Why healthcare brands need to change their approach and quickly

History is littered with examples of large, mature brands which have jeopardized their future by momentarily taking their eye off the ball. This happens for a number of reasons, but resilience and strength through both good and bad times comes from relentlessly working at your brand to make sure that you have a clear and credible purpose with an experience that delivers this. Brands at the top of their game need to work especially hard to maintain their dominant positions and positive perceptions.

This is an important lesson for global healthcare companies to learn, and they need to do it quickly.

On the whole, healthcare companies benefit from positive, people-first, perceptions, not to mention the fact they are often seen as highly indispensable. During the past four years of the FutureBrand Index, some of the consistently highest ranked brands are from the healthcare sector for example AbbVie. Whilst others such as Sanofi are climbing the rankings fast and have seen a significant improvement in how they are perceived externally. Therefore recent reports that both companies, as well as five other leading healthcare brands, are under fire for raising the price of their key prescription drugs and abusing the patent systems, has prompted us to consider how they can maintain their positive reputation with consumers and their strong brand position.

If we take a closer look at AbbVie’s performance in the Index, it scores highest on ‘being a company with strong ideas and principles’ and acting ‘credibly and authentically’. Consumers consider it to be a company they would pay a price premium for, although they may have a tough time justifying and convincing us to pay the outrageously high cost of its blockbuster drug, Humira, which treats arthritis, especially when the sales of the drug itself have already more than covered the cost of the research investment they made to create it. They are currently clearly not living up to their promise to place “uncompromising integrity at the heart of everything we do”. It’s this gap that starts the domino effect of diminishing positive brand perceptions, brand preference and perhaps ultimately growth.

The healthcare companies aren’t at this point yet, but they need to carefully consider their next steps and their response to the raised concerns about their behaviour. Looking at their technology sector peers, they could learn from their mistakes. Technology, like healthcare, has historically ranked at the top of the FutureBrand Index. Companies such as Apple, Microsoft and Tencent have been riding high and leading the pack. For years it was commonly believed that they could do no wrong however, in 2018 and we saw every tech company in the Index fall in the rankings, with key drivers such as trust, mission and authenticity going down. Previously unshakeable behemoths quickly and perhaps permanently lost favour with consumers when their behavior came into question and the experiences they provided veered from what they stood for as companies and what they promised their consumers.

Interestingly, the top drivers for both sectors are nearly identical – mission, innovation, authenticity – whilst healthcare also scores highly for wellbeing and tech is highly rated for thought leadership. Could it be that consumers view them similarly, which makes the comparison of their rise and possible decline all the more pertinent? A similar pattern can be observed with the financial services sector, which only 10 years ago suffered a drastic decline in positive perception but has started to come out of the other side of the global crash by beginning to rebuild trust among consumers.

As previously mentioned, healthcare companies are not yet in the same uncomfortable position as tech brands nor have they found themselves as out of favour as the finance sector has been for much of the last decade. They still hold a position of power, gaining favour and advocacy with consumers. Their current situation however, should focus their leadership teams on the challenges ahead in order to keep up this positive momentum and avoid the pitfalls that brands from other sectors have fallen into. They need to protect and nurture their reputation by ensuring their brand’s experience is consistently aligned to what they stand for, their purpose.