Project #29497 - Elaborate opportunities




In order for top companies to run ahead of the competition, managers must continually alter their strategies to reflect the industry in which they operate. This external analysis examines the macro and industry environments specifically looking at political, economic, social, and technological conditions to help formulate a winning strategy in the topical analgesic industry. The purpose of the external analysis is to identify opportunities and threats. We can define the topical analgesic industry as all of the companies that offer topical ointments directed at reducing pain. The external environment is important for companies to examine because in order to gain advantages over competitors, extensive research must be conducted. Our team performed a thorough examination of the topical analgesic external environment to identify opportunities and threats to gain a competitive advantage. The mission of our well-researched external analysis will lay the blueprint for the long-term competitiveness within an industry where many competitors are present.


Industry Environment


Boundary, SIC, NAIC code

Asteeza is part of the analgesic industry. The term SIC stands for the "Standard Industrial Classification." This classification system was replaced by the NAICS, North American Industry Classification System, beginning in 1997, but there is still some data that is SIC based. The SIC code that most identifies with Asteeza is 2833 for medicinal chemicals and botanical products (SIC). The NAICS code that most identifies with the topical analgesic is #325412 for analgesic preparations manufacturing (NAICS). Both SIC and NAICS codes are used to classify establishments by their main type of activity.


The United States has the largest market for the analgesics industry around the world. Due to the small size of some analgesic companies and products compared to the huge industry of analgesics, it is easy for these smaller companies and products to disappear from the market altogether. An article published in May of 2013 stated, "The United States represents the largest market for analgesics worldwide. Ageing population represents the key growth driver for the US chronic and acute pain management therapies market" (De Angelis). The aging population is in constant need of analgesics for a variety of ailments. This perpetual need gives many opportunities to the analgesics industry to continue to grow and prosper more than it already has.

According to the same article, "After two years of recalls from Johnson & Johnson's McNeil consumer health subsidiary, 2012 was expected to be a year of recovery for the US analgesics market. Instead, production failures grew even more widespread" (De Angelis). This caused McNeil and other leading analgesic companies to have to recall some of their products including Excedrin and Children's Tylenol. Recalling some leading products could give other analgesic companies and products a chance to breakthrough into the industry. People in need of an analgesic could be in search of a new product if their existing product has been recalled or if they are not satisfied with the product they currently use. This possibility of growth would help the industry continue to thrive.


Products and services

There are numerous products and services available for pain therapy in the analgesic industry. According to an article from 2010, "Despite the number of pain therapies marketed in the U.S., there remains an unfilled need for drugs that provide improved efficacy, safety and tolerability" (Compton). This unfilled need provides an opportunity for the analgesic industry to introduce new companies and products. Any new products that could be released into the industry need to focus on efficiency, safety, and tolerability as stated in the article. If a product can be released that proves to be more efficient and safe than analgesic products that already exist and other methods of pain therapy, it will positively serve the industry as a whole.



Although there is not a significant amount of knowledge about age and gender trends in the analgesic industry, they are frequently researched. According to an article from December 2010, "Long-term use of opioid analgesics for chronic noncancerous pain has increased considerably in recent years, but little is known about trends in long-term use of prescribed opioids among specific age and gender groups" (Campbell). This increase in analgesics for chronic noncancerous pain is a good sign for the analgesics industry because it shows there is a constant need for analgesic products. This creates a great opportunity for the industry to continue to prosper as long as this trend of long-term use persists.

The analgesic industry trends show that analgesic products tend to be used more often by women than men. According to research done for the same article as above, "Women are more likely than are men to report a wide range of chronic pain conditions, including most musculoskeletal and arthritic pain conditions… Women report greater severity of pain, longer-lasting and more frequent pain, and more anatomically diffuse pain than do men, and women are more likely to experience multiple pain problems" (Campbell). This is a great opportunity for the analgesic industry. Analgesic companies and products can use these trends to create marketing plans directed towards women. They should not primarily focus on women, but since the trends show that women are more prone to be users of the product, it is important to reach out to them.

Conclusions that were drawn from the article are as follows, "Risks and benefits of long-term opioid use are poorly understood, particularly among older adults. Increased surveillance of the safety of long-term opioid use is needed in community practice settings" (Campbell). The risks involved with long-term use can be a threat to the analgesic industry. If many risks of analgesics are being exposed, people may begin to stray away from some analgesics for fear of health issues that could arise from long-term use. There are some analgesics that are made from all natural ingredients, so these products could draw people to them if there are less risks involved compared to other analgesic products. For example, Asteeza is made from all natural herbal ingredients, so people may be willing to use this product believing there are less risks involved instead of other analgesics that are not all natural.


Customers - Jackie

Private label products offer many opportunities for growth and expansion. An article from June 2012 discusses consumer views on private label products in the analgesics industry, "A rise in the popularity of private label products can be seen as consumers find that even brand names can be fallible, and seek the availability and cost savings of store products" (OTC). As major brand name products continue to become unreliable, more consumers of these products will begin looking for new analgesics they can rely upon. It is to the advantage of emerging analgesic products that they are in stores like Walgreen's and CVS since they are popular one-stop shops for a variety of consumer needs, especially medical needs.

A great opportunity for products to survive lies in consumer loyalty. The same article from June 2012 also talks about consumer loyalty, "The challenge during this post-recall period lies in brands’ ability to differentiate themselves from the competition and encourage consumer loyalty" (OTC). If a new product can differentiate themselves from all the other analgesics available, this gives the product a huge opportunity to survive and grow. There are many ways to expose new products into the industry that would be highly beneficial. Some of these are discussed within an analgesics article, "Enhanced education campaigns, overt safety messaging, and consumer-specific product positioning may be considered to build exposure and trust among U.S. consumers" (OTC). These conventions, educational campaigns, messaging, and product positioning will not only attract customers but will also help gain their trust by using the product and interacting with the developers.

According to an article about joint pain, "more than 50 percent of people over age sixty-five have clinical signs of arthritis, meaning that an estimated seventy million Americans suffer from the disease" (The Many Causes of Joint Pain). Someone at the age of sixty-five is considered to be a senior citizen. This category makes up a large amount of analgesic customers. The same article states, "As the life expectancies for men and women continue to increase, Americans over the age of sixty-five will continue to be the most rapidly growing segment of the population" (The Many Causes of Joint Pain). This means the senior citizen population will continue to support the analgesic industry because arthritis is an ailment that is never going to disappear, so this population will always need analgesics to help soothe the pain caused by arthritis.

Another key customer group frequently using analgesics is athletes. According to a blog about sports and analgesics, "Many athletes frequently experience injuries involving muscles, ligaments and tendons. Provided that the injury is not too serious, it is common for the athlete to take palliative treatment in the form of analgesic and anti-inflammatory drugs" (Atkin). Athlete's are constantly getting injured, making them a key customer for the analgesic industry. Their use of analgesics is in the form of oral or topical depending on what type of injury they are dealing with.

Massage therapists contribute to the analgesic industry as part of the customer population. According to an online article, "Topical pain relievers--whether in the form of creams, gels, lotions, or oils--can be useful tools in a massage therapist's kit" (Jones). The massage therapy industry uses only topical analgesics for pain relief and relaxation for their clients. This segment of the customer population only contributes the topical analgesic industry rather than the analgesic industry as a whole.

Interestingly, pregnant women make up a segment of the customer population for analgesics. According to a magazine article, "Women should not suffer unnecessarily from pain during pregnancy and lactation. If used appropriately, common analgesics such as paracetamol, aspirin, non-steroidal anti-inflammatory drugs (NSAIDs) and opioids are relatively safe" (Kennedy). The analgesics mentioned in the magazine article should be discussed with doctors before using them during pregnancy and breastfeeding. Although this segment may only be a small part of the customer population, it affects the entire analgesic industry using topical and oral analgesics.


Competitive Analysis and Competitive Forces - Braden

Figure A:


Topical Analgesic Competitors

The industry of leading topical analgesics is a $400 million dollar industry with hundreds of competitors. For Asteeza to be successful on a global scale, the company must perform a competitive analysis to gain a competitive advantage amongst its primary competitors. In the industry of topical analgesics the current market share leaders are Icy Hot, Private Label, Salonpas, Bengay, Tiger Balm, Aspercreme, Australian Dream, Boiron Arnicare, Perform and Biofreeze. These firms own most of the market share with Icy Hot leading the way owning 19.2% of the market. Not far behind are Private Label (16%) and Tiger Balm (5.6%). Examining the strategies of these industry leaders is what will allow our team to identify threats and opportunities in the industry, based on what competitors are currently doing.

In order to compete in the topical analgesic industry, we must look at what the market leaders do well. Icy Hot was statistically the most used product in 2013; a large portion of this is due to their advertisements. Shaquille O’Neal, one of the greatest NBA centers in history, is endorsed by the company and is seen time and time again on commercials. This is an advantage for Icy Hot because they have a credible source to promote their product nationally. Shaquille O’Neal has suffered a laundry list of injuries and he swears by Icy Hot in every commercial. This has a direct effect on the brand athletes select when purchasing topical analgesics in drug stores. We can see that Icy Hot is targeting athletes to make up a large portion of their share in the market. Viewers see “Shaq” and think, “if it works for him it will work for me!” Icy Hot targets athletes that end up becoming loyal customers as their activity becomes more strenuous and they rely on their product. Although their product is higher priced ($7.38), their advertising pays off because the product flies off the shelves.

Tiger Balm is one of the more mysterious brands in the industry. Tiger Balm, developed from “the emperors herbalist” in China during the early 1900’s is believed to be the strongest and most potent pain reliever in the entire topical pain relief industry (Gottschalk). The company claims themselves as the worlds best known pain relief formula. Unlike Icy Hot, Tiger Balm focuses on a “one size fits all” ointment that can conquer any pain or strain you may have. Testimonials on their website claim customers that swear that the quality of Tiger Balm far exceeds that of Icy Hot. The quality of their product, their mysterious name and unusual story is what drives their sales.

The company that dominated the market in 2013 is Australian Dream. Australian dream separates themselves from the pack by claiming no side effects of odor, burning or skin staining ("How It Works"). This company also makes a personal guarantee that their product will treat arthritis pain and if not a refund will be provided in exchange for the jar. This allows for new customers to try the product, knowing in the back of their minds that if they are not satisfied, they will be fully refunded for their purchase. This product that was developed in 1998 and gained a +87.6% dollar change in sales from 2012 to 2013, by far the largest of the industry. Sales of Australian Dream are in large part due to their partners that sell the product. They pose a large advantage by being distributed by Wal-Mart, Walgreens and CVS (AD), which are proven national powerhouses. Australian dreams exposure has increased dramatically since partnering with these companies.

At this point in time, Private Label has applied the low-cost leader strategy to the industry and it has paid off in 2013. Private Label currently owns roughly 16% of the market. This company does not offer some of the amenities that competitors use but it is able to provide benefit at a low manufacturing price. This in turn gives them a lower price than competing brands at $5.55 per bottle. A bottle of Private Label is roughly $7.00 cheaper than some of the most expensive topical ointments. According to a report published in 2011, Private Label share is the largest within the grocery channel (Private Label Products). We can see from figure A above, that Private Label is just beneath Icy Hot in total sales. An opportunity within the industry would be to enter products into the grocery channel because it has paid dividends for the industry leaders.

Finally you cannot ignore the cosmetic powerhouse in Johnson & Johnson’s product on the shelves, Bengay. Bengay sits in the middle of the pack in market share (9.2%) and price ($7.40). This company similar to Tiger Balm and Icy Hot markets more than one topical ointment to consumers. Consumers have the option of purchasing Bengay greaseless products, creams, gels and even pain relieving patches. Bengay gains its market share from being a dependable company. All of Johnson & Johnson products are highly regarded and this makes the decision easy for a customer looking for a quick, reliable fix. Bengay claims itself as the #1 doctor and pharmacist recommended brand (Bengay). This credibility is what Bengay focuses its marketing strategy around.


Industry Segmentation

The analgesic industry can be separated into two major groups, narcotic and non-narcotic analgesics. Narcotic analgesics are drugs that relieve pain that can cause numbness and induce a state of unconsciousness, and are either opiates or opioids, with the difference being that opiates are derived from the poppy plant, while opioids are synthetically created (Narcotic Analgesics). Narcotic analgesics are medications that mimic the activity of endorphins, substances produced by the body to control pain, and are available by prescription only. Products such as Alfenta, Lazanda, Oxyfast, Roxanol, Stadol, Demerol, and Nubain are just a few examples of the many narcotic analgesics in the industry. Non-narcotic analgesics are over the counter and some prescription products that have less of an effect than narcotic analgesics. Non-narcotic analgesics can be broken down into two groups, topical analgesics and oral analgesics. Topical analgesics are sprayed or rubbed onto the skin over areas or joints that are experiencing pain (Topical Pain Relief), while oral analgesics are usually taken in the form of a pill, and are usually used for acute pain (Crystal). An example of a non-narcotic oral analgesic is Tylenol.

Topical Analgesics come in four forms, patches, rubs, sprays and creams, and are usually separated by the ingredients that each product contains. They are usually separated into three groups, counterirritants, salicylates, and capsaicin. “Counterirritants contain ingredients such as menthol, methylsalicylate, and camphor. Products such as Biofreeze, Icy Hot and Mineral Ice are all examples of counterirritants. They are called counterirritants because they create a burning or cooling sensation that distracts your mind from the pain. The second type, Salicylates contain the same ingredients that give aspirin its pain-relieving quality are found in some creams. When absorbed into the skin, they may help with pain, particularly in joints close to the skin, such as the fingers, knees, and elbows. Examples of salicylates are products such as Backprin, Combiflex, Goody’s Fast Pain Relief, Levacet, and Pain-Off. The third type, Capsaicin contains the main ingredient of hot chili peppers. Capsaicin is also one of the most effective ingredients for topical pain relief. When first applied, capsaicin creams cause a warm tingling or burning sensation. Capsaicin products usually take a number of weeks before a user experiences pain relief” (Topical Pain Relief). Examples of products containing capsaicin are ArthriCare, Axsain, Methacin, and Zotrix.


Porter’s Five Forces Model - Nick & Jackie


1) Supplier Power- Nick

Depending on how a company obtains its product will determine the supplier’s power.  For most of the herbal based products the suppliers do not hold a great amount of leverage mainly because most of the ingredients can be grown by the company itself. On the other hand if companies decide to import all of their ingredients the supplier may hold some temporary leverage. The leverage would be temporary mainly because there are too many other companies out there who would make a feasible substitute. Typically speaking it is easy for these analgesic companies to find substitutes because there are many suppliers that would gladly take buyers in. There would be no sense in attempting a raise in prices because the demand is simply not there.


2) Buyer Power- Jackie

In the analgesic industry, buyers are primarily in a business-to-consumer relationship. They compete against sellers, the analgesic companies, to force prices down. The buyer power is high when it comes to the analgesic industry, including both topical and oral analgesics. This is due to buyers having a very large number of choices since many analgesic products are similar in price and symptom relief. If a company started to raise their prices, buyers would choose a competing product with a lower price.

High buyer power can cause a lower-than-average industry profit because buyers have so many alternatives to purchase therefore prices are constantly being lowered. "Information also provides buyers with power, particularly when they have choices, when the products are relatively inexpensive, or when products are not heavily regulated" (Carpenter, 122). Analgesic companies feel pressured to lower prices because they don't want to be forced out of the industry if consumers are purchasing competing products. There are very low switching costs for buyers if multiple products all bring relief for the same symptoms.


3) Competitive Rivalry

In the topical analgesic industry there are several companies that compete to gain a variety of different customers. Given that topical analgesic ointment products have different uses, either for arthritis pain or muscle ache, it serves different customer segments. In the topical analgesic industry, competitive rivalry is high given the number of major players already established in the market. Competition is also strategically diverse because there are other companies of other industries that target the same customers of topical analgesic ones, such as oral medication.

In the topical analgesic industry, Icy Hot and Private Label share the highest market share and there are other competitors that share lesser market share such as BenGay or Tiger Balm. Given the number of established companies in the market and the amount of equal quality products available, consumer-switching costs are making the topical analgesic industry have a high competitive rivalry.


4) Threat of Substitution

       Specifically, the goal of topical analgesics industry is to provide consumers with products that have the ability to combat pain and or discomfort as a result of applying them directly to the body; however, in more general terms, the goal of the product is to manage pain (National Center for Biotechnology Information, 2012). Some methods are more preferred and accepted than others, but there are numerous products other than topical analgesics in which consumers can combat pain. For instance, a consumer may have a very low tolerance for pain and feel the need to see a doctor to obtain some prescription medication to combat the pain. If not that severe, a customer may buy an over-the-counter pain reliever such as ibuprofen or acetaminophen to combat the discomfort. Furthermore, if the customer does not feel that modern medicine is what is best for the body, they may try to achieve pain relief through either natural holistic or spiritual remedies such as acupuncture, meditation, or herbal remedies. No matter what the consumers’ beliefs may be, they have options when choosing how they want to combat their pain.

       As a result of the abundance of alternatives consumers have when choosing their pain relief methods, there is a high threat of substitution for the topical analgesic industry. The numerous options available place pressure on the industry, specifically in determining product prices (Carpenter & Sanders, 2011). Consumers have options to fulfill the need a topical analgesic provides the solution to, thus, the profits in the topical analgesic industry are lower because of these substitutes. If not monitored, these substitute products can pose a tremendous threat to the overall success of the topical analgesic industry.


5) Threat of New Entrants

The likelihood of new entrants to enter the market should not raise a high concern mainly because of patent rights.  These licenses and rights have created a very difficult barrier to entry, along with naturally high start up costs.   Not only do these rights create a barrier, but on top that most of these analgesic companies have been around for several decades.  This has helped companies establish a reputation for themselves, as well as a loyal customer base.  Throughout these years the analgesic companies have created loyal distribution channels within their country, as well as amongst the world.  Any new entry to the market would have to deal with these already established relationships and obstacles.


Industry Life Cycle



The Topical analgesic industry is in the maturity phase of the industry life cycle. The first use of analgesics containing opiates was during the early 19th century. Hot rubs such as Tiger Balm was created in the 1870s, with others such as IcyHot being created in the early 1900s.

       Sales Growth for many companies has slowed and has reached a widespread acceptance in the market. Competition in the industry is fierce, and companies want to prolong their growth by creating new innovations and features to existing products in order to compete with competition, which is extremely advanced and fierce. This can be seen with IcyHot as the company has created many new forms of the product including patches.  Companies must continue to differentiate and market their products in order to separate themselves from a heavily segmented market (Maturity).

       During the maturity phase, companies attempt to improve specific features to resell the product, lower prices, increase distribution and promotion, find new target markets and differentiate themselves (Maturity).


Macro Environment Analysis


Natural Environment

The natural environment does not directly affect the topical analgesics industry. The companies can continue operations in poor weather due to indoor facilities that keep all employees safe. The only natural disaster that could cause a problem would be a hurricane. If hurricanes were to strike, online sales would be slightly delayed. The companies could continue using relationship marketing to stay in touch with clients to ensure they will receive the product. Topical analgesic companies must make sure they are obtaining their natural ingredients in an ethical way that does not harm our environment.


Political/Legal Segment

       The political and legal climate of the economy is an important issue every firm should be aware of no what industry they operate. For this analysis, we have defined Aldali Inc. operates in the topical analgesic industry. The United States has a very stable government structure that has not changed much since its creation in 1776. The three-branch system inhibits unconditional power from any one entity resulting in necessary causality for any legislative change. Though these benefits of the American government reduce the political risk of doing business in the United States, companies should still keep a vested interest. The two major political parties in the United States, Democrats and Republicans, have very different views on fiscal policy and liberal rights placed upon individuals and their properties, including businesses. If a party shift occurs as a result of an election or a majority shift occurs in Congress, new policies and acts can be introduced to change certain aspects of the law. Relative to the topical analgesic industry specifically, policy changes in FDA regulations and taxation policy could have an effect.  Both would cost firms funds whether directly from taxes or indirectly due to changes in manufacturing or the formula of the product itself. Drastic changes such as these would take the government time to implement and would give firms in the industry a chance to adapt to the changes themselves. Nevertheless, it is important that topical analgesic firms remain aware and act timely to any policy changes in order to remain successful.

       It is extremely important that businesses in any industry involving customer health care are in compliance with federal regulations in regards to health and safety. Not only is it vital these businesses produce the product in accordance with the Occupational Safety & Health Administration to ensure the workplace they operate is safe, it is critically important that the product itself abides by all regulations of the Food & Drug Administration (Department Of Labor). Other state’s regulations may be stricter than federal or Florida statutes.  For a firm in the topical analgesic industry, it is important they research and investigate the regulations of the geographic areas they plan to penetrate because they may be putting themselves in a position of risk for potential lawsuits that could have been avoided had it not been for negligence lack of proactive research by the firm.

Economic Segment

The United States GDP data over the recent years according to the World Bank statistics is represented in Table 1. US GDP Data (The World Bank, 2014). As it represents, the country’s Gross Domestic Product has been increasing as of late except for 2009, which is likely due to the financial recession the country was going through at the time. Also, the GDP per capita has been increasing. This figure represents the United States GDP across the population. In other words, there are more funds in the American market, which is a favorable factor for all industries. If domestic businesses are profitable and increasing their earnings, consequently employees should be compensated with higher salaries, wages, and bonuses for their performance. With more disposable income across the country, businesses can market their competitive advantages across the nation knowing their consumers have the funds to purchase their product. Also, these figures indicate a trend that the GDP will continue to grow and allow consumers to purchase more which is attractive for any industry. In regards to the topical analgesic industry, this increasing GDP has some effects on consumers. Price will not be as strong of a factor influencing consumer decisions. Customers will value quality much more than low-cost products in an industry related to healthcare; they will choose the best product available regardless of price. This is a rich opportunity for topical analgesic firm’s to market these high quality products in order to obtain a high market share and become a dominant player in the industry.


Table 1. US GDP Data (The World Bank, 2014)






GDP (current US$)

$14,417.9 Billion

$14,958.3 Billion

$15,533.8 Billion

$16,244.6 Billion

GDP growth (annual %)

-2.8 %

2.5 %

1.8 %

2.8 %

GDP per capita (current US$)






The inflation rate in a country indicates how much prices have changed over the past year relative to the previous year’s prices. The Organization for Economic Co-Operation and Development gives the data for past year’s inflation rates, but they also break down the rate by the product being consumed. As shown in Table 2. US Inflation Rates, the inflation rate over the past few years has been sporadic and unpredictable (OECD). This is often the case with interest rates because of the volatility and inconsistency of prices in the market. If you look at the data in the table conversely, the inflation rate for non-food and non-energy goods has been much more consistent over the years which is beneficial for companies in the topical analgesic industry. Although prices for non-food and non-energy goods have increased due to the positive inflation rate, this consistency provides for a more accurate estimate of future inflation. Concurrently, consumers will not react negatively to a rise in prices of topical analgesic products because history has caused them to expect such an increase. The lack of volatility in inflation of non-food and non-energy products suggests price is not a major factor in consumer’s decision to purchase topical analgesics.


Table 2. US Inflation Rates (OECD, 2013)







Inflation: All Items






Inflation: Non-Food/Non-Energy







Interest rates can play a major factor in how firms decide how to raise more capital in order to achieve their goals. According to the expectations theory of interest rates, the current treasury yield curve represents what market interest rates are expected to be in the future (Madura). As represented in Chart 1. Treasury Yield Curve, the interest rates have a positive slope relative to their length of maturity. According to expectations theory, this suggests that future interest rates will increase (Madura). As the numbers suggest, now is the time to borrow. Companies in the topical analgesic industry have an opportunity to take advantage of these low rates now in order to avoid the possible higher costs of interest in the future. If the companies have profitable projects they are not pursuing because of a lack of capital, research suggests they should borrow now; they would be returning money to the firm quicker while avoiding the higher expected future costs of interest.


Chart 1. Treasury Yield Curve (as of 2/10/14) (Department of the Treasury, 2014)



The price of fuel impacts the strategy of firm in an industry, either directly or indirectly. It is important to observe and react to the price of fuel because it may affect a company’s profit margin to points where it is no longer profitable to do business in certain geographic areas. As shown in Table 3. US & Local Fuel Prices, the fuel price is down from last year by about thirty cents both nationally and locally (Energy Information Administration). The table also shows that on average, the local geographic region’s fuel price is lower than the national price (Energy Information Administration). In order to meet certain FDA regulations, topical analgesic companies must follow guidelines that require them to obtain the necessary materials to manufacture the product from accredited institutions that there are few of (FDA). If fuel prices rise, the shipping costs of obtaining raw materials will rise. Topical analgesic companies need to monitor the fuel price and how it is affecting their product costs to ensure it is not minimizing their contribution margin.


Table 3. US & Local Fuel Prices (Energy Information Administration, 2014)






Change from last Year

US Fuel Price






Lower Atlantic







The unemployment rate can reflect the overall well-being of the economy. If the rate is high, it suggests that employers are not hiring due to a variety of possible reasons, many of which represent an unfavorable economy. However, the data I collected from the Bureau of Labor Statistics in Table 4. National & Local Unemployment Rates suggests that the current state of the economy is healthy and growing (Department of Labor) . The last two quarters of 2013 showed the national rate drop 0.6% in 6 months which is a sizeable drop. Furthermore, the data I collected about the Tampa Bay area unemployment rate I collected suggests the local economy is outperforming the nation as a whole. In July of 2013, both the national and local unemployment rates were 7.3%; however, in December, the local rate was below the national by 0.8% and had just gotten below 6% at 5.9% (Department of Labor). Though this low local rate is a good sign for sales of topical analgesic products in the area, companies may find it difficult to locate qualified individuals if they aspire to expand the operations of the business. Overall however, the decreasing national unemployment rate is a good sign and a good time for topical analgesic firms because more consumers are earning incomes.


Table 4. National & Local Unemployment Rates (Department of Labor, 2014)

Month, Year

National Unemployment Rate

Tampa/St. Pete/Clearwater Unemployment Rate

July 2013



August 2013



September 2013



October 2013



November 2013



December 2013



Technological Segment - Nick

In the topical analgesic industry, products are constantly flooding the market. Many of these products are very similar to one another with only tangible variations such as scent or color; consequently, these products do not last long in the marketplace. Technology and research and development play a crucial role in the topical analgesic industry. They provide the framework for a successful competitive advantage. Since the topical analgesic industry consists of healthcare products, consumers tend to value quality higher than price; investments in research and development will return a high quality product to a firm operating in the topical analgesic industry. Using economic logic, these industry players can charge premium prices for their quality products to increase their profit. Investing in new technologies and products can help a firm in the analgesic industry remain a relevant market leader.

       A technological trend that has become increasingly popular as of late in many industries is the process of 3D printing. This technology allows a machine to turn digital image into a solid product using a complex system. It involves a “class of materials called ‘photopolymers’ and these are typically acrylic-based materials that would be liquid until they’re hit with an ultraviolet light…” and “turn it into a sold piece of plastic,” (Hull). With this ground breaking manufacturing technology, modern day production will cease to exist, as we know it. Everything from the computers we type on to the steering wheels we use to maneuver our vehicles will be made using 3D printers. Still, currently 3D printing is in its embryonic stage which means all of the malfunctions have not been addressed and there is still vast potential to expand its production capabilities. Topical analgesic firms should remain up to date on the advances in 3D printing technology in order to pursue the competitive advantage it has to offer. Production times and errors could be minimized while the company would be producing at an increased rate. If topical analgesics continue to observe this technology and recognize when to act, they can greatly benefit from 3D printing.

       Another emerging technology that has become evident in today’s society is “green technology”. Many topical analgesics and other health care products, though intended to provide relief and comfort to the user, hurt the environment by how they are processed or manufactured by releasing many chemical byproducts of the process (FDA). If companies in the industry invest in green technology, they provide themselves a corporate image that consumers will be proud of. Furthermore, future legislation is likely to act upon this popular political issue and it appears to be in the industry’s best interest to begin to adapt to a way of “green technology” in order to remain proactive in the volatile industry setting.


Sociocultural Segment

During the past decade popularity has been expanding for analgesics, specifically targeting herbal analgesics. Studies show that one out of every five Americans has reported taking such products. These surveys are certainly positive for up and coming companies and exemplify that there is opportunity in the market. If a company wants to establish itself as a true competitor amongst other brand names, they will need to apply focus on the sociocultural aspect. This can range anywhere from demographics to social life style trends.  Hispanics have displayed a more than average interest in these type of products.  On a local basis, Tampa is about 20% Hispanic (City Data). Understanding your consumer and their attitude towards your product will play a crucial role in success. The better a company can think from the consumers perspective the easier it will be for their product to catch on.  

       One important factor that companies should zero in on is local lifestyle trends. Since major cities like Tampa hold comfortable, warmer weather over most states, it has become a great place for athletes and members of the fitness society to train outside year round. With thousands of athletes training every year, soreness and injuries become an issue. Athletes are constantly looking for answers to their sore elbows, and tired legs. Creating appeal to such a large society is just one potential direction to head in. When companies begin to market themselves on bigger scales, finding cities and areas where sports, fitness, and outdoor recreation are popular would be a great way to start off.  If they can construct a solid base they can then plan on expanding their market.

       One great factor about the industry analgesics are in is the range in age. Those who seek analgesics can range anywhere from young teens to senior citizens.  The average age in Tampa is 41 which is ideal because it does not limit companies to mainly selling to one age group (City Data).  Pitching yourself to such a multitude of age groups gives a company many opportunities. If one demographic does not spark, there is no reason to panic because there are so many more.

       One study done by the University of Maryland concluded a majority of the demographic who had shown interest in herbal products came from higher educated, higher income families. Again, when companies start to expand, finding a region where the average income is higher than normal might not be a bad place to start.  The average income in Tampa is estimated to be a little bit over $40,000 and rising every year (City Data).   For whatever reason it may be, the upper class has taken a liking to their type of products.  

       There are a great deal of large markets and small markets that companies can appeal to. One broad focus companies should cater to when analyzing from a sociocultural perspective is the local lifestyle and demographics. Whether it be finding a popular location for athletes, wealthy individuals, or high labor-intensive work (i.e. construction work or general lifting), this could be a very beneficial focus point.  


Environmental Segment


Environmental analysis is very simple for companies dealing with herbal products mainly because they are all natural products.  Other companies that may use animals or large factories usually run into a lot of environmental problems.  Some problems these companies face are over using the plant, and in some cases killing the plant once the substance is taken out.  This seems to be the only concern with companies using herbal products.  When companies use factories and animals, there can be a great deal of protest.  Other companies face many difficulties and may not be as easy to expand as opposed to herbal-based companies.  Their products come from all natural vegetation so governments and environmental activists are naturally going to prefer this type of business.

       The only other environmental concern these companies would run into would be if for some reason these plants were going extinct.  With there being so much technology today about preserving plant life this is not a major concern.   Also not to mention a lot of these companies have been able to grow the plants themselves.  There has been no speculation as to any of these products ever becoming scarce, so it is safe to say this industry is in a solid condition in terms of resource availability.  Once again environmental factors will not play a large part in companies based on herbal products because they do no harm to our ecosystem.  As long as industries abide by all rules and regulations regarding harvesting and buying plants they will not have a difficult environmental analysis.  With environmental products there are very few laws that they would run into that would set them back from their goals.  With herbal products, there will typically be no obstacles to hurdle when a company wants to expand themselves.


Opportunities - Fed do all (remember its for the industry)


Health Conscious Movement


Low Unemployment = More Disposable Income


Large Age Range in Consumers


Large Demographic Diversity Among Consumers


Low Diversity Among Competitors

Threats - Arron & Mike


The following are some of the threats that have been recognized for the Topical Analgesic industry: Competition from well-established topical analgesic ointment products


There are many well-established pharmaceuticals firms doing well in topical analgesic ointment products. The analgesic products come in the form of cream, oil, and spray. The consumers have different choices when it comes to selecting products; they constantly look for reliable, safe and cost effective products. The major topical analgesic products that are recognized by consumers and are recommended by pharmacists are: Bengay, Biofreeze, Capzasin. A company in this industry needs to market its products through enhanced education campaign, overt safety messaging, and consumer-specific product positioning. All these steps will attract consumers and also help in gaining their trust by using the product and interacting with the developers.


High Number of Competitors in the Industry

Competitive Rivalry - Arron

The pharmaceutical industries were highly fragmented during the 1980s; each industry had its own specialized products. Rivalry began as companies started merging and their specialized products began overlapping. Additional rivalry stemmed from the new biotech firms that were discovering more science-focused drug. Although some of the Biotechs were acquired by the large drug companies, others became sturdy entrants in their own right. The Biotech's started discovering new drugs and selling them to established drug companies.  Therefore, a new pattern of competition developed in the pharmaceutical industry.  So, to come at par with such established firms is a giant threat. The rivalry in the pharmaceutical industry is important to firms in the topical analgesic industry as it is a subgroup of pharmaceuticals. The major corporations may discover that there is a niche or need in the topical analgesic industry, and will not hold back to introduce a new product under their brand.


Maturity Stage of Industry Life Cycle

Herbal analgesics have not yet reached their maturity stage mainly due to lack of interest by the majority of the population.  This does not mean they are far from reaching maturity, because they are very close as a matter of fact.  These products are beginning to attain popularity as consumers recognize the price differential from conventional products.  Consumers are also beginning to acknowledge that herbal remedies focus on fixing the underlying issue as opposed to just curing the symptoms.  Last year the market gained a rough 5% increase in sales.  These facts are implying that the market has not yet peaked and there is more room for improvement in these sales.   


High Amount of Substitute Products - Arron

The topical analgesic industry also faces major threats from indirect products such as oral medication. Advil and Tylenol are substitute products of topical analgesic ointments because they are easily available over the counter at cheaper price. It is important to market products into retail stores so more consumers become aware of it.

Pricing And Cost

Many of the analgesic products are now easily available at cheaper prices. This is a challenge because the consumers look for cheaper products but it should be kept in mind cheaper products are not always the best.  The average price of any pain relief analgesic can range from $6-$12.  A company looking to enter the market should not price their product anywhere above this if they want to compete.  Companies should focus more on establishing a solid marketing scheme that separates them from competitors, than selling at a high price.  A new analgesic company will recognize they  have many competitors with all similar prices and that is where they should set their benchmark if they want consumers to consider their product.






Health Conscious Movement

High Number of Competitors in the Industry

Low Unemployment = More Disposable Income

Maturity Stage of Industry Life Cycle

Large Age Range in Consumers

High Amount of Substitute Products

Large Demographic Diversity Among Consumers

Price-based Competition

Low Diversity Among Competitors






Our team’s goal for this external analysis was to gather as much information possible on the industry of topical analgesics. After countless hours of research we were able to identify multiple unique opportunities and threats within this industry. We will use this document to help strategize our Internal Analysis for Asteeza Natural Body Wonder. We will reference this external analysis multiple times to take a more in depth look at the topical analgesic macro-environment, industrial environment and competitors. Using our well-processed external analysis, we have identified holes within the market and will be implement strategies for long-term success.




Opportunities - Fed do all (remember its for the industry)


Health Conscious Movement


Low Unemployment = More Disposable Income


Large Age Range in Consumers

Large Demographic Diversity Among Consumers

Low Diversity Among Competitors





Subject Business
Due By (Pacific Time) 05/01/2014 12:00 am
Report DMCA

Chat Now!

out of 1971 reviews

Chat Now!

out of 766 reviews

Chat Now!

out of 1164 reviews

Chat Now!

out of 721 reviews

Chat Now!

out of 1600 reviews

Chat Now!

out of 770 reviews

Chat Now!

out of 766 reviews

Chat Now!

out of 680 reviews
All Rights Reserved. Copyright by - Copyright Policy