Are third-party pharmaceutical meeting planning companies a commodity or a service? That was a question debated during an exclusive summit of independent planners at the 6th Annual Pharmaceutical Meeting Management Forum, held March 14-16 in Philadelphia.
The question generated a variety of responses from the approximately 50 participants in this lively, town-hall-type session, facilitated by Barb Taylor Carpender, CMM, Chief Alliance Officer, Taylored Alliances. Here’s what they had to say.
Commoditizing the Relationship
Several attendees said some clients, given all the changes that have occurred in the way pharmaceutical companies approach meetings, now tend to view third-party planners as commodities. Many said they felt their clients are more concerned with the bottom-line cost than with the service or value that a third-party organization can bring to a meeting.
Part of the commoditization of the relationship, participants said, stems from the fact that their internal clients are changing. Where third-party planners used to work withand meetings department, now they are often dealing with procurement and finance professionals, who tend to focus more on costs than on the logistics and service aspects of the meeting.
The move toward online requests for proposal also makes it very difficult for third-party planners to differentiate the service they provide. They also further depersonalize the process, putting relationships in the back seat. If you don’t meet the cost parameters, they’ll find someone who does— you can’t count on that key contact or relationship anymore, said one participant.
However, another attendee said that while service may not be given as much weight in the bidding process, it’s still important once you’re on site. “You only get one shot in this current environment. You can’t afford that the meeting not go well.” Compounding the service problem, one participant said, is the difficulty of meeting the expectations of clients when resources or staffing are reduced. It’s particularly frustrating when procurement says it will supply the additional administrative staff to save on travel costs. That might save money, the planner said, but the service won’t be the same.
While some pharmaceutical clients may view third-party services as commodities, independent planners at the session stressed that they are not selling a standardized service. Each meeting and client is unique, so third parties have to be prepared to plan three different ways for three different clients, said one person. The hardest part, said several participants, is defining what “service” means, and determining how to translate some services into dollars and cents.
Still, the best approach, some attendees said, is to have a detailed proposal that outlines standard pricing for planning functions that are considered more of a commodity, and flexible pricing or options for tasks that can’t be commoditized.
Looking for Opportunities:
The independent planners in the session also discussed how to gain market share. Several said it’s critical to look for clients and opportunities to produce meetings overseas, particularly in China, India, Brazil, Russia, and other emerging markets. Pharma is goingand if U.S.-based independent planners don’t fill the void, someone else will, said an attendee.
Another participant said globalization opens up the opportunity to form international partnerships with companies overseas. U.S. and European companies should seek out connections in these emerging markets to see how they can establish a presence or form a partnership with a local company.
A few planners also said that there are opportunities for third-party pharmaceutical meeting management companies outside of pharma. Since other industries—including finance and travel—are becoming more heavily regulated, pharmaceutical meeting-planning companies have a distinct advantage over their competition. They know how to operate and plan meetings in a regulated environment, so they could take the basic pharma model and readily apply it to meetings in other regulated industries.
In general, added an attendee, theof planning functions will increase in the future, which is another opportunity for third parties. While the economy has emerged from the worst of the recession, companies won’t likely increase budgets. The recession has created a new normal, which means pharma companies will continue to watch their budgets.
How Third-Party Planners Can Capture—and Keep—Pharma Business