The Female Health Company (FHC)

please I need answers for theses case study

AFRICAN UNIVERSITY COLLEGE OF COMMUNICATIONS SAM E. JONAH SCHOOL OF BUSINESS 2019/2020 END OF SECOND SEMESTER EXAMINATION TITLE OF PAPER: International Marketing Course Code: AUBM (345) / AUBM 474 LEVEL 300 & 400: All Streams EXAMINER: Victor K. Dzogbenu Start Date: Monday 1st June, 2020; 5pm End Date: Tuesday 2nd June, 2020; 5pm INSTRUCTIONS 1. The examination consist of Section A and B 2. Answer the Question in Section A, and Any two Questions from Section B. 3. All questions must be answered in writing on a foolscaps Sheet properly margined or answer booklet provided. No A4 Sheet would be accepted. 4. Submission at HoD office on or before 5pm on Tuesday 2nd June 2020 Page 1 of 5 Examiner: Victor K. Dzogbenu Section A The Durex Sex Survey The Durex Global Sex Survey 2002 focused exclusively on the sex attitude and behavior of Today's youth in 20 countries around the world. The survey was sponsored by SSI International manufacturers of Durex, which is the World's leading condom brand. The Female Health Company (FHC) The female condom is seeking a foothold in the world market for contraceptive products.It was time to take control. Give your vagina a choice.On one of her days off before Christmas 2002, President of FHC, Mary Ann Leeper, was thinking about a great opportunity for the female condom. The potential market for the female condom was huge, but FHC had been making losses during the last few years. Mary Ann had been thinking of how to turn the minus figures to plus figures. She accepted that the product was still relatively young in the World market for contraceptives, but she thought it must be possible to produce positive results with such a high quality product. The big question was how? Background to the contraceptive market The market for contraceptives had long been heavily influenced by social and political considerations. From the early days of the Pill, the growing number of abortions and the decision to make the Pill freely available in the early 1970s to the emergence of the AIDS threats in the 1980s, this sector had always been more than a mere product category. Of the 44 million people infected with HIV worldwide, an estimated 29 million (about 70%) were Africans. In some countries (such as Botswana and South Africa) more than 20% of the population was infected by HIV. The number of African AIDS orphans was expected toreach 15 million in 2003, over 30 million people had already died from AIDS more than the number of deaths from all African wars - and 11,000 new cases were diagnosed every day. The deadly disease was decimating Africa's labour force and seriously impeding the continent's economic recovery and development. The increase in the pandemic had been linked to such cultural practices as polygamy, female genital mutilation, widows inheritance and sexual practices and behavior that are culturally imposed in some societies, In Swaziland for example the local culture celebrates virility or the-ingwanma- a man who engages in multiple sexual encounters, while the female is shunned. The AIDS disease was also fuelled by a popular myth that sex with a virgin cures AIDS. The total market consisted of a very broad range of products with oral contraceptives (the Pill) and male condom, the most popular. Other natural forms of contraceptive were also practiced such as withdrawal of, and the safe period. Men and women may also be surgically sterilised. Page 2 of 5 Examiner: Victor K. Dzogbenu Contraceptive products were available in pharmacies or general retail outlets, over the counter or via prescriptions. Contraceptive products werealso distributed in public clinics. In terms of the two leading forms of contraception, the Pill was only available through prescription, while condoms were widely available in chemists, supermarkets and vending machines etc. Growth in distribution channels has been a feature in the condom market since the second half of the 1980s in response to the AIDS crisis. Condom usage had increased tremendously over the past two decades: while use of the Pill had remained broadly stable. The Product The female condom is made of polyurethane- a thin but strong material that is resistant to tearing. The female condom consists of a soft, loose-fitting sheath and two flexible O rings. One of the rings is used to insert the device and help to hold it in place. The other ring remains outside the vagina after insertion. The female condom lines the vagina, preventing skin from touching skin during intercourse. The female condom is pre lubricated and disposable, and is intended for use only once. The product adds additional benefits to the 10 to 15% of the population that are allergic to latex and whoas aresult, may be irritated by latex male condoms. FHC and the Female Condom The female condom was invented by a Danish physician who obtained a U.S.A patent for the product in 1988, and subsequently sold certain right to the female condom to a US company. The first female condom becomes available in 1992, since which time more than 50 million have been sold around the world. The female condom was marketed under the name FC female condom in the US, Femidon in the UK, and Myfemy in other markets including Japan. The FHC manufactured, marketed and sold the female condoms, the only approved product under woman's control. FHC is based in Chicago but has production line in London. The company's UK subsidiary received a Queens Award in April 2002 for enterprise this was in recognition of international leadership achievement. The company owned worldwide rights to the female condom, including patents that had been issued in a number of countries. The problem in many less developed countries such as in Africa is that most men do not like to use condoms and when it comes to sexual relationships, women do not have power to negotiate. In many cultures, it is accepted that men can do what they like, so the female condom was a way of empowering and protecting women those countries. The female condom can prevent unintended pregnancy and sexually transmitted diseases (STDs), including HIV/AIDS. It is only HIV/AIDS product specifically developed and approved by regulatory agencies in the US, European Union, Japan and China among others, since the epidemic broke out over 3 decades ago, for the prevention of, the transmission of HIV/AIDS through sexual contact. The product was sold and available in various venues including commercial (private sector) outlets, public sector clinics and research programmes in over 100 countries. It was commercially marketed in countries like the UK, Canada, Japan and France. However, the female condom was mainly sold to the global public sector, following several years of testing Page 3 of 5 Examiner: Victor K. Dzogbenu the efficacy and acceptability of the female condom. In 1996 FHC entered into a threeyear agreement with the joint United Nations Program on AIDS (UNAIDS), which had subsequently been extended. Under the agreement UNAIDS facilitate the availability and distribution of the female condom in the developing world and FHC would sell the product at reduced price to the developing countries depending on the total number of units purchased. Pursuant to the agreement, the product is currently available in over 100 countries with major UN Health programs in 10 countries including Zimbabwe, Tanzania, Ghana, Brazil, South Africa, Uganda, Namibia and Haiti Global Market Potential and FHC Sales It was estimated that global annual market for the male condom was 12.5 billion units as at 2004. The majorsegments were in the global public sector, the US, Japan, India, and China. However, majority of sexual intercourse including those intended to results in pregnancy were completed with protection, as a results, it was estimated that the potential market for contraceptive was much larger than the identified male condom market. Currently, it is estimated that over 5 billion male condoms are distributed annually worldwide. The female condom is seen as an important addition to prevention strategies by public sector because studies have shown that its availability decreases the amount of unprotected sex by as much as one-third over offering only condoms. FHC expected to derive the vast majority of, if not fully, of its future revenue from the female condom, it sole current product, while management believed that the global potential of the female condom was significant, the product was in its early stages of commercialisation. To date, sales of the female condom has not been sufficient to cover the operational cost of the company. FHC's total revenue in 2001 was approximately US$8.4 M butwith opreating losses of US$1.2 Billion The Brazil Case After the US and South Africa, Brazil came as a major market for the female condom. The way Brazil handled the AIDS problem fitted well with vision of FHC. On November 4, 2002, FHC announced that it had signed a contract with the Ministry of Health in Brazil to produce 4 millionfemale condoms for the ministry's ground breaking National AIDS program. Under the terms of the contract, 2 millions were shipped immediately, with two subsequent shipments of 1 million each to follow. The Brail Ministry of health had created a model program where the female condom was part of a comprehensive AIDS prevention strategy that included training, counselling, outreach, education and support for women and men to change their behaviour Since 1998, the Ministry of Health has ordered more than 8 million female condoms. The program began with a very successful acceptability trial, which included 100.000 units for distribution. The order expanded in 1999 to allow130, 000Brazilian access to the female condom. During 2000 and 2001, the ministry bought 2 million unit each year. This new 4 Page 4 of 5 Examiner: Victor K. Dzogbenu million order would allow the ministry an even broader reach in its comprehensive prevention program. In one Brazilian study to evaluate the acceptance and use of the female condom among HIV infected women, high rate of use (87%), acceptability (68%) and continuation (78%) were observed, with a reduction in the proportion of unprotected sexual act from 14% to 6%%. The study concluded that adding the female condom to contraceptives options with appropriate counselling was able to reduce unprotected sex among HIV infected women a key target group of the program. In addition to continued expansion of the ministry's public sector female condom program, the product was also available commercially through DKT doBrazil, FHC's Brazillian marketing partner, which marketed the product under the brand name Reality End of Case Section A. Answer All (30 marks) Question 1 a. Critically evaluate the three (3} factors that motivated FHC to go International? (10 Marks) b. Which socio-cultural factors are important to consider in the Global Marketing of Condoms? (10 Marks) c. What are the main cultural barriers for expanding the global sale of the female condom? (10 Marks) Section B Answer any two (2) Questions from This Section 2. Indentify and discuss three (3) International market entry strategies. and when it is appropriate to use each one of them? (15 marks) 3. You are an international marketing consultant,a firm in Ghana with only domestic experience has asked for your guidance in identifying international opportunities. Advice the firm on five (5) ways to Identify International Marketing Opportunities? (15 marks) 4. International approach is fraught with a number of risk. As an International marketing expert, explain with appropriate examples, to a group of Ghanaian domestic firms who are considering going International, the risk they will be confronted with and how to minimise its impact on their operations? (15 marks) Page 5 of 5 Examiner: Victor K. Dzogbenu