This blog post is the first in a three-part series on why biopharmaceutical companies should develop and implement an international customer segmentation and targeting strategy, what it takes to get started, and how one company has found success.
With high shareholder expectations, biopharmaceutical companies must focus on customer experience through stronger international customer segmentation and targeting in order to deliver sustainable competitive advantage. The problem? These companies compete amid complex markets and organizational tensions that can hold back commercial transformation.
To help overcome these hurdles, it’s critical that biopharmaceutical companies understand today’s complex environment. Perhaps the greatest shift has been the continuing evolution of the healthcare decision maker. Now, many stakeholders—primary care physicians, specialists, key opinion leaders, treatment teams and healthcare systems—can be considered “customers,” prompting companies to adapt their engagement approach to meet the varied and evolving needs of these customers.
Moreover, as B-to-C companies continue to improve the customer experience, B-to-B and healthcare organizations are expected to deliver better experiences, too. Customers expect that your service will be smart and tailored to them because that’s what they experience elsewhere.
Also complicating the biopharmaceutical customer engagement process is the decreasing accessibility of physicians and other key decision makers, which is leading commercial organizations to look beyond in-person communications in an effort to connect with healthcare providers. According to ZS’s AccessMonitor™ survey, 56% of physicians have restricted access to sales reps in 2016 compared to 33% who did so in 2008.
Developing Lasting Customer Value
To overcome these challenges and remain competitive in the global marketplace, companies need to focus on creating high-value, long-term relationships with key healthcare decision makers by delivering an outstanding customer experience. Doing so requires three elements: The right data to understand customers’ potential and preferences (segmentation); the right channels allocated to the right customers at the right time (targeting); and an organizational design that encourages high performance from sales teams (organizational alignment).
When these three elements happen in harmony, with the correct balance of pull and push marketing tactics, it’s possible to create a customer experience that underscores a lifetime partnership with healthcare providers. But designing an international customer engagement strategy and developing the necessary capabilities to execute it is far from easy.
Many customer engagement strategies fail to deliver on expectations when members of the leadership team—and, as a result, the entire organization—aren’t committed to the change. Companies today also are under tremendous pressure to reduce cost and gain efficiencies, even while budgets for doing so come under increased scrutiny and demands for faster ROI.
The International View
Against this backdrop, companies looking to design a global strategy must resolve four key points of tension:
1. Local control versus a central approach: Countries and teams have diverse sales planning practices that global organizations address in different ways along a continuum of control, ranging from fragmented to centralized. On the fragmented—or local—side, country autonomy reigns, local approaches and software solutions prevail and manual processes dominate. This model makes it difficult to share and drive best practices across countries, but it does provide full flexibility for the countries to fully adapt the approach to the conditions on the ground. With a centralized, one-size-fits-all approach, the company drives cost savings and process efficiencies quickly throughout the organization, but this can limit the ability for countries to tailor the approach at the local level. In between these two extremes lies harmonization, where local offices can choose from a menu of choices offered by the central office.
Most companies are trying to move away from fragmented sales planning processes across countries, focusing on increased centralization but grappling with a primary question: How can we harmonize sales and marketing efforts efficiently across channels and countries while also accounting for the varying needs and preferences across markets and customers?
2. Brand-centric versus customer-centric experiences: Another major source of tension is between marketing experiences that are brand-focused versus experiences that are customer-focused. In an oncology setting, a brand-centric experience is likely to be a poor one for individual customers. Oftentimes, brand teams operate in siloes, and the customer encounters several different experiences as a result. Designing instead around a holistic, customer-first marketing approach creates much-improved, better-aligned experiences but can dilute the power of the brand. Global segmentation and targeting must resolve whether, where, and by how much to integrate branded experiences into a customer-centric approach.
3. Static versus dynamic action plans: Field reps run on action plans but also can feel held back by them. If that plan is static—locked into three-, six- or 12-month segments where changes to the plan are not allowed—the rep may be less responsive to changing customer needs. A dynamic, flexible plan moving toward “segments of one” allows reps the freedom to adapt customer plans based on current conditions. For the sales manager and commercial excellence, however, a dynamic action plan might make it more difficult to manage the rep’s performance unless the rest of the organizational processes are aligned. With its moving targets, a dynamic action plan complicates the end-to-end planning process and changes how segmentation, targeting and alignment are handled. Different countries and companies have different preferences with respect to how much agility and rep engagement should be supported.
4. Customer information versus legal risk: Delivering great customer experiences depends on leveraging customer data, but gathering and using such data requires endorsement from the legal and compliance team due to varying legal constraints from market to market. Many companies take a simplifying but conservative perspective on the legal risk: No customer information that is free text, such as client notes, can be stored in the CRM system. This creates a tension with the mindset that leveraging customer data is a source of competitive advantage. Organizations need to consider how to capture the right information in a compliant way. Without the right data, you won’t be able to deliver a differentiating and engaging customer experience.
The Time Is Now
Enabling an international customer segmentation and targeting strategy—and using it to improve the customer experience—is a potential differentiator for biopharmaceutical companies that are beginning to navigate the complex global market. Now is the time to get started: Companies are investing in new commercial models and digital channels, and those that do it right will create a source of continuing competitive advantage.
The challenges to get there are formidable but achievable. In our next blog in this series, we’ll offer best practices for building and implementing your global strategy.