Allround, Inc.: Line Extension Of Cold Products

line extension of a cold product, Besthelp+ was priced at $4.89 and the only child product, Coldcure was priced at $5.89. The product was introduced below market value to establish effectiveness and promote initial use and adoption. The trade-off is the lower gross margin achieved for the brand extension. The pricing of Allright, introduced in period 6, was established by evaluating the pricing report. The pricing report revealed that Extra was the only other multi-capsule cold product and was priced at $4.99. Dry-Up a 4 hour multi-capsule product was also available and was priced at $5.29. Since the cost to produce the product was $0.98 the decision was to introduce the product at $4.99 MSRP with volume discounts provided such that the resulting

Therefore, advertising and promotional focus for the established brand was to maintain recognition while improving repeat purchases within the targeted young families demographic. The solid financial position of Allstar Brands OTC cold medicine group supports continuing to invest in the highest quality advertising firm for the portfolio of products. The effective communication of the portfolio of products was important for gaining market share by addressing all the needs of the cold segment. BMW was the ad agency used for Allround, as a mature product in all periods, Allround+ launched in period three, and Allright launched in period 6. The continued use of BMW agency was thought to support market share gains and promote customer value drivers for the cold product segment.
The focus for the Allround product for periods 1-10 was consistently primary and reminder advertising. In Period 1 it was necessary to communicate the elimination of alcohol from the Allround formula. The benefits of Allround promoted in period 2 through 10 included adding that Allround won’t cause drowsiness and that the formulation minimizes side

This product also did not contain the ingredients associated with negative side effects and therefore the advertising message communicated that the product won’t cause drowsiness.
Distribution
To optimize distribution strategy, the decision was made in period 1 to increase co-op advertising and promotional allowances to gain prime shelf space which is important for Allround as the market leader. In period 3 when the brand extension Allround+ was launched it was important to be able to capitalize on the success of Allround. Promotional allowance was focused on mass merchandisers, chain drug stores, and grocery stores because these were identified from channel sales report of period 0. Allround has more promotional support than any of its competition.
The Market update reports were monitored and indicated in period 1 and 2 that some retailers were concerned with poor sales support. Therefore, a larger percentage of the budget in periods 3-10 was allocated to sales staff growth offset by decreased consumer