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Ed McCarthy is the director of customer value creation for Newtown, PA-based Quantum Learning Inc. He can be reached at (800) 516-4845, or visit Quantum online at www.quantumresults.com.
What to focus on when it comes down to you.
In the pharmaceutical world, there's nothing quite like a product launch meeting. Teams of people âÂ from marketing, sales, sales training and elsewhere âÂ work for months to try to create the right type of energy and excitement around the new product or new indication. Hundreds, if not thousands, of hotel and plane reservations are made. Speakers are booked and training sessions are reviewed ... and that's just the start.
By the time the representatives and managers arrive, nothing has been left to chance. The pulse-pounding music, the special effects and the speeches from the heavy-hitters are all designed with one end in mind: to fire up the sales force and equip salespeople with everything they need to deliver on the full potential of the product.
When all is said and done, it seems like the mission is accomplished. You're on the plane back home, swaying between exhilaration and exhaustion. In your mind, all that new information â the new PI, the new marketing pieces, the clinicals â and all the energy will settle in nicely by the time you get back in your territory.
But when you get back to work and start seeing your physicians, the memories of blaring music and light shows are quickly replaced by reality. As sales people you're faced with a gut check when it comes to launching a new product in this hyper-competitive marketplace. The success (or failure) of this product boils down to your ability to change physician prescribing behavior at the level of the individual practitioner, as well as your territory as a whole.
The average new pharmaceutical product costs $500 million to get to market. The ability to effectively launch new products is a key component of Wall Street's assessment of the market value of your company. Market analysts want tangible proof that your firm knows how to get beyond the so-called "early adopters" and into the hard-to-see mainstream physician community.
Traditionally, marketing teams have crafted sales messages and value points targeted directly at the needs of the early-adopter physician community. The assumption is that "leading-edge opinion leaders" will drive the rest of the physician community, so selling these thought leaders will be the difference between a successful launch and a flop.
In practice, however, the gap between early adopter and regular physician is substantial. The physicians that many of you call on are overwhelmed with too many patients, too much paperwork, too many call-backs and too much managed care. It's much easier and safer for these physicians to stick with what they already know than to take a chance with a new product â especially one whose safety profile has yet to be established. The basic strategy of the mainstream physician is simple: Wait and see.
The key is for sales representatives to target not only the leading-edge physicians who allow for a quick start to market share development, but also the more pragmatic and conservative doctors who truly make or break the long-term plans around a drug.
For the past few years, Fred Marshall, president and founder of Newtown, PA-based Quantum Learning Inc., has interviewed physicians across the country about the uptake of new products. Through his research, Marshall has seen that, despite the best efforts of marketing, sales and training, physicians are primarily concerned with the risk and cost of change, not necessarily the increase in efficacy or value of a new product or indication. High-efficacy products that entail a perceived increased risk to the patient and/or the practice are avoided.
In his research, Marshall asked physicians to rate the importance of certain factors in trying a new product (Figure 1). Time after time, focus groups comprised of primary care physicians ranked avoiding risk as the number one priority when making a decision regarding new products or indications. According to these same practitioners, the second priority was the hassle factor, or what Quantum calls the "cost of change."
When it comes to communicating with physicians, most pharmaceutical reps believe that if they show enough value, the physician will write their product despite the risk and cost of change. In fact, when Marshall surveyed physicians, their overall response confirmed this â representatives were spending in excess of 50% of their time during a sales call discussing the value propositions of their product. Most pharmaceutical reps calling on primary care physicians spend most of their time on the value of change â how fast the product works or how safe the side effect profile is (Figure 2).
In practice, this would be an effective strategy for a relatively small group of "early adopters." These physicians tend to pride themselves on using new products, and when it comes to patient care, they focus on the big outcome provided by the product's value. However, in reality, these physicians only make up between 12% and 15% of the marketplace for any new product and do not have the leverage to advance product usage through the rest of the market.
What's worse is that by their very nature, these early adopters will move on to the next "big thing" when it comes through the pipeline of your competitor. Nothing personal, mind you. But in order to stay competitive and stay on the cutting edge, these doctors will naturally migrate to a new product with proven outcomes.
Marshall's research took the next step and asked physicians what they focused on when they were presented with the opportunity to try a new product or new indication. The answer that 45% of the physicians gave was the risk of making a bad decision, with another 33% saying that the transition cost â time and energy needed to learn about the product and train their staff â was paramount in their decision.
According to Marshall, the message was clear: Representatives tend to spend a relatively small amount of time on risk reduction or transition cost management, and, in most cases, these factors are addressed only when the physician brings them up. In order to address the full spectrum of physician concerns, reps need to spend more time on strategies to reduce the risk and costs of change.
The bottom line is simple: Reps that focus on reducing the cost and risk of change in addition to promoting the value produce better results than reps that focus on value and answer the doctor's concerns only when the physician brings them up.
A closer look at this research reveals how the physician community adopts new products or indications. Segmenting the physician community by tolerance of risk and disruption is a more effective way to develop the full market potential of new products or indications than simply delivering the same value statements and core messages to the entire physician community. In essence, the willingness to tolerate risk, change and disruption is the primary factor in determining which physician is an early adopter, which is a "laggard" and which is somewhere in between.
The Technology Adoption Lifecycle is a framework that Geoffrey Moore made famous in his book, "Crossing the Chasm," and can be used to illustrate how and why different physicians try new products at different rates. This model serves as a depiction of a physician's willingness to tolerate risk and disruption and can be used to match the sales rep's communications strategy to the physician's willingness to manage the balance between the price of change, the risk of change and the value of change. Figure 3 shows the Technology Adoption Lifecycle and the key players at each phase.
As the market for a new product develops, physicians with very different psychographic profiles start using the product.
The first group to become involved is the so-called innovators, followed by the visionary physicians. Together, these two groups make up the early-adopter community. Generally speaking, the innovators are involved in Phase III and IV trials. They are technologically oriented and are associated with universities or research institutions. The visionaries are often specialists with a great deal of knowledge, technical expertise and confidence.
The third type of physician to try a new product is the pragmatist, which makes up between 35 and 40% of the total market. The fourth group is the conservative physicians, which also make up about 35 to 40% of the total market. Finally, the fifth type of physician to adopt is the laggard, which represents 10% to 12% of the total market.
When it comes to launching a new pharmaceutical product, reducing the risk and cost of change is more important than selling the value. Too often, we expect the physician to wade through hard data, read package inserts, do liver function tests, deal with patient call-backs and resolve conflicting claims among competing reps in order to achieve a modest increase in patient value. For the early-adopter community, these "disrupters" are not a problem. In fact, they are seen as a challenge (by the innovator) and a necessary step to achieving a significant leap in outcome (by the visionary). To the pragmatist and conservative communities, these disrupters are unacceptable.
The key to success in launching a new product is to establish a phased approach tailored to the unique needs and psychological requirements of each group.
As mentioned above, most sales reps hope that if they show enough value, the physician will use their new product despite the hassle factor and the risk of making a bad decision. This is most clearly expressed in the basic launch strategy most pharmaceutical firms use: Develop champions among the early adopters and use them to influence the rest of the physician community. The assumption is that the pragmatist and conservative physicians look to the early-adopting "opinion leaders" to decide what to do. In practice it doesn't work that way.
The needs of pragmatist and conservative physicians are completely different from those of visionaries and innovators. In fact, the pragmatist is often put off by the visionary, who doesn't share his or her view of new products. The visionary is focused on the outcome despite the risk and cost of change, while the pragmatist is focused on achieving a moderate improvement in outcome with an absolute minimum of risk and disruption.
To help you visualize the application of this model, let's use the example that's familiar with a lot of pharmaceutical sales people â the Palm Pilot. By comparison, there's a big difference between the adoption of the cell phone and the way the market has taken to the Palm Pilot.
One reason is that Nokia and Ericsson have made the transition from a traditional land-line to a cell phone nearly invisible. Nowadays, a person can simply buy a phone at any of a thousand retail outlets, turn the phone on and start calling. Nokia and other cell phone manufacturers have taken the risk out of their product and communicated its simplicity to even the most conservative of buyers. As a result, Nokia is one of the 25 largest companies in the world, and people everywhere seem to have cell phones attached to their ears.
On the other hand, if you were to ask how many representatives were using a Palm Pilot as part of their daily regimen, the number would be significantly lower, maybe one in 10. Why?
The people buying Palm Pilots tend to fall into one of the first two groups in the Technology Adoption Lifecycle. The innovators bought their Palm because of the "coolness factor," while visionaries could see how much better their lives would be with the organization offered by Palm. 3Com, the maker of the Palm Pilot, will need to communicate the benefits of its product in different ways in order for the bulk of pragmatists and conservatives to buy in.
The Technology Adoption Lifecycle is used to strategically segment a given market and establish a proven strategy to develop that market. One key to the successful sale of any new product or indication is developing a winning strategy to use in each phase of the Technology Adoption Lifecycle and meet the needs of each segment.
Step 1 â Identify the visionaries, pragmatists and conservatives in your territory. By studying the mannerisms, language and adoption habits of your key physicians, you'll be able to group them into one of the three key categories on the Lifecycle.
Step 2 â Develop a message that will connect with the individual physicians. You should communicate a different message to these physicians while preserving the essential brand identity. Talking with a conservative physician about the "cutting edge" aspects of your product would be a mistake. Similarly, you shouldn't play up the cost and risk factors to visionaries, who in many cases, actually sell themselves.
Step 3 â Deliver your core sales/marketing message in parallel. Just because your conservative physicians may not jump on the bandwagon as readily as some of the visionary doctors, there's no reason that you shouldn't call on these individuals as soon as you return to your territory. Take the time to identify the issues of risk, price and value and, once those have been managed, begin to move those physicians into your fold. Along the way, you'll find each segment of the market to be much more receptive to a discussion of your new blockbuster. PR