A Defense of Direct-to-Consumer Prescription Drug Advertising SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of A Defense of Direct-to-Consumer Prescription Drug Advertising
Within the past 20 years, consumer advertising of prescription drugs has grown from a rarity to one of the most pervasive forms of consumer advertising, with ads for antidepressants and heart medications now as common as those for fast food and automobiles. At the same time, direct-to-consumer (DTC) advertising has attracted a growing chorus of criticism from consumer advocates, health professionals, and elected officials. This article explores the extent to which such criticism has merit and the extent to which it lacks soundness. Specifically, the article casts doubt on the charges that (1) DTC advertising is deceptive; (2) DTC downplays product risks; (3) DTC focuses on trivial or imaginary maladies; (4) DTC doesn't promote non-pharmaceutical solutions to health problems; (5) DTC harms the doctor-patient relationship; and (6) DTC is responsible for the rapid rise in drug costs.
Swot Analysis of "A Defense of Direct-to-Consumer Prescription Drug Advertising" written by Anthony D. Cox, Dena Cox includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dtc Advertising facing as an external strategic factors. Some of the topics covered in A Defense of Direct-to-Consumer Prescription Drug Advertising case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the A Defense of Direct-to-Consumer Prescription Drug Advertising casestudy better are - – challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , technology disruption, increasing commodity prices,
wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of A Defense of Direct-to-Consumer Prescription Drug Advertising
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in A Defense of Direct-to-Consumer Prescription Drug Advertising case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dtc Advertising, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dtc Advertising operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of A Defense of Direct-to-Consumer Prescription Drug Advertising can be done for the following purposes –
1. Strategic planning using facts provided in A Defense of Direct-to-Consumer Prescription Drug Advertising case study
2. Improving business portfolio management of Dtc Advertising
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dtc Advertising
Strengths A Defense of Direct-to-Consumer Prescription Drug Advertising | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dtc Advertising in A Defense of Direct-to-Consumer Prescription Drug Advertising Harvard Business Review case study are -
Innovation driven organization
– Dtc Advertising is one of the most innovative firm in sector. Manager in A Defense of Direct-to-Consumer Prescription Drug Advertising Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Dtc Advertising
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dtc Advertising does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Dtc Advertising are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Training and development
– Dtc Advertising has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in A Defense of Direct-to-Consumer Prescription Drug Advertising Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Dtc Advertising in the sector have low bargaining power. A Defense of Direct-to-Consumer Prescription Drug Advertising has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dtc Advertising to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Dtc Advertising is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the A Defense of Direct-to-Consumer Prescription Drug Advertising Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Dtc Advertising in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Sales & Marketing industry
– A Defense of Direct-to-Consumer Prescription Drug Advertising firm has clearly differentiated products in the market place. This has enabled Dtc Advertising to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Dtc Advertising to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Dtc Advertising has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study A Defense of Direct-to-Consumer Prescription Drug Advertising - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Dtc Advertising has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Dtc Advertising is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Anthony D. Cox, Dena Cox can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses A Defense of Direct-to-Consumer Prescription Drug Advertising | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of A Defense of Direct-to-Consumer Prescription Drug Advertising are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study A Defense of Direct-to-Consumer Prescription Drug Advertising, it seems that the employees of Dtc Advertising don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Low market penetration in new markets
– Outside its home market of Dtc Advertising, firm in the HBR case study A Defense of Direct-to-Consumer Prescription Drug Advertising needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Dtc Advertising has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Products dominated business model
– Even though Dtc Advertising has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - A Defense of Direct-to-Consumer Prescription Drug Advertising should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study A Defense of Direct-to-Consumer Prescription Drug Advertising that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case A Defense of Direct-to-Consumer Prescription Drug Advertising can leverage the sales team experience to cultivate customer relationships as Dtc Advertising is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study A Defense of Direct-to-Consumer Prescription Drug Advertising, is just above the industry average. Dtc Advertising needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to strategic competitive environment developments
– As A Defense of Direct-to-Consumer Prescription Drug Advertising HBR case study mentions - Dtc Advertising takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Dtc Advertising supply chain. Even after few cautionary changes mentioned in the HBR case study - A Defense of Direct-to-Consumer Prescription Drug Advertising, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dtc Advertising vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Anthony D. Cox, Dena Cox suggests that, Dtc Advertising is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Lack of clear differentiation of Dtc Advertising products
– To increase the profitability and margins on the products, Dtc Advertising needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Dtc Advertising has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities A Defense of Direct-to-Consumer Prescription Drug Advertising | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study A Defense of Direct-to-Consumer Prescription Drug Advertising are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Dtc Advertising can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Dtc Advertising has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dtc Advertising can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Dtc Advertising has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study A Defense of Direct-to-Consumer Prescription Drug Advertising - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dtc Advertising to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dtc Advertising in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dtc Advertising is facing challenges because of the dominance of functional experts in the organization. A Defense of Direct-to-Consumer Prescription Drug Advertising case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dtc Advertising can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Dtc Advertising can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Learning at scale
– Online learning technologies has now opened space for Dtc Advertising to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Better consumer reach
– The expansion of the 5G network will help Dtc Advertising to increase its market reach. Dtc Advertising will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Buying journey improvements
– Dtc Advertising can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. A Defense of Direct-to-Consumer Prescription Drug Advertising suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Building a culture of innovation
– managers at Dtc Advertising can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Dtc Advertising in the consumer business. Now Dtc Advertising can target international markets with far fewer capital restrictions requirements than the existing system.
Threats A Defense of Direct-to-Consumer Prescription Drug Advertising External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study A Defense of Direct-to-Consumer Prescription Drug Advertising are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Dtc Advertising will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology acceleration in Forth Industrial Revolution
– Dtc Advertising has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Dtc Advertising needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dtc Advertising in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Dtc Advertising.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Dtc Advertising needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Stagnating economy with rate increase
– Dtc Advertising can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Increasing wage structure of Dtc Advertising
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Dtc Advertising.
Consumer confidence and its impact on Dtc Advertising demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Dtc Advertising high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dtc Advertising with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Dtc Advertising needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dtc Advertising can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of A Defense of Direct-to-Consumer Prescription Drug Advertising Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study A Defense of Direct-to-Consumer Prescription Drug Advertising needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study A Defense of Direct-to-Consumer Prescription Drug Advertising is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study A Defense of Direct-to-Consumer Prescription Drug Advertising is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of A Defense of Direct-to-Consumer Prescription Drug Advertising is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Dtc Advertising needs to make to build a sustainable competitive advantage.
