Rocky Mountain Medical Corporation (RMM) is a Denver based company, which was incorporated in 1982 by Robert Morrison, M.D. In each of RMM's first few years they turned a small profit, and reached sales of about $3.4 million in 1985. .
RMM Products. Currently, RMM has two lines of phototherapy products that are used to treat infant jaundice. One line of these products, Alpha-Lite , was marketed to hospitals. This product was considered superior by RMM's vice president of marketing, Lawrence Bennett. Another phototherapy product was targeted for the home. Baby-Lite was a home version of Alpha-Lite , which weighed about 40 pounds and could be rented for about $75 a day. This was much less than a hospital bill and your baby could stay in the comfort of your own home. .
TenderCare . RMM designed a disposable diaper, which seemed to have one main advantage on the rest of the competition. Just under the liner of the TenderCare diaper, was a wicking fabric the draws moisture from the surface around a soft, waterproof shield to an absorbent reservoir of filler. This would keep the baby's skin dry and in turn, would prevent rash. .
PROBLEM STATEMENT.
RMM seemed to have a good hold on the phototherapy market at this time. The problem was only 5 to 10 percent of infants would experience jaundice. This rate would only fall with new advancements in the medical world. They needed a more stable market. Now, RMM is faced with a big decision to make. Should RMM stay in the familiar market of phototherapy, or take a chance with their new product, TenderCare , in the disposable diaper market. If the elect to do so, they would be going up against larger companies like Procter & Gamble (P & G) and Kimberly - Clark (K-C). As of 1984, Procter & Gamble had two lines of disposable diapers, Pampers and Luvs. P & G held 52% of the market at this time between the two lines. Kimberly - Clark's Huggies brand diapers held about 24% of the market in 1984.
