This story at NPR (print and audio version July 4, 2013) starts with a question: “Why does anyone buy Bayer aspirin — or Tylenol, or Advil — when almost always, there’s a cheaper bottle of generic pills, with the same active ingredient, sitting right next to the brand name pills?”
I was actually surprised to see that 70% of the time consumer do buy generics – I thought that number would be lower. It might be interesting to start a discussion of this topic by asking your students how many purchase branded versus generic versions of pain relievers. Then ask them why? This article suggests that some consumers have more confidence in the branded product. While twice the price seems high, that premium might be less than pennies per pill. Is it worth that for extra confidence? What if you are giving it to your child? The decision to buy a brand is not completely irrational. You might then share data from the story that indicates that medical professionals overwhelmingly choose generics.
A next move could be to segue the discussion to marketing strategy — asking how a marketing manager for Tylenol (or Bayer or Alleve) might counter the trend toward more generic medicine? Students might point out many strategy decisions Tylenol already utilizes — ads, packaging, and product tweaks (Extra Strength, 8 Hour Muscle Aches and Pains, geltabs, etc.) — to differentiate from generic alternatives.
Finally, it might be interesting to dance around the ethics of these minor differences — and whether they actually deliver value to consumers. Or they are simply tweaks that make it more difficult for consumers to compare the branded product with a generic alternative.