The technological tipping point for pharma sales and marketing
In the wake of the eyeforpharma Barcelona event, IMS Health's Kabir Shahani and Barry Crowther present the case for technology being not just an enabler for new pharma engagement with doctors, but a game changer for its whole commercial model.
All industries are driven to change by a combination of push and pull factors. The innovators latch onto the 'pull' – an opportunity to do something different that will drive a competitive advantage. Over time, as more companies go down the same route, the laggards are either 'pushed' into change or face the real possibility of failing to remain competitive.
At the eyeforpharma conference in Barcelona this year, focused predominantly on sales force effectiveness and multi-channel marketing, it was clear that novel customer engagement techniques for the pharma industry are no longer just in the 'pull' camp of offering improved return-on-investment (ROI) for commercial activities, but are now firmly offering the only viable ongoing model for successful interaction with prescribers.
The pharmaceutical industry has reached a tipping point in how it promotes its products.
Prescribers now live in a multi-channel world
The heart of the problem for the pharmaceutical industry is that prescribers are embracing the digital information age and are faced with an abundance of channels from which they can procure information – many of which have nothing to do with pharma companies. So the tipping point for pharma is driven by an underlying one for doctors, with 2014 marking the first year where more than half of all doctors are 'digitally native' – they have grown up surrounded by online information – and by 2020 that figure will rise to more than two-thirds.
Even going back two years, research from 2012 showed that 80% of European healthcare providers used the internet for work, with 70% watching video for medical education. These figures are only increasing and the world of the digital doctor is now going mobile very rapidly.
For pharma, this means its message is easily lost in the noise if it's not delivered in a way that suits the doctors and provides relevant information; otherwise they simply won't pay attention. This, combined with the fact that more complex stakeholder networks are influencing prescribing decisions (involving both prescribers and payers) and pharma is targeting more niche, personalized patient populations, is driving a crisis for commercial ROI.
The simple fact is that the resultant combination of increased operational complexity and restricted pricing for new medicines means that pharma must lose $35bn in costs over the next five years to maintain current margins.
Customer information is king
The solution for pharma is, at least on paper, simple. The industry needs to do two things: firstly, develop a better personal relationship with its customers to deliver the information they need in the right way, in the process gaining permission to share its product messages. Secondly (and this is the harder bit), it needs to do this in a cost-efficient way to manage those operational costs.
If we focus the first part for the moment, the core of this approach is good customer information, at the individual level. The engagement cycle that works is therefore the following process:
• Identify who the right customers are and where they are located
• Understand what sort of information they want
• Understand what channels are appropriate for them to engage via
• Engage
• Evaluate the success of the engagement
• Optimize the process and repeat
While none of this may sound new, the key part is being able to do this extremely quickly and at the individual level. Customers want to engage in real-time, so everything outside of the 'engage' step has to happen super-quick to enable this. Data integration, evaluation and optimization must be extremely efficient to enable pharma to focus on spending more valuable time with customers.
Any approach that can't compete with the speed at which doctors are finding information from other channels can't compete at all.
Technology is at the core of the solution
This is where the pharma industry must embrace new technology, and we think about the whole process as consisting of a 'technology core', which feeds off information sources such as CRM systems, social media and bespoke databases, linked to the dual strands of customer engagement – personal and non-personal (figure 1).
Figure 1: Successful pharma engagement with doctors combines personal and non-personal multi-channel engagement, driven by a data-assimilating technology core.
Personal engagement is about real human interaction – with sales reps, other pharma personnel such as medical science liaison and meetings, whereas non-personal interaction is about 'remote' interaction through, for example, email, text message or direct mail. Note this is different to traditional digital versus non-digital engagement and, we think, a more sensible way to view it from the customers' perspective.
This approach can then be extrapolated over time, for each customer, to develop a 'customer journey', whereby a sequence of interactions via different channels gradually provide the prescriber with all the information they need to make the right prescribing decision, while also accepting, and managing, the fact that they will be receiving additional information from other sources. The whole process is a bit like the journey you or I go through when considering what new phone to buy.
"Data and the right technology is the engine of this new model of customer engagement"
Data and the right technology is the engine of this new model of customer engagement. Without the ability to rapidly assimilate and evaluate information at the level of the individual prescriber, multi-channel engagement is just multi-channel bombardment, with the same poor ROI as the old approaches of armies of sales reps.
Instead, the right solution combines efficient data capture and integration in the cloud, robust analysis tools for central management and rapid deployment to field personnel (and feedback back into the system). This allows for the right understanding of, and engagement with, each individual customer over time.
Ultimately, sales, marketing, multi-channel, digital and social media engagement can no longer exist as separate activities. They must now be integrated to deliver customer engagement that delivers results at a manageable cost. Now that the right technology is available to facilitate this, every pharma company must either embrace this tipping point in its commercial activities or accept a potentially fatal reduction in operating profits.
For further IMS Health marketing & sales effectiveness insight hear our speakers at eyeforpharma Tokyo in May and eyeforpharma Toronto in June.
About the authors:
Kabir Shahani is Vice President Tech & Apps, GTO at IMS Health, having joined the organization through the acquisition of Appature, which he founded in 2007 with a vision of delivering leading edge software that would provide tremendous business value while being 'surprisingly simple' to use.
Barry Crowther is VP, Technology & Services at IMS Health and joined in 2008 with the acquisition of the Skura professional services group, which specialized in data integration, consulting and services in business intelligence platforms to pharmaceutical and healthcare clients.
For more information Kabir and Barry can be reached by emailing kabir.shahani@us.imshealth.com or bcrowther@imshealth.com respectively.
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