Seven keys to turning market research into a competitive advantage.

Using market research to understand physician and consumer attitudes and behaviors has been a cornerstone of pharmaceutical marketing for years. This article presents seven keys to creating programs that not only provide information but also improve brand performance.

As the pharmaceutical market becomes increasingly complex, some product marketers are finding that traditional research approaches do not deliver enough of a performance advantage. New tools are needed to meet new challenges--fresh techniques that deliver insights to drive action and build and maintain a competitive edge.

Key #1: FOCUS ON THE RELATIONSHIP WITH ALL STAKEHOLDERS 

Relationships are critical to developing and sustaining a competitive advantage. The old model of "selling product" is no longer enough. Success depends on customer-centric approaches that build an ongoing relationship between the brand and key stakeholders. That relationship depends on the product as well as key clinical attributes, such as safety and efficacy. It is also driven by a variety of other brand attributes, including the sales experience (comprising the sales rep's knowledge and professionalism) and various physician and patient services, including practice management support and educational programs.

Managing these crucial stakeholder relationships requires new metrics. Relationship metrics capture stakeholders' emotional commitment to a brand: How connected they are to the brand and how likely they are to prescribe or purchase it, today and tomorrow.

The ability to measure and build commitment is key to a brand's success. Committed stakeholders, who have a deep emotional connection to a brand, give more of their business, and are willing to pay more for it, are less likely to defect to a competitor, and are more likely to act as "missionaries" for their preferred product. Recent research has shown that emotional commitment to a brand drives share increases among physicians. In addition, committed consumers are twice as likely to ask physicians for their preferred brand as uncommitted consumers.

Incorporating relationship metrics into the research mix is critical for increasing both physician prescribing and patient action. Understanding and nurturing the relationship between stakeholders and brands is essential for strengthening market performance.

Key #2: LOOK FORWARD AND BACK

Traditional behavioral metrics, such as loyalty and satisfaction are based on past actions (i.e., a physician's previous prescribing). They are simply a look in the rearview mirror--not a way to anticipate what lies ahead. In contrast, commitment is an attitudinal metric that reveals the strength of the brand relationship and therefore, it is predictive of future behavior.

Is it possible for prescribing data to provide that same forward-looking perspective? Research conducted by TNS Healthcare, Owings Mills, Maryland, indicates it is not. Even the highest prescribers are not necessarily committed, and they may readily switch to another product. Commitment adds a critical and complementary dimension to prescribing information, revealing unseen risks and opportunities. Atacand (candesartan), an antihypertensive, provides an illustration. Figure 1 shows the majority of high prescribers of angiotensin-receptor blockers with high patient share for Atacand are not committed to the brand, and are therefore at risk of defecting. What may look like a secure market position, in fact, holds a significant amount of risk.

[FIGURE 1 OMITTED]

By increasing commitment among its prescribers, a drug can improve its market security. Research has shown that committed physicians allocate more than twice the patient share to their brand of choice than to other brands and maintain that high share over time, even in the face of competitive actions (Figure 2).

A leading brand does not necessarily have a hold on commitment--and looking at commitment may uncover a potential market "takeover" by a second-place product (Figure 3). Brand B may be a distant second in terms of prescription volume. Yet, if two-thirds of its users are committed, it is actually in a more favorable market position than brand A, which has just half its users committed. What does that reveal about the future? In time, brand B will prevail.

[FIGURE 3 OMITTED]

This is powerful foresight for the managers of these competitive brands. Brand A's manager can see an emerging risk, take action to diagnose brand weaknesses, and identify the drivers that will shore up commitment. Conversely, brand B's manager can see an opportunity that prescribing data alone would not have revealed.

Tracking commitment enables brand managers to measure, monitor, and manage relationships between brands and stakeholders across the lifecycle. Commitment allows brand managers to identify the risks their product faces so they can protect against threats. It also uncovers competitive vulnerabilities that marketers can exploit to improve their brand's position.

Key #3: CONSIDER A MIX OF DRIVERS

Understanding that higher commitment yields greater sales, the next step is to take appropriate measures to increase commitment. When identifying commitment drivers, brand managers should consider two spheres of influence: (1) brand power in the mind and (2) brand power in the market (Figure 4).

[FIGURE 4 OMITTED]

Brand power in the mind is brand equity, which assesses the innate characteristics of the brand, driving the adoption and commitment to that product. It may Continued on page 24 be considered the "demand" side of the equation. Brand power is achieved through brand attributes and differentiation from competitors, physician and customer awareness, and relevance in the marketplace.

Brand power in the market is market equity, and includes the sales and marketing support variables that drive the brand experience, such as product access and affordability, as well as sales performance. One might consider it the "supply" side of the equation. Both spheres drive commitment, and ultimately, prescribing share.

Successful managers must identify those drivers from both the power-in-the-mind and the power-in-the-market frameworks that are most important for their brand's success. With this information, managers can then set action and investment priorities to strengthen relationships, enhance market position, and achieve financial goals.

When considering both frameworks, brand managers must examine a number of key attributes for each. To capture brand power in the mind, traditional marketing models should be augmented to include emotional metrics that represent the strength of the relationship between stakeholders and brands, in addition to awareness and interest. With regard to brand power in the market, a variety of supply-side issues, such as coding, coverage, and payment should be explored.

Key #4: CONSIDER SUPPLY-SIDE ISSUES

To build productive physician relationships, it is crucial to understand and deliver optimal stakeholder experiences. This can be done by looking beyond the sales representative interaction with the physician and considering other activities important to doctors, such as patient assistance programs, educational offerings, and practice management support. Remember that brands are not just products--they are vehicles for building relationships, and those relationships support prescribing. Product managers should incorporate these additional services into the sales and marketing mix and monitor their effectiveness to ensure ongoing improvements.

Creating an optimal physician experience requires an understanding of what physicians need and expect from pharmaceutical companies. Companies can differentiate themselves by identifying the full range of physician preferences and creating the right bundle of experiences to drive optimal prescribing. Research conducted among primary care providers, cardiologists, pulmonologists, and oncologists revealed physicians seek an integrated experience, including knowledge transfer and patient support, as well as practice management services. Such ancillary services allow physicians to run their practices better and build stronger relationships with their patients.

New market research tools allow companies to evaluate a broad range of investment options, such as speaker programs or patient education offerings, and determine the incremental value they might gain from raising their experience scores in each area. These tools can reveal the benefit of investing in each experience improvement in terms of increases in commitment and patient share, as well as in incremental dollars. Brand managers can quantify improvements in physician experience levels, focus on those that will deliver the greatest gains, and then make informed decisions about where to concentrate their efforts and resources to realize the strongest competitive advantage.

Key #5: INCORPORATE DTC INTO THE PROMOTIONAL MIX 

It is common for brand managers to reach patients through DTC campaigns. Despite recent controversies, data show that DTC spend increased 7% in the first four months of 2006 versus the same period in 2005.

Market research is vital in developing DTC advertising and to determining ad buys. Brand managers must have the information to forecast incremental prescriptions from DTC programs so they can determine which brands to advertise, where to place the advertising, and how much to spend. In some categories, such as allergy or insomnia, DTC is critical to building commitment among consumers. Converting consumers from "uncommitted" to "highly committed" can have a tremendous effect on their lifetime value.

Committed consumers are more likely to seek supporting positions for their brand of choice, such as visiting the brand's website. How important is that visit? Consumer website visits are strongly correlated with both new and total prescriptions. In addition, the more time a consumer spends on a site--and the deeper the involvement with its contents--the higher the likelihood the consumer will increase compliance and contact a physician.

Despite findings supporting the strength of on-line advertising, on-line DTC spend actually fell by 4% in the first trimester of 2006. Market research is needed to help guide the media choices that are most effective within a particular category and for a specific population. The interactive budget for DTC advertising should be determined within the context of a marketing mix model. It is important to conduct return-on-investment (ROI) assessments of alternative investment scenarios and choose those that deliver the optimal revenue and profitability. Effectively spending funds--and stretching budgets to deliver the optimal return--can be key to gaining a considerable market advantage in an increasingly crowded DTC environment.

Whether for interactive media--or for any other channels--copy quality is particularly important for DTC. Interestingly, this sensitivity to copy quality is more evident in DTC than in the consumer packaged goods arena. Health care consumers are quite sensitive to the messages they are given. The right DTC advertising copy can be a strong competitive edge.

Key #6: TEST MESSAGES TO GENERATE THE MOST POWERFUL COMMUNICATIONS

One of the most important and actionable results of market research leads to generating the right message--copy that truly has an effect on awareness, recall, and results. Successful message research demands a platform that is both robust and flexible. It must have the capacity to test large numbers of messages, reducing the risk of eliminating a good idea. In addition, it must be capable of assessing the repercussion of those messages on several possible outcomes.

In addition, the most effective message testing approach combines quantitative and qualitative research. The quantitative phase tests large numbers of messages and pares down the list to the best approaches. The qualitative phase then helps the product manager understand the "whys" and polish one's story to achieve optimal results.

Key #7: TRACK OVER TIME

At launch, a brand's positioning and attributes drive its success. As it matures, sales and service support play an increasing role in this success. Effectively maintaining this balance maximizes the likelihood of high performance. As brands and markets change over time, tracking enables brand managers to refine programs to meet the changing needs of their audiences and their brands across the product life cycle. With the tremendous investment made in building brand equity, brand managers today also must consider extending value beyond the patent period. Research can help brand managers make the best decisions on how to extend a brand's life through new indications, new formulations, or new delivery systems.

At every lifecycle stage, commitment adds insight. Early in the cycle, commitment metrics enable brand managers to predict and have an effect on future prescribing. At later stages of the lifecycle, commitment reduces "switch risk" and protects share.

CONCLUSION

The increasing spend on both traditional marketing channels has propelled many pharmaceutical brands to the same "household name" status once reserved for major consumer bands. As a result, pharmaceutical products have tremendous brand equity and must be actively managed as significant business assets. To do this, it is essential to have strategies in place that secure an ongoing competitive advantage. Market research can be a secret weapon in gaining and sustaining this critical competitive edge.

Using such new metrics as commitment, which are predictive and proven to drive share, can help support sales and marketing actions that measurably improve performance. They can move market research from a nice-to-know resource to a need-to-know essential that can make all the difference in business outcomes.

Mr. Kay is Chief Operating Officer, TNS Healthcare, Owings Mills, Maryland.

Jonathan Kay

Chief Operating Officer

TNS Healthcare

9 Park Center Court

Owings Mills, Maryland 21117

Phone: [phone]

E-mail: [e-mail]

Figure 2. Committed prescribers are two to three times
more productive. COPD = Chronic obstructive pulmonary
disease; GERD = gastroesophageal reflux disease; ARB =
angiotensin-receptor blocker.

                     Committed                Uncommitted
                    Prescribers               Prescribers

              Entrenched     Average     Shallow     Convertible

Asthma            53              42         17             9
COPD              52              41         25            14
GERD              49              43         22            14
Hypertension      40              23         16            12
(ARB Combos)
Dyslipidemia      31              18         10             6

Type 2            36              21         17            15
Diabetes

Note: Table made from bar graph.