October 13, 2008
As we have discussed in this column from several different perspectives, pharma marketing research is going through major transitions. Reduced budgets and the increased involvement of procurement departments in placing projects have become sufficiently ubiquitous that they have left the stage of being transitions and become more given facts of life. What else could possibly be left to happen? For those waiting for the other shoe to drop, it might well be in the form of outsourcing the entire marketing research function. We've been hearing rumors of this happening throughout much of 2008, with the explanation being that “marketing research is not a core competency of a pharma company.” My guess is that, just as with the downsizing of field forces, the first pharma company to move in the outsourcing direction will be followed by others. Before this happens, several questions need to be given serious thought:
Can somebody really believe that keeping up to date on customer knowledge, attitudes and practices better than the competition does is not a core competency that should be retained on a proprietary basis? Will such outsourcing reduce the cost/increase the efficiency of marketing research? What kind(s) of organization(s) would perform this outsourcing function? Haven't we learned from the outsourcing of other functions, e.g., to contract detailing companies, that some things just don't outsource well?
As the astute reader can probably tell, I'm not a big supporter of attempting to outsource the marketing research function, and I would implore the industry to think long and hard before moving in this direction, as a reflexive cost-cutting maneuver that in the end actually costs far more than it saves.
Vanderveer is group CEO of GfK US Healthcare Companies