Metabical case study Example | Topics and Well Written Essays - 750 words

Metabical - Case Study Example Pricing decisions on Metabical has an impact on the profitability of the drug as well as on the entire company. Depending on the type of the target customers and the geographical location, setting prices for the drug will impact its profitability. As far as pricing is concerned, people are not worried about the price and prefer to take prescribed drugs rather then non-prescribed drugs irrespective of the price of the drug. Thus to set up a higher price for Metabical would not be a problem, instead it will increase on profitability since customer numbers will not be affected (Quelch & Beckham, 2010).The Estimated Retail price will be $3 to $5 per pill, dosage is 1 pill per day, and treatment will be 12 weeks. The Return on investment (ROI) for the first five years for the pricing decisions is as follows:Â   or year 1, the sales turnover is 347.4 giving a ROI of (19%), year 2, sales turnover is 383.88 giving a ROI of 77%, year 3, sales turnover is, 424.18, ROI is 183%, year 4, sales t urnover is 468.72, ROI is 300% while year 5, sales turnover is 517.94, giving a ROI of 429 percent. From the figure, the ROI has been increasing year by year meaning the price strategies is one of the best (Quelch & Beckham, 2010). Question 3The positioning strategy chosen mean that Metabical has already a good image thanks to the communication and marketing strategy applied and the fact that Metabical is a prescribed drug. The existing marketing communications strategy will continually create a strong demand for Metabical.