Targeting and segmentation in a changing marketplace
Moussavou and her colleagues have implemented a new targeting and segmenting approach in the company’s primary care business unit, which has three mirror sales forces targeting GPs.
By on Apr 27, 2006Moussavou and her colleagues have implemented a new targeting and segmenting approach in the company's primary care business unit, which has three mirror sales forces targeting GPs. But she says, by 2005 when the initiative began to be implemented, the company's situation was changing, with more products in its portfolio and not all of the mirrors were presenting the same products to target physicians.
Like most business units in France, segmentation in our primary sales unit was driven by sales and marketing really wasn'st involved, Moussavou says. We felt it was necessary to align the whole company. And marketing really needed to be on board.
Before the project, she says, the company segmented based on potential and market share for each product.
We used to detail three products, but now it's eight or more but not all to the same doctor, Moussavou says. You have to choose.
She says the company has kept this layer, but has added two new layers of segmentation. The first is a territorial ranking of all 60,000 GPs in France on a weighted average of potential for each product detailed.
For weight, we used the projected sales force for the next three years and sensitivity to core, Moussavou says. If a product is not sensitive to core, you may not want to use it for segmentation. We also used profitability. I think this was the first time this was ever used at Janssen Cilag. Everbody in pharma only talks about sales not the profit actually made from their products.
The last layer, she explains, is a shortcut of sorts to allow sales management to follow-up and understand reps's activity.
Based on national ranking, we had this notion of core doctor/non-core doctor based on rank, Moussavou says.
Before its new approach, she says, every doctor in the same target class received the same number of calls, but that led to high frustration among reps and resulted in strong incentives to skew the system.
Now, instead of going for the numbers of calls per target class, we just try to see how we can maintain the proper share of calls for each doctor, she says. To do this, we get data on the number of calls each GP gets from each pharma company and this gives us an idea of the kind of pressure they might be accepting from the sales reps.
Moussavou says that instead of, for instance, targeting all top tier doctors with 14 calls, the company can determine how many calls each doctor received in the past year and ask its sales reps to have a share of that resulting in a specific call objective for each doctor.
We target a specific share of the number of calls each GP is comfortable with, no a one-size-fits-all's number, she adds.
And she says they place upper and lower limits on the number of calls each doctor receives to eliminate wasted calls.
Once we have an optimum number of calls determined for each GP, we ask the sales reps to get together and commit to a specific number of calls, she says. Then we know if we have a gap between the optimum number of calls and what they have committed to.
That, she says, gives their teams common goals supported by individual commitments.
She also stresses the importance of involving marketing from the start.
Marketing was involved in the selection criteria for the segmentation matrix, she explains. They selected the target classes they wanted to focus on to meet sales targets and had the desired scenario translated into share of voice numbers.
Marketing also provided guidelines for inviting the right doctors to promotional events.
Once the sales reps committed to invite the right GPs to promotional events and to the number of calls, the plan of action was fed back to marketing, Moussavou says. Then marketing can see the gaps and who they might need to reach in a different way.
The approach, she says, ensured the sales force was ready to accept alternate marketing efforts.
So we have gone from having only a plan of action for sales to something completely coordinated in the company that follows the company's financial strategy from financial objective to understanding how we want to reach that financial objective, get a share of voice and how we can use the different levels to do that including the sales force and other parts of the marketing mix, she says.
The approach has been well received by sales teams, with more than 80% saying they like the system. And that is something Moussavou says was a bit surprising, considering the amount of up-front work required to determine segmentation.
But they really see the benefit and have asked to keep the system in 2006 and we are, she says. Another nice thing is that the guidelines from marketing were actually followed and accepted in the field.
And Moussavou reports that despite a decline in overall share of voice due to other extenuating circumstances, the new targeting and segmentation approach allowed the company to increase its market share on all of its core products.
For other companies considering the approach, she cautions to be prepared for how time consuming the number crunching and management effort can be. She also warns that the system gives little flexibility throughout the year.
One of our product launches was delayed, but it was already integrated into the segmentation so we couldn'st go back, she says.
Moussavou also warns that the IT department must be geared up to handle the changes in dashboards required. Business reporting systems, she says, go from asking for dashboards with frequency and target classes to one that can display the gap between the commitment made by a doctor and reality.
But this system has no value if you can'st follow and track reality, she says.