needs into a product that provided better
and meaningful benefits. It obtained understanding of customer needs to translate
the high potential technology. The voice and needs of the customer was extensively
used in design of Levitra as it tried to overcome the failures of the Viagra where it
does not impair blue vision. It provided performance and dosing advantage better
than Viagra. While developing the product it also considered the men who did not
respond to Viagra treatment to provide superior performance to the customer. To
some extent it also followed Design for competitive advantage as it tried to
overcome the faults made by the Viagra and developed a better product to obtain a
greater share in the market compare to its competitors. To obtain more profit it gave
importance of cost to managed care providers it launched Levitra at a lower price
point. Considering its improvement Levitra captured about half of the Viagras
market share. It obtained phenomenal success cause of its performance superiority
and price point.
User categories In my opinion the user category which fits the product Levitra is
late majority. As it tried to launch a product which provided more benefits than the
existing product. It aimed at people who are more concerned about the price of the
product and superiority of the performance. Which does include the pragmatist
group which are not the visionaries as their opinion leaders but are more concerned
about the performing features and the one which is not so expensive.
Levitra belonged to the second mover. As the strategy they followed clearly reflects
the same. Considering the success of the first mover Viagra, which were their
competitor they took advantage of it and developed a better performing product at
low price. The launch of Levitra with superiority in its performance helped to gain a
better market share. As within initial months of the launch Levitra captured about

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

half of Viagras market share and seeking protection. Levitra tried to overcome and
aimed at being innovative by improving a better product. Levitra focused on
offering some dosing advantages and aimed at developing a product for men who
didnt respond to Viagra treatment.

New product process

GSK and Bayer developed Levitra following the new product process and the design
of the product considering the development of each phase. They followed the stage
gate process where evaluation at each step was done. The product development
phase were as follows.
Opportunity Identification and Selection - ED being an obvious social stigma for
many men there were few choices for treatment. There was need of oral medication
in the market which would provide desired benefits. Considering this opportunity
the Pfizer launched Viagra the first effective and safe oral treatment for ED.
However about 30 percent of the users of Viagra showed no positive results from
Viagra even from its highest dose. This proved to be an excellent opportunity for
GSK and Bayer to develop a product which would provide superiority in
performance.
Concept Generation With the emerging need in market for the oral medication
which would provide superior results for ED. Viagra being the first product to
provide safe oral treatment for ED didnt prove much effective in its performance.
As it required an hour after the taking the medication for results to occur. It also
consisted few minor side effects such as headache, nasal congestion and altering a
blue vision in some individuals. This led to generation of the concept for the need of

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

the product similar to Viagra but lacking these side effects or offering better
benefits.
Concept Evaluation- It followed a product definition that included intended market
user, the problem perceived by the existing product in the market and superior and
additional benefits Levitra would provide to the customers. Concept for Levitra was
evaluated after considering the flaws of the Viagra. Researchers identified need of
the similar compound to Viagra but with superior in performance
Development It developed a product that included features and benefits. GSK and
Bayer conducted a test to demonstrate the performance of Levitra. One study in
particular showed that the Levitra was more effective in men who didnt respond
well to Viagra treatment. Levitra offered a dosing advantage as results began to
occur after 16 minutes. Both these figures showed considerable improvement in the
product.
Launch- Despite the performance and dosing advantages, GSK and Bayer took no
chances in the launch of the product. Former football star and Coach Mike Ditka was
recruited as the spokesperson. Like Dole, he would be recognized by his target
audience as a strong, masculine role model and would help encourage more men to
seek treatment for ED. GlaxoSmithKline and Bayer became sponsors of the NFL. The
Levitra tagline seemed thoroughly appropriate: Stay in the gamewhen youre in
the zone its all good. GlaxoSmithKline and Bayer relied on their existing global
marketing and distribution networks to narrow the gap between the two drugs and
to get worldwide distribution and acceptance of Levitra. Further, Levitra was
launched at lower price to obtain a greater market share.

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

Product innovation charter

Background Erectile dysfunction (ED) is a condition that carries an obvious social
stigma for many men. ED can occur for a variety of reasons: cardiovascular disease,
medications such as diuretics and beta blockers, or other factors such as smoking or
prostate surgery. Prior to 1998, men suffering from ED had few choices for
treatment. Penile injections and suppositories had their own drawbacks and did not
provide consistent results. Other men seeking to overcome ED turned to
psychotherapy, surgery, or vacuum-related devices. There was need of oral
medication in the market which would provide desired benefits. Considering this
opportunity the Pfizer launched Viagra the first effective and safe oral treatment for
ED. However about 30 percent of the users of Viagra showed no positive results
from Viagra even from its highest dose. This proved to be an excellent opportunity
for GSK and Bayer to develop a product which would provide superiority in
performance.
Focus It focused on developing a product which was similar to Viagra but provided
superior performance. The market dimension Levitra followed was as follows Former
football star and Coach Mike Ditka was recruited as the spokesperson. Like Dole, he
would be recognized by his target audience as a strong, masculine role model and
would help encourage more men to seek treatment for ED. GlaxoSmithKline and
Bayer became sponsors of the NFL The Levitra tagline seemed thoroughly
appropriate: Stay in the gamewhen youre in the zone its all good.
GlaxoSmithKline and Bayer relied on their existing global marketing and distribution
networks to narrow the gap between the two drugs and to get worldwide
distribution and acceptance of Levitra.

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

Goals GSK and Bayer prioritized line extension as its new product category. As it
aimed at competitive advantage, gaining a market share to obtain profit and
suitable margin in the market. In order to obtain a competitive advantage against
their competitor it developed a product with superior performance and at a lower
price. It aimed at improving the benefits offered by their customers. Levitra focused
on offering some dosing advantages and aimed at developing a product for men
who didnt respond to Viagra treatment. Within the first few months of its launch,
Levitra captured about half of Viagras market share which helped them gain profit
in the market and considerable margin over their competitors.
Guidelines The rule of road for the Levitra was to follow simple strategy to
success. Develop a product with similar to Viagra but with additional features and
benefits. Levitra being the second mover took the advantage of the technology and
emerging need in the market for the oral medication. Considering the success of the
first mover Viagra, which were their competitor they took advantage of it and
developed a better performing product at low price. The launch of Levitra with
superiority in its performance helped to gain a better market share. As within initial
months of the launch Levitra captured about half of Viagras market share and
seeking protection. Levitra tried to overcome and aimed at being innovative by
improving a better product. Levitra focused on offering some dosing advantages
and aimed at developing a product for men who didnt respond to Viagra treatment.
The innovativeness it provide to the product was that results began to occur 16
minutes after taking and last about 5 hours. In addition Levitra does not impair blue
vision.

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

New product category GSK and Bayer prioritized line extension as its new product
category. As it aimed at competitive advantage, gaining a market share to obtain
profit and suitable margin in the market.
Competitive advantage In order to obtain a competitive advantage against their
competitor it developed a product with superior performance and at a lower price.
Customer acceptance goals - It aimed at improving the benefits offered by their
customers. Levitra focused on offering some dosing advantages and aimed at
developing a product for men who didnt respond to Viagra treatment. The
innovativeness it provide to the product was that results began to occur 16 minutes
after taking and last about 5 hours. In addition Levitra does not impair blue vision.
Which stimulated the use and sales of the product and satisfied the customer needs
which eventually improved the market share.
Financial performance goals. They aimed at obtaining a greater market share by
developing a product that is similar to their competitors but with superior
performance. They followed the same marketing strategy and promotional effort
and developed a product which will overcome the flaws in existing product.
Importance of cost to managed care providers was considered. Levitra was
launched at lower price point. Thirty Levitra pills cost between $291 and $299
depending on the strength; comparable prices for Viagra ranged from $7 to $25
higher. Within the first few months of its launch, Levitra captured about half of
Viagras market share which helped them gain profit in the market and considerable
margin over their competitors.
SWOT analysis
Strengths

Assignment#6
12/2/2015

New Product Development

Nikita Ubale

GSK has brand name which helps it gain identification for its product.
Its better performance and dosing advantages that provides better results over its
competitors.
Strong marketing and promotional strategy helps to gain more identification to the
product.
Weakness
Growing competition in the market.
Medical deficiency if over dose
Opportunities
Increasing need in the market for the oral medication on ED.
Growing education and confidence level to opt the medication for ED
Threats
Intense competition in the market.
Improvement in technology for the late movers.
Patent infringement.
Conclusion Levitra case helps us to understand on how second mover has
competitive advantage in market by bringing in superior change in the product.
Levitra provides us information on how market share can be obtained more
effectively by being second mover. Levitra case is included in the chapter to
emphasize on how important is launch management for the success of the product
in the market.