Pfiner

Pfiner focused on animal health products for the U.S cattle industry, particularly in cow and calf including a large Lumber of products: vacunes for both newborn calves and their mathers; medications (de-wormers) and antibiotics (preoneumonic and other diseases). Pfizer positioned its products on the combination of superior science (resulting from its significant R&D efforts) and high-qualityproduction or quality control techniques. The pride in its sophisticated research and development was shown in its new and useful products for the market. The company invests more in research and development than any other animal health company.
Pfiner ´s marketing is being managed by Kipp Kreutzberg (senior marketing manager) and Joan Kuzmack (Manage of marketing research) in order to providesome insight into the continued viability of segmenting.
Currently this marketing team has to work to a series of recent problems.
During at least last 15 years Pfizer´s animal health business had been segmenting the product on the basis of caw and calf, that it to say it is based on beef,s products.
This industry is still under some changes due to a number of new situations, we know that allthreaten the Pfizer´s market. We are going to explain each ones bellow:
* The market share had decreased in cosumption of beef , from 44 percent in 1970 to 32 percent in 1997, while pork and poultry had gained share. It was due to two main factors; the first is about healthy concerns particularly in the colesterol and fat, with the result that the products are of low quality. The second ispreparation issues, many beef products require cooking and preparation time, which limit the consumer selection. In addiction there is another issues to consider, there is a lot of competente with new products from the poulty and pork industries. As for example the Tyson foods which has attracted the attention of the public with creative proposals, unlike most beef products.

* There is bigproblem for the ranchers as we can read in the case, the problem is that ranchers producing poor quality products due to the decrease of prices. And industry analysts believe that this have to change because there is the need of

* improving the quality of the products. Best quality is assessed based on U.S production targets for tenderness, juiciness, flavoring and marbling (fat) on the cut ofbeef. The first dimension is based on taste quality and the second is based on yield that 70% of beef cattle should be rated grade 1 and 2 implying a good amount of beef for the carcass size. Only 25% of beef cattle meet the criteria.

* The current market is not doing so well for Plizer and their customer. Consumer demand had declined over the years resulting a situation of over capacity,which depressed prices. In addiction a Flood of imports resulting from NAFTA regulation worse the situation, as did high prices for feed.

Their primary customer or ranchers are being affected by a vertical integration of the powerful packer. We cannot compete with packers that own their own cattle and feedlots.

At first it will be good to have a look in the external analysis:

Porkindustries
Poultry industries

COMPETITION
Integration in overall supply-chain

SUPPLIERS
Consumer behaviour Change
Less beef consumer
BUYERS

Potential Entrants

SUBSTITUTES
Pork Industries strength
Poultry industries strength

Pork
Poultry
NAFTA
Cheaper imports

LEGISLATION
Low prices calves
Cost of producing high

ECONOMY
Less time preparation

TRENDS

Pfizer is havingproblems with the new customer´s solution which is maximum output with the minimum input. They are trying to save in costs, only doing the bare minimum on health care. In addiction seed stock producers were seeking “best genetic”.
For this reason Kipp wondered how the ranchers would handle the changes and if he must follow with the same segmentation or must to changes it with a different...