Product Lifecycle Management and Market Research

How did you make your last critical strategic business decision? Was it based on your experience because you found yourself in a very similar situation? Or maybe you had a really strong gut feeling? Perhaps you were in a highly political situation and it really wasn't a true decision per se, but more of a selffulfilling prophecy where the decision had already been made and you were just looking to justify it? Or was upper management clearly leaning one way and you knew if you came back with a different recommendation it was going to be a huge uphill battle - and you just weren't prepared for that fight? These are just some of the ways in which key strategic marketing decisions are made everyday. Decisions that usually result in significant investment of resources - dollars, field sales time, and corporate focus. Many of these decisions translate into the near- and long-term success of a pharmaceutical brand. With so much at stake, why don't brand managers spend more time making these decisions by perhaps conducting some market research? In the real world, sometimes there just isn't enough time if you are trying to react to market conditions or more often a brand manager just doesn't have the budget to afford to conduct a study every time an important strategic decision must be made. Based on my experience and the experience of my colleagues, I believe that there are some critical primary market research studies that you must conduct throughout the brand lifecycle to have enough supporting information to make key strategic brand decisions. I also strongly believe that primary market research should be supplemented and integrated with secondary market research to get the best understanding of the marketplace. In this first article on the subject, we will discuss what those key primary market research studies are and how they create a strong foundation from which a brand manager can make multiple strategic and tactical business decisions. First, before we discuss specific market research approaches, it is important to understand when market research can assist a brand manager. There are three key functions of brand management where market research is of great use regardless of the product's stage in its lifecycle: 1) Planning, 2) Problem-Solving, and 3) Surveillance. Whether a product is preparing for launch or has been on the market for several years, developing, adjusting, and monitoring the brand plan is at the core of a product manager's activities. Every tactic, ideally, should be measured against the strategies set forth in the brand plan. In the annual planning cycle, market research can help identify market opportunities and help define or refine target customers and their characteristics. In other words, market research can address how and where you get the business. Another important role of market research is to assist with the wide variety of business issues and problems that arise throughout the product's lifecycle. Some of these issues include anticipated key short- and long-term business decisions a brand manager must make. For example, determining the optimal pricing strategy or the different strengths or types of product presentations to offer (i.e., tablets, powder, liquid, bottles, pre-loaded syringes, etc.). Should the brand manager invest in Phase IV studies? If so, what additional information would impact physician prescribing or managed care formulary access (i.e., head-tohead studies, concomitancy, use in certain patient populations, outcomes studies)? These seemingly simple questions typically impact millions of dollars. For such a significant business decision, don't you think it is prudent to spend a fraction of that price to make sure the best decision is being made? As intuitive as it sounds, you may be surprised by how many of such decisions are made without more than a gut feeling or determined by political pressure. The third use of market research is for market surveillance. Competitive intelligence and market surveillance should be a routine market research activity. This includes: monitoring competitive promotional activity and messaging as well as any competitive clinical development; understanding how customers currently position your product and how and why this has changed over time. Not to mention keeping a pulse on sales representative activity and execution of marketing direction, particularly on how this translates into customer message recall and product usage.

The breadth and depth of market research knowledge varies greatly among product managers. While in most organizations it is one of the primary "feeder" departments for marketing, rarely do ex- market researchers make up the majority of a brand team. If you are one of those brand managers who doesn't have formal market research experience, you may be wondering just how much market research you really need to know. While a marketer should have a basic understanding of both common primary research approaches and secondary data sources available, it is much more important for a product manager to approach a business decision with a market researcher's thought process. I have broken down the market researcher's thought process into four key check points that a product manager or market researcher should employ. First and foremost, learn to ask the right questions and then keep on asking them. While this sounds fairly straightforward, it can often be challenging. Asking the right questions requires you to be cognizant of when you are creating biases. These biases are rooted in assumptions you don't even realize you are making and tend to surface as leading questions or a data filtering approach that can skew your survey population and resulting outcome. For example, if your survey population only contained high writers of your product, questions about your product will probably be answered more favorably than from physicians who recently switched to a competitor. Assumptions are okay and unavoidable, but you must be aware of them and how they will affect the answers to your questions. (see Fig. 1) Similarly, the second check point is to understand what information is really needed to make a particular business decision. This can be heavily influenced by budget and time constraints, but I've always favored at least some data so that you have information to support your decision if management asks for rationale. Often when there is very little time or resources, I will look to in-house secondary data or refer to past primary market research results that at least provide a foundation. If time and budget permit, you must then determine if you need primary or secondary market research, or both, or whether internal consensus of experienced individuals is enough. Regardless of the approach you use, the next important step is to know the limitations of the data set(s) you have chosen. Many secondary data sources will actually list some of these in their manuals or audit books. This is probably something you should ask of your market researcher or sales analyst. The other thing I routinely do is check for consistency between the newest results and those of previous studies, reports, or ad hoc analyses. This is particularly important when looking at primary market research results. Usually a few background questions about patient types and product usage are asked. If these results do not match with your secondary data reports, this is usually a flag to ask more questions and find out why there is a discrepancy. It may be the way the question was worded or the screening criteria for the survey sample resulted in a more focused population than originally intended.

T he most important and final check point is to make sure the results are actionable. I call this the "so what" factor. This means a market research project should always have a business question at its root and end with recommendations on how to address that question. This is one of the hardest parts and depending on the style of the market researcher, the analysis may end with the survey results as opposed to the final step of making an actionable business recommendation. Frequently this last step is left to the product manager. In the management consulting arena, the actionable business recommendation is usually the reason the consulting project was initiated and the value the consulting firm brings to its client. To a management consultant, all of the data gathered (including primary market research) is considered supporting documentation for the business recommendation. In many market research departments the study summary is seen as the finished product. This is usually because many market researchers approach the project from a more academic and scientific viewpoint instead of from that of a business manager. This is why a brand manager must be the project compass and keep the focus on an actionable recommendation. If not, the brand manager could end up with a lot of interesting data and be scratching his or her head asking "so what" or "why did I want this project in the first place?"

While the market researcher checklist will help a brand manager ensure an actionable recommendation with a solid understanding of the limitations of the research, it is still important for a product manager to have a basic understanding of the most common studies and secondary data sources available. While some of the studies and secondary data are specific to certain stages of a product's lifecycle, most of these studies are used throughout the lifecycle, particularly during the pre-launch, launch, and growth phases when brand investment is high. This review of the most common market research studies for strategic business decisionmaking will be presented in the order in which these studies are typically performed in a launch situation. Often in re-launch situations or when there is a significant market event such as a competitor launch, some of these studies will be re-run. In subsequent Future Pharmaceuticals articles we will go more in-depth into some of these studies; however, if you are interested in more in- depth knowledge or formal training, I would recommend attending a TVG Inc.(R) course.* As we review the studies below, remember that sample selection is extremely important to the results of these studies and potential future success. Based on the targeting strategy, product managers along with their market research counterparts must determine the appropriate survey sample design (i.e., writers of which products, high vs. low share, early adoption, specialty, etc.). The closer your survey sample reflects your target population, the better the results will predict their actual response. PRODUCT PROFILING Product profiling studies help a brand manager understand which product attributes are considered important and different to customers. (See Fig. 2) The attributes customers consider important and different (the top right box) are the ones that need to be highlighted in the product's positioning and messaging that will be developed later. Usually a product does not have a great number of attributes in this column, so the product manager must also think about how he or she can make attributes that are different but not important (bottom right box) become more important to prescribers. (See Fig. 2) PERCEPTUAL MAPPING A perceptual map shows how products are positioned in the minds of prescribers. To get the whole picture, you must first know the importance of the attributes before you can compare the relative differences between products on each attribute. Perceptual maps can be very confusing to read and interpret without the guidance of a trained and experienced market researcher. You will see why when you look at Figure 3. To a brand manager, the results of a perceptual map are important to understand how strongly certain attributes are affiliated with your product versus your competition. You can also understand which attributes are considered similar by the spatial clustering. This will help a brand manager understand how physicians differentiate products. Perceptual maps can be compared over time to measure if changes in your messaging and those of your competitors shifted how physicians think of products. (See Fig. 3) WAR GAMING War games are studies that help brand managers simulate competitive selling situations. These studies are particularly useful for product launches - whether you are the new market entrant or a product creating a defense strategy to blunt an entrant. The success of a war gaming project tends to be directly related to the amount of preparation and attention given to development of the testing material - the closer you can anticipate and simulate the new product's selling messages, the more applicable and predicative the results will be. In order to achieve this, teams with sales, marketing, and market research representation are ideal. The result will either be a recommended sales message sequence for a new product, or a sequence on how to overcome objections and diffuse the anticipated new product's selling message. PRODUCT POSITIONING Product positioning is the foundation for brand messaging and promotional material development. According to the TVG, Inc.(R) approach to product positioning, your positioning statement must include three parts: the premise, promise, and proof. The premise is the background information you must believe to accept the positioning. The promise is the positioning statement, and the proof is a series of three to four data points that support the positioning statement. Sometimes product managers will develop a product's positioning, then gain internal consensus and move forward to the development of messaging without formally testing the positioning statement and supporting message points. A brand manager who skips this market research step in the development of a master visual aid is setting themselves up for disaster down the road. It is very important that the positioning and supporting proof statements test strongly with physicians. This is one of those situations where a product manager may think they know their customers and can represent them, but

because this is the foundation for a brand's tactical plan and millions of dollars of promotional investment, it is prudent to double check with the customers themselves. CREATIVE CONCEPT TESTING Creative concept testing helps a brand manager identify the optimal visual theme that conveys or aligns with the product positioning. Usually the tag line and opening headline are tested as part of the visual options. A brand manager will have to balance a concept's stopping power, communication of the positioning, and motivation to prescribe when choosing which concept will be the foundation for the promotional campaign. Rarely does one creative concept rise to the top in all categories so it will become a strategic decision for a product manager as to which category or combination is most important in choosing the winning concept. MESSAGE TESTING Message testing is the development of the wording and data displayed in the master visual aid. Often the copy, sequence, and whether data needs to be displayed visually in a chart, graph, or table is tested. Some researchers will hold the messages constant throughout the study, but usually to save time and money, slight modifications are made between testing cities. The result will ideally provide a product manager with a finely tuned message sequence that supports the product positioning, is relevant and important to physicians, and motivates them to prescribe. MASTER VISUAL AID TESTING Master visual aid (MVA) testing is when the results of the creative concept testing and message testing are married to create the core selling piece for sales representatives. Typically, this is more of a "disaster check," or "confirmation" that when the creative visual elements are combined with the copy, the layout, and the message, the sequence remains optimal. Sometimes if you have additional target groups or specialties that are important to the brand but not key targets for the MVA, you will include them in this round of testing. ATU STUDY An awareness, trial, and usage (ATU) study is a quantitative survey that helps a brand manager understand how aware physicians are of the product and certain features, reasons for physician trial (or not trying the product), and why they continued using the product and with which patient types. Often, ATUs are conducted a few times a year, much more frequently surrounding a market entrant and often as a hybrid study combined with message tracking. MESSAGE TRACKING Message tracking studies do just that. They are quantitative surveys that identify which messages physicians are receiving, and how relevant, believable, and motivating they are to prescribing. A brand manager can use the results to identify where message adjustments are needed (if any) as well as any areas for sales force training and direction. Message tracking studies help a brand manager keep a pulse on how messages are received, competitive activity, and sales force activity and impact. These are usually fielded in combination with an ATU a few times a year. Research waves are compared to see how changes in sales force direction impacted physician prescribing behavior. The common marketing research studies highlighted above are at the core of a brand manager's strategic and tactical business decisions. There are a few secondary data analyses surrounding segmentation and promotional response modeling that are also used quite frequently and will be discussed in more depth in subsequent articles in Future Pharmaceuticals. In conclusion and as discussed, the key to making a critical strategic marketing decision is to be certain of the market conditions and anticipated impact of your decision. This encompasses great planning, problem

solving, competitive intelligence, and using the tools available to answer the "so what" questions. So even if you do use your experience, your gut, or play the internal political game, if you can incorporate the approach and where appropriate the use of primary market research discussed above, as a brand manager, you can feel confident that you have the information from which to make informed strategic business decisions at any point in your product's lifecycle and thus stake the odds of success firmly on your side. Trademarks are the property of their respective owners. *For more information on TVG Inc(R)'s Market Research & Product Management Courses, visit www.tvg-inc.com/seminars/default. asp (TVG, Inc.(R) is a PDI Company(R)) Please note that Janice Arnold has no affiliation with TVG Inc.(R)

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