Friday, November 17, 2006

MARKETING AND DISTRIBUTION OF PHARMA GOODS

Pharmaceutical marketing and distribution is an atypical challenge. For most pharma products prescription generation plays a key role in generating the sale. However, the OTC (over-the-counter) push and OTC pull too play complementary roles depending on the product profile. For instance, certain injectables are a clear-cut case of a specialist prescription product. Analgesics, on the other hand, are under the influence of OTC dynamics. Alternatively, in consumer marketing, the target audience is clearly defined. The media carries the messages. The significant reason for sale in consumer marketing is OTC pull. OTC push also plays a complementary role. The dynamics in consumer marketing are, thus, far simpler. In essence, pharma marketing is a complicated knowledge based marketing challenge where the ‘informed customer’ (doctor/chemist) is a major influencer.

The crucial determinants of pharma sale are:

 In-clinic promotional activities
 OTC pull activities
 OTC push activities

In-clinic promotional activities: These are conducted to persuade, remind, and strengthen brand equity and brand recall. The usual in-clinic promotional activities are –

1. detailing the product with the help of visual aid and LBCs
2. samples, compliments and gift articles to help in brand recall and building prescribing habits
3. negotiated personalized business sponsorships to enable higher prescription based sales
4. Company-MR-Doctor relationship building and relationship marketing.

OTC pull activities: OTC pull results from patients/end consumers demanding the product from chemists, purchasing and consuming the same. This bond between the product and end consumers develops through trust. OTC pull results from:

1. good patient experience with the brand
2. patient/end consumer oriented information and persuasion campaigns
3. informative pack inserts/posters/etc
4. freebies directed towards end consumer (given through doctors/chemists as discounts on repeat purchases or in kind).

OTC push activities: refer to the retailer pushing the sale of certain products. Generic products have highest OTC push. Following reasons impel the retailers to push certain products:

1. an emotion that the pushed product is of quality; gives value-for-money for his customers; gives well being to his customers; so that they will come back to his retail shop for future planned and impulse repeat purchases
2. higher margins/ schemes
3. gifts/freebies with purchased goods to the chemist.

Thus, the above processes stimulate the consumption process in the pharma formulations marketing sector.

The methodologies used for stimulating pharma product consumption are:

 focused customer working
 high call frequency
 maximum call coverage
 mailer/ad reminder support
 feasible service needs to be met

Focused customer working:

The current market clutter and competitive practices have forced most pharma companies to select particular products to a doctor; develop intimate relationships; collaborate with the customer to fulfil service needs in the most economical and feasible manner in line with the policies of the company. The most important aspect is measurement of the customer relationship in terms of the business yield, profitability and customer satisfaction. The prime goals of focused customer (chemists/doctors) working are to ensure product availability, high product consumption, and maximum profit with the highest customer delight.

High call frequency/call coverage/reminder support/personalized services:

The general call frequency used to be once a month. However, competitor activity, promotional clutter, development of society and technology are setting a tone for redefining call frequency.

In the 1970s and earlier for the kind of roads, transportation and communication systems available; and the number of doctors practicing the call coverage used to be 8 to 10 calls per day with a once a month or once in forty five days coverage. Sometimes, the more potential doctors had higher call frequency.

The present scenario in society mandates an evolved approach to communicate promotional messages, remind, inform and persuade prescribers about brands. The evolved approach focuses on higher call frequency (say once in a week for select doctors), maximum call coverage (chemists/doctors – trade and institution) through all modes of transport, harnessing technologies such as internet, mailers, ads in journals and thus promote through multimedia. And this also entails personalized services.

Conference promotion is another crucial aspect akin to event promotion that has gained importance in pharma marketing.

DISTRIBUTION plays a crucial role in product marketing as is well known.

Generally, the company from the warehouse or central depot bills goods to the C&Fs or super stockists as the case may be. From there the goods are billed to stockists for onward dispatch on demand to the chemists. In the present scenario when time is paramount, it is very vital that the products are available in time at the right place, because as the saying goes ‘sale lost is lost. It cannot be recovered’.

Logistics have a very valuable role to play in distribution. Availability of the correct mix of products, selection of the correct mode of transport, trans-shipment of the right mix of products, safe packaging constitutes the logistics and help in cost control, resulting in enhanced profits. All relevant documents like invoices, delivery challans, permits, and certificates must be in order during transportation to avoid delays and thereby avoid inconvenience.

A competent distribution adds to the success of marketing. Overall, pharma marketing and distribution are very challenging tasks in a company’s operations.

-Nandan Talgeri, Distribution Manager and Sunil S Chiplunkar, Senior Product and Training Manager,(now, Sunil is Manager - Marketing and Training) both from JUGGAT PHARMA, BANGALORE

1 comment:

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