PR: the power of perceptions

pharmafile | November 3, 2004 | Feature | |   

Pharma is taking an increasing interest in PR and what it can achieve in the marketing mix. But with a general background of cost containment within the pharma industry, how can PR prove its worth? And is PR finally going to be as measurable and accountable as other corporate activities?

If expenditure trends are anything to go by, PR in pharma, like nearly all the other components of the marketing mix, is under the cosh, and has been for some years.  

Evidence for this appears in the London Business School/Havas study, Marketing Expenditure Trends 2001/04, which tracks actual and planned spending in a range of industries in the economies of the US, Japan, Germany, UK, France, China and Brazil. The report was researched between July and September 2003 and covers expenditure on advertising, sales promotion, brand PR/sponsorship, direct mail, and interactive marketing over the four years 2001 to 2004.

The study, shows that historically, pharma has not been a big spender on PR, and it is not increasing its spend. By PR the report means PR and sponsorship for brands, as opposed to corporate communications aimed at investors, regulators, etc. It includes events and their sponsorship but not broadcast programme sponsorship.

Overall spend on PR as a proportion of total marketing spend is 15.4% and has risen 6.8% since 2001. Moreover, with the authors predicting faster growth for the world economy in 2004, they expect PR to recapture some of its share of marketing budgets.

But for pharma, the proportion of its total spend on PR is 11.1%, which has fallen by 10.1% since 2001, in an industry that has cut back marketing spend overall.

Not only is spending down, but measurement and accountability are becoming increasingly important. But what does that measurement mean?

Measuring PR effectiveness

In the old days, when asked to account for the effectiveness of PR, managers and agencies would usually resort to compiling all the press cuttings, measuring them in column inches, and then working out what the equivalent amount of advertising would have cost, to give a return on investment.

Slightly more sophisticated versions of this process would add a qualitative dimension and work out how positive the article was, whether the headline or the picture caption was positive, and score the output accordingly. But things are getting more sophisticated, and the criteria are now moving well beyond counting column inches.

Asked if clients demand measurement criteria, Jeannine Nolan, head of healthcare practice at Ogilvy PR, says: "If they don't, we remind them! Otherwise, how can our clients assess whether a campaign has delivered against its objectives as well as provided a return on investment?

"There are still some clients who struggle to understand the inherent value that a strong PR campaign can deliver for a brand. Fortunately, most of our clients are fully on board with the value of PR, but having defined measurement can also make it a lot easier to sell to the internal stakeholders as well as facilitating future development plans."

Judging your agency's performance

On the client side, measurement is even more critical. Miriam Hughesman, communications and publications leader at AstraZeneca, says: "We certainly insist on measurement for all PR programmes. We define measurement criteria before we start a programme, and have checks in place to ensure that the criteria are relevant as the programme progresses.

"All agencies need to identify SMART objectives – specific, measurable, achievable, realistic and in a timeframe – for each brand's PR programme which include measurement criteria for the programme overall and on a project by project basis.

"We also look at how well agencies measure their programmes in our agency evaluations that take place every six months. For new agencies pitching for business, we require evaluation to be part of the programme."

Beth Birke, brand communications manager, Seroquel and Nexium, says: "We use a number of measures including physician surveys, message delivery in media coverage and sales."

David Prager, brand communications manager for Symbicort, points to a strategic dimension: "Measurement is essential to an effective PR programme. It not only tracks the response and success of a particular campaign, but it also contributes to an overall understanding of the current state of the market.

"When measuring PR effectiveness, it is important to look beyond column inches and identify what messages are being disseminated. Well-placed messages will help to shape the environment, ensuring a brand's differentiation message is relevant to a target audience."

Hughesman adds: "Measuring PR is far more than column inches. Measurement criteria for every PR programme should fall out of the SMART objectives set for that programme."

Effective measurement

Ogilvy's Nolan warns that it is hard to judge which discipline contributes most to a campaign's overall success. She agrees that PR evaluation is becoming increasingly integral to any campaign, "although of course it is not always easy to attribute success to one discipline for an integrated programme which might also include advertising, sales activity and medical education."

Even so, setting clear goals at the outset is crucial, she notes: "It is vital to ensure that there is clarity about the relationship and difference between stated marketing objectives and communication objectives. These goals need to be set as an integral part of the planning stage – and also to be updated and revisited as the programme evolves. Also, make sure that the appropriate budget is allocated, otherwise comprehensive evaluation will be hard to deliver and may compromise subsequent activity."

Meeting goals

Beth Birke of AstraZeneca looks at goals, and says: "By looking at PR in terms of meeting three specific goals – influencing perceptions, changing behaviours and contributing to sales – we can analyse past work and begin to put systems into place to measure and quantify activities as they relate to these. That being said, message and content analysis in media coverage, coupled with physician/patient qualitative surveys, are the most common tools."

Measurement of PR activities in cleverer ways than just counting columns inches, is now clearly and firmly on the agenda. But it is still early days and there are plenty of refinements in the pipeline. How can measurement be done better?

The most effective measurement of PR?

From the agencies' point of view, it all boils down to clear goals at the outset. "You need to identify and agree upfront the success criteria – awareness, brand uptake, market share, switch or compliance – to name a few," says Nolan. "Once core messages have been established, it is much easier to examine the relevant factors for success such as analysis, reach or frequency.

"At Ogilvy, when we run market or KOL meetings, we might agree meeting outcomes and expectations from both the client and customer perspective in the planning process. After the meeting, we can then always ensure that subjects like uptake, quality of speakers, levels of understanding and buy-in are included in our follow-up questionnaires. It is also very easy in post-campaign euphoria to defer feedback. It's really important to progress this when all parties are still engaged and motivated.

"Sharing positive outcomes is the best way to build relationships and business," she adds. "Also, it is worth encouraging clients to market their successes internally. It is equally important, though of course never quite as easy, to ensure that where objectives have fallen short of expectation, then learnings and ways of working in the future are identified and aired."

Communicating PR results to management and marketing

Birke thinks it is important to measure achievements in terms that management will understand. "We hope that by examining activities in terms of influence of perceptions, behaviour change, contribution to sales and ROI, we will more effectively communicate results in the terms of most interest to marketing and management.

"We also must assume responsibility even if it is only one of many factors for the achievement or failure of business objectives. PR must claim credit and accept blame for the part it plays in moving the business."

This need to show a measurable impact on perceptions and behaviour is complicated by the emergence of new stakeholders in the NHS such as prescribing nurses and pharmacists. Can PR have any effect in the new NHS?

Ogilvy's Nolan thinks it can. "PR can be used to spread awareness of a new drug rapidly amongst doctors but also the wider population of fundholders and other influencers. PR can develop educational programmes associated with the management of the relevant therapeutic area that can reach a wider audience of NHS professionals or assist the commercial arm of a pharma company to enhance their communications.

"Acting within the guidelines of the Association of the British Pharmaceutical Industry, PR has a role to play in communicating disease awareness to consumers so that they are aware that there are (unspecified) new developments in a therapeutic area and it is worth seeking the advice of their doctor."

Birke believes it already has had an important impact. "Quality and appropriate PR programming can only aid a brand's credibility and integrity. In the case of Seroquel, PR has played a pivotal role in developing relationships with important patient advocacy groups as well as opinion leaders."

Potential PR pitfalls

So, what are the issues associated with differentiating brands through PR – does vigorous use of PR in any way compromise a drug or a manufacturer's credibility?

"As with any form of marketing, the challenge is to design programmes that develop market size for market leaders but aid market penetration for market followers," says Nolan. "To be effective, pharma PR increasingly has to have an educational slant for professionals or consumers.

"Patient groups are an important part of the communication process as they are there to promote the interests of patients in an unbiased way and effective collaborations between them and the pharmaceutical industry are improving the voice of the patient. The media is increasingly sceptical about receiving publicity about the latest clinical trial in isolation and looks for confirmation from other sources before covering a story.

"A PR professional is unlikely to convince a journalist to put forward a story for publication purely on the basis of having a 'good relationship' with the journalist. Credibility can therefore be lost if there is little in the way of objective substantiation. This means that PR is developing more sophisticated offerings than just press releases."

If PR is about much more than a well-thumbed contacts book, what about problems when the chips are down? What are the key issues involved in protecting corporate brand image, for instance when a drug has to be withdrawn or a launch is pulled for safety reasons?

Hughesman sees three overriding considerations when this happens: "Patient safety is first and foremost. There must be open communication of the highest ethical standard with healthcare professionals and patients, and the company should be operating with integrity at all times."

Nolan agrees about transparency and openness. "Proactive and timely communication to all stakeholder (medical professionals, consumer, financial world) is important. By engaging with your audiences at a corporate level as well as at a brand level , the impact of negative product PR can often be contained. But transparency and openness must be embraced, as well as a clear message and perception that the appropriate action is being taken."

Vioxx and global PR strategies

A prime example of the central role of communication and openness is the Vioxx story. On September 30th, Merck & Co pulled its $2.5 billion blockbuster, which generated 11% of the company's total revenue, from the market after new data found the arthritis drug doubled the risk of heart attacks and strokes. Merck's stock, predictably, plunged almost 27% in response to the news.

"We've taking this action because we believe it best serves the interest of patients," said Raymond Gilmartin, Merck chairman, in a statement. "Although we believe it would have been possible to continue to market Vioxx with labelling that would incorporate these new data, given the availability of alternative therapies, and the questions raised by the data, we concluded that a voluntary withdrawal is the responsible course to take."

The Vioxx story, which was headline news all over the world, also serves as further proof of the global nature of the pharma industry. But how does the global PR dimension impact on local activities? Are there any conflicts between local and global considerations, and how can they be resolved?

Nolan argues for clear consensus at the outset.  "To have impact, global messages should of course transcend cultural differences. However, they should be developed to reflect the most powerful position that resonates at a local level. The kind of conflicts that frequently occur are where this relevance is forgotten if consensus is not sought, then how can any campaign engage those who have to drive it?

"The key things are ensuring that all local agencies have the global plan and input to how it can be adapted at a local level, which centrally developed activity is adaptable and consistent with market needs, and there is regular communication, both formal and informal to keep all players in the loop.

"Where resistance is anticipated, it is important to be able to demonstrate how buy-in and collaboration will clearly add value at a local level. Areas like training, mentorship, buddy schemes and providing template materials which are relevant locally can all help facilitate the global/ local relationship."

Birke thinks global activities are more usually positive:"Depending on the drug and the marketplace, global PR can be very impactful. For Seroquel, the brand reputation in the US and Europe is known and understood by UK physicians which can help us achieve our marketing goals. Additionally, global activities can often provide perspective and depth that in-market activities cannot afford.

"Sometimes global PR activities are not relevant to our marketplace. We are not required to sign on for all global programming but it is sometimes strongly recommended, regardless of the local brand position or priorities. For Seroquel, these conflicts are easily resolved as the global and local teams have good relationships and open communications."