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Feb 2009 Vol. 8, No. 2

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Guest Article Find resources cited this article online at: http://tinyurl.com/5hgxra This article is part of the February 2009 issue of Pharma Marketing News. For other articles in this issue, see: http://www.news.pharma-mkting.com/PMNissueFeb09archive.htm Published by: VirSci Corporation PO Box 760 Newtown, PA 18940 infovirsci@virsci.com

Sales Force Effectiveness Metrics More Important Than Ever in a Tough Market Author: Lisa Roner

PMN82-04

Pharma Marketing News Vol. 8, No. 2: February 2009 Page 2

© 2009 VirSci Corporation (www.virsci.com). All rights reserved. PMN82-04 Pharma Marketing News

ans Nagl, Promotion Response Modelling Manager, Shire, a scheduled speaker at eyeforpharma’s upcoming Sales Force Effectiveness Europe 2009 summit March 3-

5 (see http://tinyurl.com/dzeara), focuses on Sales Force Effectiveness (SFE) metrics for Shire.

Eyeforpharma had a chance recently to talk with Nagl about how the current economy and changing pharma landscape is impact-ing program effectiveness measures.

eyeforpharma: How might current economic conditions affect promotional programs?

Nagl: In our current dire eco-nomic situation, everybody is trying to reduce costs and save as much as they can. With large num-bers of people being laid off, many are losing their ability to purchase medications.

Know Who You’re Talking To More than ever, that means we really need to know who we’re talking to—who we are targeting. We cannot just produce from big promotional pro-grams that half the time don’t even reach relevant people that can generate a positive return on in-vestment. We need to streamline our programs even more and make them better, more effective, more efficient—and that’s where promotional response analytics come into play.

eyeforpharma: How do we go about gaining these efficiencies in our programs?

Nagl: We’re spending time trying to find out how well a certain promotional program performed in terms of the financial aspects—ROI and sensitivity.

“Wholistic” Approach But ROI is usually just one point in time, and at that single moment no one knows whether it would be good to spend more money, stick to the campaign or even spend less money. So that’s where the whole promotional sensitivity approach comes into the game and allows us to make decisions in a more rational, rather than emotional way.

In the past, in my experience, many companies based their decisions on experience—decisions that involve many millions of dollars—and took a chance they could be flat out wrong. The land-scape is changing and although experience is relevant, you need something more to make a better educated, more rational decision.

So my question is if you spend say $25 million in a promotional campaign—and for a large pharma company that’s not much—then wouldn’t it be helpful to do a $100K study that would give you an estimate of what your ROI might be in order to make a rational decision.

Lack of Skills A Problem From what I’ve seen, our industry has very few professionals that are actually able to deal with these particular questions.

eyeforpharma: Are the necessary skills resident in the industry?

Nagl: We know a lot about segmentation research, attitudinal research, qualitative research, traditional market research ideas and forecasting techniques, but there’s been very little or shallow interest in the promotional response area.

If you want to go to the market and find people who can do this, it’s usually very hard and it’s especially difficult to find companies or individuals who can do this kind of analytics on a global basis. You find companies who can help you do this in the US and that’s it. But if you want to look at this from a portfolio approach, it all falls apart. There are only three or four companies that can really do this.

And this is where conferences like eyeforpharma’s become so important. The pharma audience actually has the chance to engage with these people and learn these technologies—not only the technical information, but what it means and how this information has been derived and can be managed and put to work. That’s an entirely different thing.

It Takes Sales Experience and Statistics In my experience, I can come up with some great estimates based on some calculation, but when I go to my sales department, they say they can’t implement it. So the people in this area must be practitioners but also technically savvy in these kinds of economic techniques and that’s really a challenge.

H

Hans Nagl

To learn more about eyeforpharma's

upcoming events and reports on this topic, please visit www.eyeforpharma.com

Continues…

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We’ve been trying to hire people at Shire who are both statisticians and practitioners and it takes us months to find someone to fit the bill. We either find statisticians with great technical knowledge but that can’t go in front of leadership and put what they just analyzed into simple terms, or we find people who’ve managed these types of things but have no clue how to really do it and engage in an in-depth discussion with a vendor or research person.

Special MBAs Needed Finding the right combination is really difficult. I would even challenge academia when they pro-duce MBAs in this area to have a good deal of class work incorporated into their curricula to that includes these kinds of econometrics and tech-niques so that people coming to industry actually know that this is available.

The time is really right for that in pharma and elsewhere, too. Everybody wants to streamline. Nobody wants to waste any money at this stage. And this is when these kinds of things become even more important.

Past experience is helpful, but not to a large degree. It certainly helps you gauge where something could go, but it can’t be the sole driver. Even vendors in the market are experienced-based. And that means there are a lot of assumptions built in.

They’re not really objective studies and that’s mostly because companies go out looking for quick answers and don’t let the experts do their jobs right. It’s not really about quantitative answers.

eyeforpharma: How could such approaches change the path forward for pharmas?

Take a Long-Term View

Nagl: With so many layoffs in the sales force, you can’t help but think that the promotional response work is all about mitigating risk. If companies would have done a thorough job and looked at the long-term implication of their portfolios and thought more about how many sales reps they really needed in the future—even two years out—they might have seen this coming.

To learn more about measuring the effectiveness of promotional programs, be sure to hear Nagl’s talk at eyeforpharma’s upcoming Sales Force Effectiveness Europe 2009 summit March 3-5 in Barcelona, Spain. For more information or to register, please visit www.sfeeurope.com.

Pharma Marketing News

This article is reproduced with permission from eyeforpharma, – John Mack, PMN Editor

Pharma Marketing News

Pharma Marketing News is an independent, free monthly electronic newsletter focused on issues of importance to pharmaceutical marketing executives. It is a service of the Pharma Marketing Network, which brings together pharmaceutical marketing professionals from manu-facturers, communications companies, and marketing service providers for wide ranging discussions and education on a multitude of current topics.

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