Using Analytics to Measure Marketing Program Effectiveness · For many SMBs, analytics is the game...

CONCLUSIONS PAPER

Featuring:

Kevin Garabedian, Senior Director SAS Small to Midsize Business Solutions

Bob Caprara Chief Methodologist, PSKW

Insights from a webinar with PSKW about why it chose SAS® software – and how this transformed the company’s business

Using Analytics to Measure Marketing Program Effectiveness

SAS Conclusions Paper

Table of Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Analytics: Changing the Game . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Turning Data into Insight to Market Prescription Drugs

More Efficiently . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Evolving from Commodity Printer to a Valued Partner . . . . . . . . . . . . . 3

SAS® Analytics: Turning Data into Gold for SMBs . . . . . . . . . . . . . . . . 3

SAS® Software: The Secret to PSKW’s Success . . . . . . . . . . . . . . . . . 3

Collect and Organize Your Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Analyze Data and Forecast Trends and Outcomes . . . . . . . . . . . . . . . . 4

Taking the Guesswork Out of Offers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Fine-Tuning Targets for Coupons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Making Decisions at the Individual Physician Level . . . . . . . . . . . . . . . . . . . . . . 7

Distribute Reports to the Right People at the Right Time . . . . . . . . . . . 7

Closing Thoughts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

About the Presenters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

1


IntroductionIf you’re an executive in a small or midsize business (SMB) seeking to drive sales growth, you could invest more money in traditional sales and marketing programs . But if you’re facing shrinking budgets, this simply isn’t an option . You have to work smarter with what you have, targeting the right people with specific offers that they are likely to accept .

Innovative companies like PSKW, a leading pharmaceutical couponing business, are deploying state-of-the-art analytics solutions to do exactly this – and with great success . PSKW is turning vast amounts of data collected about doctor and patient coupon usage into valuable insights – and using these insights to differentiate its services . “We’ve dramatically increased the value and effectiveness of our services by analyzing return on investment by physician, region, drug and program and are using our findings to advise customers about the best coupon strategy to achieve their goals,” explains Robert Caprara, Chief Methodologist for PSKW .

PSKW’s customers – which include leading pharmaceutical companies around the world – are thrilled with the results of their data-driven coupon campaigns . The company’s consultative approach is working so well that word is quickly spreading . As illustrated in Figure 1, PSKW has averaged growth of 140 percent annually since 2009 . And all it took was a commitment to analytics – and a two-person analytics department using SAS Analytics software for small and midsize businesses .

0

2

4

6

8

10

12

Jan-‐08

Apr-‐08

Jul-‐08

Oct-‐08

Jan-‐09

Apr-‐09

Jul-‐09

Oct-‐09

Jan-‐10

Apr-‐10

Jul-‐10

Oct-‐10

Jan-‐11

Apr-‐11

Jul-‐11

Oct-‐11

Jan-‐12

Apr-‐12

Jul-‐12

Oct-‐12

Growth in Coupons Process vs. 1/2010 Level

PSKW Growth in Processed Claims

Claims v

s. 201

0

Figure 1: Using SAS Analytics, PSKW has transformed a commodity coupon and printing business into a high-growth consultative marketing service.

Purchase of SAS and start of analytics

2


Analytics: Changing the Game

For many SMBs, analytics is the game changer . “Every company is looking for ways to gain competitive advantage, improve productivity – and ultimately increase revenue,” explains Kevin Garabedian, Senior Director for Small and Midsize Business Solutions at SAS . “Many don’t realize that their data is a huge asset that can be used to help them compete successfully with bigger or like-sized companies, make better decisions, and achieve desired financial results .”

Take PSKW, for example . “We started out in 2005 as a coupon printer,” explains Caprara . “Clients would come in and we’d say, ‘How many coupons would you like printed?’ We printed them, and our clients gave them to doctors for distribution to patients along with their prescription . As patients redeemed the coupons, we then recorded all related transaction data – for example, when prescriptions were filled, where and more .” (See sidebar for more .)

In 2010, management had an epiphany . It believed it could significantly accelerate growth by changing the industry . “We were in a commodity coupon printing business,” notes Caprara . “That’s when our CEO said, ‘You know, our coupon data is really good data, and we’re starting to collect a lot of it . Let’s start using the transactional exhaust that comes from the use of coupons to offer consultative marketing services that optimize the effectiveness of programs .’ This would enable us to go from being a commodity vendor to a true, strategic partner . We used analytics to change the game .”

Turning Data into Insight to Market Prescription Drugs More Efficiently

PSKW invested in SAS solutions for midsize business to collect, analyze and report on its data – and used the resulting insights to market prescription drugs more efficiently and effectively . “For years, pharmaceutical companies sent sales reps to sit in doctor’s offices and wait for a window to talk to a doctor,” explains Caprara . “This often cost companies $200 million a year – and increasingly, they couldn’t afford it . We were the first company to use analytics to show that there’s a different, cheaper and more effective way of achieving their goals . Instead of spending $200 million on a sales force, for example, you can spend $2 million on a coupon program and have very similar results .”

PSKW started to push its coupon data to its clients using portals and dashboards powered by SAS to see what was going on with its coupons – for example, the burn rate and resulting lift in prescriptions . States Caprara: “In essence, we used analytics to create a positive feedback loop and show clients what really works . Once that happened, it was like a snowball going down a hill, and as it gained steam, it changed the game .”

Coupons are designed so that

when they are redeemed, PSKW

knows when, where, how and

which doctor prescribed the

drug. By incorporating other

data on prescriptions, it can

tell its pharmaceutical clients

whether physicians continue

to prescribe the drug even

after the coupons ran out,

and whether patients refilled

prescriptions. From there,

pharmaceutical companies

can get a better sense of which

physicians’ offices respond to

coupons and which patients

might need follow-up coupons

to continue filling a prescription.

3


Evolving from Commodity Printer to a Valued Partner

Today, PSKW works with nearly every major pharmaceutical company – and the company’s growth has come not just from expanding its client list, but also doing more with existing clients . “It’s because we’re doing business with them a different way – in a consultative fashion that gives them real data, real information about what works and what doesn’t . We partner with them to make the best marketing decisions based on this information,” emphasizes Caprara . “And SAS solutions for small and midsize businesses are what make it all possible .”

SAS® Analytics: Turning Data into Gold for SMBsYou don’t have to be a huge company to derive value from SAS, explains Garabedian . “We bring the power of SAS technology to small and midsize organizations like PSKW in an affordable way .” The software helps them aggregate and consolidate their data into a central data repository and transform it into meaningful business insight . Customers can trust their data, efficiently report it, and make strategic and more informed decisions .

SAS solutions for small and midsize businesses enable all this by providing three core capabilities:

• Data management enables users to access, cleanse and manage data from multiple systems and sources across the organization, without always having to rely on the IT department .

• Analytics and forecasting enable users to explore the data to uncover emerging trends, forecast future conditions and make fact-based decisions, all using powerful SAS Analytics from within a familiar Microsoft Office environment .

• Reporting and visualization empowers business users to create their own reports and get the information they need – when they need it and in the right format – via the company’s existing reporting platform (such as Microsoft Excel) or easy-to-configure SAS dashboards and portals .

SAS® Software: The Secret to PSKW’s Success“We give SAS a lot of the credit for our success,” notes Caprara . “It’s the best tool for mining our extensive data resources and building predictive models . We’ve used it to become the industry leader in analytics and data-driven program management in the pharmaceutical industry .”

Let’s take a closer look at how PSKW leveraged SAS software at the operational level .

“Before, no one within pharma

companies was looking at what

was working and what wasn’t.

Their approach was to give

every doctor several coupons

and hope for the best. Most

never even followed up to see

how many claims actually came

through and what percentage

of prescriptions were tied to a

coupon.”


4


Collect and Organize Your Data

Clean, complete, aggregated data is the foundation for accurate analytics and reporting . “But most small and midsize companies have data coming in from at least seven different sources,” notes Garabedian . “The challenge is how to efficiently collect and organize all of this data .”

In PSKW’s case, enterprise data was being generated by coupon exhaust from financial transactions . “Every coupon use has an extensive data record because it’s tied to a patient, a physician and a pharmacy,” explains Caprara . “As long as the patient is using that coupon, we’re able to track the patient and see, for instance, how long they were on therapy and how they stayed on therapy . Each coupon is tied to a prescription, which means it’s tied to an individual physician, so we’re also able to see how individual physicians use coupons . And who in the pharmacy channel is generating the most volume and traffic .”

After collecting data for thousands of coupon programs (over 500,000 unique physicians and millions of patients), PSKW had a critical mass of data that it could analyze and use to predict the behavior of people . It could accurately predict how people and programs behave as variables such as target audience, coupon value and costs change .

But to understand what’s really driving a particular drug to be used (for example, the doctor, insurance plan, the government or the coupon), PSKW had to merge client data sets with its coupon exhaust . “This was a beautiful thing about SAS – the software gives you the ability to seamlessly merge data together,” states Caprara . “Our clients often say, ‘Yeah, we have that data, I’ll give it to you . What format do you want it in?’ And my answer’s always the same . ‘I don’t really care, just give it to us in any format that you have . I have SAS, so we can read it .’ SAS figures out what’s in there, pulls it into a data set, and I’m ready to go .”

Analyze Data and Forecast Trends and Outcomes

“We use SAS to analyze targets and make recommendations before coupons are even printed,” explains Caprara . “We found SAS to be the best tool to mine our data and build predictive models for coupon programs .”

For example, PSKW’s analysis revealed that how much patients actually have to pay out of pocket (OOP) explains about half of the performance variations of programs . Leveraging this insight, they used SAS software to build predictive models that help clients understand how different offers will likely perform relative to their cost to the business . As a result, PSKW’s clients can make informed decisions about how to maximize return on investment with limited marketing budgets .

“SAS was chosen because of

its superior ability to merge and

analyze large amounts of data

from numerous sources. We

often merge client data with our

own internal data to provide

insightful analytic support.”


“Our clients have a ton of data.

They don’t want any more.

What they want are insights and

wisdom. You need tools to turn

data into knowledge. I’ve never

seen anything as flexible and

powerful as SAS for doing that.”


5


In addition to forecasting potential financial return, PSKW uses analytics to provide strategic information for future promotion planning . This includes:

• Measuringeffortstoretainmarketsharewhenadruglosesitspatent.Byanalyzingthe results from various coupon trials, PSKW helps branded drug marketers understand what price point helps its drug stay competitive with a generic drug . “Coupons allow patients and physicians to have the option to stay on a branded therapy that is working for them . We often see market share erosion stop and even reverse itself versus generics when this option is made available,” Caprara says .

• Analyzingthebenefitofplacingcouponswithpharmacistswhoofferthemtocustomers concerned about the cost of a drug . This reduces the chance the pharmacist will call back to a physician’s office requesting a different drug .

• Identifyingphysicianswhoaremostlikelytoprescribethedrugiftheyhaveacoupon/free sample, along with determining which drugs will benefit from having a coupon . For one client, there was 40 percent uplift in drug prescribing when PSKW helped it target the right physicians . “We did one analysis that showed that for every coupon that a doctor uses, he is writing four or five other prescriptions . That was a deciding factor in keeping the program,” Caprara explains .

Taking the Guesswork Out of Offers

Figure 2 shows an example of a typical offer analysis summary table – created using SAS Analytics – that PSKW uses with clients . On the left are different types of offers to consider offering via coupons . PNMT means “pay no more than,” so the client can see, for example, that if it has patients pay no more than $10 OOP with a $50 cap, it can expect a certain number of monthly claims and an estimated paid benefits per month . “Our clients get much-needed clarity so they can make an informed decision based on performance and cost,” adds Caprara . “There’s no more guesswork about what offer will be the best for their budget and business .”

Summary Table SAS allows us to quickly model offer scenarios

Offer Es(mated Average Copay

Modeled Average Paid Benefit

Modeled Average Pa(ent OOP

% Pa(ents w/ No OOP

Predicted Monthly Claims

Es(mated Paid Benefits/Month

PNMT $10 up to $50 cap $48.59 $33.92 $14.67 0.0% 4,108 $139,349

PNMT $10 up to $100 cap $48.59 $38.23 $10.36 0.0% 6,745 $257,870

PNMT $15 up to $50 cap $48.59 $29.95 $18.64 0.0% 2,920 $87,457

PNMT $15 up to $100 cap $48.59 $33.36 $15.23 0.0% 3,893 $129,845

PNMT $25 up to $50 cap $48.59 $22.29 $26.30 0.0% 1,788 $39,850

PNMT $25 up to $100 cap $48.59 $24.06 $24.52 0.0% 1,975 $47,524

$20 off $48.59 $19.66 $28.93 7.7% 1,561 $30,684

$30 off $48.59 $28.47 $20.12 21.5% 2,618 $74,543

$50 off $48.59 $41.10 $7.49 70.8% 10,704 $439,912

Figure 2: Using SAS, PSKW models the expected number of claims and associated costs for each offer scenario so clients can make informed decisions.

6


Fine-Tuning Targets for Coupons

Developing a good offer – even one that’s based on historical data – doesn’t ensure marketing success . Companies also have to know exactly whom to target with that offer . Caprara explains, “What SAS allows us to do is say, ‘OK, give me what you know about doctors, and I’ll merge that with what I know about their coupon use, and we can identify the best targets .’”

Figure 3 illustrates the power of merged coupon and segmentation data . The physicians represented by the green box show real sensitivity to using coupons . States Caprara: “If you put a coupon in their office, they tend to use it, and they’re also the highest segment Rx targets . So boom, now we’re giving our clients direction on the execution side – and this is just the first level of this analysis . As clients share more about what they know about their targets, we can roll it into our analysis – and further optimize execution on the coupon side .”

Coupon Sensitivity Decile Rx Decile 0 1 2 3 4 5 6 7 8 9 10 Total

10 34 1 2 5 9 12 19 37 58 90 159 426 9 78 12 7 14 20 23 42 75 107 168 149 695 8 140 13 12 20 37 52 80 105 185 234 136 1014 7 206 27 28 32 52 78 90 153 201 236 97 1200 6 393 36 28 69 89 111 143 208 287 260 103 1727 5 503 47 60 69 104 146 158 211 224 205 61 1788 4 1187 70 93 115 170 220 257 257 267 156 71 2863 3 1279 70 96 99 123 133 114 129 101 62 32 2238 2 380 22 22 19 24 31 21 15 11 8 6 559 1 487 16 19 15 24 24 9 16 14 8 7 639 0 172 6 4 8 9 7 7 3 3 0 2 221

Total 4859 320 371 465 661 837 940 1209 1458 1427 823 13370

Category # Targets % Targets A Targets 4703 35.2% B Targets 2826 21.1%

Low Targets 5841 43.7%

Figure 3: With SAS, PSKW can easily identify each client’s high-value targets who are most likely to use a coupon.

7


Making Decisions at the Individual Physician Level

Over time, companies can use coupon data to decide who should continue to get coupons – and who shouldn’t for the sake of the bottom line . “There are physicians who will use a coupon and it grows their business . They see that’s a good thing and keep doing it . There are other physicians who are using coupons but their business is not growing . We can identify those physicians and pull back on the coupons . We can keep peeling back the onion in such a way to reach the point where we’re making decisions at an individual target level . And this is easy to do with SAS .”

Distribute Reports to the Right People at the Right Time

“One of the reasons we chose SAS over other software packages was the fact that it allowed us to quickly automate complex analyses and easily share results with our clients,” shares Caprara . “With SAS, it’s just, ‘Boom, automate the analysis, put it on the portal, and let the client have it in real time .’ They love it,” explains Caprara .

Ease of reporting and sharing of data has proven to be incredibly valuable – because once PSKW started to make data available, its clients’ thirst for it grew quickly . They wanted mechanisms to monitor key performance indicators in real time, flexible setups and layouts for reports, dashboards, the ability to change report content, drill-down functions, and easy exporting of reports to Word and Excel .

With SAS reporting software, PSKW could deliver every time . SAS gives SMB companies three different ways to distribute reports and get the right data to the right people at the right time:

• Office analytics software that integrates with Microsoft Excel for easy importing and exporting of data .

• A business intelligence solution that gives users of all skill levels powerful reporting and dashboarding capabilities through an easy-to-use interface .

• Data visualization software that allows you to visually explore data for deeper insights, as well as drill down into graphs from a desktop, iPad®, or Android device .

8


Closing ThoughtsPSKW’s use of analytics proved to be advantageous for both the company and its clients . The company’s story is a great illustration of why just believing in the strategic importance of marketing isn’t enough today . More than ever, marketing executives are being asked to quantify the impact that their organization’s marketing efforts have on the bottom line .

Unfortunately, most marketing performance solutions available today address only tactical issues . SAS, however, takes marketing performance management to the next level – and gives companies the insights to change the game . You can use it to plan better, work smarter, act faster, and differentiate your business in ways that make you more competitive . All you need is the right combination of:

• Data management software. Most companies start here because without a complete, accurate, and trusted data foundation, you can’t generate reliable insights .

• Analytics and forecasting software. Having a 360-degree view of data enables marketers to ask questions that could never be asked in the past – and not only to discover patterns and trends of past activity, but also to predict how customers will respond to future marketing campaigns so they can make choices that will increase ROI .

• Reporting and visualization software. By sharing information across the business using SAS reporting tools, decision makers can draw meaningful conclusions from information that’s available any time and on any device . With data visualization, they can go beyond static reports to an interactive environment to explore data visually and find greater value from information hidden within the organization .

Most SMBs can’t afford to do everything at once – and the good news is, with SAS software, you don’t have to . Start small and build up your analytical capabilities over time and as budgets permit . You’ll realize significant, incremental business value at every step .

9


For More InformationTo view the on-demand recording of this webinar: sas.com/reg/web/corp/2232676 .

To learn more about SAS solutions for small and midsize business, visit us online at

sas.com/smb .

To learn more about how PSKW is using SAS, view the PSKW success story:

sas.com/success/pskw.html .

About the PresentersRobert Caprara Robert Caprara, Chief Methodologist for PSKW, has more than two decades of experience in the strategic and tactical use of marketing data . At PSKW, Caprara is responsible for developing the in-house capabilities needed to analyze and optimize PSKW’s copay assistance programs, including physician targeting, offer evaluation, program impact and physician-level ROI . Prior to joining PSKW, Caprara was Senior Vice President of Advanced Analytics and Market Research for ImpactRx . He has a bachelor’s degree in biology from St . Joseph’s University and a master’s in engineering from Villanova University .

Kevin Garabedian Kevin Garabedian, Senior Director of SMB Solutions at SAS, has a high level of passion and focus for working with small and midsize companies to help them utilize technology to foster growth . An accomplished leader with strong managerial and strategic sales skills, Garabedian has extensive software sales and sales management background . With more than 20 years of experience in the software industry, he is currently focused on building the go-to-market model and strategy for SAS SMB solutions .

http://www.sas.com/reg/web/corp/2232676

http://www.sas.com/smb

http://www.sas.com/success/pskw.html

About SASSAS is the leader in business analytics software and services, and the largest independent vendor in the business intelligence market . Through innovative solutions, SAS helps customers at more than 60,000 sites improve performance and deliver value by making better decisions faster . Since 1976 SAS has been giving customers around the world THE POWER TO KNOW® . For more information on SAS® Business Analytics software and services, visit sas.com .

SAS Institute Inc. World Headquarters +1 919 677 8000To contact your local SAS office, please visit: sas.com/offices

SAS and all other SAS Institute Inc. product or service names are registered trademarks or trademarks of SAS Institute Inc. in the USA and other countries. ® indicates USA registration. Other brand and product names are trademarks of their respective companies. Copyright © 2013, SAS Institute Inc. All rights reserved. 106346_S105420_0513

http://www.sas.com

Using Analytics to Measure Marketing Program Effectiveness · For many SMBs, analytics is the game...

Documents

Transcript of Using Analytics to Measure Marketing Program Effectiveness · For many SMBs, analytics is the game...