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Do we understand our customers well enough?

  • By cognite
  • 22nd July 2019
  • Hits: 505

McKinsey and others suggest that up to two thirds of new pharma brands fail to reach their first year’s targets and about half of those that do meet their goals fail to do so subsequently. These are damning statistics, although consumer launches are no better. Relative failings in the product, pricing or marketing may all be implicated. More detailed reasons may include

  • Strategy: Insufficient understanding of market situation and/or competitive situation leading to inadequate market shaping and/or positioning
  • Clinical data: Poor data or poor use of data, including overestimation of what data can do, leading to complacency and poor marketing
  • Agility: Inability to react fast enough to the reception of the approach by customers and reaction of competitors to combat it
  • Targeting: Failure to use the wealth of customer data available to accurately define who target customers should be and understand their behaviour and attitudes 
  • Service: Not doing enough to make it easy for prescribers and patients to switch and use the product properly
  • Advocacy:Insufficient advocacy from opinion leaders and/or target customers
  • Communications: Failure to create a compelling story and deliver it via the right channels and media
  • Short termism: Inability to maintain interest and engagement once the launch phase is over, reasons ranging from lack of follow up new clinical data and RWE to fresh marketing ideas. Successful brands are built over the long term
  • Self-belief: Lack of focus on internal communications and the need to inspire the whole organisation to buy in to the vision and plans to achieve it. The required passion and commitment are absent!

Overall, whether the supposed fault is in medical, market access or marketing, the failure rate suggests that there is too often insufficient ability to differentiate the brand in a meaningful way for customers. In a market where budgets are not infinite, payers and prescribers do not always see the value at the price being asked. Is that inevitable because of the cost of producing breakthroughs for smaller patient populations or is it also because understanding of customers still lags behind understanding of the product?

Certainly, all but one of the reasons for failure listed above could be attributed to sub-optimal customer orientation. This includes flawed insight and strategic know-how as well as slow response to change. In turn, this may reflect overconfidence in the product and marketing skill, a lack of launch experience and organisation or misplaced reliance on superficial market research. All of these may mask the scale of the challenge but only serve to remind us that the holy grail of marketing is to meet customer needs. Whichever way you look at it, failure to do so carries a heavy penalty!