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KMK Value Based Medicine

Sales Force Effectiveness

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Delivering Customer Value
Accelerating Brand Performance in an Era of Value-based Medicine

Delivering exceptional customer value to drive superior customer engagement.
Delivering exceptional customer value – we hear about it every day within the circles of sales and marketing, but what does it really mean? Why is it important, and in the end, does it really matter? Clearly, questioning if value matters is a bit “tongue in cheek”. Intuitively, we can probably all agree that delivering value to our customers is certainly the right thing to do. It builds customer loyalty, deepens customer relationships, and ultimately, builds brand equity.
The focus of this paper is on the frontline healthcare provider – the Healthcare Practitioner (HCP). Understanding what influences an HCP’s decisions is critical to creating effective sales and marketing tactics which drive behavior.

To this day, the single largest commercial investment for a pharmaceutical company continues to be the field force organization, where reps spend the majority of their time promoting brands to HCPs. Clearly, the HCP plays a critical role in not only diagnosing, but also selecting the appropriate treatment for the disease state. Therefore, it makes sense to not only better understand the value levers most important to this audience, but how pharmaceutical commercial organizations can adapt to deliver value to these stakeholders in order to drive superior customer engagement. Whether it is the sales rep call or a particular marketing tactic, companies reach the HCP in a number of distinct ways. It is therefore imperative that these “touch points” offer value to the HCP and ultimately, to their patients.


What is customer value and what does it look like?
Customer value comes in all shapes and sizes, and is certainly not found in the abundance of Big Data assets that drive the majority of our commercial decisions today. Value after all, is a perception, and perceptions are gathered through primary market intelligence, not through the vast medical or pharmacy claims datasets or EM R platforms that permeate the industry. Value also has different meanings to different stakeholders. Think about the vehicle or mode of transportation we use. What I may consider to be of value because of the advanced safety features my car possesses, may be totally different than what you deem to be of value, you being more focused on gas mileage and lower out-of-pocket costs in vehicle maintenance. Others living in urban areas may find the need to even own a car an unnecessary expense and rely solely on public transportation, thus their point of view on vehicle value is dramatically different than ours.

These perceptions around value are certainly no different in the world of healthcare delivery where there are a myriad of stakeholders, all possessing varying needs and points of view around what constitutes value. From patients to healthcare practitioners, payers, pharmacists and health systems – all are critical customers in the evolution of healthcare delivery. Yet, all will have varying degrees of how they define customer value. Even two practitioners within the same practice will likely have differing viewpoints on what is deemed of value to them, and which companies they associate with best supporting their needs.

If I can focus my reps on 3-5 key things to consider while engaging with an HCP beyond the features and benefits of the product, we are in a better position to develop a lasting and more impactful relationship with that HCP. This translates into improving our probability of success with that HCP long-term

Why does delivering customer value really matter in the world of pharmaceuticals?
Delivering value accelerates brand adoption, uptake and market share performance when exceptional value is being delivered. In addition, customer centric organizations are 60% more profitable than non-customer focused organizations (Deloitte and Touche). Studies consistently demonstrate that HCPs are more brand loyal to those companies delivering superior customer engagement and value. This is even more prevalent in markets where there is little to no therapeutic differentiation across brands. How is this possible? Essentially, customers have unique perceptions around what is important to them. It could be the support of patient assistance programs, the availability of samples for a new therapy, the frequency in which they see a sales rep, or access to a Medical Science Liaison to gain a more objective viewpoint on a topic. The list is virtually endless. Vet, these tactics can be quantified and prioritized through proper market research design and advanced analytics ..
Understanding the value metrics most important to a HCP is the critical first step, and this is captured through large, quantitative primary research. The end result is a prioritized list of sales rep competencies and behaviors along with marketing-led support activities.

MARKETING ENGAGEMENT VALUE METRICS
Stated Preference vs. Share Contribution Seven Marketing Activities exhibited a high Preference and Market Share Contribution. Patient Assistance Programs (co-pay cards/vouchers) were a Leading Marketing Engagement Activity

To accomplish this, we evaluated dozens of support services and rep competencies over the years through thousands of HCP surveys, resulting in the identification of approximately 75 Sales Rep “winning competencies” and 75 Marketing Engagement activities that HCPs routinely cite as being important to them. Such information can be used in data analysis where perceptions of customer value gathered through primary research are tied to HCP-level Rx information to understand the drivers of delivering value on market share performance. Of course, the list will vary slightly in prioritization relative to the disease state and target audience being studied.

Such analysis enables pharmaceutical companies to fine-tune their sales training efforts to include areas well beyond the product features and benefits. The analysis encompasses sales rep competencies and behaviors that are important to the HCP in terms of what they want to see from a rep and how they can best engage with the HCP and office staff. Additionally, the sales rep attributes and marketing engagement activities can be prioritized in terms of their market share contribution. This offers a major competitive advantage to those companies looking for such an edge in a very competitive commercial landscape, where rep access is increasingly more limited, and product differentiation is often minimal. As one pharmaceutical commercial leader cited, “If I can focus my reps on 3-5 key things to consider while engaging with an HCP beyond the features and benefits of the product, we are in a better position to develop a lasting and more impactful relationship with that HCP. This translates into improving our probability of success with that HCP long-term.” It also directly translates to accelerating brand uptake and market share performance for the brand.

A Case Study on Delivering Value
A recent client engagement evaluated the impact a pharmaceutical commercial organization was having on delivering value across rep competencies & marketing engagement activities. The internal perception at the company was that it was doing an excellent job of delivering value across all of the leading value metrics. Yet, its market share and TRx volume was lagging and not meeting expectations. Following the quantitative research to capture customer perceptions and applying a proprietary linear regression model where over 900 HCPs from the client’s call list responded to the study, the results were very clear.

Despite an internal home office perception that the company was very well-perceived among its target audience, the company did not rank number one across any of the value metrics, and in most cases was deemed to be “at parity” with the number two company in this space. In other words, it was tied for second place and not even remotely close to being the number one company in terms of delivering exceptional value and customer support. Again, this is feedback coming from nearly 7,000 respondents!
Following the first wave of research, the company made a concerted effort to improve its perception among its target audience. They modified internal training efforts to incorporate more time around “how to sell” in the office setting, and prioritized marketing tactics based on the market share contribution of the engagement activities derived from the proprietary model. After three waves of research (about 72 months), the company made significant inroads among the top vaIue drivers. They “owned” 8 of the top 15 Sales Rep competencies, and 5 of the top 15 Marketing Engagement activities.

Value Rx- Wave 3

The critical finding was where they achieved “ownership” among these value drivers and the resultant impact on market share performance. Among the one-third of HCPs that rated the company as number one across selected value metrics (i.e., they had “ownership” on these metrics), brand market share performance was significantly higher. While they achieved a 9% market share overall for the brand among all target HCPs (up from a 7% share a year earlier), its market share grew to 27% among HCPs where the company was delivering exceptional customer value and engagement, more than doubling its market share performance. The result? Delivering superior customer value on the value metrics that matter most had a significant, positive impact on market share performance.

What is the lesson here? First and foremost, don’t assume you are performing as well as you think without capturing routine customer feedback. This is a constant challenge among commercial organizations. Many organizations believe they are delivering leading-edge sales and marketing tactics. Why? Because the vendors that are hired for such engagements tell us so! There needs to be an objective, third-party oversight that captures routine customer feedback and benchmarks this feedback against key competitors in the therapeutic class. For example, we may achieve a 9 out of 70 customer satisfaction score for a particular marketing tactic and think we are doing everything perfectly fine. However, if our competition scores a 9.5 out of 70, are we really doing as well as we should? Rather than analyzing your own activities in a silo, developing a performance scorecard that incorporates competitive benchmarks is critical to understanding how you truly stack up in the eyes of your customers.


What? So What? Now What?
So what does it all mean? First, don’t assume you understand HCP needs without asking them first. A pharmaceutical sales rep’s job is far more complex than delivering the 2-3 core selling messages within the average 5-7 minute sales call. It is being respectful of the HCP’s time and office staff, being objective in the discussions and delivering empirically-based supporting evidence. It is also showing genuine care for patients and demonstrating how your company and its marketing support programs genuinely care for the patient. It is acting in a professional demeanor, and engaging in a two-way dialogue. It is also supporting the entire office, not just the target HCP.
In addition, don’t assume you think you are doing everything better than the competition. Pharmaceutical commercial organizations tend to operate in silos. Capturing a customer’s viewpoint on what is of value, and which companies do the best job in delivering value across these dimensions will only help to drive more effective customer engagement in the future. Establishing an objective performance scorecard and monitoring your performance over time across these KPls will put your organization in the best position possible to identify any critical gaps in performance and how to best narrow these gaps.

Finally, an effective performance dashboard centered on value metrics incorporates a customer’s perspective that is appealing to both Sales AND Marketing. There is no reason for commercial organizations to continue to operate in silos when the same customer is likely the target for both rep-based and marketing led activities. We have ATUs, Message Recall studies, and a slew of other platforms that tell us the “what”, but cannot get us to the “now what”. Drawing upon the right tools and taking that next step are critical in delivering insights into the diagnosis of the business problem, as well as recommending a strategic course of action based on empirically-derived information.

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