Marketing Biotech When Funds Dry Up
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Marketing Biotech When Funds Dry Up

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The Biobranding Group\'s first report on important issues in the Australasian Biotech sector.

The Biobranding Group\'s first report on important issues in the Australasian Biotech sector.

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Marketing Biotech When Funds Dry Up Marketing Biotech When Funds Dry Up Document Transcript

  • Marketing Biotech When Funds Dry Up During these hard economic times, it is common for companies to slash their marketing budgets in order to improve their short-term bottom line and operate more efficiently. Australian small to medium biotech companies are no different. To grow business when funds dry up, it is essential biotech marketing departments change strategy rather than cut budgets. In this report, we provide a brief overview of the short-term and long-term negative effects of cutting marketing budgets and suggest a new marketing model for biotech companies to use in the current climate and into the future. INTRODUCTION The model suggested further on in this report outlines a new marketing framework for biotech THE economy is in as worse a state than many life- companies to work from in hard times and best- science executives can remember. The sentiment practice methods to carry over into the better times. amongst management in the industry seems to be of But first, we must outline both the short-term and dubious belief in the effectiveness of advertising and long-term negative effects of cutting advertising marketing in the current climate. expenditure. With no best-practice policies in place, management is in limbo trying to preserve what they can whilst trying to ensure that they stay afloat. Many THE MASS MARKETING CYCLE executives are choosing to drastically slash their marketing budgets or cut them completely. Further organisational pressures to achieve more for less THE cycle begins with budgets being slashed due to mean that buyers frequently end up in homogenous unsteady cash flow, as seen recently in response to groups, forcing the marketing department to develop economic crises. With this, marketing departments sophisticated and expensive ‘one size fits all’ begin cutting back on ad frequency and quality of marketing messages. What often results is the marketing collateral. marketing department wasting time (and funds) Still trying to reach the whole target market and trying to salvage campaigns rather than develop pressured to get the same results with far fewer new, more effective strategies. resources, ad campaigns end up with inconsistent messages. The sudden fall in company marketing Marketing Biotech When Funds Dry Up - 1st Edition, June 2009. 1
  • activity and quality begins to send alarming unique, individual messages at them. The marketing messages to investors, customers and competition department can develop a ‘purple cow’ for each and the years of building brand equity often begins cluster and develop warmer leads for the sales force. to falter. The new model has a range of benefits. Firstly, it is With brand equity slipping, marketing activity less expensive than traditional mainstream mass significantly slowing and revenue falling, the marketing. Secondly, it helps build brand equity company begins hiring more and more salespeople more effectively in more markets. Thirdly, it creates in the hope of lifting sales. To improve cash flow, the cohesion between the marketing and sales sales force is pressured to look for short-term, high departments. And finally, it allows for greater control profitability sales rather than cultivate long-term and measurement of ROI with real-time analysis. relationships. Over time, with relationships dwindling, sales prospects slowing, and brand equity falling even further, revenue and investment funds begin to CLUSTER MARKETING MODEL dry up. Marketing budgets are slashed due to lack of funds and the Mass Marketing Cycle continues on its merry way. THE Cluster Marketing Model is straightforward but requires careful execution. The following steps have Does this sound familiar? been developed to provide a guide to ‘going The degree to which biotech companies experience clustering’: the Cycle can differ substantially, but one thing 1. Advertise Smarter. As already outlined, instead becomes clear: whilst building brand equity may take of advertising your product range’s many benefits many years, it can be quickly eroded with long-term to a large audience, promote your brand to negative impacts. smaller, more alike audiences. As Seth Godin Small to medium biotech companies need a model emphasises in his best selling book ‘The Purple that can allow both effective and efficient marketing Cow’, “For big results, think small”. on lower budgets. This type of brand-focused marketing will fulfill a number of objectives. Firstly, it will appear as a new marketing campaign and make your THE NEW MODEL OUTLINE company appear innovative and energised. And secondly, it will position your company more effectively within your most important markets. THE marketing department’s role has always been to communicate the company’s core messages to the 2. Marketing <-> Sales Collaboration. An masses through what is known as mass marketing. important part of the Cluster Marketing Model is Herein lies part of the problem. ensuring complete collaboration between the marketing and sales departments. In order to first In times of short cash flow and limited budgets, why develop the clusters, it is a good idea to hold scattergun homogenous, indirect messages through meetings with sales people to create short lists of traditional channels? Instead, we suggest a new qualified target audiences. These meetings can brand of marketing called Cluster Marketing. help better outline the target audience’s Cluster Marketing focuses on separating target psychographics, allowing for far more targeted customers into more similar demographic and marketing messages. psychographic groups (clusters) and focusing more Marketing Biotech When Funds Dry Up - 1st Edition, June 2009. 2
  • These meetings should be made common 5. Measure, Measure and Measure some more. practice through the duration of the marketing As your target market has now been separated campaign, allowing real-time feedback of into smaller more manageable clusters, measuring marketing’s messages. Introducing sales activity your campaign’s success will be simpler. between marketing ‘attacks’ can help refine Sales tracking tools should be built into the sales messages and improve the marketing campaign cycle and coupled with regular feedback between ‘on the run’. the marketing and sales departments. With each Another benefit of these regular meetings, the piece of marketing collateral able to be measured marketing department can develop a better through the Cluster Marketing Model, refining understanding of the sales cycle and produce messages and improving communications for inexpensive tools to help smooth the process. further campaigns becomes much easier. These tools can include sales presentation materials individually customised for the individual clusters. CONCLUSION 3. Develop Your Purple Cows. As Godin (The Purple Cow, 2003) explains, “Being safe is risky. THE Cluster Marketing Model provides a far more Boring always leads to failure. Very good is an efficient and effective framework than current mass everyday occurrence and hardly worth marketing models. With complete adoption of the mentioning. To be a Purple Cow is to be new model, small to medium biotech companies can remarkable.” avoid The Mass Marketing Cycle. Now that you have done away with the limitations Whilst providing a firm foundation for marketing of mass marketing, you can significantly increase departments to work from in tough economic times, brand awareness and generate positive brand the Model also provides a set of best practice attitudes amongst each cluster by creating unique methods for carryover into better times. messages or purple cows for each. Using this method, every piece of marketing collateral can With new cohesion between the marketing and sales be personalised and customised and go a long departments, a better understanding of the way in making the sales force’s job much easier. company’s target market and more trackable campaigns, adherence to the model will allow 4. Improve Your PR Program. A solid PR program protection of brand equity and business growth long is a necessary part of any Cluster Marketing into the future. campaign. When correctly implemented it can strengthen the overall marketing mix, generate ‘Marketing Biotech When Funds Dry Up’ is the first warm leads for the sales force and make the edition of The Biobranding Report. The Biobranding company appear active and energetic for a Report is a monthly investigation into important fraction of the cost of mass marketing. Also, as issues facing the Australasian biotechnology part of the Cluster Marketing campaign, your PR industry. program can be customised to each individual The next report, ‘Exploring Cluster Marketing for cluster. Biotechs’, will be available in July, 2009. To Collaborating with an experienced PR Firm who subscribe to the reports, email has existing relationships in the necessary media team@biobranding.com.au. For more information channels will all but ensure success. see over. Marketing Biotech When Funds Dry Up - 1st Edition, June 2009. 3
  • About the Author: David Ball is Managing Director of The Biobranding Group, a Brisbane-based brand strategy and identity creation firm focused on the life-science industry. David has tertiary qualifications in biotechnology and marketing experience through launching and running his own web businesses. About the Company: The Biobranding Group was founded to provide a unique offering to the Australasian biotechnology sector. With real world science and high-tech expertise in-house, the company understands your needs because they understand your technology. The company is committed to improving scientific communications throughout the Australia-Pacific region and help the biotechnology industry reach its potential. For more information please visit the company’s website at www.biobranding.com.au or email team@biobranding.com.au. About the Report: The Biobranding Report is a monthly investigation into important matters affecting the life-science industry. The content is based on research, literature and experience and is written from an independent perspective. To subscribe to the report, please email team@biobranding.com.au. © 2009 Zebras International Pty Ltd. All rights reserved. No part of this document may be reproduced or transmitted without obtaining written permission from the author. Proud Member of: Marketing Biotech When Funds Dry Up - 1st Edition, June 2009. 4