What's next for SFE?
Results from an eyeforpharma survey suggest there is little consensus about the best sales strategies for the future. Andrew Tolve reports.
By on Apr 26, 2010Results from an eyeforpharma survey suggest there is little consensus about the best sales strategies for the future. Andrew Tolve reports.
The past decade has wrought dramatic changes for the pharmaceutical industry.
The days of robust product pipelines and easy market access have been replaced by fierce brand competition, increased generic presence, and more restrictive regulatory hurdles.
In the face of such challenges, pharmaceutical companies have been forced to reconsider all aspects of their business models.
Sales forces have come under particular scrutiny.
Last year, eyeforpharma conducted a survey of 30 leading sales and marketing managers and directors to assess where the industry stands now.
The majority of survey respondents worked at global pharmaceutical companies with a strong presence in Europe.
Some of these companies focused on specialty nutrition and biopharmaceuticals; others on dermatology, critical care, or generics.
Nearly all of the respondents were based in Europe, from the Netherlands, Ireland, Turkey, and Portugal to Denmark, the UK, and Germany.
The survey revealed that sales forces are indeed changing the way they develop talent, reach customers, and target markets.
But there is little consensus about the new strategies sales forces have already adopted or about the best strategies to adopt in the years ahead.
Heres an overview of what the survey discovered.
Training and development
Training and development play a critical role in todays sales forces.
As directors and managers downsize teams and adopt new strategies, job roles change and reps are forced to confront new responsibilities that go beyond the traditional sales pitch.
What does it mean to build customer value, for instance? It sounds good in theory, but training a global sales force to execute that is a different story.
So eyeforpharma asked, What training and development programs give the best return on investment?
Sixty-one percent of respondents felt that internal coaching was the most effective way to challenge, motivate, and teach reps, with only seven percent opting for outsourcing.
An equally slim minority felt that incentive schemes give the best return on investment, while 18 percent believed that coaching combined with incentive schemes provides the best formula to retain talent and train reps for new capacities.
For more on coaching, see Coaching for sales effectiveness.
For more on incentive schemes, see Do incentive schemes work?.
For more on retraining reps, see Retraining Reps To Sell New Technologies and Getting sales reps ready for specialty care roles.
Marketing investment priorities
As the pharma marketplace becomes more cluttered, and more reps vie for the same customers, access has become more difficult to obtain.
One solution is to embrace the Internet as a tool to establish and maintain relationships with patients and physicians.
Social media forums like Twitter and Facebook offer direct contact with customers, and eMarketing techniques can create virtual access where it might be denied in real-world settings.
A number of big pharmaceutical companies have started social media sites and launched eMarketing campaigns in the past several years.
But the return on investment of these campaigns is still largely unknown.
So eyeforpharma asked, Is your company investing more resources and budget in making the sales force more effective or in eMarketing?
Respondents suggested that most companies still view traditional sales force effectiveness as a wiser way to invest resources and budget.
Sixty-five percent said their companies invest more in SFE than in eMarketing.
Only 14 percent said it was the other way around, while 21 percent said their companies invest equally in both.
For more on social media, see To Tweet or not to Tweet? That is the pharma marketers question, The upside of social media in marketing and How the pharma sector benefits from social media.
For more on eMarketing, see Making e-marketing effective.
Emerging Markets
The past decade has witnessed the flowering of numerous emerging markets, including the big four of Brazil, Russia, India, and China (BRIC), plus smaller markets in Turkey, Pakistan, Greece, and dozens of countries in the Asian Pacific.
So eyeforpharma asked, What emerging market is your company investing most heavily in?
Survey respondents identified Russia as todays single hottest emerging market (19 percent), though 23 percent said their companies invest equally in all four BRIC countries.
Russias popularity is partly due to its proximity to the rest of Europe.
Additionally, Eastern Europe has matured in the past five years, and Russia has proven eager to revitalize commercial activity.
Despite its large population, India received no votes from survey respondents as the place of greatest investment, likely because India is still recovering from patent-law problems.
As these problems smooth out, investment will likely increase rapidly due to the scale of the Indian market.
For more on Russia, see Reassessing Russia's pharma market.
For more on Brazil, see Breaking into the Brazilian pharma market.
For more on China, see Cracking the Chinese pharma market.
For more on the pharmerging markets as a whole, see How to get ahead in 'pharmerging' markets.
New Sales Strategies
As pharmaceutical companies face unprecedented challenges, a number of new strategies have emerged to turn a short-term negative into a long-term gain.
Key Account Management is one path on everyones map, as are terms like customer-centricity, closed loop marketing, and social media.
But from an industry perspective, no consensus has emerged about the best way to proceed.
So eyeforpharma asked, With the shift from primary to specialty care, what is the main change you have made, and what is the main change you think needs to be made?
When asked about the main change theyve made already, survey respondents produced vastly varying answerseverything from KAM to SFE to detailing to enterprise marketing, none of which earned more than 11 percent of responses respectively.
Survey respondents exhibited slightly more consensus when it came to what changes they thought needed to be made in the years ahead.
Twenty-eight percent of respondents identified customer-centricity, but opinions still varied widely.
For more on KAM, see Getting to grips with KAM.
For more on customer-centricity, see Creating a customer-centric sales strategy and How customer-centered marketing can work for pharma.
For more on closed loop marketing, see Close Loop Marketing in a Multi-Channel Environment.
Changing Roles
Pharma sales reps, managers, and directors enjoy little job stability in todays market.
Those who feel assured of a job feel equally assured that that job wont look the same two years from now.
So eyeforpharma asked, How will your role evolve in the next five years?
Respondents indicated that their jobs will take on a range of new specialties in the next five years, from an increased focus on customer-centricity and sales force effectiveness to best practices in marketing and analytics, lean thinking, and eMarketing.
But again there was little consensus as to which one of these changes would impact them.
Conclusion
Diminishing market access, slimmer product pipelines, increased competition from brands and genericsall have forced pharmaceutical companies out of their comfort zones.
Sales forces across the industry have responded with a leaner approach to total rep count, a heightened emphasis on coaching, and a renewed commitment to sales force effectiveness.
But when it comes to adopting new sales strategies, each sales force seems to be in a world of its own.
Approaches implemented to date have little in common, and there is only slightly more consensus about what new strategies should be adopted down the road.
When it comes to defining the future of the pharma industry, there is still a lot to talk about.
All of these issues and more will be discussed at eyeforpharmas 8th Annual SFE Europe 2010, as well as at SFE USA 2010 and the e-Communication Marketing Summit 2010.