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Alk-Abello Revises Strategy For Lost Product and Recovers Profits in Two Years

Nov 5, 2020 | Cases, Health Policy

The Issue You Tackled

The company faces total loss of sales for a consumer medical device – very well known amongst the 100,000 users and doctors – with the ending of a patent in 2010. It has developed a replacement product, but faces the challenge of migrating patients and doctors from the existing brand, which will have to happen very fast. What kind of marketing and sales effort should be made, over what period of time, with what likely results?

What You Actually Did

The project started with a one-day workshop with the four person management team, mapping the resources involved – patients, doctors, specialists, sales force – estimating key numbers and causal relationships. The second step was a three week modeling effort between one expert and two key executives. The third and last step involved a half-day workshop reviewing and confirming results, and testing strategy options.

The Results

The project resulted in several benefits to the company. An initial idea – to capture patients via a website proved impossible because usage would be too low, and their engagement with the new brand limited. Direct sales effort and marketing to doctors would not work, because the medical condition was too rare to engage their interest.

The solution was to involve specialists in the routine training-updates that doctors have to undertake, then follow up with sales calls to those specific doctors who had attended the training. This would require five times the previously estimated cost and effort, but deliver attractive results. Current sales volume, worth €1 million in annual profits, would disappear with the loss of the current product.

Pre-existing plans would fail to rebuild more than half this profit over three years, and lose most of the market to competitors. The revised strategy, though costly, would more than recover the existing profits in two years, due to the better profit margin on the new product.

Name Medical Device Company
Modeler Kim Warren
Contact For more information on this case, please contact Kim Warren at Strategy Dynamics.
Client ALK-Abello, Denmark
Client Type Corporation

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