The forecasting model for the pharmaceutical industry is now useless, thanks to several changes over the last decade or so. Drug launches will remain, but the big, Viagra-style blockbusters and their predictable surges in demand are long gone.
A recent McKinsey report, as chronicled in Forbes, made this case as cogently as anyone. What it didn't do, however, was let readers know what they ought to be doing about it. Generally, it advised focusing on "opportunities where the potential upside dwarfs the potential downside," and placing "many small bets." While there's no arguing with the basic probability assumptions in that advice, there's not all that much pharmaceutical marketers can do with it, either.
So here's a common-sense step toward improving the odds of sales success in this new reality that all drug marketers ought to be taking, yet few are: Invest in your corporate brand. A strong corporate brand can improve the odds of a given launch's success by trading on its brand equity and credibility.
When strong corporate brands are at their best, the ability to successfully launch new products and attain long-term growth greatly improves. More and more, customers are interested in who-and-how a product is manufactured over what it's designed for.
There are 5 key benefits of a corporate brand that are specifically applicable to today's’ evolving pharmaceutical industry:
1. A strong
corporate brand helps find differentiation via the organizational associations. While products and services tend to become similar over time, organizations are inevitably very different. Customers may
be more comfortable with one organization over another, particularly if the products are similar. You need to identify those organizational characteristics and make them relevant to customers.
2. A strong corporate brand can draw on organizational programs that provide energy to product brands. Citizenship programs and major sponsorships will usually span the organization, and thus the corporate brand is in a much better position to exploit these over product brands.
3. Corporate brand associations provide credibility. Attitude research in psychology has shown that "believability" and persuasive power is enhanced when a spokesperson is perceived as being trustworthy, well-liked and expert. These same characteristics are relevant when evaluating whether a claim made by an organization is credible. A trustworthy organization will be given the benefit of the doubt, an organization will be liked because of its citizenship activities, and an expert organization will be seen as especially competent in making and selling its products. Trust is a particularly important attribute, and it is easier to develop for an organization than for a product.
4. Leveraging the corporate brand across products and markets makes brand management easier and more effective. Off-brand programs and initiatives become more visible when the corporate brand is leveraged across the organization.
5. A strong corporate brand fosters true partnerships with its customers. It can play a key role in articulating these elements to employees, distributors and others who must buy into the goals and values of the corporate brand and represent them to the customers. In the case of product brands, there is no such supporting system.
A model built around corporate brand strength is one that is time tested in many other, very different categories from pharmaceuticals – and there are lessons to be learned. Consider how Kellogg's logo gives any product bearing it instant credibility at the breakfast table.
GSK and Pfizer, for example, will no doubt recognize the similar strategic tack taken by General Electric's GE Healthcare, which shows up as one highly credible brand to both healthcare organizations and providers, even though the products it offers those two groups are quite distinct.
This is what the future of pharmaceutical marketing looks like. In fact, it's already underway. In January, Abbott Labs spun off AbbVie, a distinct corporate brand with a focus on patient-centric innovation.
AbbVie is using its corporate brand to communicate how it is "addressing serious health issues" in healthcare. It is investing in being experts and partners in the most challenging areas of healthcare such as the hepatitis C virus, oncology, and renal disease. No longer will AbbVie be marketing itself around a pipeline of drugs but rather as a partner in addressing serious therapeutic areas in healthcare.
There's no longer a debate about the new realities facing drug makers and the futility of forecasting within it. But strong corporate brands will go a long way toward helping companies manage a challenging landscape.