Darwin’s Finches, the HCA and the future of healthcare communications
Independent medical communications consultant
Chris Stevenson highlights how medical communications agencies may need to differentiate themselves and find their niche if they are to be successful.
I recently read the thoughtfully written review of 10 years of member surveys from the Healthcare Communication Association. The HCA is a primarily UK based organisation of companies involved in the medical communications field. Their report highlights some worrying trends for their members, and for the many other people and companies in the same field. Trends such as the reduction in average budget, the lengthening time from business win to revenue generation, the commoditisation of digital, the demand by clients for more senior input and the increase in pitch costs are classic signs of a service industry being squeezed from both above and below and, at least for the last 10 years, an industry struggling to develop novel approaches to address these issues.
“If one wants to be “In the digital space” isn’t it important to think about how you might differentiate yourselves in that space…”
This is where Darwin and his finches come in. His study of the finches (I know they are not truly finches) on the Galapagos describes a single species that diversified and evolved, creating 15 species of finch, each specially adapted to their own environment, not competing with each other, and almost certainly surviving in greater numbers than a single species would have done. Darwin was born 203 years ago, this concept is not new and the analogy, I hope, is somewhat obvious.
Let’s take digital as an example. I hear many communications companies stating that they “Need” to have a “Digital presence”, recognising they don’t know about digital and developing relationships with 3rd party suppliers that drain revenue from them. They claim they need to do this because that’s where the money is going. Darwin’s finches wouldn’t develop in that way. They know that constantly chasing the same food source as all the other birds is not a viable strategy for the future.
Perhaps the thought process needs to be different. If one wants to be “In the digital space” isn’t it important to think about how you might differentiate yourselves in that space such that you can develop strength in negotiations to buck the trends the HCA so clearly describe. Actually, scrub that. Digital is just like other services, you need to understand the customers’ needs and how you can deliver a service profitably. Isn’t the process one where the whole business is looked at in the light from the changing client and decisions are made about the areas clients will value, where you have expertise and where you can create differentiation? That’s what the finches would do, understand the sources of food and adapt accordingly, avoiding competition with others and becoming experts.
“…I encourage all agencies to question the internal information they have and to strive for improved ways of delivering their products and services.”
Another mantra I have often heard is that medical communications agencies don’t want to be put in a niche. There’s plenty more market out there, people say, and we want a slice of all of it. That’s not how the finches survived. Call it niche marketing, or as some people do, blue ocean strategy. Call it modern thinking, call it providing deep and lasting value. Call it survival. After 10 years of challenging data it is time to think differently, to recognise that niche is not a bad word, niches can be big, and that allowing what you do to be called a commodity has not helped many medical communications businesses and is clearly hurting the value perception of the industry.
When facing squeezed margins, and the HCA clearly describes exactly this, it is understandable to focus on increasing the efficiency of what your agency does. This is to be applauded and encouraged. Internal efficiency is an important step in creating value and margin. Indeed, I encourage all agencies to question the internal information they have and to strive for improved ways of delivering their products and services. However, it is not enough to look internally. Without the external focus and the creation of real market based value internal efficiency, important as it is, can only deliver in the short term. For long-term success both internal and external worlds need to be addressed.
And finally, it is not the clients fault. The client operates in the same way as you do. If they see a commodity they offer commodity prices, if they see a specialty they are willing to pay for it. The challenge is to find a niche that is valued and develop your business there. Don’t describe yourself as a multiple-niche agency, you don’t believe it and no one else will. Those that do often fool themselves and they do not have the robust pricing and market presence that are signs of differentiation. Be brave, study the environment and evolve over time. Specialism is not a constraint, it may well be the secret of your survival. Perhaps being called a bird brain is not such an insult after all.
About the author:
Chris Stevenson is the founding partner of Protinus Solutions, an independent training and consulting organisation for the healthcare communications industry specialising in developing internal efficiency and lasting differentiation. With over 20 years experience in the field Chris has helped many organisations through consulting, planning and interim positions. He can be contacted at firstname.lastname@example.org.
Do you see specialism as a constraint?