What happens to marketing research when marketing budgets are decreased? Marketing research needs to find new ways to do more with less, to change…..you’ve heard it all before.
But how do you actually change without sacrificing quality and actionability? Short term, you can pursue the path of conducting the same projects you’ve carried out in the past by consolidating suppliers and negotiating lower costs per project. It’ll work for a little while, but it’s short term thinking and no different than putting a patch on a tire leaking air because it’s worn out its tread.
It won’t take long before this short term strategy will result in a lessening of quality to your internal customers because, eventually, your suppliers will reduce their service levels (you get the B Team) because the lower pricing you’ve negotiated doesn’t allow them to earn a decent profit. I can speak to this with some degree of authority. For those of you of more recent vintage in the Pharma MR space, my previous company, Migliara-Kaplan, had the first agency of record arrangement in the industry (1994). It was with Zeneca Pharmaceuticals (prior to AstraZeneca) and after three years of losing money, despite the prestige and continued stream of work, we walked.
Converting change into opportunity requires a mindset shift. You have to ruthlessly evaluate the work you perform and how you’ve organized the people performing it. Just because you’ve done something in the past is no reason for doing it in the future.
So, what are the key elements to think about?
- Get real! Accept that as pharma shifts from a primary care to a specialty focus, marketing budgets will shrink simply because marketing to 10,000 specialists requires less money than attempting to reach 200,000 primary care physicians. Even with these new, more highly reimbursed stakeholders, research should cost less as well. That can only be accomplished if we reevaluate how we design and execute studies.
- Progress over perfect! That means taking a very hard look at the types of studies routinely conducted, the sample sizes typically used, and even methodologies employed. Is the information provided really valuable or just nice to know? Is the research being conducted because we’ve always done it that way? Marketing research should focus on executing just the research that addresses the business’ key decisions. Does the business really need statistical significance across 10 physician segments to make decisions?
- We need more generalists and fewer specialists. In the search for excellence as a profession, artificial fiefdoms of specialized expertise have been created that often result in some researchers being experts in understanding the unique needs of “left handed treating physicians.” As market research specialists are often deployed across multiple brands, research becomes further removed from the brand and the brand team, information is provided to Product Directors asynchronously and in “bits”, forcing them to assemble the parts and create the story. One marketing VP just brought in a consultant to sort and sift the research to aggregate the findings and synthesize the story. Research should be afraid, very afraid!
- Throw out the templates. Research templates were designed to prevent mediocrity, not deliver excellence. They were developed to make less experienced researchers capable of successfully conducting competent research. But competent is no longer enough. Companies need more. Products and their competitive situations and growth opportunities differ, yet the research we conduct across products is often the same…the 5 country monthly tracking study conducted on behalf of a brand that hasn’t moved share in a year. The attitudinal segmentation studies that can no longer be implemented. The qualitative study that leaves the brand team wondering now what. If marketing research is to be a beacon guiding marketing, we need to get creative and try new approaches that may not be listed on that template. In short, we need to become researchers again, not just purchasers of research.
- Organize research like pharma’s customers think. Customers don’t think in discrete interactions and touch points, yet that is how marketing and marketing research are typically organized. Instead, prescribing is a set of interrelated interactions that, added together, make up the customer experience. Hence, findings delivered in a non-integrated way often miss the mark. For years, choice models have overstated preference share because the respondents’ choices are made without a realistic context and the interactions between stakeholders are often not measured or fully appreciated. By pulling the pieces together to align with the “real world” we can develop better and more actionable insights.
Change creates the opportunity for marketing research to prove its value and adaptability. Marketing research skills and customer understanding are valuable and needed more than ever. Beyond suggestions already made, thought should be given to marketing research playing an expanded role serving new internal customers, both as an opportunity to bring greater value and more integrated thinking to our companies, but also to eliminate significant methodological and financial redundancies. As an example, pricing and health outcomes are often separate activities within pharma, yet the methodologies employed and the data collected are largely the same as have been used in marketing research for years, just executed by different suppliers. In health outcomes, conjoint analysis is only beginning to be used. I could go on with other examples…
The new world of pharma now rotates on a different financial and marketing axis. While many may want to shout, “Stop the world, I want to get off,” others will recognize this new world of as one of opportunity, but only if we’re willing to stop living in the past and focus on how to add value to our companies going forward.