Sunday, July 1, 2012

To brand or not to brand!?

Value delivery considered the core of marketing to stimulate consumption and improve market penetration, depends on the delivery of attractive, relevant, creative, persuasive, informative and timely messages.  Communication or messaging in pharmaceutical marketing is a challenging dimension.  The media of marketing messages remain print inputs, non-print inputs (like videos) and gifts or compliments that provide the interface for messaging.  When  a medical representative is involved in messaging there is an audio visual impact, the personal touch, and relationship building. All this translates into value delivery for improved sales outcomes.

Environmental developments have an impact on the process of marketing.  There is a discussion today in contemporary Indian society, on branded generics and unbranded generics - some patients are wondering why doctors are not recommending unbranded generics.  In India, right from pre-independence days, the culture of prescribing by doctors and product promotion by pharma companies has been in favour of branded generics.  The concept of unbranded generics has never taken off, simply because brands are a covenant of trust, brands are a symbol of reliability, and generate confidence, hence, doctors and patients alike prefer branded generics and unbranded generics.

The controversy is that pharmaceutical marketing processes of branded generics has created greater cost and has increased the MRP of medicines for patients.  Brands are commanding a premium compared to unbranded generics.  This is understandable.  It is however, market driven and patient (or purchaser) psychology based issue.  There are no easy solutions to this conundrum.  Pharma brands prescribed by doctors, has in fact helped improve market penetration and availability of drugs.  Since pharma brands have better profit margins than unbranded drugs, the surplus (or profits) has been reinvested by pharma entrepreneurs to launch newer brands and invest on marketing systems (including recruiting new MRs) to promote the drugs to newer doctors in newer territories.  It is this competitive situation that has helped market penetration.  If it was not for competition and pharma branding concepts, pharma companies would not have been motivated to expand to new territories for promoting products, and to promote products in new territories or launch new pharma brands, one requires monies, this comes from profits, which is through 'pharma brand' marketing.

Hence, pharma brands have not created problems in the pharma market, they in fact have helped many pharma companies to gain financial and marketing muscle, this bounty of profits has attracted many many pharma entrepreneurs, and the net result is that pharma products are available in plenty in India.

Imagine you have unbranded iodised salt and Tata iodised salt, any purchaser, would go in for the branded Tata salt, if he can afford it and not for the unbranded iodised salt packet.  This is because branded pharma products have a picture of reliability and win the confidence of buyers, prescribers and prospects.

The long and short of this matter, is that pharma brands are not an immoral part of the pharma industry, in fact, they are the pillars of growth of pharma industry.  If the unbranded generics market has to grow in India, it is not only competitive market forces which will make it happen, but it is also incumbent on the Govt., to provide unbranded options for patients.  This sort of scenario will further impel pharma marketers to offer quality corporate branded - pharma generic products (eg., Merck generics: Merck Paracetamol; Cipla Ibuprofen, Micro Metformin, Juggat Atenolol etc).  ONE CANNOT GET AWAY FROM BRANDING!  Even if the unbranded generic market is given incentives or encouragement to grow, corporate branding will start to happen - eg., in the chip industry, INTEL INSIDE is a famous branding example in a commodity based market.  Branding is what a marketer will inevitably do to secure his market interests.

There was a time when chakki atta was always an unbranded industry, however, with economic liberalization, branded attas have started becoming a part of the market.  When this sort of a branding phenomenon has become commonplace in commodity sector, and branded offerings becoming the norm to provide differentiation and create loyal customer pools, can pharma brands, which have been there ever since the pharma industry was born in India, be wished away?!!

Branding in pharmaceutical industry will take a new avatar if unbranded generics are encouraged by the Govt.  Corporate branding of unbranded generics will start to happen.

Raymonds is the premium clothes maker, the brand name gives the product its value, one cannot argue that unbranded clothes will be cheaper hence, unbranded clothes are more moral!  Unbranded markets and branded markets will always be there and they will co-exist.  Choice will be that of buyers.

The distinction between clothes and medicines is that the prospective buyer of clothes is the recipient of advertising messages, the people marketing medicines however, spend all marketing energies and communication towards the doctor, who does not consume the medicines, he only recommends them.  Hence, the format of pharma product communication creates a foundation for "hand-in-glove" relationships between pharma marketer and doctor.  

The Govt., if at all, should find ways and means to ensure that the patient too is brought into the circle of communication.  Why should a patient blindly buy what the doctor recommends, what are patient rights?  Why can't the patient exercise brand options or even discuss with a doctor for some other drug options?  Patient empowerment is the new thrust area that regulators and healthcare marketers need to focus on.

We live in a wired world, the internet and various other communication media have caused the collapse of  information float, today, people have good means to solve problems through information search, and problem solving is sophisticated and easier.

Marketers are essentially successful if they help in this problem solving behaviour of doctors and patients.  If marketers start to use various modern communication tools to participate in problem solving processes of doctors and patients, it will take marketing messaging to new highs and create a new way of delivering value for improved sales outcomes.

Brands are and were a part of the solution to various problems associated with assurance of quality, creating confidence in prescribers, patients and purchasers, and providing reliability in a health sensitive sector.  A bad drug can destroy the life of a patient, hence, doctors and others want reliability, which happens through quality and branding.  Brands are covenants of trust.

Branding cannot be wished away, simply  because brands are a part of the solution in problem solving by doctors, patients and purchasers.

So if the idea is that by promoting the sale of unbranded drugs, MRP can be reduced and access to medicines achieved to promote patient welfare, then the solution is not complete, it goes against human psychology which wants certainty and reliability.

If unbranded product generics should click, branding should come from elsewhere, eg., it can be from a branded retail chain which sells a bouquet of cheaper unbranded drugs (eg., TRUST GENERICS from Trust medical stores of Bangalore or Medplus generics etc), or from a corporate umbrella brand which sells a series of unbranded drugs (eg., Micro generics, or Juggat generics etc).

Like it or hate it, in today's contemporary society and market conditions, branding is a necessity, only the choice of the form of branding has to be decided, eg., it can be umbrella corporate branding or product branding or other types of branding!  The answer to the question, to brand or not to brand is very clear, in fact, there is no choice, you have to brand!!  Brands deliver value to prescribers, intermediaries, manufacturers, purchasers and end users!

Thanks for reading this write-up on branding and its inevitability, please scroll down and read all other articles, please click on older posts as and when required, also recommend this blog to your acquaintances!!