Brand Management: Paxil - Case Study Example

? Brand Revitalization: Paxil BY YOU YOUR SCHOOL INFO HERE HERE Brand Revitalization: Paxil Introduction The prescription drug Paxil is used to treat a wide variety of depression symptoms. In the late 1990s through 2007, Paxil was one of the most respected anti-depressant medications on the market, providing GlaxoWellcome considerable profitability. However, over time, this brand has lost much of its equity with the loss of its patent, allowing for generic drug production as a replacement from other pharmaceutical companies. Further, Paxil has experienced considerable negative publicity, thus impacting the marketing effectiveness of this particular drug. This report identifies the causes of this negative marketing from a historical lens and also suggestions on how to revitalize the fading brand and restore its recent lost brand equity. Historical Marketing Tactics Paxil had relied on television and print advertising, historically, in order to gain brand recognition and some semblance of brand loyalty with diverse consumer markets. The brand even relied on promotional materials, such as T-shirts, to assist in spreading the brand’s name and overall purpose. In 1998, the Food and Drug Administration delivered a warning letter to GlaxoWellcome about the inappropriate distribution of T-shirts at a children’s health forum in Florida, believing it was promoting an unethical and unapproved use of the drug by expressing its merits to children (Mundy 2008). Thus, Paxil relied on an extensive and rather expensive integrated marketing campaign in order to gain consumer following and to get patients to inquire about the drug at their health clinics to assist in reducing depression symptoms. Up until 2007, these marketing efforts had been a profit success and built considerable brand equity that maintained the ability for extensions of the Paxil name where appropriate. The Current State of Paxil In 2010, GlaxoSmithKline, was forced to pay $558,000 to Montana as part of a lawsuit settlement that managed to prove that the drug manufacturer was not sterilizing all batches of this medication (Johnson 2011). Further, in this same settlement, it was proven in a court of law that the dosages described on the label were different than what was actually part of certain batches of Paxil (Johnson). The media press releases about this settlement were widely available in local newspapers and on the Internet, thus reducing some of the drug’s reputation at the manufacturing level. Another recent study identified that Paxil maintains the ability to significantly raise blood sugar and those it was labeled a concern for diabetics that were using the drug to maintain their depression symptoms (Reinberg 2011). Further, in 2010, the state of Connecticut received a settlement of $1.7 million due to another situation where GlaxoSmithKline knowingly produced and sold defective and/or tainted Paxil batches. In total, including settlements paid to Connecticut, Paxil was forced to pay a whopping $750 million in settlements across the United States and abroad (Reinberg). This not only reduced the marketing equity of Paxil, but also managed to discredit GlaxoSmithKline, thus creating a situation where the brand was beginning to lose its trust as a reliable drug with a reliable manufacturer. To make matters worse for the brand, the Rottenstein Law Group launched a website devoted solely to informing consumers about Paxil in order to spread the word about the dangers the drug poses in a variety of different ways (PR Newswire 2011). This website allowed for posting on blogs and on sites such as Twitter and Facebook, thus exposing the drug to even further negative publicity and a reduction of its brand equity. This is increasingly important to the manufacturer due to the rise of diverse consumer reliance on social networking and blogospheres for their information sources. Sites such as MySpace, Twitter, YouTube and others are growing in popularity across the world and have moved into the mainstream for many demographics domestic and foreign (Smith 2009). Thus, this effort by the Rottenstein Law Group only further added negative word-of-mouth in an environment that is used extensively by consumers around the world. Further adding disgrace to the Paxil brand was a settlement guaranteed by the district court of Louisiana involving a longshoreman that committed suicide after being prescribed Paxil (Wieczorek 2009). The family of this individual was able to convince the circuit court as well that Paxil maintained sole liability for this suicide (Wieczorek). This information was also widely available to diverse demographics in a variety of multi-media formats. It has also been identified through reputable scientific studies that the drug Paxil causes those who rely on it to gain weight (Brewer 2008). This is especially important during a period in history where healthy living and health-consciousness it becoming a mainstream issue, coupled with rising advertisements about the dangers of obesity in multiple demographics. The negative information publicly displayed on the Internet and in other press releases only served to cause more damage to the Paxil name. Why is this Important for Paxil? Brand equity is measured through “brand awareness, attitude toward the brand, and attitude toward the company and its ethical policies” (Holehonnur, Hopkins & Fine 2009, p.166). These factors are directly linked to whether a brand maintains the ability to expand or how long its life cycle will be amongst other anti-depressant drugs. Thus, this becomes of considerable importance to GlaxoSmithKline and Paxil as a solo brand due to the extensive negative marketing and word-of-mouth that it began to experience rather quickly after 2007. One other brand that experienced considerable negative publicity in recent years was Abercrombie & Fitch, who was constantly being targeted for improper, sexually explicit advertising and unethical hiring and firing practices. Abercrombie & Fitch has always been a brand that was geared toward vanity and youth beauty and acts as a segregator company that isolates only specific youths that the company wishes to be in their clothing brands. Lost consumer revenues due to this negative publicity forced the company to impose dramatic cost mark-downs on their previously higher-priced merchandise as a means to rebuild consumer loyalty and gain more brand equity. It was a successful campaign, however, when the company changed some of its risque catalogue marketing that depicted scantily-clad youths to a more down-to-earth marketing campaign, thus allowing for price increases to occur when sales volumes rose because of these socially-responsible efforts. However, Paxil does not have this luxury, it would seem, considering the depth of payments in the form of settlements that continue to plague the brand. Paxil services a much broader demographic audience than Abercrombie & Fitch that has a more tightly-knit target market. “Effective marketing strategies depend on a thorough understanding of the motivation, learning and memory processes that influence what consumers buy” (Jackson 2002, p.1). Paxil receives considerable damage to its brand equity and brand loyalty in nearly all of these categories as the negative publicity hinders the motivation to sample Paxil as an option for anti-depression treatment and also continues to reinforce negative learning at the same time because of its high-profile status in the health industry. A brand acts as a symbol for the actual manufacturer itself, thus impacting future brand loyalty and brand equity for many other products produced by GlaxoSmithKline as consumers, through their learning process, will begin to link other drug brands with GlaxoSmithKline when the names are interlinked on packaging or other multi-media advertising. What can Paxil Do? Paxil, in order to revitalize the brand, needs to develop socially-responsible marketing that illustrates the benefits of the drug based on scientific data or even human testimonials from those who have found success through its use as a treatment for depression. People have a tendency to trust information when it comes from reliable sources, and thus using non-paid consumers that have used Paxil successfully can accomplish the goal of ensuring more brand equity. This is especially important during a period where the patent has been lost and generic drugs are taking its place in markets across the world. In psychology, people are motivated by a sense of peer belonging under the commonly known Hierarchy of Needs proposed by Abraham Maslow. Therefore, using peer associates as a means to boost the integrity of Paxil is the most appropriate methodology to ensure that the brand can experience brand extensions or gain back some of its lost reputation as a quality anti-depression drug. Paxil should take a lesson from Abercrombie & Fitch that was forced, through consumer protest and outrage, to change some of their marketing tactics to avoid accusations of unethical business behaviors. Paxil has been proven, in a variety of courts, to be somewhat unethical in manufacture, marketing and distribution, and therefore changes to how the company is perceived by diverse demographics is necessary in order to achieve a return to high brand equity. None of the negative publicity that GlaxoSmithKline and Paxil have been receiving in recent years is speculation or just fly-by-night word-of-mouth, it comes from very reputable judicial sources and is spread over a wide variety of multi-media. The dangers that Paxil imposes must be countered with corporate social responsibility in order to find success and revitalize its brand reputation in key domestic and international markets. References Baruzzi, Cara. “State to get $1.72 M from drug suit”. McClatchy Tribune Business News, Washington. October 28 (2010). Brewer, Benjamin. “Weight Gain Dogs Many Pills”, Wall Street Journal, New York. April 24 (2008). Holehonnur, A., Hopkins, M. & Fine, A. “Examining the customer equity framework from a consumer perspective”, Journal of Brand Management. 17 no.3 (2009): 165-180. Jackson, A. “Brand Loyalty’s Influence on Consumer Behavior”. (2002). Accessed September 28, 2011 from http://www.essortment.com/all/brandloyalty_pqk.htm Johnson, Charles S. “Montana to get $558,000 in GlaxoSmithKline Settlement”. Missoulian, June (2011). Mundy, Alicia. “US Probe of Glaxo’s Paxil Widens”, Wall Street Journal, New York. June 20 (2008). PR Newswire. “Rottenstein Law Group Produces Videos to Inform Public about Paxil History, Dangers and Litigation”, New York, September 9 (2011). Reinberg, Steven. “Combo of Paxil, Pravachol May Raise Blood Sugar”. US News and World Report, May (2011). Smith, Tom. “The Social Media Revolution”, International Journal of Market Research, 51 no.4 (2009): 559. Wieczorek, Dave. “Learned Intermediary Emerges as Key Defense in Drug Suits”, Inside Counsel, June (2009). Read More