eyeforpharma.com

We all know that today’s pharmaceutical marketplace is extremely competitive - not only are there significant budgets at stake, but also the environment around big pharma is becoming increasingly hostile from multiple viewpoints: patients, physicians, regulatory agencies, reimbursement, and competitors and generic competitors. Sales managers must stay tuned to what sales force activities are actually encouraging prescribing decisions among various physician segments, as well as monitor how its reps (and competitors) are performing in these areas.

In the past five years the number of sales reps has grown by 85% and yet the productivity has declined by 23%. Something, somewhere, is not adding up. It is vital that sales managers start to get to the bottom of this issue and develop and implement a sales strategy that has measurable return on investment. Current metrics are more focused on efficiencies rather than effectiveness. A better tool to measure financial impact and productivity of sales force activities is an imperative for this very significant budget allocation.

But how can a pharmaceutical company measure the effectiveness of its sales team? Data such as market share and revenues for particular products in or specific regions form the basis for such calculations, but can be affected by any number of factors in addition to sales force effectiveness, including promotional and advertising spend and competitor activity. Common methods of measuring sale force effectiveness revolve around frequency of calls made by sales reps to target physicians, with the underlying assumption that higher numbers of sales calls will equate with greater product sales. Targets are set around number of calls per day and so on. Such data is relatively easy to collect and can be measured directly against sales and market share data. A sales rep associated with a particular territory with falling sales volumes might then be encourage to work harder (i.e. increase the frequency of sales calls) to drive the numbers back up.

Unfortunately there are a number of problems with this sort of metric:

- Confuses sales call quantity with sales call quality. A sales call merely to enquire over the physician’s golf handicap, or the state of health of the physician’s loved-ones, clearly are not going to result in a product sale. Likewise, sales call frequency measures favor irrelevant contacts, such as physicians that might be easy to talk to but who do not actually have many patients that fit the profile of the drug being marketed.

- Implies the only sales tool worth considering is the sales call. In a highly competitive environment a physician might be faced with a veritable barrage of requests for “just moments of their time”. There is now an increasing trend for sales reps to deliver sample products to physicians but never actually see the physician involved. While good working relationships between the sales rep and customer are vital, much can be gained by adequate back-ups to the sales call, such as call centers and websites and e-detailing. Thus, actual sales of a drug might not necessarily be directly related to the number of calls made. Sales call frequency measures also put pressure on activities that may assist the sales rep in the performance of their job, but that do not involve direct contact with the customer, such as opportunities for training, or participation in medical conventions or conferences.

- Sends the wrong message in terms of expected behaviors. Focus on call frequency could encourage inappropriate or non-optimal behaviors in sales staff. For instance, irrelevant calls to non-target physicians or non-prescribing staff just to make up call numbers. IMS reported that in the decile analyses they perform, they often find little difference in the call levels achieved by high decile doctors and low decile doctors. This highlights the fact that reps are not naturally inclined to focus their efforts on high value doctors but on accessible doctors. This is perfectly understandable if the lists they are being given are poor quality (which we find in Europe is often the case, doctors who have retired are listed, doctors at hospitals that no longer exist are listed and so on) and the compensation and incentives for the sales force are not aligned to higher decile physicians.

- Ignores potential problems with marketing plans. One strategy designed to assist a sales rep in remaining efficient and effective is to pair a sales call frequency target with a target list of call recipients. However, this approach can lead to a new set of issues. For instance, target lists are prone to change, so that any plans that include such target lists must be carefully managed to ensure they stay relevant. Likewise, if the target list is too long, a sales team might be spread too thin for effective customer contact even though total time logged with clients might be the same for a region better balanced in terms of a marketing plan. Target customer lists also need to account for customer turnover. For instance, a particular region with a high turnover of prescribing physicians will require a higher number of calls to achieve the same sales as a region with a more a stable customer base.

The common result of these factors is that situations can arise whereby sales call targets are met, but revenues and/or market share stagnate or decline. Clearly, what is often missing from many sales call frequency-based measures of sales force effectiveness is a consideration of the impact that the marketing message and the sales force activity actually has on the customers prescribing and the brands bottom line. Thus, logging sales calls is a fine method to ensure the sales force is active, but does not answer questions such as:

- Has the physician actually understood the benefits offered to his or her patients by prescribing the particular product on offer?

- Is what is being offered relevant to the physician’s practice? Studies show that reps are calling on physicians in Europe who do not even prescribe much in the category the rep is calling about, which means it is often irrelevant to their needs – but meets the reps target of x calls per day.

- Does the product being offered answer a need or satisfy a goal of the physician?

- Is there a benefit to the physician’s practice or patients by prescribing the pharmaceutical brand?

- How much impact on brand prescribing is the sales force actually having compared with other marketing activities?

- How can sales calls be more ‘effective’ – rather than simply more ‘efficient.’

Let’s examine this final distinction in more detail:

• Sales efficiencies include things such as procedures, calls per day, minutes per call, cost per detail, cost per minute, and so on.

• Sales effectiveness is focused on productivity, looking at the impact of behaviors on prescribing, impact of each interaction, content requirements of interactions for improved financial return from the sales activity for the brand, and so on.

There is a very big difference, and this difference seems to be the heart of the pharmaceutical sales force productivity problem. While the industry has described their metrics and analytics as effectiveness, they are actually focusing mainly on efficiencies. By focusing on efficiencies, effectiveness has to reduce due to the focus of the metrics. The direction from here is clear: companies need to refocus on metrics made for measuring productivity and actual financial return for the brand. They absolutely must measure actual effectiveness, instead of efficiency, to ensure they are delivering the right messages to the right target audiences, with the appropriate influencing behaviours to create a bottom line impact from the call - and be able to measure this.

But how?

All companies measure efficiencies and do attempt to measure effectiveness. All companies do things such as Detail Follow Ups (DFUs) and other measures aimed at looking at detail quality – but what do these really measure? They are done after a detail call and it is obvious that the doctor knows what they are trying to measure, which can confound what they say. In addition, they are recent, so the messages are more top of mind. The bottom line is that they are still not actually measuring if this sales call had an actual impact on prescribing the brand, and if so, what that impact is. Other more focused measures must be used. These exist and are being used in pharma.

But what are they?

This topic will be covered in great detail in part two of this article series which will look at how some pharma companies have overcome this problem with the more recent sales force analytics tools now available.

For more information on this topic, please visit the Eularis web site at www.eularis.com

Author: Dr. Andree Bates, Eularis (www.eularis.com)

• Add new comment