Metabical Pricing Packaging and Demand Forecasting Foe New Weight Loss Drug

Overview

Learning Objective

1. Analyze different product pricing approaches: cost-based pricing, demand-oriented pricing, competitive-oriented pricing, and target-return pricing. 2. Evaluate product packaging alternatives for fit with consumer data and possible pricing strategies. 3. Explore the complexity of making product pricing and packaging decisions for a new product when demand and consumer behavior are uncertain. 4. Examine methods for forecasting demand of a new product and estimating profitability. DISCIPLINE: MARKETING

• People with a body mass index (BMI) of 28 to 30 had an average weight loss of 26 pounds over a 12 weeks & people with a BMI of 25-28 had an average weight loss of 15 pounds using metabical. • CSP wanted to base their new product comparably to Alli, but felt Metabical could be priced at a premium due to the need of a prescription to get the drug. • Pricing was a main concern with this product and several scenarios were run to try and project and forecast where the pricing would make the best return on investment (ROI). • Packaging - The weight loss drug available in three four-week packages. • The four week packaging was at the specific point where the consumer did not have to spend too much money to buy it, yet got invested in the product enough that they would come back to buy the second and third portions

Marketing Research

– According to the US survey • 34% overweight • 25.8% obese • 4.7% severely obese – Health care providers were positive about the prospects of weight loss drugs. – Responses of individuals: indicates 12% would immediately opt for such a solution. – Focus group: Need of Prescription-strength drug with FDA approval & clinical results to backup weight loss results.