Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Case Solution & Analysis

1. Is 1-Day Acuvue a superior product? How would a patient pick between a 1-day, 7-day and 14-day contact lens?

One day Acuvue is a most comfortable and contended contact lens for the customers who use lenses on the occasional basis. Those customers prefer one day contact lenses over seven and fourteen days because they are health conscious. However, from the perspective of price per lens the customer would go for seven-day contact lenses that will be suitable for the consumer from both sides that is from eye care and economics. Hence, the customer would be more inclined towards 7-day contact.

vistakon case solution

2. What is the value of a 1 Day Acuvue user, a 7-Day Acuvue user, and a 14-Day Surevue user to Vistakon? (Base your calculations on ONE year of usage.)

Value of one-day Acuvue for the company is 91 and for the 7-day the value is 98, however, the company is earning 97 dollars from its 14 days contact lenses.

3. What are the main issues limiting consumer adoption of 1-Day Acuvue? Consider an adoption for patients and channel partners. Provide support for your arguments.

The reason behind the limiting consumer adoption from the perspective of (ECP) was that the eye care professionals were reluctant to provide their patient information to vision that the company will directly approach their customers to market 1-day contact lenses. However, the professionals were also concerned about their profitability because the consumer does not have the experience of wearing disposable contact lenses. The main concern was with the pricing scheme of the product.

4. What do the test results (presented in Exhibit 21) tell you about who is adopting the 1-Day Acuvue?

Exhibit 21 shows that the company must focus on the promotional strategy of the 1-day Acuvue with the help of Eye Care Professionals who recommend contact lens to their patients. ECP must emphasize on the daily price of the product rather than enlightening the economic perspective of the product that is related to its yearly cost. The exhibit presents that if the customer is price sensitive then their first choice would be 7-day or 14-day product. However, the health conscious customer will be more inclined towards 1-day Acuvue product on the prescription of ECPs.

5. Which segment of patients should Vistakon target for 1-Day Acuvue? Why did you pick this segment and not the other potential segments of consumers?

The company has targeted white color, high-income group for 1-day Acuvue, who prefer eye care over prices. These are part-time contact lens users who wear glasses while they are attending business meetings or when they are travelling. The company is offering disposable contact lenses that are more convenient for the daily use as compared to the conventional contact lenses. The customer uses conventional lenses for a longer period by using a daily wash approach to protect the lenses from harm. Moreover, these are those consumers who use contact lenses for an extended period than recommended.

As the company is targeting the segment which is economically strong and would select a product on the basis of quality rather than price and in the matter of contact lenses these customers will highly adopt the product which will give them high quality eye protection and support. Hence, keeping in mind the importance of eye care for the customer the company has launched their product with their marketing slogan of “care for your eyes”. This statement will create high impact on the minds of health conscious customers and make them agree to use disposable contact lenses.

7. What price should Vistakon charge for 1-Day Acuvue? Discuss the implications of your pricing decisions on channel partners.

The company’s total cost of 1-day Acuvue is \$91 hence, the company would charge 40 percent markup on it and will charge 127.47. Similarly, for 7-days and 14-days the company will charge \$137 and \$136...............................

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Vistakon, independent and entrepreneurial subsidiary of Johnson & Johnson, is a pioneer in the production and marketing of disposable contact lenses with the launch in 1987 Acuvue, first disposable extended wear lenses - soft contact lenses that patients are due within two weeks, and then abandoned. By 1993, Acuvue was the leading brand of soft contact lenses in the United States. In March 1994, Gary Kunkle, president of Vistakon, was presented with the test market results for the company product line, 1-Day Acuvue, the world's first daily disposable contact lenses. Test results of the market, a number of strategic issues related to: 1) positioning and pricing of the new daily wear disposable products, and 2) cannibalization of existing company extended wear disposable lenses, and 3) a mixture of push and pull the components necessary for an introductory marketing campaign to be effective in creating and coordination of supply and eye care professionals and consumers. In deciding how to act, Kunkle must evaluate the risks associated with the beginning of the direct start with unproven strategy as opposed to expanding the test market. "Hide
by Alvin J. Silk, Bruce Isaacson, Marie Bell Source: Harvard Business School 26 pages. Publication Date: Mar 05, 1996. Prod. #: 596087-PDF-ENG

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