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Making your mark

Marketers across Europe want to take responsibility for tailoring global campaigns to meet local needs

zebraSince the process of unification began in the 1960s, it has never been more apparent that Europe is far from being a homogenous, unified region. The recent resounding `non' from the French people to the European Constitution is the latest proof that there is a long way to go before we can talk about melting borders, closer cultural harmony and the economic benefits of a free-flowing single market.

With an estimated population of nearly 460 million people, 25 countries and 20 official languages since its enlargement in May 2004, the European Union is, at first glance, still a hugely disparate and multicultural land mass.

Yet, in commercial terms, this picture does not conform to the widely- accepted sentiment that we are living in an increasingly global community, where global consumer brands, such as Coca-Cola, Nike and McDonalds predominate.

The world of cinema has also been bitten by the global bug: the recent release of the new Star Wars film Revenge of the Sith was described as the widest simultaneous global movie launch of all time, being screened in over 100 countries by the end of its first week. The continued growth of the internet and 24-hour news feeds mean that we are never more than a click away from knowing what is happening on the other side of the world. Some commentators say that pharma companies are still learning to use the wealth of new technical tools available to disseminate effectively their key messages around the globe.

Seeking success
Europe is one region where the pharma industry is really making an effort to convey core messages, as it represents numerous opportunities for commercial success.

Regional European marketing teams have the onerous task of coordinating national campaigns with all their cultural and linguistic differences, while at the same time remaining true to core global strategic messages. How well they are managing to balance these considerations is open to debate, as is the question of whether European drug promotion in the 21st Century requires a strictly global impetus and focus, or a more finely-tuned specialist local approach.

Leonard Lerer, editor of the International Journal of Medical Marketing, believes that companies are going to have to take a global approach if they are to achieve European marketing success.

Our recent research for one of the major global pharmaceutical companies indicates that the similarities between the major European countries far outweigh the differences, he states. In other words, distinct opportunities exist for substantial standardisation of all forms of pharmaceutical promotion, including market access, all aspects of the approach to pricing and reimbursement, and the positioning and branding of products. In my view, the time is right for more, rather than less, standardisation but this requires competencies at European head office level which may not be apparent today.

He points to a number of ongoing trends that are currently reshaping the European pharmaceutical arena, such as a perceived convergence in issues around healthcare financing.

On top of this, there has been a substantial diffusion of influence across Europe in terms of issues like parallel trade and the use of the internet, he adds. Consumers are basically becoming much more similar across the European region.

However, the fact remains that any push towards a more centralised approach to European marketing is going to meet with huge resistance from those out in the field. While different languages are the most noticeable stumbling block to successfully transferring marketing strategies proven in the US across the pond, there are other disparities.

European countries have different cultural beliefs, different attitudes towards medicines, and differing views about the pharma industry and its representatives, especially in terms of drug promotion. It is for these reasons that, in the past, companies have tended to use domestic healthcare communications and PR agencies that insist they possess the specialist local knowledge needed to crack a particular European market.

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However, there has been a recent trend - particularly on the part of larger pharma companies - to appoint a sole agency to oversee pan-European programmes. For instance, sanofi-aventis has appointed Publicis to do all its European work. Such moves have led to accusations of short-sightedness based purely on cost-cutting, while big pharma simply argues that it's all part of catching up with the global thrust.

There is definitely a trend towards a global brand manager, a desire to launch within one year and get approval globally, and a push towards central approval of copy material, says Tom Kass, head of healthcare investment service at EFG Private Bank.

The industry has always been exceedingly powerful at local national level, he notes. People in head offices have not always found this useful and have wanted to transfer the power back to the centre. However, I'm not yet sure that the bias towards global brand managers with global launch mandates is going to be very successful.

He argues that while centralisation would undoubtedly save a lot of effort and energy, the time is not yet ripe: I think you have to respect the need for centralised coordination while at the same time understanding that the regulators and the cultures in these societies and markets are different.

Matt Rowley, managing partner at the Central Group, warns of the dangers of going too far down either the global or local path. By definition, the moment a fully global approach is adopted, it compromises local campaigns by `knocking off all the edges' in order to fit the global messages into every market, he explains.

At the end of the day, every product manager in every agency is measured by how well they do for their own particular national market, not on how well the overall European campaign is going. A stringent global approach is effectively saying to product managers `you can't do the 100 per cent best for your market' and this will usually lead to internal people pulling against the project.

Too local
Problems also arise however, if companies decide to allow campaigns to become too localised. Rowley says that this scenario is at best a short-term approach with product managers being measured on how well their products do in a brief one- to two-year spell rather than five to 10 years, which would be a much more useful indicator for the company.

Of course, any further moves towards centralisation are going to meet with fierce resistance at a local level. As Kass puts it: I have no doubt that every king or prince who is running a country will want to keep it as local as possible. They will say they have the contacts with the regulators and approval agencies, and can tap into their respective markets. They can be fairly obstructionist to save their own jobs.

Lerer agrees that local affiliates and agencies will put up a hideous fight. However, he argues that ultimately, the battle is lost before it's fought because the economics of pharmaceuticals today indicate that it simply isn't possible to maintain a huge
local organisation.

He points to the fiscal disparities between certain European countries where marketing spend does not always correlate to margins: It tends to be in the countries where pharmaceutical companies make the most money that they put in the least marketing effort. For example, countries such as Italy have some messy issues but nevertheless remain highly profitable, whereas Germany has a huge resource allocation but the profits are not so high any more. What is required is a dispassionate readjustment rather than a radical change, he suggests.

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The big debate
The question rests on whether the most successful model for the future of European pharmaceutical marketing is indeed one based on a core global strategic campaign that delivers consistency in key messages, product positioning and brand identity.

Most agree that it is, but there is much debate about how much leeway local affiliates and agencies should be given in terms of catering to the environments and needs of particular markets.

As David Barratt, managing director of Lowe Azure and Lowe Fusion points out, it can be a tricky task getting a local affiliate to play ball with a global campaign. He says that it is unusual for affiliates to adhere to the `global brand book' with only minor tweaks for the local market and that, more often than not, local product managers will request major changes to core visuals or even try to push through a 90-degree turn from the carefully researched central image or copy.

What most pharma companies fail to recognise is that all local advertising agencies need to fuel their `contribution to overheads' with the creation of new campaigns and major changes to visuals, irrespective of the validity of the researched core campaign, he says. These local agencies are of course also staffed with persuasive sales people and it is a combination of these factors, along with the inexperience of `fresh-from-the-field' local product managers that leads to this situation.

Market specifics
Barratt's opinion is that local agencies servicing local affiliates will always try to come up with `better, more relevant' visuals rationalised by an `it's not right for this market' position when they see their livelihoods threatened by global campaigns.

He cites the example of one recent global launch which was compromised in one unnamed top five country by the local marketer insisting that the core speedboat visual needed three tailfins instead of the strategically correct two - despite hugely expensive helicopter photography off the coast of Florida.

Even if global marketing uses a agency group with good on-the-ground offices, they are still up against it, because these offices all have their own creative teams headed by a strong, even headstrong, creative director who is looking to build his book and win awards for the local agency, he says.

Of course, good innovative creativity needs these creative directors, but not when it comes to implementing core campaigns at affiliate level. Having a drug brand with contrasting visuals and core propositions in different countries just confuses doctors. Key opinion leaders and lower level opinion leaders now travel around Europe and the US much more, so core campaigns are paramount, he insists.

Yet, is the pharma industry truly aware of the complexities that surround the issue of adapting European marketing to global strategies? Lerer believes that, in general, the industry has been slow to recognise the rapid changes that are occurring in Europe, such as the substantial professionalisation of government and
the regulatory agencies.

In his view, the `competencies' that he spoke of earlier, which head offices will need, include improved tools for measuring and predicting European trends, as well as a more rigorous approach to standardising branding messages.

Little more than ideology
The picture of Europe as a completely homogenised region ripe for centralised marketing penetration is perhaps a little too idealistic at this stage.

I think there is a move towards globalisation, but in terms of Europe I don't think the pace of change is ever as quick as people think or want it to be, muses Rowley. Strong cultural and linguistic differences exist in Europe; that's just the way it is and it's going to take some big regulatory changes from Brussels to speed up the process. But at the moment it's still glacially slow.

Kass believes there is some scope for restructuring the European markets: We don't really need it broken down into 25 nations, it could probably be broken down into half a dozen regional entities, such as the Nordic nations for example. Maybe what we need is fewer administrators and heads of countries, and instead one or two marketing/sales types who can tweak things for each of the markets, he suggests.

One thing is certain: as the world of pharma shifts more towards a global way of thinking, things are going to get even more interesting. For even though local managers will be happy to see their products imbued with specific universal brand elements, they will want to retain responsibility for local campaigns, tailoring them for the needs of the audience. The war of attrition has only just begun.

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Global versus local: the ongoing debate
The global versus local argument in European pharmaceutical marketing has drawn some interesting responses from various pharma companies, which have learned the hard way that going too far down either road will invariably have limited results. Matt Rowley, managing partner of the Central Group, has highlighted some recent inroads companies have made into improving their European operations.

1. Planning and assessing priorities
One new approach to getting the balance right between the global spearheads and local operations is to formulate a stratification system, which some term the `stop light' approach.

In any global or European launch, the central team will analyse each component of the core campaign and put it into categories of `red', `amber' and `green'.

`Red' components are the essential `untouchable' elements such as the logo, brand colours and some of the core messages. You'd be surprised by how many of these things have been changed or tampered with in the past, Rowley notes. `Amber' zones denote material such as medicine support messages and the detail aid flow, which can be tweaked after consultation. `Green' material will be what local teams will absolutely want to modify for their own markets, such as the campaign visual. Why force everyone to have the same cheesy American visual? asks Rowley. Giving teams leeway to circumvent this gets past a lot of cultural problems.

2. New approaches - centres of excellence
Some companies are coming up with novel ways of addressing the global-local debate and problems that arise when local teams, fearing compromise, break ranks with the global push. For example, GlaxoSmithKline (GSK) has taken a number of its key therapy areas and established certain European countries as `centres of excellence' in each area. Rather than having a global or European team leader whose job it is to run around trying to `herd the cats', GSK has worked out the strengths of each affiliate and allocated responsibility for each therapy area accordingly.

In the UK, it's diabetes and in France it's respiratory, explains Rowley. The function of these centres is to formulate marketing strategies and then to help implement them across other country markets, rather than having an overall `compromised' approach.

The beauty here is that people don't report to a global function, but are instead on the headcount of the local general manager, he asserts. That's really important because in the past, when these people were part of a global European organisation, they had to report through different structures and lines of power than the local general managers who are ultimately responsible for the income in the company. What this approach does is short circuit the whole argument about which is tuned in best, global or local, because this way the global or European guys are the local guys.

3. Appointing the right agency - many or few?
When choosing which communications agency you want to run your European show it is not just a case of who you pick; it's very much a case of how many. Typically, a company will choose a global agency to run its branding, plus a whole host of domestic agencies to tackle country-specific implementation. According to Rowley, Pfizer has shrugged off its US-centric image and is now adapting to a more European way of appointing agencies. It has drawn up a roster of agencies, highlighting their strengths and experience in particular areas so that, in theory, it will always pick the best man for the job at hand.

Meanwhile, sanofi-aventis has taken a different approach. Once it had been catapulted to global number three, the French power-house decided to think big and appointed Publicis as its sole communications agency in December 2003 for a three-year term. Rowley describes the move as very much the main test case for companies wanting to streamline their US and pan-European marketing programmes.

The ultimate factor here is if companies try to forge relationships in the hope of replicating the bond that a consumer brand will have with an agency network, they could run into problems, says Rowley. Even the very biggest healthcare networks aren't a fraction of the size of their consumer counterparts. Whereas, even the smallest pharma companies will have an affiliate in virtually every market in the world, healthcare networks just don't have the resources to cover every single one of the European markets.

Publicis is probably the biggest healthcare network in the world but the real question is, `is it big enough?' To plug the gaps, agencies will most likely turn to consumer agencies. Notwithstanding local product managers' arguments that global campaigns can compromise their strategies, they are also being asked to potentially work with agencies they haven't worked with before and that will not have a great deal of experience in healthcare.

While I think the sole agency model has good intentions, it's quite a feat for any healthcare agency to try and map the size and reach of even small-to-medium sized pharma companies, let alone the larger ones.

4. Maintaining the global-local relationship
Perhaps one of the biggest traps global/European leaders can fall into is underestimating the wealth of knowledge and experience that local teams have to offer and failing to harness this effectively. To a large extent, global managers have to trust that the core campaign will be adhered to locally and the best way to ensure this is to keep local teams in the loop.

One of the core competencies of any global or European product manager is the ability to bring people along with you, states Rowley. All too often, it is a skill that is overlooked. Local people want to feel from the outset that they are doing the best they can for the product in their respective markets and a good global manager will ensure that this is so.

Involving local product managers and local agencies earlier on in the formulation of the marketing strategy will make them more responsive and give them a clearer picture of where they are going. This will also allow global managers to free up more time to work on best practice, strategy, messages and positioning rather than incessantly rallying the troops.

The Author
Gareth Carpenter is a freelance pharmaceutical and healthcare journalist

2nd September 2008

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