Metabical

Pricing, Packaging & Demand Forecasting

A Group 5 Presentation

CEO Dashmeet Singh BaggaPriyesh IyerHemant ManglaniYuxian XueAkshay Maheshwari

Key Product Attributes

Target Segments

Demand Forecast strategy

Packaging strategy

Pricing Evaluation

ROIProduct AttributesFDA approved prescription drug

Minimal negative side-effects

1 tablet per day

Customer Satisfaction is keyHitting the Bulls Eye!

Secondary Target SegmentAge: 25 40 yearsCollege Education$50,000 < Income < $80,000 Primary Target SegmentAge: 35 65 yearsCollege Education plusIncome > $80,000

Forecasting Demand!ApproachForecasted Demand (millions)Scenario 17.06Scenario 216.14Scenario 314.79Our Choice12% respondents would ask for a prescription immediately

Higher probability of conversionLarger Customer Base to tap intoForecasted Demand (5 years) = 16.14 Million Units of a 4-week pack

Packaging StrategyFactors to considerLikelihood of program completion by each customer

Packaging and Pricing of competitive products

Cost per pack

Preferred Time interval between 2 prescriptions by Doctor

And the Winner is4 week Pack28 tablets in one pack

Incentive to repurchase

Affordability across primary and secondary segments

Easy to monitor monthly progress

Available AlternativesEvaluating Pricing StrategiesPrice SkimmingCharging higher than competitors because you are different$75 Retail Price

Brand Driven PricingAll CSP products are priced considering 70% Gross Margin$125 Retail Price

Customer Value PricingIncrease Customers perceived value$150 Retail Price

Price Skimming ($75 Option)AdvantagesHigher DemandAffordable by all target segmentsDisadvantagesBrand name associated with low quality products

Brand Driven Pricing ($125 Option)AdvantagesInelastic DemandConsumers are from a relatively higher income groupInsensitive to price change

Monopolistic MarketOnly FDA approved prescription drug for combating obesity

Maintains Brand EquityDisadvantagesProne to competitionUncertainty of Perceived Value High Price could lead to low demandUnderlying assumption of no change in customer preferences in 5 years

Customer Value Pricing ($150 Option) AdvantagesPerceived as High Quality and premium productDisadvantagesExploitation of Consumer SurplusTarget Market is further compressedProfits & ROIRetail Price ($)Profit (millions $)ROI % (Brand Driven Pricing Strategy)

75394.28(7)125932.25120%1501201.31184%$75 Retail Price will not help recover initial investment

$125 Retail Price provides an ROI of 122%Demand is assumed to be the same as the demand for $75 retail priceDemand would be lower in reality but still a profitable option

$150 Retail price gives unrealistic ROIDemand can be expected to be significantly lowerAvailable Alternatives