Making Sense of Multichannel Marketing

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22 Oct 2012 Vol. 11, No. 9

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This article is part of the October 22, 2012 issue of Pharma Marketing News. For other articles in this issue, see (after October 31, 2012): http://www.news.pharma-mkting.com/PMNissue119Oct2012archive.htm Published by: VirSci Corporation PO Box 760 Newtown, PA 18940 [email protected]

Making Sense of Multichannel Marketing Towards Achieving the “Holy Grail” of Marketing Effectiveness Author: John Mack PMN119-02

Pharma Marketing News Vol. 11, No. 9: October 22, 2012 p. 2

© 2012 VirSci Corporation (www.virsci.com). All rights reserved. PMN119-02 Pharma Marketing News

ultichannel marketing (MCM) is considered the "holy grail" for many marketers in pharma and other industries. It has become a hot topic even

though there is a huge amount of misunderstanding about what it really is.

This issue has troubled Len Starnes, Former Global Head of Digital Sales and Marketing at Bayer, now an independent consultant who provides strategic social media and digital marketing services to the global pharma industry.

“When I spoke to marketers,” said Starnes, “from a conceptual stand-point they said multichannel market-ing is easy to understand—using multiple channel to target, motivate and engage your audience. Every-one seemed to understand that. But the second thing I discovered was that it was extremely difficult in practice.”

Starnes hosted a poll on LinkdedIn that asked, "Will pharma marketing become de facto multichannel marketing in future?" (see Figure 1, below). A more complete presentation of results from that poll as well as comments from Starnes and colleagues can be found in the July, 2012, issue of Pharma Marketing News (see “Multichannel Marketing: Easy to Brag About, but Difficult to Do”; http://bit.ly/Ru96lB).

This article summarizes the discussion lead by Starnes during a recent MultiChannel Webinar hosted by eyeforpharma, which is also hosting the 2nd Annual Multichannel and Mobile Strategy conference November 29-30, 2012, in London (see http://bit.ly/MTG916c). Also speaking at the webinar was Tim White, Head of Digital Commercialization – Europe for Novartis, Benedikt Hoffmann, Head of eBusiness, Janssen, and Morten Kamp Jorgensen, Director, Corporate Brand & Reputation, at Vestas, a company that specializes in wind power solutions.

The following is an edited transcript of the eyeforpharma webinar. Listen to the webinar here: http://bit.ly/QCvNBh

Len Starnes: The first question is a very simple one: What exactly is Multichannel? Is there one single definition that fits all?

Tim White: Multichannel is a very complex topic. For me the most important thing to understand is that channels are just the ways that we communicate with our customers. Put that way, it sounds simple. But multi-channel is really the strategy—the business process—that we use to approach our customers.

M

Len Starnes

Figure 1: Len Starnes’ LinkedIn MCM Poll Results

Continues on page 4…

Tim White



Taking Multichannel Marketing To The Next Level From The Multichannel Maturity Mandate, Forrester Research (http://bit.ly/Pi1fbB)

There is no de facto standard definition of multichannel marketing. Forrester explores the practice by describing four levels of multichannel maturity, identifying the key characteristics of each level (see Figure 2, below). The four levels are:

• Channel entropy. Non-integrated channel operations are the baseline of the multichannel maturity model. Marketers in this category independently manage customer interactions within each channel. They may have multiple teams executing programs in the same channel. The business logic behind the customer engagement strategy is different in each channel. Companies operating at this stage maintain independent channel-specific data stores. No true cross-channel capabilities exist across the enterprise. Only 5% of the respondents in our survey fell into this category.

• Channel independence. Managed channel operation is the mode in the next stage in the maturity model. Marketers in this category still manage customer engagement independently within each channel. However, they have integrated the teams executing programs in the same channel. The lack of process and technology integration we discovered leads to the conclusion that more than 50% of the respondents in the commissioned Forrester survey, who characterized themselves as “mature” multichannel practitioners, fell into this category.

• Multichannel integration. Integrated, cross-channel visibility characterizes the third stage of maturity. Marketers operating at this level have a single view of customer data, interactions, and transactions across multiple channels, in near real time. The integrated view of the customer’s multichannel interactions enables marketers to execute cross-channel campaigns and to analyze the results. However, this integration is at the data level, not the process level. Customers can, and usually do, have different experiences in different channels.

• Multichannel engagement. Holistic cross-channel customer engagement is the practice of the most mature multichannel marketers. Marketers operating at this level have a single view of customer data, interactions, and transactions across multiple channels. Processes are consistent across channel and user interfaces. Customer engagement in each channel is aware, and informed by, offers and interactions in other channels. Customers expect and receive consistent, reliable interactions with the company.

Figure 2. MCM Must Evolve. Source: Starnes, SlideShare (http://slidesha.re/Pi2mrK)



Going even further, we can talk about how we are getting information back from customers. The key, however, is that we are leveraging the field force, email, Web, social, mobile—any of these various ways that we can communicate—it’s the full package that drives a true multichannel strategy.

Benedikt Hoffmann: When implementing multichannel marketing, sometimes you have to take some shortcuts and focus on certain channels. But as Tim said, it’s really looking at the whole mix of channels. But when when you’re trying to solve a specific challenge, you will have to focus on some channels to also prove the impact of what you are doing.

Morten Kamp Jorgensen: To me multichannel is about ensuring an integrated approach to the key audience and making sure that you actually hit them with targeted mes-sages with the highest possible relevance and making it as con-venient and valuable for them to engage with you.

LS: Definitions are good but not always that useful. So let’s move on and really get to the core of

multichannel. What really are the essentials of true or good multichannel? I’m stressing true and good here. What are the keys to executing really good multi-channels?

BH: You clearly have to define the objective—what do you want to achieve and be pragmatic because you have to show the value of what you’re doing quite quickly. Sometimes you try to do the whole market channel, but it takes too long to show the value. The approach we are using is to define specific challenges and then identify the channels we are going to use. Then we implement the campaign and make sure that we integrate all the data across the different channels. Afterwards can show the value in terms of cost saving but also in terms of sales impact.

TW: Integration for me is absolutely key. We may be doing an email campaign and also have reps out in the field with iPads. But in order to do “true multichannel” it’s about setting that vision, setting that target and then working through the processes, working to set up the right integrated systems. That requires working with IT and other partners. Behind all that is a great deal of change management and being able to understand where our customers are and to be accessing them on their terms and getting them the right message at the right time.

LS: Do you have any comments about the technology that is required? Do you have in-house technology or from the vendor side?

TW: Personally, I am a big believer in subscriber soft-ware service [software as a service; SaaS]. I think SaaS gives conservative industries like pharma the ability to catch up quite quickly on the tech side and actually stay up to speed with the rest of the world. It’s all about find-ing the right technology partner.

But let’s face it. Other industries are doing multichannel marketing very, very well as the technology exists. That’s why I come back to the idea that this is an internal thing, this is within organizations. So let’s go out there, let’s find the right technology and then let’s starts focusing on the business and the people in our organiz-ation and make it a reality.

LS: I would like to move on now to channels. How do you select the right channels, bearing in mind we have so many channels today?

BH: One approach I am using in Germany—where we still have a pretty good access to physicians by the field force—is to use the field force to capture channel pref-erences of our physician customers.

The other is approach is to just use different channels like direct mailing, phone calls, etc. and see who is responding and who is not responding and thereby refine the channel preference of your physicians.

So I think you just have to start and have a good CRM system in the back end to be able to improve the channel preference information you have.

TW: You have to first look at the objectives and then go fish where the fish are. Over time you can let your customers self select their preferred channels. This is the concept of approaching your customers on their own terms. It requires marketers that understand their customers. At that point you are starting to get into service itself and not just some kind of multichannel one way marketing.

LS: Is social media a channel suitable for pharma?

TW: Typically, we think of Facebook, Twitter, LinkedIn, etc. as social media “channels.” But social media in itself is a concept that says content is shareable. We are listening and not just pushing out information via these channels. Not everything is going to have a share on Facebook button and or is going to be on Twitter because we obviously know the regulatory and other limitations the drug industry faces.

Morten Kamp Jorgensen

Continues…



We can learn a lot of lessons from other companies that have approached social media from service perspective and also learn who are the influencers in our sector and what they do in social channels.

LS: While multichannel marketing usually focuses on old marketing channels, most of your job titles refer to digital marketing. Does this mean that your focus is exclusively on digital channels or do you manage all channels?

BH: Digital is our focus area, but we are integrating that with all the alternative channels from direct marketing to digital. Of course, we try to integrate what we are doing with our field force. So yes it says digital but it means multichannel and including a very closed loop with our field force.

LS: Let’s move on now to a question that I know a lot of people are interested in. How do you measure ROI or determine cross channel KPIs?

BH: In the end you have to show senior management what is the sales impact or what is the return on investment. That’s the ultimate goal. But of course you normally also define leading indicators that show you whether your project is running well and which channel might be the most effective one. If you have to show the value for the first time, you should define some pilots and say okay we are just using this approach in one region with one customer segment and then track the sales. That’s one way to do it.

LS: But do you try to determine common KPIs for each channel so you have some basis for comparison?

BH: You can say okay we reached so many physicians by email, so many opened and so many clicked through, but in the end it doesn’t show you anything in terms of sales. So you can measure all those leading indicators and you can compare different campaigns by channel. But in the end you have to show the sales impact or the impact of cost savings. This you can only do if you really define areas or customer segments where you have a control group and where you have the group where you are implementing the certain campaign.

LS: Tim, would you like to tell us what Novartis is doing on the ROI front?

TW: ROI is a really hot topic. In countries where we can’t subscribe to customer level data it’s very hard to determine pure ROI on anything. We have different models that we use to try and get around this, but digital gives us a whole new set of metrics that we are able to wrap around these activities as well. So we can look at things like the amount of time we are actually spending with our customers and whether or not that is increasing.

With digital, we now understand things we never knew before such as what type of content is actually being discussed and what conversations are having an effect on sales. There are certainly leading performance indicators, but the ability to then see where the different levers that you are pulling are having an effect on your sales is only going to come when you can understand as much as possible the full picture of the contact points you are having with your customers.

It might sound like a broken record but it comes from integration, it comes from making sure your technology is all talking to itself and you have a 360 view of the customer. Then you look at the sales from there.

Driving Change Management

LS: Are you finding that marketers are willing to accept these types of leading indicators rather than hard ROI? How do your marketers feel about that?

MKJ: I don’t think the marketers are the problem here. I’m more worried about executive management. It’s difficult to argue against facts. So that’s why we try and base all our efforts on the power of facts and create as much transparency around our activities as possible. We measure everything we do and that can actually take you quite far.

To do that you need to develop a culture of profession-alizing your business. So ultimately I would also argue this is the matter of change management as was mentioned earlier.

LS: Regarding change management, do you have any advice for marketers that are used to traditional field force campaigns and not multichannel or integration? How have you driven change management?

TW: My perspective on change management is that you have to set a vision. You have to paint a picture of where you want to go. Maybe that means we are not going to get there in one year or in maybe one project, but we are going to reshape the organization. Over time what happens is you can get people starting to actually believe in that and they can start to say this is why we are doing it and this is why my role fits into this puzzle.

Also, find your milestones and say we’ve got a lot of success out of this project and we saved X amount of millions of Euros or we grew share voice by 10% by implementing this. These are really good milestones but the real change management then comes in when you say we are going here, here is the vision, here is the picture and then everything starts to fall in place over time but it is a process it’s not something that happens overnight.

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Making Sense of Multichannel Marketing

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