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October 13, 2008

Negotiating the “Indirect” Sale: Part I

Influence

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We are often asked to work with companies and organizations that do not negotiate in the traditional sense of bartering over price (or terms). Some sales representatives do not have any control over pricing or terms due to organizational norms or the commoditization of their products or services. Other companies, such as pharmaceutical firms, are even more limited in their ability to negotiate due to regulations. For example, pharmaceutical sales representatives cannot “trade” services, samples or “extras” for prescriptions.

We struggled at first to apply the usual negotiating lessons and techniques to the “indirect sale” until we realized that a tactical approach to sales would be less effective than a strategic influencing approach.

Let’s use the pharmaceutical sale as the example. A pharmaceutical sales representative spends their day detailing physicians about their products in a very limited amount of time, perhaps as little as 30 seconds while the doctor signs for their samples. Some busy physicians see as many as 15 different sales reps in a day. Most pharmaceutical reps see upwards of 10 physicians a day (often with a variety of products in their “bag”). The message has to be clear and concise and yet the “call to action” has to be more subtle than a direct sale – “Will you try Product X on patients who present the following indications…?” is about as direct as you can be within the pharma guidelines. The best “close” a pharmaceutical rep can hope for is a promise that the physician is willing to try the product at some point in the future.

The pharmaceutical sales rep has no direct control over the “sale”. The physician makes the prescribing decision on their own in the examination room after the sales representative has left the office. The doctor has built a prescribing habit over time and it is very dfficult to change the habits of a highly trained, intelligent and busy physician.

We believe that the key to successfully changing a physician’s prescribing habits is based a sales representative’s ability to develop three critical components of INFLUENCE:

1. The Credibility of the sales representative when educating the doctor about their products;

2. The Relationship that the physician enjoys with the sales representative; and

3. The Value that the sales rep delivers to the practice.

If the sales rep can build enough credibility, and the relationship with the practice and the value delivered to the physician outweigh the RISK of switching the prescription (the efficacy, safety and patient economic impact of the new product), the sales representative has started to influence the physician successfully.

In the next post, I will show you how the systematic approach to negotiating can be applied to influence physicians more successfully.

John Buelow

John is the Chief Learning Officer at Shapiro Negotiations Institute (SNI), a training and consulting firm based in Baltimore MD. SNI has trained over 300,000 professionals around the world since 1995 helping people to close more deals, faster at higher margins.

COMMENTS (1)
  • hi John,
    out of just a few lines of your discoveries I have gotten a good insight on
    handling physcicians in pharma marketing business
    thanks and keep on educating us on the same.
    Regards
    Ssebina Emmanuel
    Country Sales Supervisor
    Micro Labs Ltd.
    Kampala-Uganda

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