Why Pharma companies fail to have an impact on the mHealth app economy
Even though they try hard, most of the Pharma companies fail to have a significant impact on the mHealth app market. Some Pharma companies have published more than 100 apps available for iOS and Android, but have generated only limited downloads and usage.
This is one of the results of the new report “Pharma App Market Benchmarking 2014” released in October 2014.
On average, each of the leading Pharma companies has 60 apps in the Apple App Store and Google Play. In comparison a typical mHealth app publisher, releases just 1-2 mHealth apps. (see: “mHealth App Developer Economics 2014” free report).
With all these apps published, Pharma companies have created only little reach within the smartphone/tablet app user base. In fact, the leading Pharma companies have been able to generate 6.6m downloads since 2008 and have less than 1m active users. Given their position in the healthcare market, their app publishing efforts and the performance of some garage-type mHealth app publishers, this performance cannot make any Pharma company happy.
The app publishing activities of Pharma companies differ not only in size and reach, but also which app categories (e.g. reference, fitness, medical condition management) they focus on and to which degree they target private and professional users.
The Pharma app publishers can be clustered into three groups: Niche players, the Still Trying ones without considerable impact and the ones who have already had First Success.
- Niche: Niche players like Roche or Bristol-Myers Squibb use apps to support their core products. They have a higher share of apps that target healthcare professionals and which sometimes require doctor’s identification. Their portfolio size and reach is below average. The higher share of apps that target professionals might be an explanation for the lower reach. Professional target groups are usually smaller compared to private app user groups. Examples of private users they target include women, health enthusiasts or diabetics, all of which represent very large potential user groups.
- First Success: This group represents Pharma companies with a large app portfolio that has gained above average download numbers. The majority of apps target the mass market of private users. The main reason why this group of Pharma companies stands out is because one or two of their apps have a reach of hundreds thousands or even more downloads. For example, 86% of Sanofi’s app portfolio reach comes from three apps. If it was not for these three apps, Sonofi’s app portfolio performance would be disappointing.
- Still Trying: This group includes companies like Bayer Healthcare or Novartis. They are very active in terms of the number of apps which target large private user segments. Despite this mass market orientation of their app portfolio, their reach in the app market has remained low and below average. In contrast to the “First Success” players, they have not managed to bring to the market any comparably successful app. Comparable low 22% of Novartis downloads belong to the top 3 apps.
Analysis and comparison of the app activities of the top 12 Pharma companies gives possible reasons why Pharma companies have not succeeded in becoming leading mHealth app publishers.
- The app portfolios are not globally available: Almost half of the Pharma companies’ app publishing entities target only local markets. This means that their apps are available only in 3 or less countries.
- The app portfolio is built around the core products of the Pharma companies and not around the actual market demand: For example, if a company specializes in the treatment of hematological diseases, the app portfolio reflects that. Apps in this case would provide references to the latest research, support diagnosis and facilitate information exchange with/between the experts. There exists an app market for such products, but there are other segments e.g. health tracking, weight loss, fitness or diabetes condition management, which attract more users.
- No cross-referencing or common and recognizable design: So far Pharma companies have not used the full potential of cross-referencing between their apps. They also do not use common style guides for their app portfolio. Both of these could improve their app visibility as well as strengthen their corporate identity in the app market.
The other reasons for the lack of spectacular success relate more to how they organize their app business. For example, the leading Pharma companies use up to 17 different app publishing entities. Such a strategy makes a globally aligned app category focus and reuse of existing concepts and knowledge difficult (e.g. Novartis publishes apps under 17 different entities).
Pharma companies should also question their role in the mHealth app economy. Is it a good strategy to develop and publish the next 700 apps in the next five years? There are other roles (e.g. mHealth data aggregator, mHealth app incubator, partnering) that might help Pharma increase their return on investment in the app market.
Interested in finding out more about how Pharma companies make use of the mobile app channel? Check out the “Pharma App Market Benchmarking 2014” report.
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