AffinityMonitor TM 2015 Executive Summary The End of Spray and Pray : How Pharma Companies Can Market More Effectively by Understanding the Preferences of Individual Doctors
AffinityMonitor TM 2015 Executive Summary The End of Spray and Pray : How Pharma Companies Can Market More Effectively by Understanding the Preferences of Individual Doctors All doctors have specific preferences for if and how they engage with pharmaceutical and biotechnology companies. The range of promotional channel options for pharma companies is growing fast, and doctors are showing specific and widely varying preferences. Firms that understand these affinities can tailor their marketing strategy accordingly, leading to better engagement at lower cost. Until recently, however, there has been no systematic, crossindustry way to identify the channel affinities of individual physicians. Last year, ZS Associates debuted AffinityMonitor TM, a comprehensive report that tracks interactions among pharma brands and health-care providers in the U.S. This year s report includes real-world engagement data for 632,000 healthcare professionals and more than 100 pharma brands, covering 123 million individual interactions. The results give pharma companies detailed insights into industry trends, emerging channels, and the individual preferences of the doctors they re targeting. In this executive summary, Pratap Khedkar, ZS Associates Managing Principal for Pharmaceuticals and Biotech, and Malcolm Sturgis, who leads the AccessMonitor TM and AffinityMonitor TM offerings, discuss the results of the 2015 AffinityMonitor TM study. They also provide guidance on what the findings mean for pharmaceutical and biotech companies seeking to strategically improve their marketing efforts.
Pharmaceutical and biotechnology companies seeking to communicate with doctors face a far more complex environment than in the past. Even as access for sales reps grows more restricted each year fewer than half of all doctors are truly accessible today, down from nearly 80% in 2008 new digital channels are emerging. Yet each doctor has a unique preference for how he or she wants to receive information across the various channels. Without clear insights into the affinities of individual doctors, pharma companies have had to resort to trial-and-error to determine what works best for the physicians they target an extremely inefficient approach that is inherently limited to their own direct experience. That kind of spray and pray approach is costly and time-consuming, and doesn t give companies information on the universe of physicians they haven t yet contacted, says Pratap. In 2014, ZS introduced AffinityMonitor TM, a report that provides a unique view of how healthcare professionals (HCPs) engage across marketing and sales channels. The latest AffinityMonitor TM report includes data from more than 100 pharma brands, including engagements with 632,000 physicians across a wide range of specialties (up from 514,000 in 2014). That represents the vast majority of doctors that most pharma companies market to. Among the physician base, more than half (348,000) receive information through both personal and nonpersonal channels. In all, the report looks at 123 million individual physician interactions. Critically, says Malcolm, those reflect actual, real-world engagements with various communication channels as opposed to stated preferences and it includes sales rep visits. Such broad-based, robust data creates value for pharma companies in several ways. First, it gives an indication of where the overall industry is heading in terms of promotional channels and particularly how digital channels can help pharma companies enhance their marketing efforts to physicians. Second, the AffinityMonitor TM report shows industry benchmarks for particular channels at the level of individual physicians. For example, if a company isn t successfully reaching a particular doctor via email, it can see whether the rest of the industry can. And third, the report lets companies see the promotion-channel preferences of physicians that they have not yet tried to contact. 1
Key Findings Among the key findings, sales reps continue to be the best way to engage the average physician, even though the best way is steadily getting worse. The long-term trend is toward restricted access, but when reps can get in, the doctor is more likely to engage. The second-highest channel for engagement is digital push such as email or alerts sent to a physician s smart phone followed by inside sales (or telephone sales), direct mail, digital pull (or content that doctors can access on their own), and peer interactions such as speaker programs. A second key finding is that non-personal marketing channels are quickly helping pharma companies overcome the trend of restricted access for sales reps. The past decade has seen a slow but inexorable decline in the number of doctors who are easily rep-accessible. (Nationwide, fewer than half now fall into that category, according to the 2015 AccessMonitor TM study.) Yet of the entire universe of 632,000 physicians, 74 percent engage with multiple pharmaceutical companies across one or more channels. Sales reps still show the highest ROI at scale, Malcolm says, and companies should use them whenever they can. Similarly, some doctors are extremely valuable and should be targeted even through expensive channels. But there s a growing number of doctors who are hard to see and less valuable. These are places where companies can potentially deploy lower-cost channels. Segmenting doctors by their accessibility to personal promotion (sales reps) and also by non-personal promotion (other channels, including digital) allows pharma companies to identify potential gaps in their marketing approach (see Figure 1). For example, of the 54 percent of doctors who are less accessible to sales reps, 15 percent show good accessibility to other channels. In other words, those doctors haven t closed the door for good. Pharma companies can still reach them, provided they use the right approach. There s some type of non-personal promotion that these doctors like, says Pratap. Maybe it s digital. Maybe it s direct mail. Maybe it s a speaker program. It doesn t have to be all of them, but there s some channel that works for every specific person. AffinityMonitor TM lets pharma companies find out what that channel is. 3
PERSONAL PROMOTION VERSUS NON-PERSONAL PROMOTION ACCESS RATING Accessible via Non-Personal Promotion Good Top 70% of engagement for at least one NPP channel Poor Including NR s Total Accessible via Personal Promotion Good > 30% of targeting reps have reach Poor Including NR s 21% 25% 46% 15% 39% 54% Total 36% 64% 100% Accessible is defined as Personal or NPP Access Rating 4 or greater; NPP Channels include digital push, digital pull, peer interaction, and direct mail NR not reported due to insufficient coverage; HCPs that are insufficiently covered for both Personal and NPP are excluded Figure 1. Looking at physicians who are harder for reps to access, a significant portion show good accessibility to non-personal channels. One important caveat is that the number of physicians with poor access across both dimensions sales reps and non-personal channels may seem large, at 39 percent, but that includes all physicians in the sample. When pharma companies look at the smaller subset of high-value physicians for their particular product, this number typically becomes much smaller, thanks to a more granular commercial focus and a broader array of tactics. Variation Across Specialties Another key finding is in the variation across medical specialties. Although overall accessibility to sales reps is growing more restricted, some are still more accessible than others. For example, urologists and allergists are both typically more willing to see sales reps than other specialists such as nephrologists or oncologists. However, looking at engagement with nonpersonal channels as well as with sales reps the picture changes. Specifically, while some specialty areas are still rep-accessible like dermatology and gastroenterology they are less likely to engage with nonpersonal channels (see Figure 2). Conversely, other areas such as nephrology and oncology, which tend to be among the most restrictive for sales reps, are actually more receptive to non-personal channels. These tend to be highly 4
academic specialties, says Malcolm, with physicians who are used to gathering their own clinical information. For pharma companies, there s an opportunity to extend their reach into these areas by putting out relevant information on complex therapies, using easy-to-reach channels, and ensuring that doctors who have an affinity for those channels are aware of the information. That can happen either through communication from the sales force or through a wellstructured multichannel campaign. PERSONAL PROMOTION VERSUS NONPERSONAL PROMOTION ACCESS RATING, BY SPECIALTY Good Rep & NPP access Poor Rep access & Good NPP access Good Rep access & Poor NPP access Poor Rep & NPP access 23% 35% 36% 43% 51% 51% 54% 47% 49% 39% 37% 22% 17% 9% 13% 11% 8% 8% 9% 7% 6% 19% 19% 19% 21% 23% 26% 28% 30% 15% 11% 15% 18% 17% 14% 14% 22% 22% 16% 14% 37% 35% 37% 17% 22% 23% 17% 10% 9% 11% 37% 37% 38% 42% 44% 48% Allergy Urology Cardiology Rheumatology Endocrinology Gastroenterology Dermatology OBGYN % HCPs Psychiatry Neurology Pediatrics Oncology PCP Nephrology Accessible is defined as Personal or NPP Access Rating 4 or greater Figure 2. While rep accessibility is lower for some specialties, such as oncology and nephrology, they show a greater willingness to engage in non-personal promotion. An Abundance of Outreach The data also gives an interesting perspective on the frequency of marketing efforts, and how frequent interactions can quickly become overwhelming. ZS looked at a composite, top-tier, multispecialty pharma company based on real data from companies that fit that profile and estimated that it would have about 17,000 physicians on its list of top HCPs (based on marketing activity). That group would receive 144 contacts a year, or one every 2.5 days. Drilling down one level, the pharma company s top 100 doctors would receive 423 contacts a year. And the top 10 doctors would receive more than 600 each year. To be clear, that s from just one company. 5
Looking at the flow of marketing messages from the physician s perspective across multiple pharma companies the volume is even more daunting. The top 30,000 doctors in the overall sample receive an estimated 2,724 industry contacts a year, or 7.5 every day (including weekends and holidays). For HCPs in specialty areas that have a lot of overlap among different pharma companies, the number can grow to twice that or more. Given such volume, it s easy to imagine how doctors can start to get buried under an avalanche of marketing. It s also easy to see how even the right message, in the right channel, to the right doctor, could get lost in all the noise. The takeaway for companies is clear: they need to figure out which channels works best for each physician, focus on that, and scale back the rest. Just because a channel might be inexpensive doesn t mean it s worth doing, says Pratap. In some cases, it might be drowning out the other, more valuable contacts you re initiating. And it creates a bad customer experience for physicians. To that end, AffinityMonitor TM looked at the way doctors engage in various channels over time. Not surprisingly, different channels showed different saturation points. For example, doctors tended to open the first few emails sent by a pharma company for a given brand, but after about 10, they reached a saturation point (assuming no change in underlying content) and stopped opening future emails. For messages sent to a mobile phone, the saturation point is much lower physicians stopped opening them after roughly four messages. And while relatively few physicians will respond to physical direct mail, those who do may keep engaging many times without the pronounced saturation effect that shows up in digital channels. This highlights the fact that you need to think about each channel, along with its constraints for each customer, carefully and plan the marketing for it in a customer-centric way. says Malcolm. Even physicians that engage in a particular channel won t do so for long if you overwhelm them. One solution that has proven effective is the orchestrator rep, meaning a central point of contact within the pharma company who has visibility into all outreach to physicians across all channels and can refine sales and marketing efforts to their unique preferences. Ideally, the orchestrator rep can incorporate each new interaction to continuously improve future marketing and promotion efforts cementing relationships with individual physicians. The Impact of Education In this year s AccessMonitor TM report, a core finding was that physicians from the more elite medical schools were correspondingly more likely to restrict access to sales reps. That does not bode well such physicians are the thought leaders of the industry, and the people who will shape its future, yet they are increasingly difficult for pharma companies to see. 6
However, looking at non-personal channels, such distinctions disappear (see Figure 3). There is little correlation between where a physician attended medical school and his or her willingness to engage in non-sales force channels. In fact, while the difference is still small, those from elite schools are actually more willing to engage in peer interactions than the overall population of physicians. The implication is that the industry dynamics that are making rep access harder don t carry over to other channels, says Malcolm. As a result, pharma companies need to find the right channel for individual doctors, rather than relying on a one-size-fits-all approach. AVERAGE ENGAGEMENT OF PHYSICIANS BY MED SCHOOL BACKGROUND Top 12 Schools Top 50 Schools Other Schools 1% 2% 2% 10% 10% 11% 29% 28% 28% 24% 26% 27% 19% 19% 20% 39% 42% 45% WWW Personal Face-to-Face Peer Interaction Personal Remote Digital Pull Digital Push Direct Mail Figure 3. Rep accessibility declines among doctors from more prestigious med schools, yet engagement for non-personal promotions is less indicative. Implications for Pharma Leaders The findings of the AffinityMonitor TM report describe a far more complex and dynamic environment for pharma companies, but they also provide a roadmap for how to navigate that environment. No single channel works for all doctors, says Pratap. Yet most doctors will engage with pharma in some way. By understanding those channels on a physician level, and targeting their marketing and promotion accordingly, pharma companies can improve the effectiveness and ROI of their marketing efforts, and set themselves apart from the competition. 7
About the Experts Based in Philadelphia, Pratap Khedkar is ZS s Managing Principal for Pharmaceuticals and Biotech. He has advised many pharmaceutical and healthcare companies on a wide range of sales and marketing issues, including multichannel marketing, marketing mix, promotion response measurement, managed-care issues, sales force strategy and incentive compensation. Malcolm Sturgis is an Associate Principal with ZS Associates in Evanston, Ill., where he leads ZS s AccessMonitor TM and AffinityMonitor TM offerings. Malcolm has advised pharmaceutical and biotech clients on a range of strategic marketing issues, including brand strategy, opportunity assessment, investment optimization, multichannel planning and sales force design. 8
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