written on 17.08.2012

Interview with Puneet Narang, Marketing Director, Reckitt Benckiser Turkey

At Reckitt Benckiser, you have gradually taken positions of increasing responsibility over the last decade in Marketing. What would you highlight as the main specificities of Turkish market compared to your previous experiences, in terms of the commercial strategy pharma and healthcare companies need to adopt?

Turkey is a highly regulated market, and this impacts the way companies should operate in Turkey. In this country, there isn’t really an over-the-counter (OTC) market, as most of the drugs are prescribed. There is no advertising directed to consumers; instead, companies strive to influence the doctors and the key opinion leaders.

As a result, most of the healthcare companies, including Reckitt Benckiser, have developed a medical marketing strategy as opposed to a consumer marketing strategy. This is very different from most of the markets where I have been in the past, i.e. Australia or Ireland, which both are consumer driven.

Some companies mentioned the possibility to set up specific teams targeting the pharmacists. Is this something you envision, and how should Reckitt Benckiser’s commercial strategy evolve in the coming years?

In Turkey, Reckitt Benckiser does not have its own in-house healthcare field force. We operate through distributors who have large field forces to call upon both doctors and pharmacists. Our primary focus is on the doctors, because this is where prescriptions are generated from. Then, one needs to influence pharmacists who are the ultimate gate keepers. Therefore you need to detail your product to both doctors and pharmacies.

Reckitt Benckiser is a very brand-oriented organization, and one of the few companies that has really implemented the concept of Power brands. In the Turkish market, what is the key to establishing brand penetration?

We operate in three different healthcare categories: gastrointestinal, cold & flu, and sore throat. In all three, Reckitt Benckiser enjoys market leadership.

On the healthcare side, it all starts from having the right product. Before building a brand, you need to have the right set of products and the right formulations. In this market, as you deal mainly with the doctors, you need to convince them not about your brand, but about your product. Product and brand go hand in hand.

In most of the cases, we are the first ones to have entered the market with very good formulations. For instance, we are one of the few players in the market to have Ibuprofen as a cold & flu product, which is a lot better than a Paracetamol based cold & flu product. The doctors appreciate our offering, as it gives the consumer a better relief. They start prescribing and recommending more of these.
First, the brand is based on the right product. Then, over a period of time, the brand is based on the consumer experience. This is very different from other markets, where brands are built through advertising. In Turkey, they are built through the doctor’s prescription, the pharmacist’s recommendation, and on the consumer own self experience with the product.

Among these three healthcare categories, which one has been driving the growth in the recent years?

We entered the gastrointestinal market 15 years ago; we entered cold & flu and sore throat through the acquisition of Boots Pharmaceuticals.

But in fact, for all three categories, we have been growing in double digits every year; we are still gaining market share in all these different markets every year.

Despite the tough economic climate, the group’s net revenues grew by 13% last year. What has been Turkey’s contribution to this performance?

Turkey is one of the fast growing markets for Reckitt Benckiser. Reckitt Benckiser’s revenues in this market have been steadily growing by double digit figures over the last years. Earlier, when we were a part of Europe, we were the second or third fastest affiliate in terms of growth in the region.

As you rightly mentioned, Reckitt Benckiser has a strong concept of Power Brands. Likewise, the concept of Power Markets has been introduced at the beginning of the year by Reckitt Benckiser’s new CEO Rakesh Kapoor. He said that 2012 will be a year of transition, with an increasingly strong focus on emerging markets. The group has now classified 16 power markets as preferred future investment destination. Turkey is one of them. This represents significant growth opportunities for us in the future.

Turkey has always been a large market for the group; Reckitt Benckiser has never shied away from investments in Turkey. We hope that, as we go in the future, we will see a lot more growth and investment coming especially on the healthcare side.

In Turkey, what is the importance of the healthcare business for the affiliate’s revenue?

Globally, the organization is now structured in three broad categories: health, hygiene, and home. The objectives for Turkey are to align with the group’s global strategy of investing more on the health side.

Currently, 10% to 12% of our revenue comes from consumer health. Ideally, in about five years, one fourth of our turnover will be coming from consumer health.

Although known for its households brands, Reckitt Benckiser often ranks in the top positions worldwide in the pharma business. How do you assess the Turkish affiliate’s current strengths and weaknesses as a pharma player?

Globally, Reckitt Benckiser is the sixth largest OTC player. Nevertheless, it is fair to say that people do not associate Reckitt Benckiser with OTC as much as they do with Fast Moving Consumer Goods (FMGC).

In Turkey, we are even smaller as an OTC company; as there is no defined OTC market. We are part of large prescription pharma market, in which we are not seen as a major pharma company, and this is something we are actively trying to change through our relations with the doctors and the pharmacists. Our strengths lie within what Reckitt Benckiser stands for globally as well, the fact that we are an innovation led organization. Innovation is part of our DNA. This strong culture comes into the consumer health side as well. Indeed, we have plans to launch new products within the next few years in Turkey, and this is where our growth will come from.

Before your appointment in Turkey, you have spent all your career in English speaking countries, which beyond the language, have certain cultural similarities. As an Indian native with a western experience, would you say you have the best profile to succeed in Turkey, as the country is at cross roads of both cultures?

It is an interesting question, and to be honest I haven’t thought of it that way. But I think you are absolutely right, someone with a background like mine, with a mixture from East and West, has all chances to be successful in Turkey.

Culturally, it is very similar to India. When my Turkish team share their cultural experiences with me, very often I can empathize with them because of those cultural similarities. Likewise, when people talk about their aspirations toward a more westernized society over here, I can again understand exactly what they mean.

My background definitely gives me an interesting edge to understand the complexity in this market.

What are your ambitions for Reckitt Benckiser Turkey?

My personal ambitions for the Turkish affiliate are to grow consumer healthcare much faster. Given the way this market is growing, both in terms of population, development, and with the opening of pharmacies, the introduction of family practitioners, I believe we are moving in the right direction.

Turkey will become a very strong healthcare market in the years to come. Any multinational company would like to operate here if they are not here already.

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