Abstract
We propose a network model to identify the main drivers of consumer-based brand equity. We apply our research to assess the value of three over-the-counter drug brands. Our aim is to help manufacturers to improve their position in the market of self-medication. This market has very peculiar characteristics: consumers buy products in response to their specific health needs; nonetheless, the market is not strictly regulated in the same way that the prescription market, which allows firms to choose their pricing and communication strategies. Moreover, consumers are not forced by physicians to buy one specific drug, but they can choose the one they prefer. To develop our model we use the Analytic Network Process methodology, which allows integrating qualitative and quantitative judgments from many decision makers and deals with non-regular preference structures. The output of the model is a ranking of the brand value drivers, according to their importance in influencing the consumers' purchase intentions. We find that advertising plays a major role in this setting. To test our model and validate our results, we analyse three Italian brands that produceover-the-counter (OTC) Diclofenac-based drugs. In addition, we compare our results with their market share.
Highlights
In recent years the pharmaceutical industry experienced a decrease in its performance, which involved losses in profit margin and return on investments
By means of the Analytic Hierarchy Process (AHP), we found evidence to say that companies’ reputations and the strategies adopted to build consumer loyalty play a major role in determining the brand value as perceived by consumers; we emphasized the importance of choosing the most appropriate price for products, having reliable after-sales services and paying attention to customer feedback
We extend our previous research, using a more complete model to assess brand equity – we build our model under the general framework of the Analytic Network Process (ANP)
Summary
In recent years the pharmaceutical industry experienced a decrease in its performance, which involved losses in profit margin and return on investments This situation can be partially ascribed to the very peculiar nature of this industry: manufacturers face high costs for R&D activities and for patents, competition is high and the relationship with customers is often very constrained. In this context, reduced profit margin can impede – or, at least, make more difficult – the development of new products, which, for the most part, require long lead www.intechopen.com. In some cases, having a good reputation in the prescription medicines sector (Rx)helps to improve one’s position in the OTC market as well
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