We're out of the trenches
The downward pressure on pharmaceutical product prices and the level of profitability is already forcing companies to consider how to cut costs and to gain the most out of the money that is spent. An improvement in the way resources are allocated will be the focus of all companies in the latter half of the 1990's and beyond. Although a great deal of information via audits and primary research is available, it is still surprising that relatively few companies are interrogating the data via econometric analysis to help understand the marketing and advertising forces that affect a specific brand's behaviour and the magnitude of these effects - a procedure used in the consumer area since the 1960's. It is vital to know what the likely effects will be on brand performance when considering a change in the promotional spend and the allocation across different media. It is also essential to understand the pricing dynamics in the market to assess the likely response to price changes. Short to medium term forecasting can be made much sharper and resources used more wisely if these issues are better understood. Furthermore, the need to review the return on the promotional investment from different brands within the company becomes a logical step for the marketing director. In future, despite the changing customer base, the attitudes of managed care groups towards different scenarios can be monitored via primary research using "choice-based conjoint" investigations to provide additional input for short to medium forecasting accomplished by econometric analysis. Creating great efficiency and helping to save valuable resources can also help to save jobs.
- This could also be of interest