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Detailing (DET) 5. Please define the variable "detailing." Details are defined as each product discussed during a sales call. A sales call is defined as a face-to-face meeting between a pharmaceutical rep and a physician (or group of physicians). Detail dollars are based on the average cost of a sales call, including fixed costs associated with keeping a rep in the field (salary, car allowance, travel, bonus, etc), but with none of the variable costs (samples, marketing materials, etc). The average estimated cost per call in 1999 was $138 for office-based physician calls, and $174 for hospital-based physician calls. Each year, Scott-Levin increases the average cost by the consumer price index (CPI). This cost is attributed to the entire call or contact with a physician. Each detail that is presented during the contact is then allocated a portion of the total call cost. To accomplish this, the details are ranked by minutes, from highest to lowest, and the dollar amount is then apportioned according to a set ratio (see table shown below).
6. The issue of detail costs needs further explanation. Usually, a representative will detail two or three products on a call. As I understand your procedure, you determined the cost of the call itself, but counted the number of details as your independent variable. Therefore, the cost of the detail was overestimated, and the ROI underestimated, by a factor of two. During a contact (call) between a physician and a rep, several products may be discussed. Each product discussed is a detail. Therefore, there is only one call, but potentially several details for each contact made. Each of the products discussed is counted only once per contact. The cost per contact (call) is then allocated to the individual products depending on the time spent on the product during the call. (See cost allocation discussion in Question 5.) 7. Please redefine DET versus Physician Meetings & Events (PME), as there appears to be two different definitions used with regard to rep-driven small group meetings. Detailing in this analysis included detail dollars from the Scott-Levin Personal Selling Audit/Hospital Personal Selling Audit as well as the "Small Rep" Events from the Physician Meeting & Event Audit, to look at the total rep effect. Correspondingly, the "Small Rep" Events data were deleted from the Meetings & Events variable. 8. Please comment on the impact of having a representative from one company detailing two different products to overlapping targets (eg, Lipitor and Rezulin were both detailed to endocrinologists by one representative). Representatives often detail more than one product at a time. It would be a very common occurrence for more than one product to be detailed to overlapping targets. This occurs most often with primary care physicians, as many products are detailed to these specialties, but also occurs with other specialties (particularly if an entire product line in a therapeutic area is detailed to the same specialty). 9. a. Were samples and marketing materials (such as sales aids, etc) included in the detailing variable? The detail dollars did not include any of the variables costs, such as samples and marketing materials. The detail was defined as a product discussion that took place during a face-to-face meeting between a sales rep and a physician. It may or may not have included the rep leaving samples. 9. b. Wouldn't these factors increase ROI? It's difficult to predict exactly how these factors would affect ROI. One would expect that quantifying the cost of samples would decrease ROI, because currently the full sales impact of detailing is in the data, but not the full cost. However, this cannot be guaranteed. The regression is based on observing how sales change as detailing expenditures change. So the actual impact would depend on factors such as how much sampling is increased when brands increased detailing, and how much sampling is decreased when detailing was decreased, and, finally, how this differs by brand. 10. You only measured the fixed costs associated with a call, not a detail, whereas with all other media you measured the variable costs. Since representatives have to get paid anyway, I question whether the comparison for the ROIs for detailing are fair? If one were to take the total number of reps in the industry today, multiply that number times an average number of sales calls per year times an average rep's salary, it would be similar to Scott-Levin's methodology of multiplying the average cost per call times the projected number of calls to physicians. Scott-Levin takes this one step further by allocating portions of the cost of calls against the products detailed during the calls. Like any audited data, there are caveats associated with projected information; however, the methodology is consistent across all corporations, products, and therapeutic categories. 11. Aren't the data "threatening" to those who believe mainly in detailing? The results for detailing shouldn't be seen as threatening at all. The fact that detailing did so well — despite the huge amount of money spent on it — is very encouraging, and certainly would suggest that companies continue to spend money on detailing. By no means could one guarantee that medical journal advertising (JAD) or PME would be as profitable if similar amounts of money were spent on those activities. And by no means is the implication of this study that one should no longer use detailing. What the study says is that, on average, over 1995-1999, journal advertising and PME were attractive, yet underutilized investments. Companies that are expanding their marketing budgets should strongly consider these activities. One should also keep in mind that the results of these studies are average ROIs over a 5-year period. They suggest that the average brand manager consider JAD and PME for additional funds. However, individual brand managers know more about their particular brands and the particular context they face, so that information should greatly influence the final budget allocations. What this study does is to provide general guidance, across all brands and within the 9 cells looked at, on how successful these various activities were. 12. What assumption was used for DET with respect to the consistency of visits (eg, one visit per month, two per month, etc)? There was no assumption used for the number of details over time. In the Scott-Levin audit, physicians report one week in every month for all rep contacts that are made during that week, and the results are then projected to the national level by specialty and region. 13. Did you control for "e-detailing" when performing your analysis on detailing? If so, how were you able to do this? e-Detailing was not included in this analysis. 14. Could a low ROI on detailing be a function of saturation? First, it is important to note that the ROI for detailing is not always "low," ranging between $2.68 and $10.29. It is particularly high for large, more recently launched brands. Yes, the results obtained for detailing could be a function of saturation; however, this is just conjecture. The analysis did not try to identify particular saturation levels for any of the marketing activities. 15. If the margin of error on PME is high because it was hard to separate from simultaneously high detailing levels, why isn't this also true for detailing? When two marketing activities are highly correlated, there is potential for the regression to be unable to determine both of their effectiveness levels. However, there is more that comes into play than just the correlations between those two variables in determining the margin of error. First, there is the question of how consistently each of these variables relates to sales levels. In this case, detailing related more consistently to sales than did PME. There is also the question of how strongly they correlate with all the other variables in the study. In this case, the balance of all these forces came out against PME. |
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