PHYSICIAN’S CHOICE HOME PREGNANCY TEST
Physician’s Choice is a highly accurate, easy to use, and fast home pregnancy test that uses a procedure unlike any other pregnancy test on the Brazilian market. This test will be designed, packaged, and marketed to suit the specific needs of the this market. A complete analysis of the Brazilian market has beencompleted and is presented in the sections outlined below.
The cultural analysis reveals several trends in Brazilian society that should be considered when going to market with any product, especially a highly targeted product such as a pregnancy test. This analysis shows that birth rates are declining, economic power is shifting, and families are getting smaller.
These changeshave been accompanied (or possibly caused) by a large increase in the percentage of the population living in cities. Large population centers are concentrated in two main regions of the country, the South-East and South.
The amount of disposable income in these regions is also growing quickly. This has created a new market for premium products that are perceived as providing superior value.Price is much less of a concern for these consumers than for others in the market.
Competitive and Environmental Analysis
Analysis shows that the starting point for the marketing effort is the South and South-East regions of the country. These are by far the most economically important regions. Both of are highly industrialized, and together they account for more than half of the totalpopulation and approximately 75% of the GDP.
Within these two regions, retailers have started offering more sophisticated imports to serve Brazilians that are interested in value and have new disposable income. Our analysis also shows that American products are generally perceived as having high quality, and therefore high value.
Wholesalers and other middlemen are organized by industry or category– not product. Most Brazilian distributors attempt to act as a one stop shop for a particular vertical market, carrying many different types of products instead of many varieties of one product.
The total market size for pregnancy tests can be conservatively estimated as follows: Assuming that 60% of women of childbearing age are sexually active and that 75% of those have access tohealthcare, the total market potential for Brazil is approximately $75 Million (R$ 188 Million).
The information gathered shows that urban women, of childbearing age (20-34 years old), in the top 20% of income earners that live in the South-East and South Regions of Brazil should be targeted with a premium brand.
Physician’s Choice is positioned as the premium brand – a professionalstyle test that the target market can bring home and use with confidence. This does not represent a risk to the target market, which already uses pregnancy tests. This is not an innovation in the market in the classic sense – it is instead an improved form of a product that already exists.
Physician’s Choice will employ a distributor to take title to the product, warehouse it, and sell it toretailers in Brazil. Physician’s Choice has selected StarTrade as its exclusive distributor in the Brazilian market. StarTrade is familiar with the market and retailers Physician’s Choice is targeting, and they have helped several other companies (including Bayer, Coke, Parmalat, BASF, and 3M) succeed in Brazil.
As a premium brand, Physician’s choice will use a skimming strategy and aim to capture10% of the available market initially, with an expansion in year 5 to 15% of the available market. The complexity of the product and pricing strategy will result in a small, but profitable, share of the market. At 10% of available market, sales through distribution will be $2.4 million (on retail sales of $4 million) and generate a profit of $800,000.
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