Driving Efficiency in Pharma Marketing
Transcript of Driving Efficiency in Pharma Marketing
Pharmaceutical marketing executives face a perfect storm: a more competitive, price-conscious pharmaceuticals market, physician-customers who have the tools to be far choosier about the channels and media they engage with, squeezed marketing and market research budgets, and tighter data privacy laws.
Driving Efficiency in Pharma Marketing
2 / March 2020 [email protected] + @SKIPTATECH + SKIPTA.COM
Pharmaceutical companies are grappling with
the rising cost of bringing a new product to
market, falling average peak sales, and slower
sales ramp-up. It still costs about $2 billion
to develop and launch a drug, according to
Deloitte (1) despite new technologies and
data tools. Average peak sales are falling,
even as high drug sticker-prices continue to
fill the front pages. (Peak sales are down at
just $470 million, from $820 million in 2010,
according to Deloitte.) Product differentiation
has become harder – yet more important –
as certain therapeutic areas become more
crowded.
It’s little wonder that marketing budgets are
being reined in. Marketing executives are
having to be far shrewder and more selective
in how they deploy resources. In effect, they
are having do to more with less. Efficient,
highly targeted marketing and market
research has become a business priority.
Yet one of the pillars of marketing – third
party data – is under threat from far-reaching
privacy laws such as Europe’s General
Data Protection Regulation and California’s
Consumer Privacy Act. Conventional third-
party audience targeting is not a panacea for
marketers: online data sellers hit their mark
less than half the time, according to a recent
study by the Melbourne Business School and
Massachusetts Institute of Technology. (2)
But carefully chosen third-party data
remains a staple of effective marketing. The
new regulations demand that those who
purchase third-party data have rigorous
policies and procedures in place to ensure
such data meets privacy and security
standards. Violating the laws could cost up to
4% of global revenues. (3)
Pharmaceutical marketing executives need
rapid, cost-effective access to highly-targeted
channels that directly reach, engage with and
understand relevant audiences, in a manner
that is fully compliant with existing and
emerging data protection laws. They need
tools that allow regular interaction with and
feedback from target audiences, enabling
the longer-term customer relationships that
today’s market dynamics demand.
Today, it is not enough to simply advertise
new products to busy physicians. Marketing
must be about education, relieving
customers’ pain points and helping them
problem-solve. It must be interactive, not
prescriptive.
Social media is enabling that shift from
marketing as a promotional tool, to a tool of
engagement. Social media is revolutionizing
multiple aspects of the healthcare industry
– including how pharmaceutical companies
interact with their customers. Engaging
healthcare providers – including physicians –
in their own social media environments has
become an increasingly important part of the
overall marketing mix. As such, social should
be considered an integral part of marketing
and business development, not siloed within
corporate communications, warns Ogilvy’s
Ritesh Patel. (4)
Introduction
The Opportunity: Efficient, cost-effective audience-targeting and engagement
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As more physicians go online, social is not
just an additional promotional channel, it is
becoming the most important one. A 2018
MedData Group survey suggested that up to
90% of physicians already use popular sites
such as Facebook, Twitter and LinkedIn. (5)
That is only likely to increase as a younger
generation of physicians come through the
ranks and as other aspects of healthcare –
including medical records, prescriptions – go
digital.
Importantly, three quarters of physicians,
in the same survey, were open to receiving
pharmaceutical company advertising via
such channels. Meanwhile, fewer and fewer
physician practices allow in-person sales rep
visits. A 2019 survey by Decision Resources
suggested that almost 40% of doctors had
had no interactions at all with sales reps over
the prior six month period. (6) That’s why,
after a slow start, digital marketing within
the pharmaceuticals sector is now eclipsing
traditional channels.
Selected social media channels – such as
online communities of professionals – offer
unique opportunities to reach and engage
customers. They allow pharmaceutical firms
to cut through the digital noise that results
in a vast majority of promotional materials
going unnoticed, or being blocked by
frustrated consumers who feel they are being
bombarded with irrelevant materials.
Such social channels also enable effective
customer segmentation, for instance by
grouping accredited physicians according
to their chosen specialty and/or areas of
interest. This enables companies to define
and reach particular customer sub-groups,
based on specific needs. “Successful
segmentation can improve targeting,
retention and…ultimately, market share,”
Social media is a core part of the marketing mix
Social media enables precise customer segmentation and behavior-based marketing
SKIPTA’S SOLUTION
Informa’s Skipta is a leading social network of verified healthcare professionals,
organized into 25 specialist communities covering over 700,000 US-based
practitioners. Communities are speciality-focused (e.g. oncologists or neurologists) or
disease-focused, for instance around migraine or diabetes.
The platform provides a secure, private space within which professionals may
collaborate and learn from each other. It hosts discussions around particular
conditions or case studies, facilitates exchange of clinically-relevant information
among individuals or groups, and provides news and information from credible third-
party sources.
4 / March 2020 [email protected] + @SKIPTATECH + SKIPTA.COM
according to a May 2019 WARC Best Practice
paper. (7)
This level of engagement is not one-off.
Social media channels enable almost real-
time engagement, resulting in deeper
understanding of customers’ evolving needs
over time. Digital media has enabled so-
called “behavior-based marketing” – the
ability to personalize messages based on
what buyers are interested in, who they’re
talking to about it, and why – in real time. (8)
Engaging with physicians via a trusted
social media platform that offers a variety
of communication formats and channels
is becoming more valuable as researchers
better understand the true drivers of
physician decision-making. Doctors may
report that they behave rationally in selecting
one treatment over another, but in reality,
many more are driven by sub-conscious
drivers, such as comfort and brand familiarity.
“Treatment choice is a complex process, and
researchers must find innovative ways to
dig deeper into this behavior and use more
focused technologies to un-earth the real
drivers of decision-making,” says 2019 MRS
Awards paper. (9)
In effect, social media enables not only
targeted marketing, but also highly
actionable market research. Those research
insights in turn lead to more effective –
and cost-effective – promotional activities.
“Pharma marketers haven’t always
considered customer insights as a first step,”
writes ZS Associates principal Amy Marta. (10) They should. Getting immersed in the
customer’s experience and learning over time
through a variety of research approaches
generates business-critical insights that
feedback into identifying and defining new
product opportunities.
Such market research turns into a
competitive advantage, enabling a highly
differentiated product portfolio. It also comes
at little extra cost, at a time when marketing
executives are compelled to be more
selective in how they deploy limited budgets.
INSIDE TIP
Skipta reaches over 80% of US physicians in some specialist communities. The
platform can also target even more narrowly-defined audiences based on target lists,
ICD-10 data or therapeutic area.
Addressing physicians via social media channels offers another, in-built, level of
segmentation: behavioral segmentation. By definition, those physicians present
within particular online communities are interested in and engaged in those
communities and the information and exchanges they offer. Behavior-determined
segmentation can have “particularly tangible value to the bottom line,” says the 2019
WARC paper (7). The richer and more precisely audience sub-groups can be defined,
the more likely pharmaceutical firms are to deliver the right messages, engage their
customers – and achieve results.
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INSIDE TIP
Skipta provides accurate data on both passive (views) and active (comments) by
groups of specialists, around particular topics. A study investigating Skipta members’
interests in migraine found that Diagnostic Strategies generated the highest interest-
levels, with comments from over a third of participants over a six-month period.
Primary care physicians were the most active contributors to the discussion, which
drew more than 4000 content views.
Digital marketing offers huge advantages
in customer segmentation and targeting,
and in market research. And it does so at
considerably lower cost than many traditional
channels.
As marketing budgets continue to tighten – a
Gartner GMO Spend Survey suggests that
they have been falling since 2016 – executives
have had to be far more discriminate about
how they deploy their declining resources.
The focus must now be on quality, not
quantity – and on the marketing efforts
and activities most likely to deliver results.
“There has been a shift in mindset from
[large] campaigns to capabilities,” says Matt
Egol, chief strategy officer of digital services
at PWC. Those capabilities include choice
of channel, generating creative, relevant
content, as well as post-marketing analytics. (11)
To boost return on investment with flat or
declining marketing budgets, Chief Marketing
Officers are turning to the “70/20/10” rule.
This means devoting most marketing efforts
to the 70 percent of efforts and activities
most likely to yield positive results, reserving
a further 20% for development phase
marketing projects that may in future justify
higher spend. The final 10 percent go to
experimental projects that provide useful
learning but are unlikely to be pursued.
Better results, at lower cost
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Careful selection of appropriate third-
party data sources offers another way to
avoid wastage within shrinking marketing
budgets. Traditional third-party audience
targeting is often inefficient, demanding
cost increases that exceed the increase in
customer identification, according to the
MIT/Melbourne Business School study. (The
study found that 151% cost increases led to
only 123% gain in audience.) Few of the shiny
new audience-targeting algorithms, claiming
to use AI to boost return-on-investment
multiple-fold, actually deliver results, the
study’s authors claim. (12)
Third-party data is still a crucial part of
marketers’ toolbox, however. That much was
clear when data-aggregator Acxiom was
acquired in July 2018 for $2.3 billion. Despite
the exponential increase in data sources,
a significant proportion of chief marketing
officers still feel they don’t have enough
third-party data, according to a 2018 survey
of 226 CMOs, conducted by Forbes Insights
and the Trade Desk. (13)
Yet new data protection rules are putting
a strong brake on the collection and use of
many third-party data sources, with hefty
financing (and reputational) penalties facing
those who flout the laws. Hence an even
greater share of marketing executives –
almost 40% – say that finding the right third
party data is a barrier to improving their ROI,
according to a Wipro survey. (14)
Pharmaceutical marketers need high-quality,
carefully-sourced data from trusted third
parties whose privacy and governance
policies are clear and transparent. “The
growing importance of online data also
means brands should recognise privacy
concerns,” including by ensuring explicit
permissions are gathered to use individuals’
data, and that customers’ data preferences
are clear, says the May 2019 WARC Best
Practice paper. (7)
Skipta already meets data protection
standards demanded by GDPR and by
privacy laws in US states including California
and Colorado. In choosing to become part
of the Skipta community, physicians opt into
clear rules around data privacy and security.
Skipta therefore offers pharmaceutical
marketers data that is both highly relevant,
and compliant – the ideal mix in today’s
digitally-driven, yet tightly regulated
marketing landscape.
Technology has brought huge opportunity
for more efficient, targeted marketing – but
not all technology is alike. Digitally targeting
doctors in a way that’s accurate, compliant
and relatively inexpensive is referred to as
‘programmatic marketing’. This method
allows sponsors to “target precise groups
of physicians in granular ways, and remain
compliant with regulations,” writes Marylyn
Donahue in Knect365 e-Pharma Summit
paper. (15)
Although comparatively new to the
pharmaceuticals sector, programmatic
marketing – with cost-efficiency built into its
definition – is likely to become a mainstay
of marketing, as more physicians engage in
online communities, and more is understood
about their online behavior.
Skipta enables such programmatic marketing.
Engaging with physicians in a targeted
fashion, via a trusted social media channel
that is compliant with data privacy laws
offers a cost-effective solution to today’s
challenges and achieves the interactive,
advisory approach to marketing that
physicians shown to be most responsive to.
Finding the right third-party data
7 / March 2020 [email protected] + @SKIPTATECH + SKIPTA.COM
References
1. https://www2.deloitte.com/content/dam/Deloitte/ch/Documents/life-sciences-health-care/
ch-lshc-Pharma-Launch-paradigm.pdf
2. https://www.warc.com/content/paywall/article/event-reports/why-audience-targeting-could-
be-a-waste-of-marketing-budget/127201
3. https://www.emarketer.com/content/five-charts-explaining-the-state-of-third-party-data
4. https://www.warc.com/content/article/atticus/social-media-has-revolutionized-the-
healthcare-industry/108546
5. https://www.meddatagroup.com/landing-page-mobile-stats2/ [PAYWALL]
6. https://decisionresourcesgroup.com/news/124633-decision-resources-group-2019-epharma-
physician-report-finds-u-s-physicians-increasingly-too-busy-to-see-pharma-sales-reps/
7. https://www.warc.com/content/article/bestprac/what-we-know-about-segmentation/110142
8. https://www.warc.com/content/article/bestprac/how-behaviour-based-marketing-can-
improve-b2b-marketing/125674
9. https://www.warc.com/content/article/mrs-awards/incite-changing-how-we-gather-insight-
to-understand-the-true-drivers-of-decision-making/130013
10. https://www.zs.com/-/media/files/publications/public/zs-interview-marketing-research.
pdf?la=en
11. https://www.warc.com/content/article/ana/organizing-principles-to-stem-the-tide-of-
declining-budgets-b2b-marketers-must-shore-up-core-competencies/123154
12. https://www.warc.com/content/article/event-reports/why-audience-targeting-could-be-a-
waste-of-marketing-budget/127201
13. https://www.forbes.com/sites/kimberlywhitler/2018/11/12/new-study-identifies-the-top-
issues-that-keep-cmos-up-at-night/#705e6c6248a7
14. https://www.emarketer.com/content/five-charts-explaining-the-state-of-third-party-data
15. https://www.warc.com/content/article/event-reports/the-case-for-using-programmatic-
advertising-to-reach-physicians/123538