Monday, March 10, 2014

How Viagra used ecommerce to take on the counterfeiters

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Last month, Stephen Whiteside of WARC attended the ePharma Summit in New York City. Over the next few weeks, you'll see some of the insights he captured from the event.

How Viagra used ecommerce to take on the counterfeiters

As the subject of more than 20 million online searches a year, Viagra – Pfizer's erectile dysfunction drug – generates a level of web traffic that would make many brands jealous. Less enviable is the fact a third of these inquiries lead consumers to sites selling copies of the product, not the real thing.

While elaborating on this problem, Lauren Ljubicich, Pfizer's director of marketing, told delegates at the ePharma Summit – an event held by the Institute for International Research (IIR) in New York in February 2014 – that a quarter of men with erectile dysfunction (ED) had purchased Viagra from the internet. But as 25% of the market for PDE5, the group of drugs tackling this condition, is attributable to fakes, it was apparent that lots of Pfizer customers – all with prescriptions – were being misled.

"Twenty-five percent of men thinking they're taking Viagra aren't actually taking Viagra," Ljubicich said. And although consumers are frequently aware of this possibility, it is often impossible to distinguish an official vendor from one offering imitations, as the latter platforms look entirely authentic. "There's not a huge difference between the two," she continued.

Further adding to the confusion, unapproved digital merchants regularly provided links to both "generic" and "real" Viagra – with Pfizer's analysis showing 80% of goods sold under the second of these labels were counterfeit. "It's very difficult, if you're just a guy going online and searching for Viagra, to actually find a legitimate way to buy it," Ljubicich said. (Read about an earlier Pfizer campaign seeking to tackle counterfeiting with an online educational campaign.)

Even once the fake pills are delivered, separating reproductions from the genuine item is challenging, as they typically come in the same shape as bona fide Viagra, and are embossed with mock-ups of Pfizer's logo. The only consistent area of divergence is that the formulation of the illegal tablets was uniformly below par.

"It doesn't just hurt us bottom line financially; it impacts our brand," Ljubicich said. "It wasn't just a business opportunity; it was also really our responsibility to figure out this counterfeit situation. We built the category. We put Viagra out there." (Read more about the launch of Viagra.)

As an introductory step, Pfizer sought to ascertain whether common assumptions concerning why men purchased Viagra on the internet were true. First, it attempted to determine if they mainly utilised the drug for recreational – rather than medical – reasons. "It was a huge surprise when we did research and found out that it wasn't recreational users … It was real men with ED," Ljubicich said.

"And 75% of people who bought Viagra online have had a conversation with their doctor about ED already. And 75% of those guys actually have a prescription in hand when they go home, search how to buy Viagra, find a website, and wind up with illegal Viagra … We knew that they were going to be the biggest target for us regardless of whether they actually went online and fulfilled their prescription."

The next goal was to discover why the digital path to purchase was preferable to bricks-and-mortar pharmacies. "It seems obvious when you talk about it, but we actually did a lot of research to back it up. It was this idea of embarrassment; of convenience," Ljubicich said. Significant numbers of men, the analysis reported, visited pharmacies at specific times in a bid to avoid meeting people they knew; others drove to outlets a couple of towns away. "We wanted to make the experience more comfortable, so it would be less embarrassing."

Digging deeper into the data, however, pointed to the influence of other factors. A third of searches for Viagra were linked to securing a good deal – from hunting for discounts to trying to searching out a coupon. "There was something else at play, and that was a savvy-shopper mindset," Ljubicich said. "A lot of people consider online to be the best deal. So that's why men would go online, search for Viagra, and then ultimately find something that's not real."

Viagra's imitators had recognised the attraction of low prices, as they charged an average of $13 per pill, compared with the equivalent rate of $20 commanded by Pfizer. "Men just want a deal, but instead they're getting ripped off," said Ljubicich. If the company successfully encouraged customers to buy legitimate products on the internet, it could better serve their needs and – in the end – save them money, as they were less likely to waste it on fraudulent and ineffective copies.

"There's a real consumer behaviour, and we had the opportunity to capitalise on it," Ljubicich said. "Home delivery was a very nice intersection of consumer behaviour: there was a business opportunity for us, but then there was a corporate ethical responsibility."

Having discussed the viability of running a home-delivery platform with around a dozen firms – and deliberated over forging a tie-up with a discounter like Costco or Walmart due to their reputation for low prices – Pfizer chose to ally with CVS. The pharmacy chain promised a fully integrated solution combining fulfilment services and a web property retaining the look and feel of Viagra's own site.


As a consequence, the site from which customers engaged in transactions was hosted by CVS, but is "very similar to Viagra.com" – that is, with similar colours and branding, and images from its marketing campaign. "It feels very legitimate. And that's ultimately what we wanted: let men know they're getting their Viagra from a legitimate source," Ljubicich said.


The importance of this consistency could not be underestimated. "We wanted something that was a little bit more branded, because when we spoke to men, when we did our research, it was more than just a transaction for them – it was different than when you just going to pick up cold medicine. This is Viagra; it really hits you in the core," Ljubicich said.

"Men think about talking to their doctor for 18 to 24 months before they actually have the conversation. And when they finally have the conversation, it's: 'Now what?' We wanted them to continue on the Viagra journey that they'd been on for so long."

Pursuing such an idea was replete with risk. In the first instance, if current users of Viagra tried buying online and were disappointed, they might switch to a competitor. A similar experiment undertaken with another of Pfizer's products a year earlier had also led to a "huge backlash" from its trade partners, and got cancelled in its early stages. Based on these learnings, the organisation worked "very closely" with the relevant parties to avoid repeating this mistake with Viagra.

A beta launch programme for Viagra.com began in February 2013 – covering everything from taking in new prescriptions to checking the status of an order and an insurance estimator. In terms of communications, Pfizer initially set out to convince doctors regarding the desirability of home delivery so they could evangelise to patients. One reason for this was that 70% of men prescribed Viagra had it sent straight to a pharmacy rather than taking their prescription home. "If he wanted to fulfil it through home delivery, he needed to know about it at the doctor's office," said Ljubicich.

The results were not heartening. "That test was wildly unsuccessful. We got about six prescriptions through the doctor's office," said Ljubicich. "If you didn't spend 25 minutes talking about counterfeit with them, they could not care less. So it was a losing proposition for us in the doctor's office."

In response, Pfizer shifted its strategy to focus on the patient. Doctors, it realised, had to know home delivery was an option, but they were not reliable as a source of recommendation. Starting with a paid-search campaign, the company thus began aiming its messaging directly at consumers on the internet – and the situation soon turned around.

By the time of the national launch in May 2013, Pfizer was able to call on search and banner ads tailored for men with ED. Its objective was to "intercept them, educate them and get them" to try buying Viagra online. A complementary PR effort endeavoured to boost awareness and prompt visits to the brand's website. "Of course, we're business-minded, so we were thinking we'll get their names, and we can do a lot of adherence marketing to these patients, and hopefully get refills as well,"
Ljubicich said.

The figures from the campaign's opening week were extremely promising, as it yielded:
  • 420 million PR impressions. "PR was a huge factor here. We knew that PR was going to be the main way that we floated this," said Ljubicich
  • 1,000 orders – a total that is "not as high as we would want it to be, but we're very happy with it" as a starting point. Of these orders:
  • 18% were refills. "We'll certainly try to do some marketing to get that higher," Ljubicich said
  • 14% were from former Viagra users: "This is a nice number to have," said Ljubicich, as it meant communications were either converting users back from counterfeits or building the business
The issue of counterfeiting, inevitably, remains far from redundant – indeed, "somebody made a website that looks exactly like ours" immediately after the new platform went live. Thanks to its official online service, though, Viagra was able to offer prescription-holders confidence when making purchases, and knowledge that it understood their needs.

"It turned into a brand halo play," said Ljubicich. "Even if people have no intention of using it, there is this overwhelming positivity that, 'Finally, pharma or Viagra is getting on board and meeting me where I am as a man.' And these guys care about counterfeits."

Drugs for chronic disease states, she argued, may also be viable candidates for home delivery. The potential for other pharma lines might be constrained, however, by the limited amount of relevant online activity than was the case for Viagra. "For brands that don't have a similar consumer behaviour that's leading to men searching for it online, it's not clear to me that this is a great opportunity," Ljubicich said.

Download this report and see all other ePharma Summit features from WARC here.
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