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


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.


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.


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


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


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