The Hindu Business Line : Push for the pill

Over-the-counter marketing is at a nascent stage in India, which continues to be prescription-driven. Even as pharma companies grapple with strict legislation and preference for home remedies, there is need for greater brand promotion.

YOU'VE just hopped off a speeding bus, twisted your ankle, and landed unceremoniously on your back. And when you hobble home, wounded pride and all, you immediately reach for a tube of Moov or Iodex to rub into your aches.

And when you find your children down with a rasping cough or a bout of fever, you look for that bottle of Glycodin cough syrup or Crocin. Or maybe a good rub-down with Vicks Vaporub will do the trick. Over-the-counter (OTC) brands such as those named above may have become household names over the last few decades, but ironically, brand gurus still consider OTC marketing and branding to be at a nascent stage in India. India continues to be a prescription-driven market and managers of OTC brands still prefer to market their products through doctors rather than invest in brand building.

OTC brand expert Nicholas Hall, Chairman and CEO, Nicholas Hall and Company, says Indians by nature are extremely brand-conscious, but when it comes to the OTC segment, there is no brand loyalty.

"There is no emotional attachment with brands, barring a few like Vicks or Moov, which have stuck in people's hearts. OTC brands in India are sold on efficacy and not trust."

The Rs 7,500-crore OTC market has been witnessing flat growth of just three per cent over the last five years, and Hall thinks the brand custodians themselves are not inclined to shift the paradigm. "The media cost is much higher if a brand were to consistently invest in branding; therefore, pharma companies are comfortable as they are."

He says that while branding does exist in certain categories such as cough and cold, analgesics and skin care, vitamins and minerals are still untouched. "Abroad, nobody consumes vitamins or minerals based on a prescription."

Industry stalwarts and branding experts agree with Hall that conscious brand-building in the OTC market is absent, and offer a list of reasons as to why branding in the OTC segment has not been a hit in the country.

The first and the most obvious reason is the regulations. Says Geogi Zakariah, Business Head, Alembic Consumer Healthcare, "There are a number of drugs such as Ranitidine (a digestive drug) which are sold in supermarkets in the West under various brand names. But the regulatory authority in India allows Ranitidine to be sold only through the prescription route."

Agreeing with Zakariah, a Novartis spokesperson says: "The real challenge for OTC brand building is still the legislation. There is no clear definition of what constitutes an OTC pharma product. The healthcare segment in India has to mature enough for OTC expansion. The Drugs Technical Advisory Board has resisted approval of shift of molecules from prescription to OTC. So, that is the real challenge, not that OTC companies have not invested enough in brand building."

Says Renuka Jaypal, Business Head, Ogilvy One, the direct marketing division of Ogilvy & Mather, "Traditionally, the pharmaceutical industry has paid less attention to building brands and customer relationships because of their belief that it is a low priority in the highly regulated world of pharma marketing where the relationship between the manufacturer and consumer is not direct. It is for this reason that direct marketing and relationship programmes with doctors and chemists play a dominant role in the marketing mix."

Kinjal Medh, Head (Interactive and Healthcare), FCB Ulka, says the reason for healthcare companies not focusing on branding is the fact that India is primarily not a pill-popping nation.

"The Indians always prefer home remedies to a prescription drug. If it is a cold, for instance, they would first treat themselves with warm adrak pani (ginger infusion), and only if the cough continues to worsen do they feel the need to consult a doctor."

The other factor which Medh points to is the huge expense a brand may incur to advertise. The brands' turnovers are not large; many brands wonder whether spending 5-6 per cent of their turnover would give them enough returns.

Zakariah of Alembic says the industry is yet to witness an automatic shift from prescriptions to OTC. Marketers have to understand that they have to give consumers time to change their basic behaviour.

"Therefore, I don't think the investment made by companies in brand building is inadequate. Benadryl, for instance, has spent Rs 7.5 crore on a brand turnover of Rs 35 crore, while Glycodin has spent Rs 4.5 crore on a brand turnover of Rs 18 crore," he says. "Overspending will never ensure proportional returns," he adds.

A senior spokesperson of a leading pharmaceutical company says another aspect of the brands' reluctance to invest in branding is the fear of getting alienated by the community of doctors. He says most brands consider the prescription route to be much safer.

Though Ulka's Medh does agree that OTC brands in India do fear getting alienated by the doctors, he says companies can still build OTC brands through media and yet keep them happy.

As for OTC marketing of vitamins, minerals and other nutraceuticals, the industry feels it is too early.

"Proactive health care is still a far cry in India," remarks Zakariah of Alembic. "The question is whether the consumers will buy these products over the counter. One can't spend crores on advertising without knowing whether there is scope to build the market. The prescription is any day a safer bet."

Similarly, Medh says nutraceutical players have to first prove that the benefits their products claim are more significant than home remedies, as "nutraceuticals in India are part of home remedies."

Does the OTC segment actually have a future in India, given the myriad regulations that surround it? Can marketers engender trust among consumers through branding?

"Why not?" asks Jaypal of Ogilvy One. "It has happened in categories that were purely commodity markets. It will be an easier journey in pharma because health is a very personal and important subject. The fact that consumer spends on healthcare are on the rise is proof that this is already happening. The challenge for the pharma industry is to reach the fragmented target population of end-users while maintaining their traditional relationship with doctors. As the customer becomes actively involved in his/her own healthcare, the role of the face-to-face salesman will need to be re-examined. The companies will need to supplement their direct sales efforts with marketing campaigns through other channels."

"In the pharma industry, it is clear that patents will remain the chief source of economic value but market trends indicate that `brand' will increasingly become an important factor. Shortened patent protection, consumerisation of prescription products and direct-to-consumer advertising will drive this trend," adds Jaypal.

Medh of Ulka says OTC brands have to communicate a persuasive benefit for consumers to consume a pill. "At the same time, one also has to be consistent in terms of brand spends. Brands such as Coldarin have collapsed due to lack of consistency not only in spends but also positioning."

Hall says OTC manufacturers have to deconstruct themselves and delve into the lives of their consumers and find out what their needs are, and accordingly reposition their existing brand or even launch a new brand.

"A lot can be done in terms of branding, even within the existing regulations and patents," he says.

"With the increase in literacy levels and aggressive marketing by Indian companies, especially after globalisation, there is no doubt that companies will be able to build up credibility and trust," says the Novartis spokesperson. "The major category which has been neglected by the OTC industry is vitamins. This has unfortunately been under price control all these years, but stands a very good chance of being successful under the OTC umbrella," he adds.

Hall recommends the use of various marketing strategies such as brand promotions, doctor endorsement, advertising and Internet to create brand consciousness among the consumers. "The Indian OTC brands have to brain-transplant to grow," he says.

Pictures by Bijoy Ghosh

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