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Big isn't always beautiful

As we are all aware, the pharma business model is changing. For the past 20 years the dominant philosophy has been "bigger is better" - the belief that you have to achieve greater mass to succeed

Juliet La MarqueUntil recently, big pharma companies have been able to bully the market and out-shout lesser rivals with increased marketing spend. They've also invested in larger salesforces, demanding high call rates and coverage.

They have put all their money behind blockbuster drugs and product acquisitions, and have developed global marketing campaigns to steamroller customers and competitors. However, this is changing - not just in the UK but around the world.

The stream of blockbusters has slowed and a high proportion of the top selling drugs are now off patent. The move to generic prescribing is accelerating and there is an increasing emphasis on evidencebased medicine. The customer base is shifting with the range of decision-makers becoming more diverse and more elusive.

There is a backlash against global marketing (especially global advertising), with dissent among even its most avid practitioners. And the death of the salesman - long predicted - is finally happening.

In the current economic climate it is the biggest companies that have been hardest hit, resulting in cancelled projects and staff cuts. The heavyweights are slimming down. Yet, middleweights are on the rise. It's the mid-sized companies that are really setting the pace. They aren't hamstrung by longterm strategies or massive overheads and are less arrogant than their bigger rivals.

As they don't depend on blockbusters but on cash cows, they milk them as hard as they can. They are more agile, flexible and willing to innovate in the way they communicate. They recognise that success comes from aligning the interests of manufacturer, prescriber and patient to find common goals.

For these companies, global branding is not the answer to local marketing issues. They realise that the goal of advertising is to stand out - why make all your communications look the same.
The same trend is occurring on the service side. There is a backlash against global agency networks, with companies looking for agencies that fit their needs. The future will belong not to the biggest, but to the agencies that are fit for purpose.

That's where the mid-sized independent agencies fit in. They are not stifled by the corporate culture of the global agency networks, they are flexible in the service they offer, pricing structures and, most importantly, take pride in integrating their agency team with your marketing team. There are no hidden costs or condescending attitudes.

And as traditional media are declining and new channels of communication are opening, the medium-sized agencies are quick to adapt to this changing environment. They are willing to exploit the form of communication that brings the best results for their clients.

With an emphasis in the NHS on costreduction, and procurement doing the same in pharma companies, these agencies offer the best RoI. Perhaps procurement should review their KPIs and not put their eggs in one global agency basket, which can very quickly lead to agency complacency and frustration within the marketing team.

If the "bigger is better" model has had its day, perhaps the future is a pharma/agency combination that is both lean and keen.

Juliet La Marque is managing director of Life Healthcare Communications
She can be contacted at juliet@lifehealthcare.com or on 01344 887525

Innovative Thinkers in healthcare advertising - a special supplement from PMGroup Ltd

25th July 2008

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