24 July 2000
There is a lot of speculation in the marketing community that the giant merger between Glaxo Wellcome and SmithKline Beecham is likely to lead to the new super-pharma company offloading its consumer products, such as nutritional healthcare drinks. The speculation follows the announcement that Smith & Nephew Healthcare has decided to sell its consumer brands so it can concentrate on being a "high-tech medical company".
Some think the big pharma companies are preparing the ground for a marketing push that would seek to create a consumer perception of drugs and medicine as brands in their own right. In effect, this would mean that companies as large as the new Glaxo SmithKline and Pfizer would fade into the background as their individual products took centre stage.
There is further evidence for this in the fact that some of the big advertising agencies have begun taking over smaller healthcare marketing specialists in preparation for a newly focused push on developing separate brands.
Perceptive legal marketers may well be watching this tendency to consolidate around core competencies with some trepidation. Here is an industry - a phenomenally successful one like its own - tightly regulated and only really experienced in marketing fringe, fast-moving consumer goods, looking at how it can push a company's name into the background and concentrate instead on marketing a range of core products.
Building a brand image for an individual drug is not easy but when it is achieved it can be very powerful. Anadin and Viagra are just two examples. If consumer loyalty can be built up so that your brand is what the consumer turns to when they have a headache or, urm, something a little more troublesome your relationship is secure.
A law firm, too, offers a range of remedies for moments of crisis.
Up until now it has been a case of: "Got a merger developing - reach for a City firm." Now legal marketers would have us believe it's more likely to be: "Feeling a takeover coming on - Freshfields can help."
But as consumers/clients become more discerning, they also become more aware of brands. If your firm is good in litigation, do you want that expertise affected by a less than good reputation for work in M&A? Do you want the potency of your financial services team swamped by a global identity?
Following the logic of the moves in the pharma industry, perhaps now is the time to consolidate around what you do best and then build your branded range. It is a radical step, but what would happen if the name Clifford Chance became as invisible a marketing tool as Rhône Poulenc while its products/services became as widely identifiable as Day Nurse.
Of course some firms have already experimented with such marketing. Linklaters' Blue Flag is just one example. These, however, have been launches or expanded services. The core business of the firm has remained Linklaters the law firm, Clifford Chance the global firm and so on.
The pharmaceutical giants are consolidating their businesses as rapidly and ruthlessly as the City firms. They and their agencies know that as their market changes, they are going to have to create brand awareness and loyalty. And some have decided the only way to do so is to go for brands plural not brand singular.
Of course the other side of the argument is one that the pharma businesses are all too aware of - consumers buy what works and if they can get it cheaper by getting it on prescription, so much the better.
Firms may choose to experiment with creating brands around narrow services, specialisms or even teams, but if they don't deliver, or they cost too much, their customers will dump the brand and look elsewhere.