Sounds of Inevitability, Redux

Let’s quote some more movies.

Tallship
In Peter Weir’s terrific film, Master and Commander: The Far Side of The World, the opening scene is a British warship circa 1790 that’s in heavy fog, pursuing an unseen enemy. Nobody’s sure if the enemy’s really there until, far in the distance, the captain sees a faint orange flash. He has about one second to scream out "Down! All hands down!" before a hail of cannon fire reduces the ship to splinters and kills half the crew.

I may have just seen the flash.

In a post on Media Buyer Planet, a website for, duh, media planners, a post on March 19th revealed that General Motors has publicly committed to spend half of its advertising budget to "digital and one-to-one" advertising over the next three years. That alone is interesting.

It’s even more interesting when you consider that GM is the third-largest advertiser in the country, according to Advertising Age. second only to Proctor & Gamble & AT&T. To put that into even more perspective, GM spent 3.296 billion in advertising in 2006. Doing a little primitive math, that works out to about:

  • $9 million a day
  • $376,000 an hour
  • $6,270 a minute
  • Or, about a hundred dollars a second.

This is all happening in a marketing environment where, according to the Wall Street Journal, ad agencies in general are cutting expenses and tightening belts in anticipation of a general ad spending slowdown.

It’s one thing to throw your support behind a new or different marketing model when the rising tide, if you’ll pardon the metaphor, is lifting all boats. It’s quite another when the economy is heading into a recession, when you’re one of the true eight-hundred-pound gorillas of consumer advertising, and when your industry (i.e., the US automotive sector) is taking a real beating. And under such circumstances, for General Motors to openly make a big bet on relationship marketing is a validation, we think, in the automotive marketplace of what we know works in pharma: relationships.

And if you disagree, well, you may want to hit the deck. Something’s coming.

Patients like you: transparency and the market

Okay, back from a week’s vacation in Big Sur California. It was great to have some time to clear the head, relax and think in an open way what is going on in this industry.

When I see patientslikeme.com come to life, I see a trend starting to reveal itself. The trend is one of personal self-responsibility. Most of the evidence is, of course, anecdotal, but I believe this trend is being driven by the combination of aging Boomers having pangs of guilt about their self-centered ways, combined with the force of legislation like Health Savings Accounts which are forcing them to make their own health care decisions. This legislative and societal shift indicates to me that the age of true healtcare responsibility is nearing.

The big tipping point will be next year’s debate on universal health care. It will be ugly, protracted and exhausting. A lot of sacred cows will be butchered. And for our world of RM, DTC, print, TV, online — all of it will be put under scrutiny. But the fact is, to control costs, people DO have to take responsibility for their own health. Too many people in this country are simply squandering it through bad compliance or being convinced only a brand name drug will gave the effect they need -never the generic. 

This responsibility is a two-way street. Transparency in information and costs is the missing component for now, but not after the health debate is done. There will be transparency. The government will not want to give people more control without expanding what they have control over. So rest assured there will be an element of "you get to shop" put into the next round of insurance reforms. Electronic Health Records will become the norm. Hospitals posting costs of equipment and surgeries online will become the norm.

We, as marketers need to plan for this time. Transparency is a strategy, not a punishment. We need to think for our clients and brands how about best to tap into transparency, because it is one of the hallmarks of building trust, which is the Great Divide between patients and their medications. We will need to learn how to write, conceive, get regulatory approval, and deliver communications that champion transparency — we should use it!  Because in the end, transparency may help in the solution to the horrors of non-compliance. If you are open with the patient, the patient will be better informed and empowered to make the purchase and re-purchase.

Patientslikeme.com is an incredible innovation. Of the 50 things occurring on the site, the one’s that really driving everything else is transparency at work among patients. Today, a website. Tomorrow, the world.   

Patientslikeme.com: The Sound of Inevitability

AGENT SMITH: Do you hear that, Mr. Anderson?
Agent Smith grabs Neo in a choke-hold, forcing him to look down the tracks, the train's headlight burning a
hole in the darkness.
AGENT SMITH: That is the sound of inevitability.

From the film The Matrix

Yesterday, in The New York Times Magazine, there was a story about a new web site called Patientslikeme.com. The story, which may require registration to read, is here. When reading it, you should mentally accompany it with the sound of inevitability, whatever you deem that to be. A relevant excerpt:

Tere are a little more than 7,000 Todd Smalls at PatientsLikeMe, congregating around diseases like Parkinson’s, multiple sclerosis (M.S.) and AIDS,
all of them contributing their experiences and tweaking their
treatments. At first glance, the Web site looks like just any other
online community, a kind of MySpace
for the afflicted. Members have user names, post pictures of themselves
and post updates and encouragements. As such, it’s related to the chat
rooms and online communities that have inhabited the Internet for more
than a decade.

Doctor
But PatientsLikeMe seeks to go a mile deeper than
health-information sites like WebMD or online support groups like Daily
Strength. The members of PatientsLikeMe don’t just share their
experiences anecdotally; they quantify them, breaking down their
symptoms and treatments into hard data. They note what hurts, where and
for how long. They list their drugs and dosages and score how well they
alleviate their symptoms. All this gets compiled over time, aggregated
and crunched into tidy bar graphs and progress curves by the software
behind the site. And it’s all open for comparison and analysis. By
telling so much, the members of PatientsLikeMe are creating a rich
database of disease treatment and patient experience.

At almost the exact same time, in his blog, Sandeep Jauhar writes a long, thoughtful post about the looming shortage of physicians in this country.

In the face of an increasingly burdened healthcare system, one in which primary care physicians have less and less time to spend with patients, patients are beginning to take matters into their own hands. They are connecting with one another, and working together to help themselves better manage conditions that the system is not doing a particularly good job with.

Patientslikeme.com is just the beginning. Marketing, including relationship marketing, ultimately is only effective when it mirrors, or leverages, a bigger trend. This is one of them. A fundamental shift seems to be underway in how patients manage their diseases. And, thankfully, we are right in the middle of it.

 


	

Service Is The Most Ignored Form of Efficacy II

We have posted previously about how pharma companies need to begin to understand the importance of servicing their patients. Well, in today’s Wall Street Journal Health blog, Walgreen’s seems to have gone one better at this, by making an acquisition that enables them to begin putting healthcare centers in the workplace. This merits a closer look.

Here’s the relevant part of the story:

Walgreen execs said yesterday that the company’s buying a shop called I-trax for about $260 million and another company called Whole Health Management for an undisclosed amount, the WSJ reports.

After the deal goes through, Walgreen will have more than 500 health
centers, including both its existing retail clinics and the on-site
health centers its buying, the WSJ says. I-trax provides worksite
health services for more than 160 employers, including familiar names
such as Lowe’s and Toyota. Whole Health Management has work site
centers for Continental Airlines and Sprint Nextel Corp., among others.

From an RM perspective, this is fascinating. Given how new this model is, there’s more than a little speculation in thinking about it, but the implications of this could be enormous.

Pouring_pills
First, it removes many of the compliance barriers that might otherwise keep a patient from simply renewing a prescription or seeking medical advice. When, literally, there is a physician and a pharmacy right down the hall, any systemic friction that inhibits engagement with the healthcare system is substantially decreased.

Second, it also significantly rearranges the channel structure of pharma marketing. The current, classic system in which a patient receives a prescription from a physician then purchases drugs at a pharmacy is a manufacturer to agent to retailer to consumer pipeline, with the physician essentially acting as the agent. In this case, if the physician and the retailer are on in the same, the channel structure changes into a simple manufacturer to retailer to customer.

Thid, and perhaps most interestingly of all, this innovation vastly increases the scope that Walgreen’s has to work more closely with pharma companies to create and maintain patient relationships. Because Walgreen’s represents many different pharma companies, they become, in some respects, the arbiters of the relationship — they have the opportunity to be the gatekeeper for a lot of patients, and if the physician is now in-house, in a much more comprehensive way than they ever have before. Ideally, this will lead to far better service and accessibility to healthcare, which will, in turn, enhance efficacy.

This has already happened in a lot of consumer markets. The same network of companies that helps you take care of your lawn (TruGreen) will help you with home repairs (Servicemaster), cleaning (Merry Maids) and so on. Enterprise Rent-a-Car will pick you up and deliver. Virgin airlines offers limo service to the airport. This is a version of that. It will be interesting to see how this all develops.

REALLY interesting.

Internal Noise and Relationship Marketing

Explaining to traditional pharma marketers what relationship marketing is and how it works is tricky sometimes. In a post yesterday entitled "That Noise Inside My Head" Seth Godin provides a really nice metaphor for explaining RM.

Static

Godin poses the simple, yet difficult, question: "Why don’t people do what they know they should?" In other words, and I’m going to quote Godin here:

Why do people struggling for an income end up using an
expensive check cashing service when the bank right next door will let
them have a checking account for free?

  • Why do students spend an hour fighting about their homework instead of ten minutes just doing it?
  • Why do customers fall for slick come ons or fancy financing instead of buying what’s best for them?
  • Why is it so easy to fool voters with patently false accusations?
  • Why do some people turn a routine traffic stop into a life-endangering argument with the cop?
  • Why can’t worthy charities (with dreary stories) raise more money than they do?

The answer, according to Godin, is an internal " noise that keeps them from being rational, that forces them to
avoid the simple truths sometimes, that makes them unable to take a
shortcut when a long (more emotional one) is available."

Bingo. If patients listened to their physicians, did precisely what the physician told them, including staying on their prescriptions, utilizing all the additional or secondary techniques to support them (i.e., exercising regularly to help combat depression) and in general, uniformly acted like model patients, there’d be no need for RM.

But here in the real world, they don’t. Patients are complex, differ radically from one another, and are subject to a wide range of influences, some of which are good for them and some of which are distracting, wrong, or downright destructive. And this emotional space is the field we play in.

RM is about realizing how patients actually think, feel and act, and responding to it in a way that helps them manage their condition better. Rather than ignoring the white noise, as traditional pharma marketing is sometimes wont to do, we acknowledge it, and strive to create marketing programs based on how patients truly are, rather than how they should be.

Which is why it works.

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.

Ship
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:

Longtail 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.