With the emergence of new media and related technologies, the pharma marketing landscape has evolved from a focus on paid media to earned opportunities. How the industry adapts to this change is crucial.
For all industries, diminishing returns from conventional marketing practices are evident. And as marketplace clutter continues its spread, companies are taking a hard look at their branding strategies and questioning tactical investments. The pharmaceutical industry is among those with an urgent need to find new ways of marketing, particularly as competition from generic drugs increases, squeezed pipelines produce fewer blockbusters, and many top brands will reach the end of their patent life by 2014. Simply put, pharma’s traditional “push” marketing model—direct-to-consumer paid advertising combined with a huge sales force directly selling to physicians— is no longer working on its own.
Pharma marketing has reached its inflection point. In 2002, four percent of consumers surveyed by the FDA (U.S. Food and Drug Administration) said they visited a doctor specifically to get an advertised drug; in 1999, the number was 13 percent (see chart below). According to that same survey, 18 percent of consumers said an ad drove them to ask their doctor about a medical condition; in 1999, the number was 27 percent (see chart, opposite page). Additionally, less than half of all detailing by the industry’s some 80,000 sales representatives actually result in face time with a prescriber, while only about five percent of patient education materials developed by drug companies are ever distributed to patients. And, despite considerable investments in brand building to form an emotional bond with consumers, there’s little evidence to show this has practical value. While the FDA survey hasn’t been repeated recently, we can assume the downward trajectory continues.
In the face of these trends, integrated marketing is not just en vogue it’s critical. After all, achieving awareness is a dead objective; communications—from public relations and online marketing to social engagement and guerilla tactics—need to be connected in time and space to have impact. We’re beyond the point of “can we” and must now work together to determine “how.”
BALANCING DIGITAL DEMAND
The pharma marketing landscape continues to evolve considerably with the emergence and strengthening of new media and technologies. Traditionally, pharma companies’ focus was largely limited to physicians, but now sales reps are increasingly challenged for face time to sell directly.
Meanwhile, patients, caregivers and providers alike are immersed online, relying on the Internet as their extended source of health information—from health portals to pharma manufacturing websites, from health advocacy sites to blogs and chat rooms—fundamentally changing how we as marketers must interact with our customers and go to market.
Pharma marketing must evolve into a “fish where the fish are” mentality in order to survive. Digital communications is not just a channel; it’s an entirely different way of doing business, influencing everything from gaining strategic insights to tactical execution. A coordinated approach is essential, and digital is the connecting point with all stakeholders. There needs to be a balance of paid, owned, and earned digital media to truly be effective—surrounding target audiences with key messages at every touch point.
Paid media—traditional print and broadcast advertising, with the addition of online display ads, web banners, event sponsorships, and search engine marketing—is limited in value on its own, particularly as consumers seek to “validate” ads through other research, such as referrals (by friends or other doctors), news articles, etc. And as budgets tighten, most companies continue to pull back on their paid media spend.
Meanwhile, owned media, including product websites, Facebook pages, blogs, and forums, present significant potential as the lines between social, search, and media continue to blur. Continuously fresh online content feeds search optimization while social interactions through networks like Facebook and blog communities improve search rankings. All content then helps enable and encourage social interaction, which will, in turn, enhance search while strengthening stakeholder engagement.
Paid and owned media are important vehicles, but earned media may appear to be the most influential. Media relations via staff-written news or peer-reviewed articles, third-party endorsements, viral buzz and word-of-mouth offer invaluable opportunities for pharma companies to interact with customers while encouraging the spread of user-generated content.
IS PAID MEDIA DYING?
While paid media is increasingly the smaller slice of the marketing pie, it can’t be forgotten. It requires greater sophistication and targeting. For example, Instinctive Data (ID) is a new innovative platform that grants pharma marketers unprecedented access to a healthcare provider’s practice while aiming to improve provider education based on specialty and patient population, utilizing real-time patient level data.
Time is everyone’s most valuable resource—and it’s especially true for today’s healthcare providers. Tens of thousands of providers across all specialties utilize MD On-Line (MDOL) daily to transact their business. Through ID, a feature located in the provider’s MDOL web portal, pharma companies are able to integrate sponsored, sophisticated, and targeted communications seamlessly into the provider’s daily workflow. The information delivered is valuable, meaningful and simple to share. Tools such as “Forward to a Friend” encourage the provider to email interesting and relevant content to colleagues with the click of a button, helping turn paid media into earned through word-of-mouth and possible online buzz.
Additional features such as “Search for Patients” and “Print a Reminder for Patient’s Chart” allow the providers to take immediate action with their patient population to drive behavior change. These tools help to trigger the provider to discuss key information with patients during visits, further promoting the earned media potential of ID. These types of marketing solutions not only seek to improve the quality of care and enhance the doctor-to-patient relationship, but also hold the potential to ultimately change the provider’s perception of the pharma industry for the better.
THE FUTURE OF INTEGRATED MARKETING
The ID model is also an example of how pharma marketers are embracing new ways of engaging physicians on their terms. Like other consumers, physicians are changing their media habits and taking advantage of technology through mobile devices and social media, forcing marketers and sales reps alike to alter promotion strategies. Sales reps have been the main channel for transmitting marketing information through “detailing” to physicians for the past 50 years, accounting for 60 percent of all sales and marketing expenditures. However, the number of doctors willing to see reps has declined about 20 percent since 2008, according to ZS Associates, a consulting firm that maintains a database tracking physician meetings with reps.
As the money spent on face-to-face promotion is increasingly disproportionate to the return on investment, the interest in—and potential of—e-detailing continues to grow. First introduced in the early ‘90s, and pioneered by pharma giants such as Merck, digital or virtual detailing is now increasingly sophisticated, effective and embraced. A cost-effective, growth- intensive strategy, e-detailing will eventually evolve to include more interactive features such as videos, web chats, and information from key opinion leaders, helping to further advance the changing landscape of pharma sales and marketing.
The future of pharma marketing is in engagement, interactivity and user control. Marketers will continue to improve their profiling of healthcare professionals, helping to better understand their daily workflow while cataloguing preferences to deliver a more targeted and tailored experience. Through this evolution, companies will need to keep a tight grasp on using multiple approaches to effectively have their messages heard. As marketers, it’s our imperative to understand how our customers—and theirs—engage with each media type, and then blend a strategic mix into pharma companies’ communications strategy.
Understandably, given the turbulence in the industry, this effort will not be without its challenges. Strict government regulations, including the Sunshine Act, which requires pharma to annually report payments or transfers of value provided to physicians to the Secretary of the U.S. Department of Health and Human Services, and the not always positive public perception of prescription marketing—will force further change. But the prices paid will earn positive gains, in customer relationships and business growth.