Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002

In July 1996, the French social security governmental agency (the CNAM) sent a letter to all doctors urging them to prescribe generic amoxicillin instead of Clamoxyl, SmithKline Beecham's (SB) blockbuster antibiotic. Pierre Chahwakilian, Marketing Director of SB in France must decide how to respond: (1) milk Clamoxyl and divert promotional investments towards Augmentin, a more specialized and still patent-protected antibiotic, (2) strengthen Clamoxyl's brand equity among doctors by increasing the effort of medical reps, by launching new forms, or with new advertising, (3) go against SB's corporate philosophy and reduce the price of Clamoxyl, or (4) change nothing and count on the resistance of French doctors towards generics. The B case (Augmentin in 2002) shows that GSK (the company formed by the merger of Glaxo Wellcome and SmithKline Beecham) now faces the same options for Augmentin, another blockbuster antibiotic. Should they use the strategy that was so successful for Clamoxyl or have the market conditions changed so much that a whole different approach should be followed?

Authors :: Pierre Chandon, Olivier Kovarski, Jacques Lendrevie, Sarah Spargo

Topics :: Sales & Marketing

Tags :: Pricing, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002" written by Pierre Chandon, Olivier Kovarski, Jacques Lendrevie, Sarah Spargo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Augmentin Clamoxyl facing as an external strategic factors. Some of the topics covered in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 case study are - Strategic Management Strategies, Pricing and Sales & Marketing.

Some of the macro environment factors that can be used to understand the Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 casestudy better are - – 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, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , increasing energy prices, increasing transportation and logistics costs, wage bills are increasing, there is backlash against globalization, central banks are concerned over increasing inflation, etc

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Introduction to SWOT Analysis of Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Augmentin Clamoxyl, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Augmentin Clamoxyl 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 can be done for the following purposes –
1. Strategic planning using facts provided in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 case study
2. Improving business portfolio management of Augmentin Clamoxyl
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 Augmentin Clamoxyl

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Strengths Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Augmentin Clamoxyl in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 Harvard Business Review case study are -

Ability to recruit top talent

– Augmentin Clamoxyl is one of the leading recruiters in the industry. Managers in the Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

High switching costs

– The high switching costs that Augmentin Clamoxyl 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.

Training and development

– Augmentin Clamoxyl has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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.

Highly skilled collaborators

– Augmentin Clamoxyl has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Operational resilience

– The operational resilience strategy in the Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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.

Ability to lead change in Sales & Marketing field

– Augmentin Clamoxyl is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Augmentin Clamoxyl in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Organizational Resilience of Augmentin Clamoxyl

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Augmentin Clamoxyl does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Effective Research and Development (R&D)

– Augmentin Clamoxyl 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Diverse revenue streams

– Augmentin Clamoxyl is present in almost all the verticals within the industry. This has provided firm in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

Superior customer experience

– The customer experience strategy of Augmentin Clamoxyl in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Learning organization

- Augmentin Clamoxyl is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Augmentin Clamoxyl is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Cross disciplinary teams

– Horizontal connected teams at the Augmentin Clamoxyl 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.

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Weaknesses Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 are -

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Augmentin Clamoxyl is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Increasing silos among functional specialists

– The organizational structure of Augmentin Clamoxyl is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Augmentin Clamoxyl needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Augmentin Clamoxyl to focus more on services rather than just following the product oriented approach.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002, in the dynamic environment Augmentin Clamoxyl has struggled to respond to the nimble upstart competition. Augmentin Clamoxyl has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

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 Augmentin Clamoxyl supply chain. Even after few cautionary changes mentioned in the HBR case study - Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Augmentin Clamoxyl vulnerable to further global disruptions in South East Asia.

High operating costs

– Compare to the competitors, firm in the HBR case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Augmentin Clamoxyl 's lucrative customers.

High bargaining power of channel partners

– Because of the regulatory requirements, Pierre Chandon, Olivier Kovarski, Jacques Lendrevie, Sarah Spargo suggests that, Augmentin Clamoxyl 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.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002, is just above the industry average. Augmentin Clamoxyl 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.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Augmentin Clamoxyl has relatively successful track record of launching new products.

Products dominated business model

– Even though Augmentin Clamoxyl 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 - Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 should strive to include more intangible value offerings along with its core products and services.

Slow to strategic competitive environment developments

– As Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 HBR case study mentions - Augmentin Clamoxyl 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.

Low market penetration in new markets

– Outside its home market of Augmentin Clamoxyl, firm in the HBR case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

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Opportunities Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 | 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 are -

Lowering marketing communication costs

– 5G expansion will open new opportunities for Augmentin Clamoxyl 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Augmentin Clamoxyl can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Augmentin Clamoxyl can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Augmentin Clamoxyl can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Augmentin Clamoxyl can use these opportunities to build new business models that can help the communities that Augmentin Clamoxyl operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.

Manufacturing automation

– Augmentin Clamoxyl can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Buying journey improvements

– Augmentin Clamoxyl can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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.

Better consumer reach

– The expansion of the 5G network will help Augmentin Clamoxyl to increase its market reach. Augmentin Clamoxyl 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.

Leveraging digital technologies

– Augmentin Clamoxyl 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.

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. Augmentin Clamoxyl can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Loyalty marketing

– Augmentin Clamoxyl 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Augmentin Clamoxyl can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Developing new processes and practices

– Augmentin Clamoxyl can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.

Low interest rates

– Even though inflation is raising its head in most developed economies, Augmentin Clamoxyl 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.

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Threats Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 are -

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.

Consumer confidence and its impact on Augmentin Clamoxyl 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.

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. Augmentin Clamoxyl can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Stagnating economy with rate increase

– Augmentin Clamoxyl 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.

Backlash against dominant players

– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Augmentin Clamoxyl business can come under increasing regulations regarding data privacy, data security, etc.

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 Augmentin Clamoxyl.

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. Augmentin Clamoxyl needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.

Technology acceleration in Forth Industrial Revolution

– Augmentin Clamoxyl has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Augmentin Clamoxyl 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.

Regulatory challenges

– Augmentin Clamoxyl 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002, Augmentin Clamoxyl may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .

Increasing wage structure of Augmentin Clamoxyl

– 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 Augmentin Clamoxyl.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Augmentin Clamoxyl can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 .

High dependence on third party suppliers

– Augmentin Clamoxyl 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.

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Weighted SWOT Analysis of Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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 Marketing Strategies in the Competition between Branded and Generic Antibiotics (B): Augmentin in 2002 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 Augmentin Clamoxyl needs to make to build a sustainable competitive advantage.

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