Brand Loyalty: Using Secondary Data for Prescribing Persistency

This is the first in a series of eTips! measuring brand loyalty. Stay tuned for March's edition which will address the applications of primary research.

Brand loyalty is a construct that reflects the amount of return business a manufacturer can expect for a particular brand. It is a construct that has its origins in consumer products but also has applications in the life sciences arena. The measurement of brand loyalty is a multi-stage process that requires a particularly rigorous application of market research techniques.

It is common to measure a form of brand loyalty by monitoring the continued buying patterns of consumers within a product class. The pharmaceutical industry is amenable to this calculation because of the availability of prescribing data for most drugs, especially those drugs dispensed by retail pharmacies. This body of data permits the measurement of a surrogate construct that provides a clear indication of brand loyalty. This surrogate is prescribing persistency.

Persistency calculation involves accessing historical data and selecting physicians who prescribed a compound. One then tracks the volume of prescribing over an established period of time. This can be done for both new and ongoing prescribers. This data is aggregated and an average persistency score is calculated. This analysis is completed for each drug within the competitive class. The average persistency scores are then used to compute a persistency index for the drug class that permits a comparison of all competitors.

Persistency is a surrogate for brand loyalty because it does not measure the exact variables that comprise the loyalty construct. Instead it provides a market-based indication of the continuing use of a drug by a prescribing physician. This is a running snapshot, but it does not provide information about why the loyalty exists or continues to function. This is when primary research is often employed to determine what?s behind the loyalty construct.

Persistency measurement is only one of many uses for secondary data. This rich resource can be effectively utilized in other business intelligence efforts, including brand measurements of promotional mix and levels, pricing strategies and changes, formulary status, and direct-to-consumer (DTC) programs. Consult with your marketing research provider to help you design an effective template for a complete secondary data assessment.