In the Pharmaceutical Industry the customer value proposition traditionally is a complex path to understand, being constantly changing with different assumptions, where unprepared business models can struggle to identify not only those changes as well future patterns and gain effective competitive advantage in a challenging industry. The traditional Pharma Commercial Share-of-Voice driven approach, was mainly focused on the entire market where the traditional promotional pressure was mainly sales force driven. Although currently we’re seeing more the transformation, of not only the Commercial Excellence models and Frameworks, as well specific processes that are getting more critical than ever. An example of that are processes like Segmentation and Targeting, that requires a more holistic and coordinated approach to address the market in a fully alignment with the product strategy and selectively focusing on patient/physician segment,s supported by the clinical data, preferences and innovative promotional requirements by the market.
Targeting the right customers for concrete purposes is part of a mandatory Multichannel/Digital/Marketing & Sales Effectiveness plan, which requires the sales force not only to become more effective as well key influencers in the market dynamics and masters in customer engagement initiatives, in order to be able to retain, attract and nurture customers across all meaningful touch points driving product loyalty and advocacy.
Pharma has now reached a tipping point in terms of allowing some of the Commercial Excellence operations to receive inputs from Digital, Big Data or Artificial Intelligence, partnering with Data Science to obtain the best results as possible, with efficiency and speed and being able to implement to the running models technical capabilities to process large volumes of data, connecting all the dots to extract and map all trends as possible and bring more agility and speed to the processes with agility and robustness.
These changes and bringing of new processes and technology requires not only an appraisal of what the industry knows about segmentation and targeting models as well, the entirely review of the segmentation and targeting area as part of a holistic new marketing and commercial paradigm, where Agility and are key concepts and critical strategy requirements.
Segmentation is a mass market split that includes all individuals into different groups/segments of customers with distinct characteristics (e.g. behavior, goals, and attitudes), needs and potential.
What makes a Segmentation exercise complex in Pharma is the unclear perception of the customer behaviors, decisions and actions, where the market outcomes are rarely visible or agreed between different roles of the company (e.g. Marketing, Commercial, Medical or Market Access).
Integrating part of Segmentation components is Targeting: that allows the selection of which segment of the customers a company wants to market the products; if by Therapeutic Area or Business unit.
After knowing which Target better answer our strategic goals, we need to decide if our efforts and commitment should focus on the most potentially profitable, largest, less competitive or reachable segment cluster, where the Targeting exercise can be more effective once a concrete number of customers (e.g. physicians, pharmacies, patient groups, etc.) archetypes is properly defined and communicated to the entire organization for transparency and responsibility.
A Pharmaceutical manufacturer then decides the best commercial strategy to deliver Key Messages and product benefits based on the Brand Plan story-telling and Patient Journeys to a segment of customers. Those segments can be based for example, on the Physicians Specialty, prescription area, Product adoption/loyalty, Economic value, preferences, behavior profile or Market Potential.
Typically a Segmentation and Targeting strategy happens after the Commercial Excellence team is able already to understand what kind of intelligence processes or tools about competitors, tenders, available market and market specificities. Happen as well after the situation analysis, tactics and solid definition of the brand value are in-place, where knowing the Disease pathways, competitive landscape, payers mapping and strategic imperatives are key parts of a strong and solid pre-S&T work.
Therefore a Segmentation and Targeting Model should not only be Agile and properly managed with sustainable and continuous processes as well connecting critical add-ons like Digital, Artificial Intelligence, Data Science or Big Data to enable efficacy and execution power to the ongoing operations. In the Figure presented in this post “Pharma Segmentation and Targeting – Critical Success Factors” we’re able to see all critical connections/success factors that strongly enables not only simplicity and Agility as well control and monitoring to a typical Segmentation and Targeting model.
We cannot forget how important the Brand plans are for any S&T model where the strategy, messaging, content should always be part of all operations involving segmentation, profiling or targeting of HCPs, Accounts, Product Decision Makers and many others.
Most of the companies still spend time in debating (internally or externally) outdated questions like: How much variables the S&T algorithms should have and How much Digital exposure should they have, where the critical question should instead rely in the agility and effectiveness of the S&T model and Which Critical Success Factors are applicable to our company culture and business strategy.
A Segmentation and Targeting model will always be different for the type of products we have in Pharma. For example, a big pharma company can have extensive portfolios, where distinct type of products (OTC, Primary Care and/or Specialty Care) can represent a tuff reality for the Commercial and Marketing teams. Then we can have another set of small-medium size companies (Pharma or Biotech or Medical Devices) with products for rare diseases, specific niche market drugs or devices, biological products (e.g. vaccines or blood components) or even Biosimilar. And both type of companies (Big or Small-Medium) are astonishing different in terms of S&T models usage and applicability.
The model always need to interpret the Product Lifecycle, Central/Local Commercial strategies, Internal or External environment, customers accessibility, product pricing and available channels.
Then having a sustainable process agility and control to adapt the Product messaging to specific Segments under the same S&T strategy can be a key factor for effective execution of the model. S&T agility is key for dealing with rapid technological and business changes and gain significant improvements in quality and service operations.
An agile S&T model is a fast moving, adaptable and robust partner for any engagement ecosystem to effectively understand our target profiles, effectively plan the customer journey and deliver a consistent messaging plan where it’s crucial to understand the different approaches and commercial techniques for the different target groups (e.g. hospital, pharmacies, patient, payers, non-clinical decision makers, etc.). Agility should also be able to incorporate the market feedback into the running model and proceed with changes, audits and re-definitions. Currently some companies are already performing those validations by using Artificial Intelligence and process reengineering and then proceeding with an effective re-definition of the sales approach by the different segment (e.g. re-entry, expansion, market share defensive mode, maintain).
It’s not so important how many dimensions and channels can work for a specific S&T Model, is more critical to understand which of those dimensions and channels are applicable for our segments with combinations of the products, strategy, brand plan and accessibility, knowing exactly that efficiency is in the ability to deliver tailored and coordinated messaging and communications to our customer and overall market.