Tann_Task1

Chhai Tann

#001226392

February 9, 2020

Western Governors University

A1.  New Products and Services  

MedImmune Inc. is a company dedicated to the manufacturing of vaccines. It is based in

Maryland, USA. The company currently manufactures influenza vaccines that are administered
nasally, under the brand name FluMist. MedImmune plans to introduce and market two new
vaccines in the country of Cameroon. One is for dengue fever and the other is for HIV, the two
most common diseases found in the region. The projected price for the dengue fever vaccine is
$240 per dose and $400 per dose for the HIV vaccine.

 A1a.    Identify need and existing global market

MedImmune Inc. makes use of three different means of marketing research to determine if
the two vaccines generate profit for the company. The first method is to survey the population.
Cameroon is a poorly developed country that does not have advanced infrastructure set up to
utilize modern technology. Because of this, gathering marketing data must rely primarily on
surveys. Primary data is gathered directly from participating correspondents. Representatives are
selected to represent the country’s demographics, from each aspect of society. Regardless of
whether probability or nonprobability sampling is used, in-person interviews are the best option.
MedImmune’s sales team can gather in-depth information about the demographics of the
Cameroonian population. There are glaring flaws, however. First, it is the most expensive as a
huge amount of time and resources is dedicated to seeking individuals who live in poverty-
stricken conditions. Second, a large amount of bias can occur depending on the interviewer in
question. Lastly, sampling can be skewed due to individuals who register as not present for an
interview.
The second method is the direct observation. This is effective in gauging the current status
of the market in Cameroon before the company implements its marketing strategies.
MedImmune can utilize a little bit of technological infrastructure that Cameroon does have to
record the purchasing behavior of the population. Research by Wells and Lo Sciuto (1966)
shows that “The principal advantage of direct observation is that when it is done well it produces
a highly detailed, nearly complete record of what people actually do.” If MedImmune notes that
consumers purchase vaccines if a certain set of conditions are met, then they will use that data to
adjust their marketing strategy to suit those conditions. The downside with this method, however,
is that it is also subject to bias much like with surveys.
 The third method is focus groups. This form of research is most effective for getting the
opinions of different segments of the market, from consumers to suppliers. It consists of a panel
that has members from all sections of the market. The researcher moderates a discussion between
the members and obtains information from them about certain issues, in this case, about the
newly introduced vaccines. The major advantage of this method over the other two, according to
Then et al. (2014), “The focus group method may also decrease the bias of individual
interviews”. A lack of bias means that the generated data is neutral and provides a centered look
at how the market operates and how to best approach the opinions of its various segments. The
disadvantage of focus groups is that it requires a highly skilled moderator that can help eliminate
bias, meaning that MedImmune has to invest in hiring skilled researchers.

A1b.   Competitive Advantage

MedImmune Inc. will have a competitive advantage of being the first company to offer
vaccines for dengue fever and HIV. Its main competitors in the vaccine manufacturing business
are Dynavax Technologies, Emergent BioSolutions, GSK Vaccines, Merck & Co, PaxVax,
Pfizer, Sanofi Pasteur, Seqirus USA, and Valneva. Unlike those companies, MedImmune enjoys
the benefits of brand loyalty and a constant drive for innovation that differentiates it from others.
This includes creating brand new vaccines for new diseases like dengue fever and AIDS. Dengue
fever is a common viral infection spread by mosquitoes. It is common in African countries such
as Cameroon. Similarly, AIDS is another viral infection most commonly found in the region. It is
caused by HIV. Unlike dengue fever, HIV is transmitted through direct contact with infected
bodily fluids. Neither virus has any vaccines or drugs to combat their debilitating illnesses.
MedImmune aims to change that with its new products. The vaccines will benefit from the
company’s segmentation strategy, something that MedImmune’s competitors are lacking.
Through data gathered on the demographics of Cameroon, MedImmune will be a leader in the
market through product uniqueness.

A1c.    Risks in Product/Service Launch

There are two major inherent risks with releasing new vaccines in Cameroon. The first is
the possibility of counterfeit products. The manufacture and sale of counterfeit products is a
widespread issue that impacts virtually every industry. This is a tremendous risk for MedImmune
since counterfeit vaccines negatively affect the market perception of their vaccines, leading to
reduced potential sales. As a result, MedImmune’s overall reputation in the industry is damaged.
Not only that, unsafe counterfeit vaccines that lead to injuries can ultimately subject
MedImmune to increased oversight from the biotech industry and medical community. The
company can take several approaches to reduce this risk. Those approaches are the use of
holographic labels, applying advanced security coding, employing specific color schemes to
identify product types, and partnering with customs officials to seize counterfeit vaccine
shipments.
The second major risk is uncertainty from launching products in a brand-new market.
Cameroon doesn’t have an established market for vaccines unlike more developed countries such
as the United Kingdom and the United States. As such, MedImmune faces various issues by
bringing its products to an emerging market. For starters, many third world countries in Sub-
Saharan Africa such as Cameroon aren’t quite integrated into the global market. Civil war and
unrest blanket the region and disease runs rampant in the population. Not only that, unstable
governments pose a barrier for businesses such as MedImmune to establish a foothold in the
region’s developing market. Based on these factors, vaccine companies can implement a strategy
to develop a local market for vaccines in the region. Through partnerships with organizations
such as WHO (World Health Organization) and UNICEF, MedImmune will be able to focus its
resources on integrating its products into Cameroon’s newly established vaccine market.

A2. Customer Relationship Management (CRM)

It is recommended that MedImmune use Salesforce as its CRM software system.

Bruckenstein (2012) found that “Salesforce fosters integration across a wide range of operating
systems and devices” therefore making it the easiest system to utilize (p. 65). There are 4 major
features about the system that make it a perfect fit for MedImmune. The first is opportunity
tracking. This feature keeps track of vital data like milestones, decision making, and customer
communications. The resulting information is graphed for analysis of sales opportunities so
adjustments can be made as needed. This is useful for MedImmune to develop the best strategies
for expanding operations in Cameroon’s fledgling market. The second useful feature is analytics
and forecasting. Analytics allows the company to get a detailed snapshot of its progress in an
instant. The tool shows key performance indicators and has reporting options that can be fully
customized. As a result, business planning and estimating sales revenue is much easier through
the usage of the forecasting function. The third useful feature is marketing campaigns. Salesforce
can manage every aspect of a marketing campaign. The CRM can help set up advertising, engage
in email marketing, social media management, and route leads obtained from the campaign to
different individuals. This makes it incredibly easy for MedImmune to integrate into Cameroon’s
existing technological infrastructure and help invest in further development. The fourth useful
feature is social media and technology integration. Salesforce allows for easy file collaboration
and organization that benefits MedImmune’s employees. Integration with applications such as
emails, web browsers, and social media sites makes it incredibly easy to access content from
anywhere, useful for MedImmune’s team in Cameroon to access files from the main
headquarters in the United States.

A2a.  CRM Practices

Salesforce will be a major factor in MedImmune’s ability to maintain and track their sales
in Cameroon. In particular, the CRM’s social media platform has the most influence. According
to Bruckenstein (2012), “Salesforce's social enterprise platform allows users to better know,
engage, service, listen to and analyze prospects and customers.” (pg. 66). This connectivity
means that MedImmune and local partner companies will be able to benefit from the same data.
This is particularly true for data on the demographics of potential customers in Cameroon.
Within a centralized database, the data is merged through CRM integration leading to the
identification of opportunities for sales and/or customer service. This centralization allows for
the reduction or elimination of internal barriers where every customer detail is noted and
accounted for. Consequently, the process is streamlined and appropriate follow up by the correct
department occurs when required. This allows customers to feel that MedImmune working on
their behalf and it leads to long-lasting, meaningful relationships. For example, sales plans can
be customized for different regions of Cameroon, ranging from wealthy to poor. Local vaccine
companies in the country can be tasked with distribution and sales of the vaccines in the poorer
villages while MedImmune handles operations in the wealthier areas of Cameroon. As a result,
the company can accurately track sales of its HIV and dengue fever vaccines while
simultaneously developing relations with the local market.

A3. Distribution Channels

 There are two distribution channels that MedImmune’s vaccines can take to get to the
market. The first is the direct-to-customer channel. MedImmune first exports its vaccines from
the United States to Cameroon. After the shipments clear customs regulation and gets
government approval, most get sold directly to Cameroonian pharmacies, hospitals, retail outlets,
public health immunization organizations, and long-term care centers. This method is the most
common and effective for the general population, especially ones living in poverty and can’t
afford the vaccines. The second distribution channel is via medical product distributors. The
remaining vaccines that aren’t sold to the larger care centers end up in smaller places such as
physician’s offices, clinics, and nursing homes. This method caters more to the wealthier portion
of the Cameroonian population that can afford to buy the vaccines.

A3a. Key Considerations  

MedImmune must consider 2 key factors when establishing a market presence in
Cameroon. First, the company must decide on a mode of entry. The best way is to form
partnerships with local retailers and pharmacies that can distribute the vaccines. As MedImmune
is a large manufacturing company, it is beneficial for them to enter a joint venture with local
Cameroonian companies who have a better understanding of how the market in their country
works. Second, there are barriers to a new market that MedImmune must consider. Knowing
every aspect of a new market is significant. Culture, language, and legal regulations are all
factors that a company should be familiar with. A lack of understanding can cause brand
blunders. Specifically, in Cameroon, there is a large superstition surrounding witchcraft. For
MedImmune to succeed in the market, they have to market their vaccines correctly without
invoking that superstition.
 
A3b. Supply Chain
MedImmune’s global supply chain is identical to that of other vaccine companies in the
industry. The process begins with raw materials that are assembled into a complete vaccine. The
company contacts suppliers of these raw materials to ship them to their manufacturing plants.
The completed vaccines are shipped out to the desired country where they enter through a port of
entry. Local distributors send the vaccine shipments to the desired locations before they end up
in the hands of consumers. Any disruption in the chain can be catastrophic to MedImmune’s
efforts to establish a presence in Cameroon. A lack of raw materials, for example, prevents the
vaccines from being manufactured. With a lack of shipments being sent to Cameroon, supplies in
the country will eventually dry up. Cameroonian distributors will feel the pressure to negotiate
new business relationships with MedImmune’s competitors and Cameroonian customers will
lose trust in the company to deliver on its promises.

A4. Pricing Strategy

Penetration based pricing is the best strategy to get MedImmune’s HIV and dengue fever
vaccines to establish a foothold in the global marketplace. Penetration pricing is a marketing
strategy used to entice customers to a new product or service by initially offering a low price.
This helps the new product or service penetrate the market and attract customers away from
competitors, leading to increased awareness. The goal is to get customers to try a new product
and build market share with the hope of gaining their loyalty once prices rise back to normal.
The HIV vaccine, for example, will start at a low price of $200 per dose while the dengue fever
vaccine will be $120 per dose for new customers. Established customers can expect to pay $400
per dose for HIV and $240 for dengue fever, double the initial asking price.

A4a.   Costs

The costs associated with developing and manufacturing vaccines involves multiple
processes. Gouglas et al (2018) suggest that the cost of researching and developing a single
vaccine from the preclinical phase to phase 2 ranges between $31 million to $68 million US
dollars if no failures occur. In the real world, costs are estimated to be around $137 million to
$1.1 billion. The estimate accounts for the cumulative cost of failed vaccines generated during
the process. Adding the cumulative costs for multiple vaccines and the total amount spent
dramatically expands to $8.4 billion.

A4b.  Consumer Acceptance

At a set price of $400 per dose for the HIV vaccine and $240 for the dengue fever
vaccine, MedImmune must consider how Cameroonian customers will accept the high pricing.
Companies generally have four categories of tactics to gain customer acceptance: offering
discounted prices, advertising prices, great deals, and unique experience. To determine which of
these tactics to deploy, MedImmune must gain a deeper understanding of its current price
position relative to consumers’ perceptions. In the case of Cameroon, the company will offer
discounts and unique experiences. This is reflected in the lower asking price of the vaccines and
exceptions for those in poverty-stricken conditions who are receiving financial assistance. As a
result, the company achieves its goal as a value retailer, gained customer loyalty, and increased
revenue in the long run.

A4c. Competitor Prices

GSK Vaccines is MedImmune’s main competitor in Cameroon as they also have an
established market presence there. They currently offer a dengue fever vaccine for $180 per dose
and plan to introduce an HIV vaccine soon for $350 per dose. Although this is a competitive
price compared to MedImmune’s, GSK does not have the advantage of offering a discounted
price for lower-income consumers as this is their static price for both of their vaccines.

 A5.  Promotional Strategy

MedImmune will utilize a push promotional strategy for its new vaccines in Cameroon. It
makes use of the company's sales force and trade promotion activities to create consumer
demand for a product. Push marketing strategies are usually used to gain product exposure. In
this case, MedImmune is trying to establish a presence in the Cameroonian vaccine market so a
push strategy is needed. The benefit of a push strategy is that MedImmune can track demand as
needed and create a cost advantage, otherwise known as an economy of scale.

A5a.    Media Channels

MedImmune will promote its products through Cameroon’s newspaper publication and
television station. The company will also utilize Facebook and YouTube as the main social
media outlets.
A5ai.     Channel Justification
Cameroon’s newspaper is the main way for MedImmune to promote its products. As
most of the potential consumers live in poverty and have little access to technology and the
internet, printed media is all they have. This is especially beneficial if MedImmune can form an
agreement with the Cameroonian government as the newspaper is state-owned, allowing them an
exclusive promotion that competitors would not receive. Television is the other common form of
mass media in Cameroon. Despite a lack of internet infrastructure, the country has slowly
improved its telecommunications infrastructure to where a large majority of the population has
access to a TV. As such, advertisement through TV ads is effective in reaching that segment of
the market.
As for social media platforms, Facebook and YouTube are the two most commonly used
sites not only in Cameroon but also in the Eastern Hemisphere. Facebook is one of the largest
social media platforms in the world. MedImmune’s presence on the site will help them gain
exposure to potential customers. Not only that, the site’s targeted advertising allows the company
to reach specific demographics based on location, age, gender, and interests. Other benefits
include the opportunity to receive feedback from customers and an insight feature to acquire data
for future improvement. YouTube is another large social media platform that focuses exclusively
on videos. Like Facebook, YouTube can expose MedImmune to a wide demographic and bring
traffic to the company. The platform has a more robust advertisement platform that rivals and
even beats Facebook’s in many aspects. Most importantly, videos get more exposure, retain
traffic longer, and are better at telling the audience what to do.

A5b. Sales Promotion

MedImmune will primarily utilize customer loyalty programs and fair trade to promote
the sales of its two new vaccines. Customer loyalty is integral for the company to stay
competitive in the market. Incentivizing loyal customers with offers such as discounted prices,
BOGO (buy one, get one free), and giveaways motivate them to continually promote and
purchase MedImmune’s products. This leads to increased revenue for the company in the long
run.
Fair trade products or those that contribute to a charitable cause operates similarly to
customer loyalty programs. They are designed to build goodwill in the company. In this case, for
every vaccine that gets sold, a percentage of them gets distributed for free to those who are in
dire need of them. Not only does it benefit charitable causes, but MedImmune as well since
organizations such as UNICEF, Red Cross, etc. will recognize the company's efforts to improve
the health of the world's population.

 
 References

1) Wells, W. D., & Lo Sciuto, L. A. (1966). Direct Observation of Purchasing Behavior.

Journal of Marketing Research (JMR), 3(3), 227–233. https://doi.org/10.2307/3149897
2) Then, K. L., Rankin, J. A., & Ali, E. (2014). Focus Group Research: What Is It and How
Can It Be Used? Canadian Journal of Cardiovascular Nursing, 24(1), 16–22.
3) Bruckenstein, J. (2012). Salesforce: More than Just CRM. Financial Planning, 42(1), 65–
67.
4) Gouglas, D., Le, T. T., Henderson, K., Kaloudis, A., Danielsen, T., Hammersland, N.

C., ... & Røttingen, J. A. (2018). Estimating the cost of vaccine development against

epidemic infectious diseases: a cost minimisation study. The Lancet Global Health, 6(12),

e1386-e1396.