Do regional marketing teams really work?
pharmafile | November 29, 2007 | Feature | Sales and Marketing |Â Â Europe, marketing, regional marketingÂ
In this feature, we tackle the subject of the regional marketing team and look at a number of issues, including how these regional (and in particular Euopean) marketing teams can best add value to the parent (US) HQ as well as to the local market relationship.
We also look at whether these regional teams are able to ensure brand consistency across the differing local markets, while at the same time allowing the local marketers to exploit their cultural understanding of their own markets. Can European teams really get to grips with specific markets and tackle the problems of individual countries' frames of reference for pricing?
But at the end of the day, the big question for pharma is, does this model really work effectively? Should European regional teams exist at all and can they add value? Or would companies actually be better off listening individually to their biggest local subsidiaries and do without the regional marketing team?
Bridging the gap
Most pharmaceutical companies now have global brand teams with regional representation. These key representatives are normally commercial people with responsibility and accountability for a particular geographical or business region. An example would be an international commercial director who is part of a therapy area global team and has accountability and responsibility for all territories excluding North America and Asia. This person would work closely with the individual country teams as well as the global team and other key stakeholders and departments. In some operational models there may also be regional representatives for other functions, such as clinical, regulatory, manufacturing etc, who represent the views of their functional country colleagues. However, the challenge is to ensure that there is a clear lead for the various regions in order to simplify and speed-up decision-making.
Those with regional responsibilities play a very important role in that they help to bridge the gap between HQ and the local country teams and help to ensure that the needs and requirements for the local markets are being not only being heard, but also met.
The regional representatives (usually those with commercial or brand specific responsibilities) are invaluable to the global teams as they provide a consistent two-way dialogue between HQ teams and the local country market's key stakeholders. By creating effective and open dialogue between the various teams, the local countries then tend to be more aware of and accepting of globally-led direction, and this also ensures the globally-driven strategies and tactics are either appropriate for the respective markets, or the local markets are given some degree of flexibility to adapt to the local market. This process results in bringing together the brand teams, whether they be global, regional or local so all the members feel part of a unified team working together to achieve the same goals for the brand.
By having a regional representative, the local country teams are provided with a point of reference with which they can raise immediate concerns or issues. This can greatly aid a company's internal responsiveness as, depending on the size of the operational structure and number of local affiliates, it reduces the number of direct requests or communications made to HQ as the regional representative can address them directly or raise them with the global teams in a more efficient manner.
A consistent message
The regional teams can also help to ensure brand consistency across the various markets as well as providing flexibility for local adaptation. Normally in the development of a global campaign, there will be direct input from the regional representatives, which they can deliver based on some early feedback from the local markets. This provides an early sense check to ensure that the brand campaign framework is also appropriate for the local markets. Moving forwards during the campaign development, the regional representative can provide regular updates to the local market and by holding regional workshops, ensure the local country teams are directly involved in helping to shape the brand campaign.
Again, this approach ensures a greater degree of local buy-in and forges a stronger and more coherent brand team. It is of note that there have been many instances where some of the best ideas have come from the local markets, and have subsequently been incorporated into global initiatives. An example of this was on a recent market development project for a medical device where the UK market had put in place certain initiatives that were successful in changing the mindset of the customer in order to recognise the issue. This initiative was then adapted by the global team and rolled out across a number of markets over a two-year period with measurable success.
During this collaborative process, the regional representative can make sure that the local markets understand the need for global consistency (i.e. the same core image, key brand elements, key statements and claims etc) and that they are also aware of the dangers of brand erosion and the dilution of a true global brand identity as a result of the local country team changing key elements. The local markets can then fully appreciate the dangers of modifying key brand components that ultimately will result in, for example, the French brand execution being completely different to the UK, with the German brand being even further removed.
Given that prescribers attend meetings outside their own country, when this happens they will be exposed to different forms of the brand. One example of this is European congresses, where local campaigns from outside the prescriber's home country can be used – potentially creating confusion if they feature notable differences in the brand's values, statements and claims.
Obviously, the degree of flexibility will depend on the internal company philosophy, but in MSI's view there has to be some flexibility to ensure the brand is executed effectively in a local market. Consequently, it is important that the regional representative should provide a process whereby the local markets can refine or locally adapt the brand campaigns to ensure a true fit with the local market, plus ensure it maintains consistency. One way this can be done is by developing a brand guardian team, who through an online access portal, can allow direct local access to the brand components which the markets can adapt and submit to the brand team to ensure brand consistency.
This approach has worked very well for numerous regional or global brands and is increasingly implemented by various companies. A recent example of where this process was adopted was for the launch of Vaniqa, a dermatology brand for facial hirsutism in women. The brand was awarded the 2005 Pharmaceutical Marketing Effectiveness Awards (PMEA) European Marketing Campaign as a result of team's work. The judges said they "showed great flexibility and a thorough understanding of individual country needs" and this was a true European campaign. They built a brand academy, a brand team and a brand toolkit to ensure consistency of message. They launched simultaneously across the four major European markets, flexibly developing the product image through its emotional and rational components".
The thorny issue of pricing
So can European regional teams truly tackle the problems of individual country frames of reference for pricing? European teams can prove to be vitally important when it comes to the thorny issue of pricing. Some global teams, especially those based in the US, do not necessarily appreciate the complexities of the pricing environment in the European markets, or understand what is required to secure a price or reimbursement. In some instances, they find it hard to comprehend why you can't seek a premium price for an improved formulation of an existing therapy or why you require a health economic argument to justify the availability in, for example, Scotland for a product which has already been proved to be safe and efficacious by the regulatory agencies.
Part of the challenge for global teams is that Europe is essentially a fragmented market with complex and differing rules and policies governing pricing. It may be that for some therapy areas there are reference pricing systems in place, such as in Italy or Spain, while in the northern European markets there is some pricing freedom although pricing policies need to be justified for local formulary listings.
In France and Germany, you may be required to submit various dossiers to a multitude of authorities to first secure reimbursement and secondly, to secure a price. By working closely with the local country teams, early in the development of a product, the European regional teams can identify what is required for local pricing across all the European markets to the global teams and what the potential pricing scenarios will look like. This then allows the global teams time to:
* Sense check the key commercial pricing assumptions made for the target product profile and reassess the pricing and subsequent commercial aspirations for the product
* Provide a framework for developing specific pharmacoeconomic clinical studies or building these into current clinical development programmes
* Develop specific pricing strategies to ensure optimal pricing corridor and launch sequence.
The European teams can effectively provide the bridge between the local teams and HQ, raising what is the global aspiration for pricing with the local teams and what is required to achieve this with the HQ.
This begs the question, should European regional teams exist at all? Can they truly add value, or are companies better off listening individually to their biggest local subsidiaries?
Can regional teams really add value?
As we have discussed within the feature, European regional teams can definitely add value to a company's operational model, though the level of success does depend on their defined role, plus the nature of both the regional team and the leadership team. To make this structure as effective and successful as possible, there must be good dialogue and sound processes set up between the members of the European regional team as well as with HQ and the local markets.
Initially, from the HQ perspective, it would seem to make sense to have dialogue between the key local markets (usually the five major European markets, the US, possibly Australia/New Zealand and also Japan) and the global team. However, the key markets will vary from organisation to organisation depending on their particular priorities.
However, we need to be aware that the European regional team's remit must be wider than just the classic 'major' markets, given the growth of some of the other markets in Europe, most notably fast-growing markets such as Russia. Inevitably, there is a question of resource (both people and time), which will constrain how wide a range of countries the regional team can effectively contribute to.
The defined role of, and rationale for the European regional teams is also critical. Some organisations see it as the strategic component with local markets merely 'implementing' what has been decided for them; others take a more 'facilitating' position where the regional team develops and implements pan-regional initiatives. Both approaches have their pros and cons, with the added danger of duplication of effort if responsibilities are not clearly defined.
What we need to be aware of is that it is not always as simple as it might seem to make this model work. We need to be aware of the potential dangers and pitfalls that could jeopardise their success.
Maximising the value of European regional teams
* Limited or mis-representation of key markets.
Solution: right people involved from the key countries; frequent, effective and open dialogue between regional and local markets.
* Limited buy-in at local level.
Solution: adding value to the local operation and valuing local market input.
* Lack of transparent process.
Solution: collaborative processes to address the key marketing challenges and tasks both global to regional and regional to local
* Unclear roles and responsibilities.
Solution: clearly thought-through objectives for each level within the organisation with clear added value at each level.
Richard Jones is a senior consultant at The MSI Consultancy. He can be contacted at rjones@msi.co.uk or visit www.msi.co.uk
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