The Lack of Price Transparency in the Pharma Industry

Terry Nugent of TN&A is an experienced and well seasoned veteran of the medical marketing community. He’s previously worked for the American Medical Association, and is a member of the Healthcare Marketing and Communications Council, the Midwest Healthcare Marketing Association, and the Association of Medical Media, just to name a few accolades! A few weeks ago he shared his medical marketing insights with the Pharma Marketing Network, and we’d like to repost his insights on our blog about the lack of price transparency in pharma marketing.


The Lack of Price Transparency in the Pharma Industry
By Terry Nugent

Pharmaceutical price transparency falls into the same oxymoronic category as the long-vaunted “paperless society” and the oldie but goodie, “airline food” (which used to be an oxymoron but now is a somewhat distant, if unpleasant, memory for boomer sojourners).

There are good reasons for the relative opacity of pharmaceutical pricing. I remember going to a pricing seminar back in the day where a gentleman in charge of pricing for one of the pharma companies explained to us very vividly that fundamentally, the only constraint on pharma pricing was regulation driven by public opinion.

I have a friend who has stage 4 lung cancer. He is 62 years old. He would have paid anything for a cure, and he just did. Miraculously, it seems to be working. The last thing he’s thinking about is the price. Fortunately, a third party is picking up most of the tab.

So, the price inelasticity of life-saving drugs is compounded by third-party payment, which is why we are where we are today. Pharma in health care is unlike any other good or service because it can literally be a matter of life and death. In the case of a life-threatening illness particularly, the patient has very little choice. In addition, the market is very distorted by third-party payment. Any good or service that is subsidized by a third party, also known as other people’s money, is subject to extraordinary inflation—period. It is no coincidence that the three principal segments of the economy that have managed to have serious inflation in a historically deflationary economic era—education, health care, and defense—are all paid for with other people’s money. The normal forces of supply and demand do not apply. The normal price competition of an efficient market does not apply. Thus, there is no transparency because the price signals through which buyers and sellers communicate in normal markets are not recognizable to either buyers or sellers. In fact, sellers have powerful incentives not to publicize pricing because they make different deals with different buyers based on volume discounts. For example, in the case of the Veterans Administration (VA), legislative fiats mandate the lowest, best price for our veterans.

In fact, pharma pricing is something of a trade secret. The big players get big deals. It’s the little guy who pays list price for drugs. This is the tragedy of the uninsured. One of the principle benefits of health insurance, beyond the insurance paying a certain portion of the cost of care, is its incredible “in-network” price negotiating power.

So, the main contemporary constraint on pharma pricing power is volume discounts, with one HUGE exception: Medicare, which is specifically prohibited from negotiating pharma prices. Yes, some elements of the government, such as the VA can, but the Gulliver of government is generally quite well-restrained by the Lilliputian lobbyists from flexing its giant muscles.  

Why the VA you ask? It all goes back to the ultimate restraint on pharma pricing: public opinion. Whenever government programs such as the Affordable Care Act (aka ACA, aka Obamacare, which oddly can be either pejorative or laudatory depending on your political hue) come into play, pharma always negotiates a clause, if possible, where the public payer is specifically prohibited from negotiating price, except where the market is relatively small and the PR damage potential is very high. Bad press about unaffordable drugs for our veterans is very bad for business.

That is, of course, why pharma and the rest of the health care industry tremble at the thought of a monopsony and “Medicare for All” (formerly known as national health, alias “single payer,” alias [pejorative] “socialized medicine”). We’ll just call it M4A, which is the current Beltway shorthand.

A monopsony is the inverse, or polar opposite, of a monopoly. In a monopoly, there is only one seller. In a monopsony, there is only one buyer. Whatever the buyer will pay is the price. Period. Full stop. Well, except of course, for those pesky lobbyists, whose employers may stop making the donuts, and inventing new ones, if they lose money on manufacturing and marketing. Oh, and the voters, who can’t get the drugs they need to keep voting. Oh, and then there are the health care professionals who won’t be too happy about not being able to do their jobs with anything but thoughts and prayers (they are doctors of MEDICINE after all).

However, for fans of pricing transparency, this is Utopia. There’s only one price and it’s published in the Federal Register.

Since purchasing power drives consolidation on both sides of the supply-demand line, and a monopsony is the singularity of purchasing power, the sell side would inevitably tend to consolidate into its own black hole singularity.

Nobody on the sell side wants that. Even the buyers may find that dealing with a monopoly Healthcare Inc. that owns all the doctors, hospitals, drugs, and medical devices, may not be as much fun as it sounded. The famously nonpartisan Congressional Budget Office (aka CBO for those of you collecting acronyms) just estimated the cost of M4A at a rather impressive $32 trillion with a T over the infamous 10-year budget window. To paraphrase the late Illinois senator Everett Dirksen, “a trillion here, a trillion there, pretty soon you’re talking real money.” Even, one might add, when you can print the stuff with just a keystroke at the Fed.

So that probably leaves us pretty much back where we are today absent any French Revolution-style head surgery. Since Utopian transparency shall probably remain for the next world, let’s get back to work here on this mortal plane.

Pharmacy benefit managers (PBMs) are another factor in the lack of price transparency in the pharma market. Much light has been shed of late on this particularly opaque area of pharmacoeconomics. PBMs have become a convenient whipping boy on the price and transparency issue, and not without some merit. PBMs basically carve out the pharma side of the equation, which is very complicated and which many payers don’t want to delve into. So, the PBM is tasked with negotiating a good deal with all the various pharma companies and passing on the savings to their client, the payer. The allegation, of course, is that the PBM negotiates a very good deal and then keeps an unfair amount of the money and passes on very little savings to the payer.

Another complicating factor is the use of co-pays and deductibles. Payers don’t like paying. The claims are the not-so-fun part of the insurance business—the premiums are! Of course, health insurance really isn’t insurance anyway; it’s just prepayment of health care, as the late, great Dr. Uwe Reinhardt held. However, co-pays are one of the blunt instruments that payers use to discourage people from prescribing and consuming expensive drugs. The intent of the co-pay is to bludgeon “covered life” (aka the patient) to seek the least costly solution to any particular problem, generally with a generic drug.

This briefly unmutes the price signal, like a dog whistle lowered to human pitch. Consumers, being quite careful with their own money vs. other people’s money, immediately head to Costco for a thousand-pill package of lisinopril or some such.

Here we will pause for a thought experiment on a world of perfect price transparency.

Suppose for just a moment that you woke up today and third-party payment of health care products and services had been made impossible according to the laws of economic physics, or an act of Congress. What would you do? What would pharma do? You would probably meet at the local pharmacy and have a little talk. You would say, there’s no way I’m paying that much money for your drugs. I guess I’ll just go die. The pharma company would say, wait, don’t do that, we’ll go out of business. A discussion would ensue in which you would discover a price. That’s what we capitalists call the invisible hand of the marketplace. Customers would pay what they could, or would pay, and companies would price accordingly and manage costs to make a profit. Simple, eh? Transparent? Perfectly. Possible? No. Okay, back to planet Earth.

When we last left our heroes, customers had become price sensitive due to the dastardly co-pays. Pharma companies responded by providing co-pay cards to take the sting out of the co-pay, muting the price signal. This is very controversial.

So now we have described the various clouds that make the pharmaceutical market a particularly nontransparent area of the economy. What is to be done?

The reality is that in an environment where third-party payment prevails, a transparent market is probably not achievable. Government will seek transparency, to some degree, for idealistic reasons, for the benefit of the public, and for their own political capital. Young representatives coming to the Beltway may not be privy even to the cursory knowledge articulated by your humble correspondent as they unveil simple solutions to complex problems. (As the saying goes, for every complex problem there is a simple solution, and it is simply wrong.) The issue of transparency will be debated in the halls of Congress, powerful lobbies will be brought into play, and it will be one more skirmish in a cold war leading down the eventual path to M4A. As time passes and I watched the Congress dominated by the GOP attempt to repeal the Affordable Care Act with no success, I have concluded that M4A is probably the end state of the health care debate. It is only a matter of time. However, the question is how much time. Eventually the only way for prices to be transparent, at least to the government, is for the government to pay for all prescriptions. The government will have the ultimate leverage, an absolute in negotiating prices. The trade-off for patients is innovation.

The reality is that 90% of the drugs that are prescribed in today’s world are generic, and thus, far less expensive than they were when they were exclusively patented. Therefore, time heals all (pricing) wounds, and that time is the patent life of a drug. (Except for insulin. Somebody please explain insulin—Ed.) There was a recent controversy regarding biologics. The progressive camp was up in arms about the fact that the Trump administration actually LOWERED the period of patent exclusivity in the replacement to the North American Free Trade Agreement (NAFTA) from 12 years to 10 years for biologics. Their point is that 10 years is still too long compared to international norms. Biologics are good examples of complexity. They don’t lend themselves to generic competition because, unlike small molecules, they’re very expensive and very difficult to make. (What could go wrong?) It’s not just a question of hiring a patent lawyer and hiring a contract manufacturer as it is for small-molecule drugs. For those drugs I pay as little as $3 for a 30-day prescription. That is not, and never will be, the case for complex, hard-to-manufacture drugs.

So, what does the future hold regarding transparency in drug pricing? If there’s anything I’ve learned over the course of my fairly lengthy life, it is that no one can predict the future. That has lost me a lot of consulting work. With that caveat, my prediction is that the complexity and opacity of pricing will persist in the foreseeable future. The companies that are involved are powerful and have very entrenched positions and very adept legal and lobbying teams. The status quo has a great deal of inertia. And the ultimate factor is the total lack of price elasticity that prevails for patented products that can save lives.

Ultimately, the question of pharmaceutical pricing depends on the value of a human life. This relates to the minimum wage as well. Are some lives worth more than others? Should people of means be able to buy better health care than those of lesser means? It goes to the heart of capitalism. Is capitalism a just and moral system? Should health care be separated from capitalism? Should health care be a business, because if it is a business, managers will maximize shareholder value, or they’ll be replaced by managers who will. There are nothing but trade-offs here. If one were to nationalize the discovery process in the drug production process one might arguably stifle innovation. It takes two decades for the government to build a new fighter plane. How long will it take the government to develop a new product to treat an orphan disease?

Another consideration is that the government is creating its own problems. Third-party payment inflates prices. The Food and Drug Administration is complex, and its byzantine regulatory process is the main driver of costs. Except for biologics, which are difficult and costly to manufacture, all of the value of a pharmaceutical product is intellectual property. This includes the information obtained from clinical trials and research and development that guides the formulation of various inexpensive chemicals into a product that actually cures a disease. That’s why the sale versus cost of goods sold argument in pharma is so specious. The whole universe is made of chemicals, but like alchemists, pharmaceutical companies add value through their research and development and testing.

That’s why the government licenses basic research results from the National Institutes of Health and other government branches to the private sector to get it approved. Another way that the government, as the largest single payer of health care, (already accounting directly or indirectly for 60% of the funding of U.S. health care) could get a better deal, which would be to extract bigger royalties from pharma for the intellectual property that they transfer to the private sector. There is merit to such an idea—in the mind of the payer at least.

But my prediction remains that pharma pricing will continue to be a very contentious item in the public sphere. Players, including the public, will demand greater transparency, while pharmaceutical companies and benefit managers will continue to seek privacy. And this is one area in which privacy is not an undisputed good.

Of course, the ultimate solution, absent M4A, is to eliminate third-party payments in health care. I have always argued that if third-party payment, including government and insurance, and everything else other than the private transaction between the patient the suppliers of healthcare goods and services were prohibited, prices would come down as much as 90%. That, however, is a mere thought experiment. What we saw with the failure of the GOP to repeal Obamacare was that we’re on a one-way street and there is no going back to a time when people paid for health care out of their own pockets without any assistance. That changed in the 1930s during The Great Depression when the physicians formed Blue Cross and the hospitals formed Blue Shield. The government at that time wanted to pass a health care scheme but failed. The idea persisted until it was finally enacted as Medicare and Medicaid in the 1960s as part of the Great Society. Since then, the progressive wing of government has tried to expand these programs into an M4A scheme much like that of the United Kingdom and other “civilized” member countries of the Organization for Economic Cooperation and Development.

So, there is no chance that third-party payment is going away. As long as there are third-party payers there will be transparency issues. These issues are indicative of a greater problem, which is that the normal forces of supply and demand that give us $100, 44-inch TVs do not apply in health care because there is an alienation between the providers of services and the consumers of services, thus prices will be high. Even in an M4A environment, political forces will tend to inflate the price of health care because ultimately, even M4A isn’t just other people’s money—it’s everybody’s money.



Why Your Email Newsletters Aren't Being Read

According to August Birch, email newsletters are all about getting the readers to want our content. The common complaint about email lists is that readers are unresponsive. But it’s not about the size of the list — it’s how you use it! Readers aren’t disinterested; they’re just overwhelmed with other content in their inboxes. We’ve all become masters at filtering out marketing pitches, and some of our inboxes even give us the tools to help that process.

To get your readers to open your newsletters, you have to speak directly to them. The key to unlocking email engagement is writing a killer subject line. Here are five common mistakes that Birch thinks you can fix immediately when writing subject lines. 

  1. Talking about yourself — Readers care about themselves first. We’re busy people with so many emails and so little time.

  2. Being boring — This is self-explanatory. If your subject line makes someone reach for their coffee to stay awake, ya done messed up.

  3. Giving it away — If you explain exactly what the email is about in the subject line, there’s no reason for me to read it. Readers hit “Delete” because they already know what you’re about to say.

  4. Asking yes-or-no questions — “Want to take your writing to the next level?” If their internal answer is “nope,” then there’s no reason to open your email. Questions can be great, but you’ve got to be really careful with the yes-or-no kind. 

  5. No mystery — Leave a little something to the imagination. Readers want to be led gently towards a sale, not mugged with your blatant subject line.

Subject lines are part art, part magic, part mysticism, and part “let’s try something fun.” The idea behind your email list is to get your newsletter in front of your reader, and to do that, we need to get them to open the dang message.

Here are Birch’s five tips to get your emails opened:

  1. Close the loops — The human brain hates open loops, and we’re hardwired to want to close them. Use unanswered, non-yes-or-no questions to entice a reader to click on that email. Cliffhangers work very well in writing because we want to know what happens next. 

  2. Feed the greed — We care about ourselves above all. If someone sends you an email and it looks like you’ll gain something by opening it, there’s a much higher chance you’re going to open it. Try using subject lines with the word “you” instead of group-speak. Make the reader feel as if you sent this only to them.

  3. Format for mobile — This really should be a no-brainer, but test for mobile by looking at emails on your phone. You want the entire subject line to fit and not be cut off. The reader is not going to spend time trying to figure out what you meant. 

  4. Send emails like you’re a friend — Think about how you email coworkers, family, or friends and employ those tactics. Your readers will stay readers if they feel like your family and friends too. 

  5. Have fun — infuse your own version of fun into your emails. We all have different personalities and levels of fun we generally exude, but if your emails sound fun to open, there’s a better chance readers will click. Nobody wants another newsletter, so don’t make your newsletter seem like a newsletter. Make it feel like a community.

Let’s face it: We all need to send better email. Both you and your readers benefit if they open your content. You put so much effort into the subject matter of your email — now try to spend as much time creating your subject lines. They’re just as important as your email itself, if not more so. Test, send, and retest subject lines until you start getting the results you want. If readers don’t see your email, they’ll never buy your work. Email is the only free piece of marketing you can send where your message isn’t distracted by Snapchat videos and newsfeeds. When your reader opens your email, you’ve got their attention. You can send better email, and we can help!

T. Nugent and Associates can help you produce newsletters that get your writing seen by your readers. For a free, no-obligation consultation, call or text us at 708.334.8414 or email terry@tnugentassociates.com.

Maximizing your LinkedIn Connections

Making a LinkedIn Connection request is kind of like trying to make a new friend on the digital playground. It can be awkward and stressful, but it doesn’t need to be! Here are some tips for making connections and growing your network that are sure to get you into all the best digital cliques (and clicks!). 

The first step in this process should be growing your network. But how?

Step 1: Find and request people you actually know. 

People like friends or family, who won’t ask themselves, “Who is this?” when they see your request pop up in their email. LinkedIn already does a lot of the heavy lifting for you on this with their Add Connections page. They find contacts from your email and from there you can connect to people you know and interact with often. Just be sure not to hit the “Add X Selected connection(s)” button without adding your new, expertly crafted invitation message. Which we’ll get to shortly.

Step 2: Connect with people you want to get to know.

This can be tricky! You don’t want to spam people by requesting anybody and everybody in your related field, but you don’t want to be overly cautious. The best advice I can give, is to use your best networking instincts and have a strategy. Flatter them! Follow their business page and like their posts. Always take the opportunity to connect with others in the company like sales reps or the HR administrator to expand your 2nd and 3rd level connections to someone you want to connect with on a direct level. Other options are using LinkedIn Premium or LinkedIn Sales Navigator, but if you’re looking t

Step 3: Have people want to connect to you.

When people want to connect with you, you’re in the driver’s seat with whether you want to accept their request or not. The way to get to this point, though, is by having an amazing LinkedIn profile. Have your resume uploaded, have in depth descriptions of your previous positions and experience, request recommendations from former employers or bosses you had that can vouch for your work. Post a lot, and post good content. Show potential connections exactly who you are and how you could add value to any company or business. If you put in the work, you can really make your profile stand out! 

Now that you’re a networking machine, let’s explore how to write a LinkedIn connection request that can open more doors to the people who can help you and your business grow.

Writing an Undeniable LinkedIn Connection Request

In Larry Kim’s Medium article How to Write the Perfect LinkedIn Connection Request, he calls his perfect request formula “The Five P’s”. A request must be:

  1. Polite

  2. Pertinent

  3. Personalized

  4. Professional

  5. Praiseful


Here’s his example:

Screen Shot 2019-08-05 at 9.27.41 AM.png

Why does this work? Think about it, you’re giving someone a compliment, explaining how you know of them, telling them your exact intentions for wanting to connect, and basically asking for a virtual handshake. Who wouldn’t want to shake the hand of someone who just praised them so politely? There’s not a human being out there who doesn’t enjoy praise for their accomplishments. That’s how the Five P’s formula is nearly foolproof for establishing a meaningful connection to someone who might be able to help grow your business or find a new position.

Want to test out this formula for yourself? Go ahead and make a connection with me on LinkedIn here!

TN&A has recently been working on growing our client’s LinkedIn networks. For a free, no-obligation consultation, call or text us at 708.334.8414 or email terry@tnugentassociates.com.


Content That Scales

Joe Shields from Health Accelerators recently did a webinar called “Designing Customer Services That Scale.” In it, he discusses the 9 reasons why his company has moved to services. In this article, we’ll break down and summarize his webinar and explain our own service offerings. 

Shields’ 9 reasons for moving to services are:

  1. Globalization. Brands are becoming more relevant and providing more services to their customers on a broader, global scale.

  2. Patient empowerment. Patients are demanding more services from their healthcare providers, particularly with the more expensive products out there.

  3. Competition. If you’re not innovating, you’d best believe your competition is, and you don’t want to be left behind while your competitors are excelling in both products and the services wrapped around those products.

  4. REMS. Short for risk evaluation and mitigation strategy and required by the FDA, REMS makes sure that pharmaceutical drugs are used safely, patients are not harmed, and physicians are aware of the risks associated with the products.

  5. Unmet needs. Making sure unmet needs haven’t already been satisfied elsewhere by another competitor or government program.

  6. More complex medicines. More complex medicines mean patients need more coaching and handholding. They need more information and services to make sure they’re using the product safely.

  7. Internet/mobile phones. The internet has changed how we access healthcare information and services. We can receive and search this info at a moment’s notice.

  8. Rising consumer expectations. Healthcare and pharmaceutical companies are not just competing with other pharma companies in the service arena; they are competing with top-tier companies like Amazon and Apple who have created very high customer expectations.

  9. The need to innovate. Where new technology and customer trends converge is where innovation lies.

Those are the reasons, Shields says, that services are a differentiator for pharmaceutical products. Another reason is that services really can help solve customers’ problems. Consultancies, UX design, and the marketing agencies within healthcare have created an ecosystem that produces much deeper insights and has uncovered a different kind of need than in the past, when companies just did concept research on a print ad.

The scale of the services, though, is the whole reason for Shields’ webinar. It’s important to scale the need into the project before you begin, because you’ll invest the same amount of effort serving people with a rare disease as you would serving people with a very common ailment like diabetes. Whatever you’re working on is going to be important to patients, and you want to reach as many patients and physicians as possible. Building in scale also gives you some valid research statistics. When you see patient communities that are quite large, you can amortize this functionality and the development costs across a larger base. Frankly, you can reuse content and functionality and transfer a lot of the things that you built, such as registration forms, instead of building them again.

The pharmaceutical industry is optimized to discover, manufacture, market, and sell medicines. There is much more effort, staff, and expertise applied to finding new medicines, but you don’t see that a lot on the digital healthcare marketing side. Shields believes that that’s going to change quickly over time, and that the industry will start to see pharma and medical device companies partner with a lot of digital health startups.

Even though the pharmaceutical industry isn’t really designed to be in the service business, companies are able to figure out through research, social listening, and other techniques what customers want and need. When thinking about the next product rollout, companies need to think about specific conditions and patient types globally, and balance that with personalization on the local level. It’s important to be realistic about what it’s going to take to launch a new pharma product globally and locally, and over the course of many years. Services, if done correctly, can help you differentiate your products. They are a great way to carve out a position that your competitors might not be able to catch up to. Most importantly, services can really help a lot of patients, and help a lot of physicians provide better care. Once you develop a systematic approach, you can be well on your way to doing very big things!

It’s important not to wing it and think the pilot phase will automatically turn your product into something big. You need a plan to make that happen. If you need help on ideating and implementing services to take your product “beyond the pill,” TNA is at YOUR service. Contact us today for a free, no-obligation consultation. Call or text us at 708.334.8414 or email terry@tnugentassociates.com.


Cold Emailing

Cold emailing — it seems intimidating, right? Cold emailing has a bad reputation with some due to the generic and poorly worded emails some marketers send, but this marketing tool is actually great when used correctly. The worst thing that can happen is that someone doesn’t respond, right? In that respect, cold emailing is low risk, but it can yield a high reward. Using Larry Kim’s article on the art of cold emailing as a guide, here are some tips to make sure your cold emails get the results you desire. 

The Art of the Cold Email

Cold emails should always focus on what you can offer a potential client. You want to create a connection, and starting your email guns blazing with a hard sell is never the way to go. People are bombarded by sales emails all the time, so you want to stand out from the crowd. Show them how they might personally profit from establishing a connection with you. You also want to emphasize your company’s reputation and your personal background and previous successes. Establish yourself as a confident marketing master!

And be sure to personalize your email to the sender. People are used to being marketed to and can spot a canned email a mile away. You want your pitch to feel personalized to their company’s wants and needs. If you don’t have a potential connection’s email address, a great way to get it is to go to their company website and look at the format of other employees’ email addresses. If you have an employee’s first and last name, it’s pretty easy to figure out the formula for their work email from there. 

Here are some circumstances where cold emailing can be a great approach:

Developing Your Business

Whether you’re seeking a partner or an investor, your contacts are everything. Even if you receive a rejection, these connections can help you later on down the line. Rejection helps you figure out what is working and what isn’t, and you end up fine-tuning your pitch. Investors are rooting for you, and even if they don’t back you at the start, showing that you can grow, take criticism, and change will make a major impact in the long run.

Recruiting

I know this sounds crazy, but sometimes the best person for a job at your company already has a job at a different company. The best way to let that person know you have an opening is by cold emailing. The worst thing the employee can do is say “no thanks,” and if that happens, you can move on to other qualified candidates. Reaching out directly to candidates you’re interested in has proven to have a higher success rate than finding candidates through other methods.

Networking

Working the digital room, wheeling and dealing, those of us in marketing know just how important connections can be. If you see someone being a valuable contact at some point, go ahead and make the first move with a personalized cold email. A simple invitation to have lunch, give a talk, or write a guest post on your blog can go a long way toward creating a lasting connection with someone who might help you out further on in your career.

Is Cold Emailing Forever Cool?

That’s tough to say, but the data shows it certainly doesn’t hurt. It isn’t everything, but it’s certainly not something you should ignore. 

If your company would like to explore some options that go beyond cold emailing, contact TN&A for a free, no-obligation consultation at 708.334.8414 or email terry@tnugentassociates.com.



Lead Generation

Today, we’re talking about marketing lead generation. Leads can come about from many different sources; for example, through a good ole Internet search, personal referrals, cold calls, advertisements, and marketing events. A 2015 survey from eMarketer found that 89% of responders said email was their most-used channel for generating leads, followed by content marketing, search engine optimization, and finally events.

Leads often need to be funneled to lead management in order to move towards the process of the consumer making a purchase. This process is sometimes called pipeline marketing. But of course, leads need to be followed up on; otherwise, their valuable information is wasted. Once someone at the company reviews and qualifies a lead to have business potential, the lead is acted upon.

Anatomy of a lead

A lead typically is the contact information and (sometimes) the demographic information of a customer who is interested in your product or service. There are two specific types of leads: sales leads and marketing leads.

  • Sales leads are generated on demographic criteria such as income, age, previous purchasing history (thanks to many AI machine learning algorithms), etc., and then these leads are resold to advertisers. Sales leads are followed up by phone calls or by using lead management systems like Salesforce. 

  • Marketing leads are generated for a distinctive advertiser offer and are often brand specific. They are different than sales leads because they are sold only once. Honesty and transparency are necessary requirements for generating marketing leads, and marketing lead campaigns can be perfected by tracking the leads to their sources.

Online leads

Online lead generation is exactly what it sounds like: the generation of prospective consumer interest into a business’ products or services through the Internet. Leads are also generally known as contacts and can be generated for a variety of purposes. A few of these are list-building, building out reward programs, or e-newsletter list acquisition. These leads can come about on the Internet through four main avenues:

  • Social media posts and engagement.

  • Email marketing campaigns (both the warm and cold emailing varieties).

  • Online advertising, which has many different pricing and scale points.

  • Healthcare industry leads, which use online lead generation as a way to contact existing patients and to acquire new patients.

The bottom line is that better leads lead to better marketing, period. A small investment in lead generation with TN&A can improve your business’s marketing and extend its reach to more consumers and clients.

For a free, no-obligation consultation, call or text us at 708.334.8414 or email terry@tnugentassociates.com.

TN&A Data Hygiene

Data, along with gold, diamonds, and oil, is now one of the world’s most valuable resources. We are living in the age of the information economy, and now, data is everything. There isn’t anyone who understands this more than marketing and media professionals who rely on targeted advertising to fuel their business.

Targeted advertising drives conversion, and stronger data leads to better marketing tactics. But the data most marketers receive is muddled and unrefined, and needs to be cleaned up in order to be used.

Marketers need data that’s both detailed and easily understandable in order to make informed decisions about their business. That’s where we come in. TN&A’s data cleanse will trim the fat of incomplete, inaccurate, or useless data that messes up otherwise-useful data sets. We also clean, refine, and reformat the data to merge it into a more unified, practical format.

According to a quote from Richard Joyce, a Senior Analyst at Forrester, less than 0.5% of all data collected by companies is analyzed and used. Furthermore, “just a 10% increase in data accessibility will result in more than $65 million additional net income for a typical Fortune 1000 company.” For digital marketers, those numbers seem wild. Data is our diamonds, yet so many companies seem to be leaving their data crude and uncut.

As it is with so many business decisions, the issue comes down to money. Most companies feel that cleaning up and synthesizing their data takes too long and costs too much to substantiate the effort. A study by the CMO Council found that 25% of marketing, commerce, and supply chain executives think that they don’t have the time and/or resources to clean and process all their data, and 51% of marketers said that inaccessible data trapped in individual platforms was a major barrier to getting the most value out of their assets.

Unclean data is normally due to marketers working across incompatible platforms, buying data from different sources, amassing different user IDs—the list goes on.

What about cost? The good news is that data hygiene pays for itself by eliminating wasted marketing dollars and capturing sales that would otherwise be lost due to bad data. TN&A improves the ROI equation by minimizing the denominator. As an independent marketing agency, we’ll shop around to find the best data hygiene value.

TN&A Data Hygiene will clean your data so you can improve your bottom line in two ways:

  • Minimize wasted marketing dollars

  • Maximize results and ROI

Better data leads to better marketing, period. A small investment in data cleansing with TN&A can improve your business’s bottom line. If you have a better picture of your ideal customer, you can understand more clearly the value of each customer relationship and know which marketing tactics deliver the most predictable results and plan accordingly for maximum ROI. When all the elements of an effective marketing data work in harmony, we can turn coal into digital diamonds together.

For a free, no-obligation consultation, call or text us at 708.334.8414 or email terry@tnugentassociates.com.

Email Marketing is not dead - Common Sense Tip #3

As per common sense Tip #2: Deliverability, be sure your note makes it into the end user’s inbox. We know that not all email marketing tools are built equally, and some truly are better than others. So help yourself out by using one that works on your behalf to get your message in front of your intended audience.

 If you haven’t read Tip #2, do so now before diving into Tip #3 (and the same goes for Tip #1).

Knowing that consumers can mark messages as Spam with relative ease, be sure to give them a reason to want to open your emails.

3. Be relevant.

Marketing strategies are created for a reason, and communication calendars are meant to be followed, but be willing to acknowledge when you are forcing it. Adestra says that 57% of younger consumers actually set up an email account JUST to receive emails that they don’t ever intend to read. You DO NOT want to end up there. 

Common Sense Tip #3 - Don’t just send emails to do it; have a purpose.

Time is money, and to waste time is to throw away money. Can you imagine watching someone actually throw money into the trash? It hurts to even think about, so remember that pain when you are creating email marketing. Ask yourself:

  1. Do I need to send this message out?

  2. Does my subject line motivate them to open the email?

  3. Did what I include in my message really deliver what my subject line promised?

  4. Have I messaged them lately?

1.   Truth talk - is what you are sending valuable?

  • Yes, my readers want or need this information!

  • Not really, I’m just trying to keep up with a weekly schedule.

Just because you think your email has value doesn’t mean that the reader will agree. “Just ask yourself if your emails are valuable even if the customer never buys.” - Noah Kagan, AppSumo

2.   Give them a reason to open your valuable message.

First impressions are everything, and your subject line is your first chance to help your readers realize they should open your email message. It’s your way to stand out in the crowded inbox, and that’s why it’s so important to craft a subject line that compels people to click through.  

    • Be direct.

    • Be enticing.

    • Keep it short and sweet.

3.   Be true to your word and don’t waste their time.

Effectively communicate the value of the information you want to share and make it easy for them to know what to do next. Bottom line, it’s about trust. Studies have shown that trust is the most important thing in e-commerce, so you need to deliver on what you “promise” in the subject line.  

EXAMPLE

Subject line: You’re 1 click away from rewards

Message: Welcome to our membership program! We are excited to have you join the family and want to start you off right with $10 off your first purchase.  

CTA button: Shop Now

  • Build trust: That 1 click takes the users to their account, where the $10 code is already applied to anything in the shopping cart.

  • Lose trust: That 1 click takes users to your website, where they see a banner ad that states, “You’re 1 click away from rewards.” So they click the banner and are taken to a page where they have to give an email address. “But wait,” they think, “you already have my email because it was your email that you just sent me that got me to this point. Well obviously you don’t know me and therefore don’t value me as a customer,” so they click X, and the website window is closed.

Building trust in email marketing is like the Ralph Waldo Emerson quote, “Good thoughts are no better than good dreams if you don’t follow through” - so say what you mean in your email and mean what you say with follow-through in functionality.

4.   Are you coming on too strong?

Sometimes less is more when it comes to email marketing, and the frequency that you send messages will impact results. Emails that are received less frequently appear more important, and emails sent excessively feel impersonal. Ask yourself:

    • When was the last time I emailed?

    • Have I told them this same thing before?

In summary, think of email marketing like a relationship, where you need not be selfish. It isn’t about you - it’s about the readers/customers. So be respectful of their time and attention.

(Guest post written by T. Nugent & Associates COO, Katie Cochrane)

Email Marketing is not dead - Common Sense Tip #2

Thanks to last week’s common sense Tip #1: Desktop or Mobile - Consider where your end user will be reading your message, you are now aware that the majority of professionals reading email do so on something other than their computer.  So it really does matter how you lay out what you want to tell them.

If you haven’t read last week’s post with Tip #1, do so now before diving into Tip #2.

However, you can have the most amazing deal to offer, laid out beautifully, but it’s a complete waste if you can’t get it into your target audience’s inbox.

2. Deliverability

Even the most legitimate email can be blocked or moved to the Junk folder by ISPs if you aren’t following some basic best practices.  I separate those best practices into two distinct groups:

  1. What you can control

  2. What you have professionals control for you

Common Sense Tip #2 - Be sure your note makes it into their inbox.

  1. What you can control - Does your email look spammy?

    Recognizing a spam email isn’t that difficult:  Subject line words are misspelled, Subject text is in ALL CAPS, the sender email is unknown, fonts in the Body text are GIANT and excessively bolded.  Use your head here - if you wouldn’t open it, neither will they.

  2. What you have professionals control for you - The technical action of delivery.

I assume that you don’t have your own mail server and are therefore utilizing a third-party email marketing service provider (EMSP), and the one that you choose to use matters.

When determining what EMSP is best for your company, be sure to look beyond the premade templates and user experience (though both are important), to what is offered on the backend.  For me, it comes down to what is my mail service doing on my behalf to increase deliverability.

The worst thing that can happen to your newsletter is for someone to mark it spam.  While you can’t control whether or not the readers feel your note is spammy, you can make it less accessible for them to mark it as such.

Here is a fast example from my own experience:

I sent an email out of InfusionSoft (now Keap) where after just 1 hour, the Spam rating was so high that they stopped sending and deactivated our account.  Why in the world did so many people mark the email as spam? I paid a third party to have my list cleaned before ever pushing send!  

Plan B: take the exact same email and the long list of contacts that never received the first email and try sending out of MailChimp.  Viola - all emails successfully made it into inboxes.

So what was the difference?

Mailchimp knows what their emails look like when they land in a users inbox and therefore, they frame user options in such a way that they help me avoid being labeled as spam.  Note: I did get a ton of unsubscribes but not a single spam label.  That’s because rather than asking my contact if they know me, they ask if they would like to continue getting my messages.  

Big difference.  HUGE.

Until I am proven otherwise through personal experience, I’ve found that CRMs manage contacts well and email marketing platforms send great emails, but neither is great at both.  So weigh your options - you don’t have to pick just one. Most awesome software solutions play well with others and if they don’t, that's probably a sign.

We agree that email marketing is here to stay and it is important for your business to use it to reach customers.  Hopefully, now you also agree Tip #1 and Tip #2 that I’ve shared were both common sense, but perhaps things you were not taking into consideration.  Lesson learned.

Now that you know how to get your email into your target audience’s inbox (Tip #2) and how to ensure it doesn’t look gross (Tip #1), the final key is to make sure people actually open the email.  I’ll share more on that next week when we wrap up the series with Tip #3.

(Guest post written by T. Nugent & Associates COO, Katie Cochrane)

Is Email marketing dead? (a series on email common sense - Tip #1)

The answer is – NO WAY. 

Email marketing is here to stay.

Email marketing is something that every company should be using in some form or fashion, and if they’re not… (well, this is awkward…)

Email marketing facts

  • 102.6 trillion emails sent every year.

  • And it’s increasing.  126.7 expected to be sent by 2022.

  • 99% of people check email EVERY DAY. 

The handwriting is on the wall — no matter the age of who you are targeting or where they are in the world, email is a great way to reach them. 

But when it comes to email marketing, there are (what I consider) commonsense steps to take before sending, yet not everyone follows them.  T. Nugent & Associates is here to save the day with a 3-week primer on How to Do Email Right.

Take it or leave it — but trust me, at least one of the things I am about to tell you will surprise you because you didn’t know it already.

1. Desktop or Mobile?

Since email is here to stay, it’s important to consider where your target audience reads it.

By and large, the iOS mail client tops the list, whether on an iPhone or iPad. People are not reading emails on their desktop computers.  And the next biggest is Gmail. To be precise, 63% of email digestion took place on one of those email clients in 2019.

And 95% of professionals use email — making it ideal for B2B marketing.

Common Sense Tip #1 - Consider where your end user will be reading your message.

  1. Test it on yourself.  See if you got what was intended out of the email.

  2. Is it too wordy?  Is the button too low?  Does the image take up way too much space? Etc.

  3. Adjust accordingly to make the experience as pleasant as possible.

  4. Then test again. It is not uncommon to have to tinker with layout adjustments a few times before they are just right.

There are great email marketing services out there that offer tools to ensure your message looks great on every device. More on that next week.

(Guest post written by T. Nugent & Associates COO, Katie Cochrane)

Facebook ad system seems to discriminate by race and gender

On March 28, the U.S. government sued Facebook for allowing advertisers to exclude whole categories of people from seeing ads for housing — couples with children, non-Americans, non-Christians, disabled people, Hispanics, and so on.  I completely understand why the Department of Housing and Urban Development (HUD) says this violated the Fair Housing Act, which bans discrimination against certain “protected” groups. 

But here is the thing: As someone who pays for ads on social media, I wonder how my choosing not to include a particular group that falls outside my target market is any different than targeted advertising that companies do every second of every day elsewhere?

By definition, selecting a target audience means you are intentionally excluding those outside the target.  The whole purpose of target marketing is to focus on people who are the best prospects for your promotion — and if you can’t do that anymore, you would have to send your promotion to everyone in the world and marketing would therefore die, as would commerce.

Need help targeting the right market for your product or service? T. Nugent & Associates can help with that.

What is B2B Marketing?  (and what works in 2019?)

(Guest post written by T. Nugent & Associates COO, Katie Cochrane)

Sure, B2B marketing is no new concept, but things aren’t what they used to be — and in order for your campaign to be successful, strategies need to change, because it ‘isn’t as easy’ as it once was.

But why is it more difficult now?

Whelp, it’s called technology, and in turn, it’s called users.  Aka you and me.

Yes, B2B is one business targeting another, but businesses are run by people, and we the people don’t do things the same as we used to.  Just yesterday, I was openly sharing with friends that 50% of the new brand awareness that I experience and the purchases I make from new places is attributable to something marketed to me on Instagram.  Yes, you read that right: I am the quintessential, tech-savvy, educated, online user.

Did you notice that I said new brand awareness?

Because the truth is, a large part of preexisting or classic companies just weren’t/aren’t prepared to deal with the way marketing is today, and, as outlined in the attached article, a 2015 Bain & Company release states that nearly 90 percent of B2B marketing and sales executives do not feel prepared to sell to the digital-savvy customer — the evolved buyer.

So what does this shift mean for B2B marketers?  Adapt in order to survive.

1 - Experimentation

One of the most underrated yet important aspects of marketing is experimentation.  So often companies want a silver bullet, but there just isn’t one.  Remember, businesses are run by people and people are different.  Businesses today need to be willing to try and fail, and then try again.  Experimentation helps you understand what works for your brand and what doesn’t.

2 - Listen up

That’s what MBAs call ‘special listening.’  In order to know the person you are targeting better, you gotta spend time with them.  Follow your ideal customers on social media, subscribe to their emails, and join their Facebook groups. 

3 - Utilize your circle

Co-marketing initiatives by you and a partner attract new business to both brands by amplifying the brands’ reach.  Explore partnerships where you can cross-promote. When a company is featured or advertised in a curated email newsletter that targets a similar audience, the purchase rate is higher than it is for other marketing efforts.

Now more than ever, decision-maker positions of companies are increasingly being filled by late-20-to-30-somethings, and with so many channels to utilize, B2B marketing is only going to become more challenging. 

How are you doing with meeting the challenge?

T. Nugent & Associates knows what works and we can help you reach your target market.

To find out what we can do for you, contact us.


Digital derivative metrics - the key to resuscitating offline marketing.

I recently handled a direct mailing for a client.

The job cane in over the transom as we used to say in the 21st century and the client was old school.

However, it reminded me of a recent epiphany I had: digital will always have the best ROI because the “I” as in investment is so low.

However digital is what they call on finance a very crowded trade. Too many digital marketers are competing for a limited supply of human attention.

Therefore direct mail (which in my view includes print space advertising) becomes the contrarian play.

It has many advantages including its relative lack of competition. My USPS mailbox never overflows, whereas I almost always have about 10,000 emails. In addition, a physical piece demands some action: it silently screams “Read me, fold me, or if you must throw me away.” Something must be done with it, especially if Marie Kondo the clutter queen reigns in your condo. Email on the other hand is invisible and easy to hoard. Digital ads are even easier to ignore.

Direct mail also has a certain amount of inherent credibility. Subliminally it legitimizes its sender. Its delivered by a uniformed quasi-governmental employee. It often comes from authoritative sources such as creditors and public officials (who get to mail free with their franking privilege). It cost somebody money to send. Anybody can post online or send an email, but not everybody can afford postage and printing.

So there is merit to including mail in the omnichannel marketing mix.

However there are barriers. One of the biggest is modern media buyers don’t have any digital metrics to justify the ROI.

The answer may be found in a somewhat dated tech to bridge analog reality with the digital domain: QR codes.

I was a skeptic early on but once I got a scanner I became a user. They are particularly good when used in outdoor ads in colder climates such as real estate signs.

As print and direct mail make a comeback, QR codes or something like them are the best way to digitize readership and response metrics.these are analogous to digital impressions/email opens and clicks respectively. What would help is a metric that projects actual offline impressions to QR scans, developing a ratio reflecting the fact that only a small percentage people who read a print mail piece or add actually employ QR tech. This can be augmented by creating dedicated landing pages for each offline ad. The key is to understand that digital derivative print metrics are useful only as a relative metric vs an absolute measure if the ROI of offline ad spend; much of the value is awareness and branding which are best measured by traditional market research.

How T. Nugent & Associates Can Help

Our vintage associates’ (yours truly first and foremost) experience bridges the millennia so we’re old hands at the lost art of direct mail and print advertising in magazines.

Our youthful associates are digital natives. So, we can help you create and implement strategical programs to make the most of omnichannel options via integrated campaigns that maximize ROI.

For more information, go to www.tnugentassocites.com

Four marketing megatrends that will shape the future of pharma

1. Artificial Intelligence/Machine Learning (AI/ML) are here to help humans

Greetings, earthlings, especially those of you who market pharmaceuticals. It turns out artificial intelligence (aka machine learning, or AI/ML for short) is not your new master (insert sigh of relief here). Although the future of pharma marketing is digital technology including , but to supplement rather than replace human intelligence, according to a recent post by Viseven.

Says Viseven: “The forecast is that AI and machine automation are going to unveil individual data preferences, making pharma marketers able to ensure every customer receives adequate information in time needed. “

But you can’t automate humanity and authenticity, according to Viseven: “Even though automation is quickening and simplifying multiple tasks, marketers shouldn’t forget where their own value remains. Chatbots will never replace humanity and empathy. True emotions and understanding are what people expect most from life sciences and it’s certainly cannot be provided by technology itself.”

There is the key: Even in medical marketing to healthcare professionals, widely viewed as the most rational of humans, emotion plays a far greater role than many marketers would like to admit, yours truly included. Even these most rational of beings don’t make entirely rational decisions. If they did, marketing and sales would be much less effective.

Not only are machines unable to think, they can’t feel. That’s where we humans have the advantage. Hardware gets better, software gets better, wetware…not so much. Human emotions still have more in common with chimpanzees than PCs.

As it is, says Viseven: “All technological processes and automated algorithms require people at their core. Al/ML cannot be simply plugged in and to solve whatever challenges may occur. The triangle of data, processes and technologies still requires humans’ strategic thinking and mindset.”

As we see daily in the financial markets, most people don’t react to the same facts the same way every day. The Fed cuts rates and the herd either rallies or panics, based on irrational reactions and overreactions driven by fear and greed. What data driven AI/ML algorithms can analyze is what data points trigger human emotions and what decisions are made as a result. Monte Carlo-type simulations can predict the probability of decision-maker actions as functions of emotional reactions to data points. Such profiles can be individualized and rolled up into segments based on past behavioral data to the extent that the necessary data are transparent.

According to Sara Siegel, Deloitte Partner, Healthcare Strategy and Consulting: “Technology alone, such as the smartphone, is not a silver bullet for healthcare. Instead, success lies in the convergence of digital health and human interaction. It also relies on developing partnerships which harness technology, while providing trust-based, patient-centered care; and balances person-to-person engagement with the efficiencies provided by technology.”

2. The omnichannel digital future is now (and from now on)

Remember edetailing? Great idea if you’re a pharma CMO/CFO or an edetailing SaaS startup, except for the part where the doctors shockingly don’t want to sit in front of a computer and listen to the detail (unless of course you pay them, which you can’t). Result: crash and burn. Detail reps easily dodged that bullet. So once again human triumphed over machine.

The takeaway for the 21st century tech stacked marketeer is that the user experience is paramount. It may be easier and cheaper for you as a marketer to check the sales box with eDetailing, but if the if you lead the objects of your affection to the water you’re carrying but you can’t make them drink from that particular font of knowledge, then you are using a channel that won’t serve as a conduit for two-way communication, which is the only kind that matters. Channels that don’t function as media between the mind of the marketer and the mind of the marketee are exercises in futility.

Now comes the buzzword du jour, “the smart multichannel mix”, also known as “omnichannel”. According to Viseven, “Personalized multichannel marketing and value-based care will matter more than ever. The trend of using online resources via multiple channels is going to increase significantly. (The) (s)mart multichannel approach is gradually affecting HCP-med rep relationships as well. Receiving any medical updates or products info might be easily done at any time via Internet. As a result, here come more relevant digital solutions pharma can offer — live videos, interactive detailing and e-sampling. It seems unlikely you’ll see a high-performing med rep with no interactive presentation on his/her tablet.”

I concur with this vision with one caveat. Access is being denied to pharma reps at the day job, and even where the gate is not kept, reps are essentially trying to steal time, the doctors’ time, most valuable asset. As a wise physician once told us at an industry meeting, it’s really all they have to sell. Yet they still need to know as much USEFUL information about indications, dosages, patient assistance programs, etc. as ever, and they still need samples in a high-deductible world. As older docs retire, the uptake curve on digital is trending up exponentially-digital, especially mobile, is moving from an imposition on Boomer doctors to a demand from mobile millennial medics for who the latest greatest information is just a click away. Also, in a world moving toward concierge medicine and connected care, detail reps need to become as accessible as their colleagues in the rest of the business world — that means 24/7/365. Doctors and patients never sleep (at least not soundly), so neither can reps who want to be the winner that goes to dinner. At the very least, there needs to be a customer service center that is always on. Furthermore, channel responsiveness varies by physician and even by data point and by product and rep. Certain doctors with high interest in a complex product from a trusted rep will welcome high-value text messages, especially in response to urgent questions. Change any one of those characteristics of the rep-prescriber relationship, and harm could be done. Some doctors read some emails from some senders. Others may not be accessible at all with that channel, whereas they still read direct mail. Today’s technology allows custom media mixes by doctor, dynamically optimized based on the response graph.

Now for the caveat: I don’t think in-office online interactive presentations work. There are too many login and bandwidth issues and while tech is great when it works, it often doesn’t in vivo. Better to follow up a face-to face detail, that rarest of occurrences in the real world, with a texted or emailed link to online content.

As Viseven says of pharma vis a vis he “mobile generation”:

“Pharma made a significant shift towards using mobile technologies over the past few years. Throughout a day doctors have an ability to access any clinical information just using their smartphone. In order to get the latest sources or to find any info, just a button click is required. That grants physicians with an opportunity to be focused on more complicated tasks and leave their easy ones to be solved by smart technologies. Sounds promising? Huge transformations in healthcare and pharma industry continue to evolve through virtual and mobile experiences. Internet-savvy physicians are no longer an emerging group — nearly all physicians are online for professional purposes.”

Privacy is the biggest threat to the brave new world of personalized promotion. The controversies embroiling the FANGS (Facebook, Amazon, Netflix, and Google) threaten data broker life as we know it. In my opinion, the regulatory environment is a substantial risk. If the US ends up with something resembling the EU GDPR, business will proceed almost as usual. If something more restrictive comes to pass, marketing effectiveness could be compromised. In the short term, the biggest complexifier (as Jeff Bezos would say) is inconsistent state regulations, which could potentially mean 50x decision trees in algos.

The antidote may be, in Viseven’s words, “Trust and transparency. The keys to sufficient collaboration between humans and technologies.” I also agree that “Visualized data and up-to-date 24/7 virtual care will become the norm throughout the industry.” I am basically a visual illiterate, but my more graphically inclined colleagues have convinced me that visualizations via dashboard reveal insights plain text and spreadsheets obscure.

3. Data is destiny
 
You need to feed the AI/ML beast with mass quantities of data, and not just any data: the old GIGO rule (Garbage In, Garbage Out) applies more than ever. The data must be accurate, comprehensive, and current.

New sources are going to be woven into the data tapestry according to Viseven. If data is oil, the Internet of Things (IoT) and edge computing are shale oil, expanding the supply of data in real time at automated speed and provision, harvesting a new bounty of bits and bytes.

According to Viseven, pharma spend in this tech stack will increase 5x by 202, to $2.5 billion. Through edge computing, “data can be processed by the device itself in real-time. SaaS (software-as-service) grants pharma companies quick solution (s) from any device at any location almost 50% of pharma manufacturers are using or are about to consider it.

4. Content reigns

I emphatically concur with Viseven’s assertion that a new perspective on social media networks and content marketing is in order: “Pharma companies should no longer consider content marketing and social media as add-ons. Social media networks might be a great enabler for pharma companies in terms of deepening relationships with potential customers. Thanks to their advantages, pharma can reach very specific types of audiences throughout the world and deliver them qualified content exactly when and where they most need it. If the company wants to remain relevant, no chance those networks could be neglected.

Viseven also addresses the dark side of the social media force: “Beyond question, people often trust what they read no matter whether it’s proven scientifically or not. Thus, digital and social media platforms are ideally to be highly regulated. According to the current FDA regulations and multiple restrictions, pharma isn’t allowed just simply join a conversation. As a result, a large amount of information can be both imprecise and adverse.”

Here is a case where regulators do a disservice to the public. Antivaxxers and other charlatans and scoundrels can say whatever the social networks let them get away with, but the experts on the subject at pharma companies are gagged by FDA free speech limitations. I sincerely hope that First Amendment challenges to this policy which works against the public interest prevail.

Meanwhile pharma has picked up the pace: “According to a recent study, since 2013, the average number of tweets by pharmaceutical companies has gone up by 530%. Top industry players have increased their Twitter followers by nearly 300%.”, according to Dr. Kevin Campbell

So, to recap,

  • Humans need not fear marketing machines, rather they should embrace them rather than be replaced by them. Nonetheless, automation won’t be a panacea. You can’t just set it and forget it. There won’t be a “do my job” button on the keyboard.

  • Omnichannel is the real deal, but privacy concerns will limit the potential of data-driven content and channel personalization.

How we can help

If you need help navigating this brave new digital data-driven world, T. Nugent & Associates can be your B2B marketing sherpa. We know data, doctors, and content.

To find out what we can do for you, contact us.

Strategical

Is that a word? If it isn’t, I’ve coined a new one.

Since it’s my word, I get to define it:

A marketing service that develops strategy and implements the tactics that flow therefrom.

Where can you find such an agency?

To quote Gordo Cooper in the film The Right Stuff, you’re looking at it.

That’s right. The new kid on the block, T. Nugent and Associates, does it all or any portion thereof. In fact, strategical is more or less our one word Statement of Principles (to swipe from Herman Mankiewicz’s script for Citizen Kane).

It starts with your objectives: what are you trying to accomplish. The strategy flows from the objectives. The tactics flow from the strategy.

Like a river (except for the Chicago River), it only flows one way. Starting with tactics does not compute.

T. Nugent & Associates can help you define your objectives, review or create your strategy to achieve them, and help you implement the tactics. We can conduct a marketing audit to affirm or refine your current marketing. We can even serve as an outsourced fractional Chief Marketing Officer (CMO).

Tactically, we can handle anything that can be done with Microsoft Word and then some. That includes writing marketing plans and content. We can help you buy media. We can write and deploy email campaigns. We can manage your LinkedIn corporate page and help your staff enhance their LinkedIn presence. We can call on our network of partners for graphic design, Search Engine Optimization (SEO), printing, and more.

So in other words, no job too proud, no job too humble.

Does it pay to be ignorant?

In the 1950’s there was game show on the new medium of broadcast television called Twenty-One, hosted by one of my favorite vintage comics, Jack Benny. Two contestants competed against each other in separate isolation booths, answering general knowledge questions to earn 21 total points. It later turned out the whole show was rigged, as fictionalized in the film Quiz Show.

But before that, a parody show ran, mocking the quiz kids. It was called “It pays to be ignorant”. Everybody at the time thought that was a joke, which it was.

Flash forward to today, when one of my favorite  writers, Josh Bernoff, penned a post which turns the comical presence of that long ago show into a thought-provoking question: does it indeed pay to be ignorant?  

Well, in fact, he asks the far subtler question “What comes before learning?” The answer, he posits based on his decades, is ignorance. He cites the classic example of the Nobel laureates Penzias and Wilson who discovered the Big Bang’s background noise, having initially attributed it to pigeon droppings on the dish of their radio telescope,

His eloquent thesis statement doesn’t lend itself to synopsis, so I quote him at length:

“If you are going to learn, there are going to be a lot of moments in which you feel stupid. In fact, you are not stupid. You are either ignorant or wrong. Both are curable with evidence. After you get past that feeling of incompetence, you get the reward: insight. Now you know something you didn’t know before.

We live in a culture overflowing with know-it-alls. We know (or imagine we know) how to fix the opioid epidemic, how to fix the student debt crisis, how to preserve the spirit of free enterprise while protecting the most vulnerable among us. Especially among our politicians, there is an overwhelming desire to have all the answers. (Except when there’s a desire to do nothing; in those cases, passively, “more research is needed.”)

Ignorance feels uncomfortable. Finding out that you are wrong about anything is unpleasant. But unless you embrace the discomfort and the feeling of being wrong, you will never learn anything new.

This is why it is so important to seek evidence and recognize when you are at the peak of Mt. Stupid. There is no shame in ignorance, only in failing to act to cure it.

I wish some of our politicians would more often say, ‘I don’t know; I’m going to find out.’ Ignorance is curable. Certainty and immunity to evidence are not.” 

This is “good stuff”, as 20th Century “Tonight Show” host used to say in rendering his highest praise to guest comics. As Shaw said “He knows nothing; and he thinks he knows everything. That points clearly to a political career.” George Bernard Shaw, Major Barbara

Or to quote Yeats: “The best lack all conviction, while the worst are full of passionate intensity.” William Butler Yeats, The Collected Poems of W.B. Yeats

And finally, in the immortal words of Russell:

“The trouble with the world is that the stupid are cocksure and the intelligent are full of doubt.” - Bertrand Russell . https://www.goodreads.com/author/show/17854.Bertrand_Russell

(KC: Source of all quotes: GoodReads)

In another article, Bernoff advocates keeping an open mind in research and analysis. Inevitably you go into a study with a hypothesis. It is wise in Bernoff’s eyes to be very open to disproving it—doing so can be a far more valuable outcome than confirmation.


What role TN&A can play (or How can we help?)

As hard as you try, it is hard to be humble when you’re perfect in every way (to paraphrase an old country music classic). In other words, there is an inevitable confirmation bias when you try top keep an open mind within a business context that you’ve been in for years, especially if there is tribal corporate group think.

That’s where T. Nugent & Associates can help. Like Spock in Star Trek, we’re incapable of speaking other than the truth to all audiences, including the powerful. Or ignorance pays, as we come to each challenge with the proverbial tabula rasa, able to detect the elephant in the room without binoculars.

So, if you need a fresh set of eyes to examine your status quo, let us know here (link to landing page).      


The future of the United States (Postal Service, that is)

The Nation is not a commonplace reference for marketers, but late last year it ran an interesting story about future of Inited States PostL Service (USPS).

The piece was inspired by a drama that played out last Christmas and featured an epic cast of characters.

Two of them, Jeff Bezos and Donald Trump, have moved on to more interesting plot lines. The third was another unlikely character in a direct marketing context, Sen. Bernie Sanders.

Trump played the protagonist. As is well known in light of recent events, he is no fan of Jeff Bezos, who placed himself in The Donald’s crosshairs as a result of his stewardship of the Washington Post, a pillar of what Trump pejoratively labels the mainstream media.

The President argues that the USPS is being exploited by Amazon, and should charge them more for shipping to help resolve its financial challenges. This is arguable except for the part where Amazon decides to insource delivery down to the last mile.

There are also elements within the Administration that want to privatize the USPS. Other countries have done so. Royal Mail is the textbook precedent.

Enter The Bern, who advocates postal reforms that would enable the Service to be more competitive.

Sen. Sanders told me something I didn’t know: the USPS once offered banking services, which is still in vogue overseas. Japan is the poster child of postal banks. Given the challenges of the unbanked, this is an interesting idea.

Fat chance, though. The powerful financial lobby would render such a proposal dead on arrival regardless of its merits.

In my humble opinion, Trump has a point. Package delivery is one of the few viable businesses the USPS has. They have pricing power. Their rates are far lower than FedEx and UPS, which is why Amazon uses them, and they’re even lower for AMZN because of the volume discount they negotiated.

Such special deals for top market cap companies are under attack these days, as evidenced by the demise of HQ2 in Long Island City, NY, so now would be a great time to lay a price increase on Mr. Bezos.

It’s also a rare bipartisan alignment between the oddest of couples: Bernie and Don.

Another fat chance is postal privatization. While it is extremely hard to argue that if the USPS ceased to exist we would need to recreate it, the political reality is that it’s a sacred cow especially in both little states that dominate the Senate and the big blue ones that rule the House. A blue House beholden to unions would never in a million years privatize it.

Deregulation is perhaps more doable with The Bern providing cover on the left flank. Few people really know or care about the intricacies of packaging delivery pricing, and it can be populized as a way to stick it to the behemoth Bezos.

That could be a good thing. USPS has for many years been a business-to-business proposition. It should be freed from the shackles of the Congress and its bureaucratic watchdog (the Kafkaesque Postal Rate Commission).

Bernie also has a point about the crippling pension prefunding mandate the Bush administration imposed on it. Without that, says USPS, it would be profitable absent any other reforms.

The bottom line is marketers can anticipate that there will always be a USPS as far as the forecasting eye can see. The service offers a lot of help to marketers who want to use it to best advantage.

Is the tech stack drowning out the essence of marketing?

In IT circles, the world is divided into three parts: hardware, software, and wetware. Wetware is the human brain.

Wetware issues are described by jocular techies as an ID-10-T issue, meaning there is an idiot’s wetware at fault.

I encountered many of these as a user because I’m a 20th Century schizoid marketing man. When I was in school, I was deemed too smart to take typing (yes we had typewriters then). That led me to a lifetime of typos as the bane of my existence.

As time marched on, it marched right over those of us who were technically challenged. So we got dragged kicking and screaming into the wonderful world of IT.

People like me didn’t go into marketing because we were gifted in the STEM cell department. So needless to say, this new digital realm was not a particularly welcome addition to our resumes.

Flash forward to the present. As we approach the end of the first quintile of the new millennium, there are now nearly 7,000 “martech” solutions, and nearly 90% of them are run by marketing vs. IT. The tech stack is still a wok in progress for the majority of marketers. (Source for these stats: Marketing Profs) .

My bet is marketers are spending WAY too much time trying to get the tech stack hardware and software optimized at the expense of trying to figure out how to master the wetware.

The essence of marketing is understanding the psychology of the prospective buyer, and mastering the emotional calculus of messaging to achieve objectives.

One thing all the data and data processing in the world can’t truly do is psychological strategy. Things like branding, positioning and persuasion still are in the realm of the art rather than the science of the craft.

Machines don’t buy stuff. People do. Behavioral economics teaches us that people don’t make rational decisions. People are tribal. They’re emotional. Human emotions move markets. They’re unpredictable and volatile.

Consumer marketing is the least rational realm, but BTB is not entirely rational either. The great marketers are master psychologists.

Keep this in mind the next time you plan your day. It might be more productive to spend some time figuring out how the mind of the customer works than figuring out how the latest software upgrade integrates with your legacy systems.

The future of marketing: 4 industry leaders (including me) share their predictions

January is the season for predictions accompanied by the hackneyed caveat that they are very difficult especially when they involve the future.

So, it's high time for me to weigh in with predictions that I will remind you of next January if accurate and hope you forget about if I'm wrong. I peg the odds at 50%-50%.

Actually, the framework I'm using for my obligatory prediction piece is the "Think with Google" contribution to the predictatariat. 

Google asserts that "There’s never been a more exciting time to be in marketing. New technologies, trends, and customer behaviors are transforming the industry at breakneck speed, creating copious opportunities for those who are able to keep up — or better still, get ahead of the curve.”

Who can argue with that? Not I. Of course, having been in marketing for way too long, I could add that one could have said that at many points in the past couple of centuries. However, we truly do live in a time when a deluge of tech makes the impossible possible on virtually a daily basis. From the time I got in the marketing biz until about 1993, there wasn’t really that much new under the sun. Then the digital realm began to explode. Ever since, it has been a wild ride with one advancement after another challenging marketers to keep up with the pace of tech change.

On the other hand, the basic marketing proposition remains the same: use psychology to win hearts, minds, and share of wallet. The copywriter is still the key player. Most of the tech stack simply gets the logistics of the three “rights of Marketers”: right time, right person, right message,

Now for the fun part: let’s critique the three predictors’ predictions. 

1. Voice marketing

Abbey Klaassen, president of 360i’s NYC HQ thinks voice marketing is the future. “Voice is somewhere between an evolution and a revolution for marketing,” Klaassen predicts. 

I think it’s a fad.

True, lots of people are buying these little assistants or getting them for holiday presents. My “research” indicates lots of them are gathering dust.

In a mobile centric world, it’s hard to imagine the in-home voice devices will be the go-to interface. Speaking of (or potentially to) mobile, my experience with Siri has been botish at best. I know a few people who possess prowess, but most re using the good old virtual keyboard.

Then there’s the “Big Brother” privacy paranoia that the infernal thing is always on snooping on your every word. I predict voice will at least in the short term be one of those “great disappointments” along the lines of virtual reality.   

2. Intent

Matt Naeger, Merkle’s chief strategy officer argues “The next big thing is around predictive intent.” This new new thing would usurp old new things such as demographic-based personas and marketing funnels. 

I am personally unhappy about this scene I just mastered the buzzwords about this.

M y view is that the marketing industry tends to repackage commonsensical, ancient practices in new themes and memes in order to keep the consulting and tech pipelines moving (assuming pipelines are still in vogue). 

My personal 5-minute MBA has remained the same over two centuries: Find out what they want and give it to them.  Marketers since the beginning of time have been seeking buying signals in the form of new movers lists, RFM (recency, frequency, monetary value), and myriad other hoary techniques.

Intent is nonetheless interesting. There are many more data points available if you can capture and actualize them in as close to real time as possible. That is easier said than done but no doubt you will be hearing from multiple “partners” with shiny new tech objects which purport to do it. 

The older I get, the more I realize how great a role emotion plays even in the B2B space. How does one sense emotions that generate intent? One way is to monitor events that cause emotions and detect behavior that may catalyze them. For example, if I sell to the government and shutdown threats arise, perhaps that incites fear that causes buyers to pull the trigger on sales before the office closes.

3. New influencers

Jerri Devard, Office Depot’s chief customer officer, cleverly quips “It used to be that celebrities became influencers; now influencers are becoming celebrities.”  

What I think this means is that before you had to be a celebrity to be an influencer (e.g., a Kardashian). Now you can be an influencer even if you’re nobody and become somebody as a result.

I hope his is true, as I am a nobody and would love to become an influencer paid thousands of dollars every time I tweet (up from nothing at the moment).

What I do know is that this influencer thing is a BFD as Joe Biden would say. By that I mean marketers are throwing tons of budget at it. Sadly, this is because nobody trusts marketers or brands, so they need to hire outsiders who may command trust and respect. However, the paradox is that once their followers see through the aura of influence and realize the influencers are just paid shills, the magic dies.

Again, this is an ancient idea. We used to call it two-step marketing, word of mouth, and endorsements. He digital age has cloaked it in the mantle of social media, which is in and of itself under attack.

However, these things are tried and true because they worked. To paraphrase Lincoln (a 19th century influencer of some renown), you can influence some of the people some of the time, and all of the people some of the time. You may even be able to influence all of the people all of the time if you can match each person with an influential influencer for them.      

Well, that’s my prediction about the predictions from Google. File these away and give me fame or shame next January, unless it still “requires further study”.

 Check out what started it all - here is the newsletter that prompted my post.

 

Social Media Q&A

In the last 10+ years, social media was born and it has grown to be one of the most important communication channels to market to businesses and end-users. Within the pharmaceutical industry it is no different, social media plays a unique role and I was recently interviewed for an upcoming article on this topic. Check out how I feel about the current and future state of social media in pharma.

How will any of the scandals regarding social media companies last year (i.e., Facebook and Cambridge Analytica, Twitter bots, etc.) impact pharma marketers use of any of these platforms in 2019 and beyond?

It is difficult to predict how pharma marketers will respond to the recent blows to the credibility of Facebook and other social media, but Facebook in particular that cannot be ignored. The reality is that the political manipulation of social media has little to do with legitimate marketing, except insofar as it diminishes the overall credibility of the medium. To the extent that usage declines, Facebook and other social media will be of less utility to pharma and other direct to consumer marketers. However, Facebook has achieved such a massive market share that smart marketers will continue to exploit it for the foreseeable future.

What elements are crucial for pharma marketers to successfully work with social media influencers to promote their brands?

Influencers must be chosen with great care as to their credibility to ensure that they are bona fide. Proper credentials are essential. Any such content must be carefully prepared to ensure compliance with Medical, Legal and Regulatory (MLR) requirements.

As ephemeral content continues to gain popularity (such as Instagram Stories, Snapchat, and now Facebook Stories), how can marketers best use these platforms to engage with audiences?

Ephemeral content is challenging for, however the popularity of the more visual social media such as Instagram is compelling. Images as marketing tools are again challenging for pharma given MLR requirements, and the medium may not lend itself to traditional pharma creative. Therefore, testing of various approaches is indicated.

What will be the biggest changes or trends for social media marketing in 2019?

The challenges to social media’s credibility may impact on social media engagement. Anecdotally, I have heard people declare the death of Facebook, but to paraphrase Mark Twain I consider such reports to be grossly premature. It is apparent that the video as destiny movement has run its course, so the challenge will continue to be creating and targeting compelling content. Privacy concerns will make targeting more challenging. For example, Apple’s recent moves to limit retargeting may signal a trend to reduce the availability of data points necessary to micro target. This could particularly impact on healthcare professional targeting as most HCPs use iPhones.