This article has been given over a full month in my "DRAFT" container to ferment, to mature, and for me to see what would actually happen in a situation where large pharmaceuticals companies were giving out discount coupons to customers to encourage those customers to keep buying name-brand drugs (high-margin items which have now come off of patent) instead of their less expensive generic substitutes (still high-margin, but invariably lower-priced than their now off-patent equivalents).
For some time now, pharmaceuticals companies have been purchasing large blocks of media time to advertise their brands and their most profitable drugs directly to consumers. While the ethics and motives are quite questionable when it comes to advertising pharmaceuticals to a largely uninformed or misinformed public, this technique of building direct consumer awareness is a sound one.
The result is supposed to be that consumers will actually compel their primary healthcare providers to write them prescriptions for the drugs which they have become familiar with on television, instead of the opposite -- where a physician makes a determination based upon a patient's complaints or symptoms and chooses the course of treatment or medication. As you'd expect, this has led to a situation where the patients are making demands upon their healthcare providers to supply them with the medications they have become familiar with through television and e-media advertising.
In a legitimate marketing scenario, this same consumer-direct advertising technique has proven to be a wonderful way of pressing stores and retail outlets to start carrying product lines and brands which are already being requested by consumers. This, in turn, compels the stores to seek out the manufacturers or distributors of these brands in order to meet their customers' satisfaction. This also provides a bit more leverage on the part of newer product manufacturers to retain a higher margin in making their products available to retailers, who used to exert a great deal of power over the manufacturers of emerging brands for "slotting, " "preferential positioning" and point-of-purchase retail display expense in order to permit their products to be stocked.
Offering discount coupons to consumers is an extension and potentiator of this same consumer-direct strategy.
Think about it:
Q: Where will a consumer choose to shop?
A: Where he or she can buy the product for which he or she has a discount coupon. Voila! {That's French!}
The idea, though is to actually give the consumer some additional incentive and true value, and not to get him or her and hook 'em like the street-corner dope-peddler. Legitimacy is key to your brand's credibility. People get angry (as do lawmakers) when they feel like they've been scammed...
This news item is a beauty, albeit a bit belated in the offering. Please take a quick scan of the article which follows courtesy of SmartBrief, and when you've finished, please hit the "BACK" button on your browser so that we can have a class discussion (my discussions are invariably lectures) about how you can provide legitimate incentives without doing anything illegal, immoral, or just plain flipping idiotic. The article is several weeks old, but now we've had ample opportunity to see it start playing out... Read it and come back home! They'll be donuts served. But only if you hit that "BACK" button.
- Lawsuit targets 8 drugmakers offering co-payment coupons
A consumer-advocacy organization filed a lawsuit on behalf of insurers and prescription-benefit managers against eight drugmakers that offer coupons to lower the co-payment for branded drugs. The marketing tactic drives up medical costs and illegally conceals payment data from health plans, according to the lawsuit. Google/The Associated Press (3/7), Bloomberg (3/7)
Three legislators are investigating what they say is a "shell game" that uses pharmacy and wholesale drug licenses to sell lifesaving drugs in short supply at higher markups. "If it's not illegal, we're going to have to find a way to make it illegal, because this threatens virtually every person in the country," said Rep. Elijah Cummings, D-Md. The lawmakers want detailed information on the businesses by April 11. Google/The Associated Press (3/21)
Ah... You're finally back to stay. I'd like to summarize now, with my admittedly biased commentary:
The key to successful consumer-direct advertising, branding and coupon issuing is demonstrating and adding value, based in legitimacy. Marketing "ploys" are for con artists. Marketing tactics and strategies are for companies which wish to create a lasting sense of satisfaction and community amongst their growing roster of customers.
In brief: Do the right thing for the right reason and you can truly win. It actually does work.
Douglas E Castle for The Mad Marketing Tactics Blog
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