(i) What is the key dilemma in the case?
We believe that the key dilemma that is facing the Bayer AG Corporation is what should be the future plans for Children's Aspirin? The first thing to be considered is does Bayer stay the course, does it completely phase out the product or does it re-launch the same product under a new name? Second, how will this affect the rest of the Bayer product line? And third, how will this affect Bayer AG's profitability?
(ii) What aspects of strategy that we have discussed in the class (es) prior to and the current class that are related to the case e.g. vision and strategic intent?
The aspects of strategy that we feel have relevance in this case study are branding, barriers to exit, customer relationship management, and niche marketing.
Bayer AG has done a great job with the branding of their products and at the forefront of that branding is Aspirin.
It is without question the most successful OTC drug in history. Bayer must be careful in any strategic move it makes to protect the brand equity that it has as that is one of its most valuable assets. Once equity is lost, through competition, poor strategic moves, or scandal it is very difficult to get back.
We believe Bayer did a good job of protecting its equity when Reye's syndrome became an issue. It took voluntary, restrictive measures on an international scale sending a strong message to loyal customers that Bayer cares. In doing this they were ahead of the curve and better able to manage the crisis. We believe this shows how sensitive Bayer AG is to the importance of customer relationship management and also to the role CRM plays in brand equity.
An area where Bayer has a...