New Production Introduction Bayer Schering Pharma Germany

New Production Introductionbayer Schering Pharma Ag Germany Owns Alka

New Production Introduction Bayer Schering Pharma AG, Germany owns Alka-Seltzer, which was launched in 1931 and was meant for relief of minor aches, pains, inflammation, fever, headache, heartburn, sour stomach, indigestion, and hangovers. Alka-Seltzer Plus was a spin-off of the original medicine, meant to relieve colds and flu. The company has recently introduced a new and improved Alka-Seltzer Plus, as described in this TV ad. The ad shows that Alka-Seltzer Plus can fight congestion, unlike NyQuil. Explain how Alka-Seltzer Plus has been quality and price-positioned in an existing market. In your opinion, has Bayer positioned their product appropriately in the market for cold and flu symptoms relief products? Would you advise Bayer to use a skimming or a penetration pricing strategy? Explain your reasoning. How do you think Proctor and Gamble, the company who produces Vicks NyQuil, would respond to the ad? Guided Response: In 300 words or more, please, provide your response to the above discussion question. If Bayer is currently making normal profits on most of the products in its product line, but is making pure profits on its new Alka-Seltzer Plus with decongestant, what should Bayer do to increase its profits? Respond substantively to at least two of your classmates’ postings. Substantive responses use theory, research, and experience or examples to support ideas and further the class knowledge on the discussion topic.

Paper For Above instruction

The positioning strategy of Alka-Seltzer Plus reflects a sophisticated approach to capturing market share within the competitive landscape of over-the-counter (OTC) cold and flu remedies. By emphasizing its ability to effectively fight congestion, a primary symptom of colds and flu, Bayer has targeted consumers seeking quick and reliable relief. The product's positioning balances quality and price, leveraging its established brand recognition while attempting to differentiate itself from competitors like Vicks NyQuil, which mainly emphasizes cold and flu symptom relief with a focus on nighttime use and sleep aid.

In terms of quality, Bayer has traditionally positioned Alka-Seltzer Plus as a trusted, effective remedy backed by decades of consumer experience. The recent advertising campaign underscores its enhanced capacity to combat congestion, a key differentiator designed to appeal to consumers frustrated with products that only partially address their symptoms. The quality positioning capitalizes on brand trust, efficacy, and innovation, reinforcing Bayer’s reputation in the OTC segment.

Pricing strategy plays a crucial role in market positioning. Bayer's approach appears to lean towards a value-based pricing model, which aligns with consumers looking for effective, trusted remedies at a reasonable cost. Given that Alka-Seltzer Plus is an established brand with a loyal consumer base, a skimming pricing strategy could be appropriate for the new product variant, especially initially to recover R&D investments. However, considering the highly competitive OTC market, a penetration pricing strategy might be more beneficial long-term to increase market share rapidly, especially among price-sensitive customers.

As for Bayer’s market positioning, it seems appropriate, given the focus on effective congestion relief. The emphasis on product differentiation through targeted symptom relief enhances its competitive edge. Nonetheless, aggressive promotion and strategic pricing are necessary to challenge entrenched competitors like Vicks NyQuil.

Regarding P&G's response, Vicks NyQuil would likely emphasize its comprehensive symptom relief portfolio, including sleep aid benefits, to maintain its market position. They might also highlight differences in formulation, branding, and consumer loyalty to counter Bayer’s claims.

If Bayer is generating normal profits on most products but pure profits on the new Alka-Seltzer Plus, the company could consider strategies such as reinvesting profits into market expansion, advertising, or further innovation. They might also consider bundling products or implementing loyalty programs to deepen consumer relationships. To maximize profits, Bayer could increase the price of the new product if the market tolerates it, especially if the perceived value exceeds that of competitors.

In conclusion, Bayer's current positioning of Alka-Seltzer Plus appears aligned with strategic market principles. To sustain and increase profitability, Bayer should continually evaluate pricing strategies, competitive responses, and consumer trends to maintain market relevance and superiority in the OTC cold and flu segment.

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