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Digg It - The Direct Marketing Challenge: A Tale of Two Households
Imagine a retailer in the process of determining its advertising and promotional strategy for the next year. The retailer knows that there are millions of potential customers, but knows too that not all of them are the right targets for their brand. So, how can a r
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
etailer – or any marketer for that matter – identify the right targets for their brand?
Traditionally, marketers have relied on demographics – age, income, geography. But these characteristics can lead them astray.
To get a clearer picture, let’s look at two, see
Traditionally, marketers have relied on demographics – age, income, geography. But these characteristics can lead them astray.
To get a clearer picture, let’s look at two, see
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
ingly similar, households:
Household #1 has an income of $90K. A married couple between 35 and 54 years old, with two children, they own a home in the suburbs. Ditto for Household #2.
They sound alike but behind closed doors, these families are really quite diffe
Household #1 has an income of $90K. A married couple between 35 and 54 years old, with two children, they own a home in the suburbs. Ditto for Household #2.
They sound alike but behind closed doors, these families are really quite diffe
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
ent. So how can the retailer tell the difference between these two households?
What if the retailer also knew that Household 1 exhibits high spending behaviors: they own a Cadillac Escalade, they took a luxury cruise in the past 18 months, and that they remodeled
What if the retailer also knew that Household 1 exhibits high spending behaviors: they own a Cadillac Escalade, they took a luxury cruise in the past 18 months, and that they remodeled
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
heir kitchen to the tune of $100,000+. Meanwhile, Household 2 shows low spending patterns: they recently purchased their home, they have payments on a Toyota Camry, and they shop at WalMart. Demographically similar but their purchasing patterns are dramatically dif
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
erent.
Household 1 will likely be attracted to more premium brands and have more sophisticated financial services needs. They might even be seeking new sources of credit to support their purchasing habits. Household 2 on the other hand, is likely to prefer more mo
Household 1 will likely be attracted to more premium brands and have more sophisticated financial services needs. They might even be seeking new sources of credit to support their purchasing habits. Household 2 on the other hand, is likely to prefer more mo
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
derate brands. Their debt is likely to be lower and brand takes a back seat to price.
Now that’s actionable information.
But marketers would never know it based on traditional segmentation.
Clearly, even the best marketing models fall short when they rely only o
Now that’s actionable information.
But marketers would never know it based on traditional segmentation.
Clearly, even the best marketing models fall short when they rely only o
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
income and other demographics. To make the most of their budgets – and to build their brands – marketers must look at information that provides a deeper understanding of consumer needs, wants, propensities, and ability to purchase. Financial assets, such as stocks
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
and bonds, as well as home equity and transaction history mean a great deal in terms of a consumer’s ability and propensity to buy in specific product categories. And, more importantly, this information has great meaning in terms of the types of brands and brand me
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
sages to which they respond.
In the old world, “birds of a feather flock together” segmentation systems were the only systems available to target consumers. Now, armed with more intelligent data on the spending power of households, we can single out those “birds”
In the old world, “birds of a feather flock together” segmentation systems were the only systems available to target consumers. Now, armed with more intelligent data on the spending power of households, we can single out those “birds”
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
ith the most potential to respond to a specific branding message and to buy a particular brand. So while everyone else is following the flock, marketers utilizing more granular information will be increasing both their efficiency and effectiveness in customer acqui
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
sition, development, and loyalty.
How can our retailer integrate this powerful data on spending power into its advertising and marketing strategy for the next year?
Let’s go back to our Two Households.
Household #1 (the big spenders) is watching TV. They see a c
How can our retailer integrate this powerful data on spending power into its advertising and marketing strategy for the next year?
Let’s go back to our Two Households.
Household #1 (the big spenders) is watching TV. They see a c
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
mmercial and take immediate note of a new model for a premium brand. Then they check the weather online, and they see an ad for the premium brand. Finally, they get their mail and low and behold, it’s a direct mail piece for the premium brand they are looking for.
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Meanwhile, Household #2 (the value conscious family) is watching TV, but their focus is on an entirely different set of commercials than Household #1, even though they are in the same “cluster.” They also check the weather online, but they see different ads than th
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
first household. And when they open their mail, there is notice of a sale at their local department store.
So much for John Wanamaker’s comment that half of his advertising is wasted – he just didn’t know which half. Today he could figure it out. The fur departme
So much for John Wanamaker’s comment that half of his advertising is wasted – he just didn’t know which half. Today he could figure it out. The fur departme
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
t would be marketed to one group, lower-priced sportswear to another. This second group would be notified of sales. The first group would be the first to know about new jewelry shipments.
The implications of this information for brand marketers – from retail to fi
The implications of this information for brand marketers – from retail to fi
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
nancial – are huge. The bottom line is that there are differentiating factors that are not identified by standard demographic selects. Just think what brand marketers could do with more intelligent data on the spending capacity and propensity of consumers!
This in
This in
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
ormation is available today and can be used to create more successful marketing campaigns, more targeted advertising strategies, and a stronger brand. It is the information that successful marketers will use to distinguish between price-conscious customers and thos
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
that value name brands. With this information marketers will discover those prospects with the discretionary funds and the interest to buy their products. This is the information that will help a company succeed.
Thomas E. Dailey, is President & Chief Executive O
Thomas E. Dailey, is President & Chief Executive O
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
ficer of IXI Corporation. Echelon Targeting, a division of IXI, offers proprietary products including Echelon Discretionary Spending Index™ and Echelon Discretionary Spending Propensity™. Tom Dailey can be reached at echeloninfo@echelontargeting.com or 703-770-9677
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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