Chapter 1 Introduction to Marketing

Chapter 1Introduction to Marketing

Chapter 1 slides for Marketing for Pharmacists, 2nd Edition

Learning Objectives Define the term marketingmarketing. Describe four key elements associated with the

act of marketing. Compare and contrast transactional marketing

and relationship marketing. Analyze some of the misconceptions

surrounding the practice of marketing. Justify the need for pharmacists to market

themselves and their services. Differentiate various approaches to marketing

from the “marketing concept.” Assess key obstacles to the marketing of

pharmacists’ professional services.

Basic Marketing Principles

What is marketing?

And why does it have such a bad reputation?

TIP Marketing is not bad ---only some marketers.

Honesty and Ethical Ratings of People in Different Professions,

% % %Very high/ Average Low/

High   Very low

Nurses 82 15 3

Pharmacists 67 28 4

Medical doctors 65 31 4

High school teachers 64 27 7

Policemen 61 31 8

Clergy 54 35 8

Bankers 41 48 10

Journalists 28 44 27

Lawyers 18 46 35

Congressmen 14 44 41

Advertising practitioners 11 50 35

Car salesmen 8 41 49

Telemarketers 7 31 60

2005 Gallup Poll

How have marketers benefited you and

society?

Whether marketing is “good” or “bad” depends

on how it is practiced.

TIP Actual practice depends

on your approach.

Marketing Defined

TIP It’s all aboutexchanges.

Definition of marketingDefinition of marketing

Exchanges between people in which something of value is traded for the purpose of satisfying needs and wants

Pharmacist exchangesDispensing a drugHelping patients select OTC

medicationsProviding drug information to patients

or health care professionalsTaking a patient’s blood pressureCounseling patients about drug

regimens

Pharmacists have exchanges with

PatientsPhysiciansThird-party insurersTheir employerTheir bossPharmacist co-workers

Transactional versus Relationship Marketing

Two ways of looking at marketing exchanges (a.k.a. transactions)

Way 1: Isolated, individual transactions; participants never expect to do business again (transactional marketing )

Way 2: Series of transactions over timeCalled relationship marketing (RM)RM focuses on developing long-term

relationship (i.e., customer loyalty)

Relationship marketingParties focus less on bargaining hard for

deals and more on meeting the needs of the other party.

Marketers cultivate relationships over time that will benefit both parties.

The choice Transactional marketing – get what you can and

get the patient out of the door Relationship marketing – every interaction with a

customer is an opportunity to help the customer and strengthen the relationship

Characteristics ofRelationship Marketing Develop a relationship

with customer. Collect and manage

customer information. Individualize your

services to customers. Involve front-line

personnel. Emphasize long-term

outcomes.

Pharmaceutical Care Establish therapeutic

relationship Assess and record patient

needs. Create an individualized

care plan. Delegate clerical tasks to

free up time for professional duties.

Monitor impact on patient outcomes.

Is pharmacy practice predominantly transactional or

relationship-oriented?

Transactional Transactional OrientationOrientation

Relationship Relationship OrientationOrientation

Every pharmacist is a marketer.

Everything pharmacists do can be called marketing:

Dispensing a prescription drug Assisting patients in the selection of OTC

medications Providing drug info to patients or health care

professionals Taking a patient’s blood pressure Counseling patients about drug regimens Recruiting pharmacists for a new job Educating pharmacy students

Why study marketing?Marketing is

A way of problem solving in the real world

A way of influencing othersApplication of marketing can

Help you get the job you wantMake you a more effective pharmacist

Misconceptions about Marketing

Misconceptions about marketing

Marketing is selling or advertising.

PricingPricing

MarketingMarketingResearchResearch

SellingSelling

AdvertisingAdvertisingDistributionDistribution

MerchandisingMerchandising

Marketing

Other misconceptions about marketing

Marketing is evil.Health care professionals

do not need to market.Employee pharmacists do

not need to market.Only retail pharmacists

need to market.

Approaches to Addressing Marketing Problems in

Pharmacy

The way you approach a problem will determine

how it is solved.

Some process-centered approaches to marketing

Production – fast and cheap

Sales – fast and cheap with heavy selling

Product – better mousetrap

Customer-centered approaches to marketing

Marketing conceptNeeds and wantsTargeted customersProducts and services that satisfy

Societal marketingConsiders societal impact

What is the dominant approach in pharmacy

practice?

What is your approach?

Major Trends that Will Affect Pharmacist Practice

Consumer-driven health care (CDHC)

Costsharing

Disease/wellness

management

Health savingsaccounts

High-deductibleinsurance plan

Aging of the baby boomers

Retirement of post-World War II baby boom generation Demanding, activistsUnwilling to accept health care

status quo Expect to live longer and healthier

lives throughout their retirement

Around-the-clock societyPeople expect services and

products 24/7/365. Convenience is no longer an

option in pharmacy practice. HoursLocationSpeedChoice

Service technology

Voice-operated telephone and information systems

Bar-code and RFID trackingRobotics

Service technology:Robotics

Speed service Touch-screen interactive kiosksElectronic refill remindersElectronic prescribing, fax prescribingATM-like dispensing machines

Increase service Convenience/accessibility

Telepharmacy, telephone call centersInternet pharmacyTouch-screen interactive kiosksDiagnostic technologies (e.g., blood pressure machine)Videos and other educational technologiesWeb education, CD ROMs

Customize service Personalized patient e-profilesCustomer relationship management (CRM) cardsInteractive kiosksInteractive Web pages

Improve service quality, solve drug-related problems

Telephone call centersElectronic prescribing

Maintain a patient relationship

Personalized patient e-profilesCRM cardsWeb support groups

Using Technology to Serve Patients

Health care budgetary constraints

Rising health care expenditures concern government and other payers.Medicare, Medicaid, Social Security, and

other funding responsibilities Funding battle among health care

providersHealth care marketers must compete

for funds.

Healthcare innovations PharmacogenomicsNanotechnology

Rising global competitionMedical tourism

Thailand, India, Malaysia, Mexico, and Canada competing for the U.S. health care dollar

Patients without health care insurance or large-deductible health insurance plans

Drug importation/exportationLarge cross-border price differentials

Key problems with marketing pharmacist services

Control of practice by nonpharmacists

Product orientationConflicting professional and

merchant rolesPoorly defined image of

pharmacists among publicPharmacist shortagesSilos of health care

Demand for pharmacists

New pharmacies opening dailyPharmacist shortages

Rising payOverworkChanging responsibilities

Pharmacy

Dr’s Office

HomeHealth

NursingHome

Hospital

Insurer

ConclusionMarketing can change your way of

thinking about current pharmacy practice.The goal of this course is to help you develop

a marketing mindset.Application of marketing principles can

help you change pharmacy practice.Marketing can give you the tools to

successfully promote yourself, your ideas, and the profession.

Questions?