When a company with a new product commissions a marketing research project, it's looking for answers to critical questions: How big is the market for our product? How should we sell it? Have we come up with something big?
When Merrell Dow Pharmaceuticals, Inc. began preliminary research on its product Seldane, it already knew the answer to the last question. Seldane, the brand name for an upper respiratory allergy relief medicine called terfenadine, appeared to be every pollen-fearing person's dream come true. Like the other allergy medicines on the market, it relieved the symptoms of seasonal allergic rhinitis: the runny nose, itching eyes and sneezing. But unlike other antihistamines, there was one important thing it didn't do: cause drowsiness.
This was a major breakthrough with tremendous sales potential, but Merrell Dow needed to know just how tremendous. It needed the answer to those first two questions. That's where Opinion Research Corp. (ORC) came in.
Phone survey
To begin with, ORC conducted a large-scale random digit dialing telephone survey to assess the size of the allergy suffering population in the U.S. Merrell Dow suspected there were a lot of sneezing, miserable people out there, but it wanted to find out just how many, and how miserable they were.
Based on national probability sample of 3,800 households, containing 10,300 people, ORC projected that there are about 41.5 million upper respiratory allergy (URA) sufferers in the U.S., a group that spends an estimated $500 million a year on relief. That's quite a market.
Extensive interviews
With the size of the URA suffering population ascertained, two groups, consisting of sufferers and the physicians who treat them, were assembled and interviewed extensively.
"A number of significant multi-variate analyses were done," says Dick Smith, manager of new products market research at Merrell Dow, "factor analysis, cluster analysis, multiple discriminant analysis, gap analysis, and perceptual mapping. Subsequent to that, we did conjoint work, getting at tradeoffs in terms of pricing and other parameters.
"Prior to this we did quite a bit of qualitative focus group work to define the issues and terminology that the physicians and sufferers employ, so that when we went out and did the field work, we were speaking their language."
Personal story
The screening process during the random digit dialing survey shed light on the size of the group, and the interviews generated from it told a more personal story. From the 1,800 individuals with URAs identified in the survey, 1,005 were selected for in-depth interviews to obtain demographic and psychographic information, and to find out what medication sufferers took, and, if they weren't taking medication, why not?
Their answers told just how difficult life can be for the upper respiratory allergy sufferer.
- On average, URA sufferers had substantial symptoms 19 weeks out of the year. One-fifth, or about nine million, had them more than 40 weeks each year.
- Almost two-thirds of those questioned said that allergies bothered them "a great deal."
- Allergies are most common among persons in the prime working years. URAs affect 35% of all females in the 35-40 age range; among men, the incidence was highest among 30-35 year olds.
- It's estimated that allergic rhinitis causes three million lost work days and two million lost school days in the U.S. each year.
- 62% said they sometimes didn't take medication because it made them sleepy.
- On average, sufferers took medication less than half the time that they had bothersome symptoms.
Major revelation
This last statistic was a major revelation. The research had uncovered a previously unknown group ORC eventually termed "silent sufferers," allergy sufferers who chose not to take medication because of the drowsiness side effect of most antihistamines.
"One of the largest segments out there was this group of people who were literally begging for a product that would deliver on a non-performance-impairment attribute," says Tom Hinkel, research executive with ORC.
"Essentially, you take (an antihistamine), you get drowsy, and the next thing you know you've got your nose in your coffee. So these people would suffer and would not take their medication because it impaired their performance."
Physicians interviewed
Merrell Dow had a different set of concerns regarding the physicians. Seldane would be a prescription drug, and because Federal regulations prohibit advertising of prescription drugs to the public, physicians were Merrell Dow's link with the consumer.
A group of 352 physicians-made up of allergists, pediatricians, general practitioners, and ear, nose & throat specialists-provided .demographic information on age, length of practice, and affiliation (hospital, solo practice, HMO), which aided Merrell Dow in the sales process.
"They become predictors of behavior," Hinkel says of demographics. "You can say, for example, that physicians that live in the northeast and have been in solo practice for 20 years tend to behave this way, etc. You can train your detail force to identify which of the segments this doctor probably would belong to, and then you know what their hot buttons are and what they're looking for and you literally tailor your detail to each individual physician. That's why segmentation is so powerful. It's not the mass marketing of the 50s and 60s, where you can say the same things to all people, because people don't approach the same subject the same way."
The physicians were also asked about their prescribing habits, about which attributes, such as safety and efficacy, were most important to them, and how well the products currently on the market met their needs.
"We developed a long attribute battery that described individual characteristics of all the competitive alternatives and we tried to measure how much the physician wanted or didn't want each of the attributes. From that we went on to a brand profile where we looked for how much each of the competitive alternatives delivered them," Hinkel says.
"Once you've segmented the market," he continues, "you've got the groups of physicians that approach the market most similarly within the group and dissimilarly across the groups. Then you're looking for what other types of things really differentiate behavior."
But no matter what differentiated the physicians, Hinkel says, they were all united in their excitement about Seldane. "The physicians were jumping up and down when informed that they might have a product like this available to them, because their patients were saying the same doggone thing 'I don't want to take this because it makes me drowsy.' "
Work sessions
Throughout the information gathering process, as each phase of the research was completed, people from Merrell Dow and ORC got together in long work sessions to analyze the mountain of data they had accumulated.
"We worked very well on a team basis," Smith says. "We'd do a phase and then hold a workshop. Once we had all the data in its infinite detail, it was a matter then of categorizing it and analyzing it, doing statistical multivariate work on it to make it work for us."
"We know how to interpret models," Hinkel says," and (Merrell Dow) brought to the table their expertise in the antihistamine market. Work sessions are a highly interactive system and, coupled with the aggressive use of models, we get a lot more usable information from them. So that's why we like to use work sessions.
"We realize that not everyone uses multivariate statistical analyses, and we want to make sure they feel comfortable that these things aren't just black boxes, that they really understand why we're doing these analyses and what they mean."
After the data were whipped into a workable form, Smith says, they "formed the essence, really, in terms of the priority of our approach and helped us determine how big was big and where the product was coming from or where it should come from, potential-wise."
Number one
Seldane has definitely lived up to its potential. Since its introduction in 1985, it's become the number one allergy product world wide, according to Smith.
"Rarely does someone go out and spend as much money as Merrell Dow did to find out how high is up," Hinkel says, "but they literally had so much at stake in this particular situation, and they had a marvelous product, so they wanted to know 'Well, how much can we do here, guys?' "
That's one question Merrell Dow doesn't need the answer to anymore.