TrueView, the Ryan TrueHealth POV

You Have To Give Them A Reason

Today in the DTC Marketing Blog, Richard Meyer made one of those observations that is so simple and so obvious that it just has to be true. And insightful. Writing in a post about the concept of including an 800 number for the FDA in drug as, Meyer made this observation:

"When starting any CRM program one of the key questions you have to ask is "What's in it for my customers to start a relationship with my company?"

That, in a sentence, is what really defines RM.

When someone goes to the mailbox, or goes online, and instead of simply pushing an ad at them, you are asking them to respond somehow, it is simple human nature for them to ask themselves "Why should I do this?"

You are asking for their time, their attention, perhaps for some information.

It isn't necessarily possible for you to deliver value right then and there, on the spot, although sometimes you can. As a reason for them to respond, you may provide them with information, or insight, or discounts.

More often, however, what you're providing is the promise of value, what lawyers call an executory contract. "If you give me some information, I will provide you with value." And in any kind of RM, but particularly in pharma, you absolutely must deliver.

Ultimately, your customers are the ones who are calling the shots in this kind of project, because they are the ones defining value. This is a critical distinction. Value here really is in the eye of the beholder, and the more personalized and distinct what you deliver is, the more valuable it is to them.

Interestingly, one of the least valuable things you can provide for customers often is money -- in the form of a discount, a rebate, a free sample or whatever. This is by no means a universal or hard-and-fast rule, but value is a subjective, interpersonal concept. What is truly valued may be something emotional, or inexpensive, or surprisingly simple. And further, the customers who do tend to respond to money -- who can be bought, basically --  are often fickle, or not inclined to be loyal.

The question, always, boils down to "Why should I?" The key to the whole enterprise lies in how you answer that question. Here's a hint: "Because I want you to" is not the right answer.

Disease Management: Is Pharma Missing the Boat?

I have thinking a lot about the challenges of patient adherence these past few weeks. For the uninitiated, adherence is the art and science of helping patients with chronic or long-term conditions stay on their therapies. I always think about it, because I have seen firsthand the confusion patients suffer from lack of support -- but anyway, a statistic came to mind from my old mass market days that I felt like posting.

Today, so many pharmaceutical marketers still focus on acquisition to the detriment of the overall long-term health of their patient and brand sales. But the classic stat is this: a 1% increase in customer loyalty is equivalent to a 10% cost reduction. In other words, improved adherence goes straight to the bottom line. It is essentially pure profit.

There is so much to say about adherence. Last summer I spoke on a MedAdNews panel about the challenges surrounding the issue, which are vastly complex and easily overwhelming. But while pharma is starting to look at the problem (and I sure wonder why Wall Street is not!), the real solutions are emerging from the Disease Management companies working through managed care and major employers. One which I know of well and admire is Active Health Management (http://www.activehealthmanagement.com/). Aetna purchased them for good reason.

 

More to the point, pharma and biotech marketers need to decide whether these companies are a threat to their own adherence efforts, or perhaps their best partner. After all, if the disease management companies really take hold, there will be no compelling reason for pharma to have such programs, and in doing so, we will lose access and influence on our patients.

Think about it. Look around. Adherence IS being dealt with and pharma may be left behind.

Advocates and the Long Tail

We are tremendous fans of the concept of the Advocate. In a recent post, Seth Godin links to an analysis of the Long Tail by fellow blogger Kevin Kelly that brilliantly explains the role of the advocate in pharma marketing.

First, the Long Tail. The Long Tail, as defined by Wikipedia, is a description of the business models of Amazon or Netflix, where, rather than attempting to sell a zillion copies of a hit book or CD, they have the ability to sell smaller quantities of millions of things to niche buyers. The distribution and inventory costs of those business allow them to realize significant profit out of selling small volumes of hard-to-find items to many customers, instead of only selling large volumes of a reduced number of popular items. It was described in a very influential book by Chris Anderson.

A picture helps. The Long Tail looks like this:

On the far left side of the graph, imagine that you have the sales income from patients who see some kind of DTC ad, and promptly run into their doctors' office and insist on it. Say, you launch a drug with a big, heavily-funded DTC campaign, and you get an immediate, enormous response. The drug is a blockbuster, and you have the initial, left-side-of-the-curve revenue from a phenomenally successful acquisition campaign. Great.

However, there's another way to look at it, and that is what Kelly does. In his post, he writes about creators -- artists, writers, craftspersons or whatever. And he says this (I'm going to edit it somewhat):

Other than aim for a blockbuster hit, what can an artist do to escape the long tail?

One solution is to find 1,000 True Fans. While some artists have discovered this path without calling it that, I think it is worth trying to formalize. The gist of 1,000 True Fans can be stated simply:

A creator, such as an artist, musician, photographer, craftsperson, performer, animator, designer, videomaker, or author - in other words, anyone producing works of art - needs to acquire only 1,000 True Fans to make a living.

A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name. They bookmark the eBay page where your out-of-print editions show up. They come to your openings. They have you sign their copies. They buy the t-shirt, and the mug, and the hat. They can't wait till you issue your next work. They are true fans.

To raise your sales out of the flatline of the long tail you need to connect with your True Fans directly.  Another way to state this is, you need to convert a thousand Lesser Fans into a thousand True Fans.

This is an almost letter-perfect description of an Advocate.  And although you need a LOT more than 1,000 of them to  make a drug profitable, the purpose of relationship marketing in pharmaceuticals is to identify Advocates, and to connect with them. Just as the True Fan will purchase anything an artist puts out, an Advocate will share with others her story of success with your drug. The value of this is beyond measure.

We are not talking here about using DTC to push drugs into the channel. We're talking instead about using True Fans of your drug to help others achieve the same result. Think of the diabetes patient who's on a therapy long-term, and who uses a combination of diet, exercise, and medication to get her numbers down and keep them down. By connecting with her, your brand can show her how to help others do the same thing.