Business to Business Marketing

Dendrite International

Presentation by :
Group No-5
Group :: Team Members
- Amit Kumar Chaudhary [04]
- Saurabh Srivastava [23]
- Sampurna Nand Sharma [34]
- Nikhil Kumar Jha [36]
 Context

 Started in 1985 to develop software to assist with call planning

and reporting task.

 Decided from the outset to be a global supplier of both software

and service.

 Dendrite International is one of the world’s leading software

supplier to Pharmaceutical Industry.

 Presence of 15000 sales people in 40 companies in 11 countries,

revenue for 1993 $ 33 Million.

 As the market scenario is changing, Dendrite is looking at

another way to go to market.
 Competition

 STI has strong presence in US(Sales of $ 48 Million)-40% share

of installed reps in US, but is encountering lengthy delays
 Walsh International , based in UK($ 100 Million sales)—main
business sale and analysis of industry data-have rigid system.
 Pharma system is a new company and small company with
potential
 Cornet (13% Pharma rep)-mainly based on two large firms-had
to develop product service package.
 Other vendors offering stand alone software package for $ 100-
400 / per unit as compared to $ 300 -2000/unit for Dendrite
 Dendrite offered much higher level of service and product
flexibility
 Dendrite currently only supplier with product in Japanese Kanji
language.
 CUSTOMERS
U.S.( about 30% Pharma sales)
 Largest sales force-500 to 3000 rep/firm
 Calling frequency-every four to six weeks
 Higher level of monitoring requirement
 Less price sensitive
Europe (about 32% Pharma sales)
 sale force of generally 100-200 reps
 Calling frequency once a year
 Government funding is large and presence of managed care
organizations
 Cost sensitive
Japan(about 18% Pharma sales)
 Prescription and dispensing takes place simultaneously
 Social selling very important
 Prices have to be negotiated with individual physicians.
 Tracking expenses is a key task
 Market Developments
U.S.
 Health care costs have gone over $ 900 billion.
 Coming up of managed care organizations.
 More centralized buying and formularies to lower costs.
 Activities of sales force to drop from 250000-300000 physicians
to 35000 committees.
Europe
 Imposition of price control on drugs.
 Imposition on reimbursement regulations, More centralized
buying.
 Activities of sales force to drop further.
Japan
 Fixed price invoicing mandated and whole seller rebating
abolished.
 Imposition on reimbursement regulations.
 Movement towards separation of prescribing and dispensing
 More reps may be required now .
 Implications of changing market

 Better account management required instead of better system

design.
 Change in focus from strategic from tactical.
 Contacts should grow from beyond Information systems, sales
administrations to client functions, client customers and board of
directors.
 Less sales force required in US and Europe.
 More sales force requirement in Japan.
 Percent of Reps automated in Europe and Japan are less as
compared to US-scope of automation huge.(Exhibit 4)
 Dendrite penetration in US market is less. (Exhibit 4)
 Changes
DMU
Existing DMU: VP Sales, IS, Sales representatives
New: Board of directors, Client functions, Sales, IS, Sales
representatives
Product
Existing:
 Mix of product and service.
 More service oriented with involvement of dedicated client team.
 Service pricing based on user numbers.
New:
 More emphasis on account management
 Less requirement of help centers.
 Pricing to be done on product and maintenance cost, rather than
user numbers.
 Changes
Sales People
 Size of Pharma sales force will decrease in US due to MCU’s.
 Individual sale person’s importance will decrease in purchase of
ETM.
 Sales team will be required to influence formulary(MCU’s
decision) which will also require drug experts and others technical
persons along with sales person. Dendrite will also require sales
team with technical experts to sell ETM in US and Europe.
 Orientation of sales people to be changed for changed
requirements and culture through training and proper goal
setting.
 In Japan, size of Pharma sales force will increase ,Individual sale
person’s importance will increase in purchase of ETM. Sales force
of Dendrite needs to be increased.
Business Manager
 Can be involved earlier in project as daily fire fighting will
decrease. BM involvement will increase the influence of sales
team.
 Compensation system to be revised.