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The pharma marketer’s dilemma: partnership or product site?

As pharma marketing budgets are squeezed and pipeline gaps continue to widen due to escalating R&D costs, it is now more pressing than ever for pharma to reconsider how its digital marketing budgets are allocated at different points in the product lifecycle. In this first article I will advocate a customer-centric approach to channel use and integration, in order to forge a sustainable online marketing strategy for your products.

A site build is often assumed by new clients to be the strategic starting-point – or cornerstone – of a new product launch. Despite innumerable instances of disastrous implementation, a classic product or therapy site build is still a very attractive proposition for internal marketers. It provides total control over the content, opportunities for CRM integration, and full immersion in the brand. However, these are corporate rather than customer priorities.

Replace inside-out with outside-in

As a highly regulated sector, it is not surprising that pharma continues to adopt this inside-out view of digital. But pharma marketing is unsustainable unless the outside-in view is given precedence:

  • Where do our customers go online?
  • What are their information needs online?
  • What experience do they want?

At Blue Latitude we are spending more and more time with these customers. We sit in a room with them and watch them navigate the web until we understand their online behaviour; we gather their information needs via targeted surveys across key territories, and we perform environmental and competitor analysis in order to see what they see when they turn to their PC, smartphone or tablet.

Here are some customer-focused, ‘universal truths’ we have discovered so far, and to which I will return in my next article:

  1. HCPs are more likely to visit trusted (bookmarked) sites  than the average internet user
  2. HCPs need different types of information at different points in the product life cycle
  3. HCPS have come to trust pharma only for certain types of information

Partnership or owned channel?

By understanding where your target audience goes online, you gain a better understanding of the competition facing your proposed owned site. If the vast majority of your customers regularly visit only a few, authoritative trusted sites, it makes little sense to compete directly – because you will almost certainly fail. Do you really want to be competing with a Doctors.net in the UK, which receives more than 10,000 visitors a day? Even if you manage to pinpoint a major unmet need, you will struggle to direct these customers to your channel cost-effectively unless you figure out a way to work with these competitors. However, if your audience’s environment is much more fragmented, and no one site answers the customer’s key needs, you have an immediate advantage: loyalty to specific sites is much weaker, and you can achieve strong differentiation (and foster loyalty) by meeting those key needs in one place.

The matrices above show the fundamental differences between a competitive and non-competitive user environment. If you are looking at a closed environment, investigate whether any of the competing sites offer commercial opportunities – in most of these environments there is at least one. If so, there might be a range of possible options, from buying media to launching a full-blown microsite. However, to understand when to partner and for how long, we should look at the potential costs over the full life of your strategy.

Time and cost

A content partnership can often be a more efficient and cost-effective choice for disseminating your message at product launch and in the short term, whereas an owned site can represent a better investment for longer-term engagement. Using anonymised data and standardised content partner costs the interrelationship between these costs over time is illustrated below. There will obviously be large variations depending on the specification of both tactics, but trends should broadly be similar.  The area under the dashed lines provides total cost, and the area under the solid lines total unique users:

 The graph shows the comparative reach and cost per user of these two approaches over a two-year period. The step-change in cost for the partnership option will be based on your original agreement with the partner – you will usually agree a fixed cost per interaction / unique visitor for a target proportion of your audience, within a specified timeframe. An increase in cost might occur once this target is reached. An owned site is a longer-term play, where the CPI will remain high during the initial period (due to the additional cost of paid media to increase site visibility), but should come down with a sustained focus on optimisation and customer retention.

Both channels have their strengths and weaknesses. And you may believe that for your particular product, a long-term strategy is not required, making a freestanding partnership the best option. However, what I will consider in a follow-up article are the remaining issues of changing needs and HCP trust, and endeavour to show how these channels can and should work to complement each other, as part of a longer-term strategy.

Multichannel guide

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