As reported by Nielsen, direct-to-consumer (DTC) advertising spending by the pharmaceutical industry was down by 1% compared to 2010. I used that bit of information to update my chart of DTC spending trend over the years (see below).
This chart actually plots measured media data (excluding Internet display and search advertising) through 2010 from AdAge, which got the data from TNS Health. I calculated the 2011 total based on the 1% decrease reported by Nielsen (sorry, I don't have TNS data for 2011).
The final bar of the chart is my estimate for 2012, which is based on the premise that DTC ad spending for Lipitor will be less than half of what it was in 2011. Of course, Lipitor is now available in generic form, so we would expect Pfizer to spend less on its advertising. However, for the first 6 months or so in 2012, Pfizer will continue to spend money on advertising its $4 co-pay coupon for branded Lipitor. But after that, I expect spending to drop precipitously.
I did a little exercise to predict that DTC spending in 2012 will be down by over 3% compared to 2011 solely due to the drop in Lipitor advertising. Here's how I came up with that estimate.
First, let's look at the TOP 20 brands by DTC spending in 2011 (this chart is based on Nielsen data that I found in the April 2012 issue of MM&M):
In 2011, Pfizer spent $220 million on Lipitor DTC advertising according to Nielsen. That compares to $272 million in 2010 (a 20% decrease). So, right away, we know that Lipitor DTC spending is dropping although it still represents 5.5% of the total spend in 2011 (it was 6.3% in 2010).
Based on what I said above and a poll of readers (see here), I estimate that Pfizer will spend less than $100 million (ie, $90 million) on Lipitor DTC in 2012. If we assume everything else remains the same, that decrease of $130 million represents a 3.3% decrease in overall DTC spending!
Of course, not everything else will "remain the same." Other drugs may come on the market that may be have substantial DTC advertising budgets. But I don't think that is likely -- more and more drugs in the TOP 20 list will be coming off patent.
In any case, this is just a little thought exercise that demonstrates how much a SINGLE drug can impact the overall DTC spending trend. Not only that, but a single drug company -- Pfizer -- accounts for nearly one-quarter (22.3%) of the total (see chart below)! Seven of the TOP 20 drugs are marketed by Pfizer.
One of the TOP 20 advertised Pfizer drugs is VIAGRA. Currently, it appears that Pfizer is focusing on the counterfeit Viagra problem to bring in web visitors to viagra.com (see display ad on left).
Another TOP 20 advertised Pfizer drug is ENBREL. Pfizer & Amgen spent nearly $100 million on Enbrel DTC advertising in 2011 (compared to $71 million in 2010). And this number does NOT include what the Amgen/Pfizer has paid Phil Mickelson to be the Enbrel celebrity spokesperson (see "Amgen Blows Its Marketing Budget on Phil Mickelson Campaign" for more on that). On TV, Mickelson promotes Enbrel for the treatment of his psoriatic arthritis. According to the MM&M article cited above, psoriatic arthritis afflicts "around one in 20 of the 2% of Americans who suffer from psoriasis." That works out to be 3 375,000 people (1 in 20 of 7.5 million).
Approximately 63 cents out of every DTC ad dollar goes to TV. So, Pfizer/Amgen spend about $63 million to reach 375,000 people via TV ads! It seems a bit exorbitant to spend so much for broadcasting versus a more targeted approach. Anyway, that's the crazy world of Pharma DTC advertising! Go figure. read more..
Sunday, 15 April 2012
Search Advertising-Dtc Advertising-Lipitor
Saturday, 10 March 2012
Social Media Marketing-Personal Experience-Insurance Marketers-Insurance Marketing
Often, when proponents of pharma eMarketing get together at industry conferences, or cry into their beers at receptions afterward, they lament the fact that the drug industry isn't doing as much as other industries in the "e" arena. Sometimes, they cite eMarketing campaigns of companies like Procter & Gamble (P&G) and ask, Why aren't drug companies doing that?
The responses to that question generally fall into the category of "It's Regulations, Stupid!" That is, FDA regulations are hampering what pharma marketers can do online. The packaged goods industry -- of which P&G is a member -- is not regulated like the drug industry is regulated. True that!
So, let's look at another industry that IS regulated: the insurance industry. Where do insurance marketers spend their dollars and how does that compare with pharma? It just so happens that I came across some data that might shed some light on that (see the chart below; click on the chart to enlarge).
The data come from Kantar Media. The Internet data does NOT include search advertising. The insurance data is for the first three quarters of 2011 (total spend = $3.56 Bn) whereas the data for pharma is for 2010 (total spend = $4.3 Bn). To compare apples to apples, in 2010 the insurance industry media spend pie looks like this: TV, 54%; Print, 6%; Internet, 21%.
No matter how you look at it, the insurance industry favors Internet over print whereas the opposite is true for pharma. Why?
Here's what I have learned from personal experience. In my family -- and probably in your family too -- health decisions and purchases are generally the domain of my wife, whereas insurance decisions and purchases are my responsibility. It's no secret that pharma marketers target mostly women. My wife reads magazines like Prevention, etc. that feature a lot of drug ads. I don't read these magazines. While I have seen print ads for insurance companies, they haven't made much of an impression on me, whereas TV ads have.
So, from my personal experience, it's logical that both industries allocate a big portion of their media spend on TV advertising, but only the drug industry spends a lot on print advertising.
What's surprising, however, is the insurance industry's 28% of total media spend on the Internet (versus 5% for the pharma industry).
Coincidentally, yesterday I received an e-mail message from Geico about their "Family Pricing Program" for my son Greg. (We are Geico customers, having both our car and home insurance with them.) The message said:
"If Gregory is getting ready to graduate, preparing for a new job, or looking to establish a little independence, our Family Pricing program allows you the freedom of moving Gregory to his own policy while he continues to receive the same great rates you're currently receiving."That spooked me a bit because Greg just started his first full-time job after graduating and I mentioned to my wife that soon it will be time for Greg to get his own insurance policy! I tweeted:
"Got email from Geico about transferring my son 2 his own car insur plan now that he has a job. How'd they know I was just thinking that?"Of course, they didn't know what I was thinking, but it was nice to know that they anticipated what I may be thinking! Geico knows a lot about me and my family. They know our ages, our sex, our driver's license numbers, our driving records, what kinds of cars we own, etc. I had to give them that information to get insurance. No big deal.
So, it would be easy for Geico to anticipate that Greg recently graduated and that he may have a new job. Further, they know from experience that parents want to get their kids off their insurance plans ASAP.
After I posted that tweet, I received this response from "Shay" tweeting from the @GEICO_Service Twitter account:
"We would be more than happy to give him a quote! He can go to geico.com or give us a call at 1-800-861-8380. -Shay"That was a pleasant note th read more..