Making Sense of Pharma DTC Spending Trends

Making Sense of Pharma DTC Spending Trends

ePharma boosters see the latest direct-to-consumer (DTC) advertising spending numbers as a positive sign that the drug industry is finally increasing its allotment to the Internet in its DTC marketing budget. Nielsen data indicate that "spending on Internet ads, which has doubled over the last five years, hit $117.4 million, up 31 percent" (see "Drugmakers boost consumer ad spending 2 pct in '09"). Total DTC spending increased 1.9% in 2009 vs. 2008. All these data do NOT include search engine advertising, which I will get to in a minute.

I am having some problems with the numbers when I compare them to previous reports. For example, the total ad spend in 2009 was reported to be $4.51 Bn. If that is a 1.9% increase over 2008, then ad spending in 2008 must have been $4.42 Bn. But data reported previously by Nielson (see here) says pharma ad spending in 2008 was $4.34 Bn. My notes, however, indicate that the latter was an estimate based on spending for the first 9 months of 2008. So let's forget the latter total and use the former (I adjusted it to $4.425 based on a 1.9% year-over-year increase, which corresponds to Nielsen's latest data; see here).

Working backwards from the year-over-year percent increases reported by Nielsen, I get the following table comparing 2009 to 2008:





All the % Inc/Dec numbers agree with the Nielsen data as reported by AP here. However, the Outdoor spending number for 2008 is suspect. I had to use that number to make sure the total for 2008 more or less agreed with the total based on a 1.9% year-over-year increase. Believe me there are other numbers out there that add up even worse, such as this table I found on World of DTC Marketing:


The totals in this table aren't even close to what was reported in the AP article (Nielsen data). Actually, these are numbers for the first 9 months of each year. But TNS Media Intel's 2009 Internet number of $220.9 million is much larger than Nielsen's 2009 number of $117.4 million. How can these be so different? I'm pretty sure both are reported "measured" media, which does not include search engine ads. TNS/Kantar Media Intelligence told me that it tracks over 3,000 sites throughout the US and Canada, which is a different methodology than that used by Nielsen. So it's important not to compare these apples and oranges! Note: TNS/Kantar Media reports that outdoor pharma ad spending for 2008 was $3,084 million.

In any case, here's what the media mix looks like, 2009 vs. 2008 (using Nielsen data):




According to this, Internet spending (not including search) increased to 2.6% of the overall DTC budget. This is still much less than the 3.6% spent on newspapers! What happens, however, if you add in an estimate for search engine ads? It's been estimated that SE advertising accounts for 40% of online spending. But I'm guessing that pharma pulled back from SE advertising after FDA issued warning letters at the end of March 2009. Let's say SE spending by pharma in the 9 months after that dropped by one-third. According to my back-of-the-napkin calculations, this is how I see TOTAL Internet spending by pharma in 2009 compares with that in 2008:




You can check my math. You will see that in 2008 search equaled 40% of the total Internet spend, whereas in 2009 it is only 33%. This seems believable. If so, then the total Internet spend in 2009 increase only about 18% over 2008, which is a lot less of an increase than 31% and in line with the increase for old media newspaper advertising! Who'd have thunk old media could compete so well with new media?

Use of Patient Testimonials in DTC & Social Media Advertising

Use of Patient Testimonials in DTC & Social Media Advertising

This week I was a guest moderator for a graduate class at Johns Hopkins University: “Marketing in a Regulated Environment”.

The students are 90% scientists, working at places like NIH, Amgen, Medimmune, etc. They had a few questions they want me to answer, including these:

"Recently, companies appear to be using more patient testimonials in their DTC advertising. I am thinking in particular of Pfizer’s Chantix commercials. Could you comment on the forces driving the industry in this direction and whether there are any FDA regulatory hurdles or guidances that must be considered in using patient testimonials? As a follow-up, I have not yet noticed any attempt to integrate patient testimonials in DTC advertising with internet social media (e.g. “You can follow Bob’s success with quitting smoking using Chantix on his face book page or receive tweets from him.”). Do you think this will emerge, and if so, what would be the implications? Will Pfizer have its own mini version of The Truman Show?"

and

"There is a growing desire to allow patients who have been on a particular therapy to interact with potential new patients considering their treatment options. What are some of the potential pitfalls that a company may face if they choose to provide a forum for this type of interaction? What do you consider to be some of the competitive advantages this strategy may convey?"

Can you help me answer these questions? Please take this survey:





Use of Patient Testimonials in DTC & Social Media Advertising

sanofi aventis Feels the Social Media Pain. But Is It Authentic?

sanofi aventis Feels the Social Media Pain. But Is It Authentic?

Simultaneous posts on Pharmalot and Pharma bnet have focused on what seems to be a disgruntled patient who posted photos and comments on sanofi-aventis's (S-A) Facebook page (see "Bald Women Lash Out At Sanofi-Aventis & Taxotere" and "Sanofi's Latest Challenge: Women Who Say Its Chemotherapy Left Them Permanently Bald").

"Ann Adams" posted this message to S-A's Facebook Wall: "Good morning Sanofi, i had your drug Taxotere and as you can see from me photo this is what my scalp looks like 4 years later. Do you have any comment to make?" Her bald head photo appears on S-A's Facebook page as well. See the screen shot below:

I clicked on "Ann Adams" to learn more about her and found her Facebook page that had one message on the Wall: "This is my disfigurment from your drug Taxotere, the drug you kept this adverse side effect secret. Why dont you want to answer my letters and emails?"

I assume this was a message she had also posted on S-A'a page, but I can't find it there.

Did S-A "block" this post?

Ann says: "Its very unpleasant of you Sanofi to have an unhappy customer blocked from your page."

The timelines don't match up. The post on Ann's FB page says it was made 2 hours ago (see screen shot above), but Ann's S-A FB post about being blocked was made 8 hours ago.

Is "Ann" authentic or just a scam perpetrated by a disgruntled S-A employee or a competitor?

On the Internet nobody knows!

UPDATE: See comment to this post, which claims that "Ann Adams" is a real person. That comment cited an article in which "Ann Adams" was quoted.

Sanofi Loses SM Face Over Hair Loss PR Debacle
I also received a note from an anonymous friend who said:

"'Ann Adams' would appear to be a pseudonym for Shirley Ledlie (see Jim Edwards' post from Saturday), given the identical scalp images. I would hypothesize, given the accusations of blocking, that Ledlie's posts were removed and that she subsequently opened up a pseudonymous Facebook account as 'Ann Adams' to repost them...and scold s-a for blocking her in the first place.

"...this is the sort of PR event that any company (especially a company already aware of organized criticism) should have been prepared in advance to respond to...and it represents the degree to which pharma misunderstands social media (as most other industries did 3-5 years ago) in jumping straight into 'push' mode (e.g., FB 'fan' page) without first understanding in depth the conversation that's already going on and the motivations, needs, and behavior patterns of those already engaged in the conversation."

UPDATE TO UPDATE:  
It looks like we may have been "pfooled" by a phony, pfishy sanofi aventis FB page!

See comments to this post. Also, the URL seems "pfishy": http://www.facebook.com/sanofiaventis0 - the final "0" means that "sanofiaventis" was already taken (probably by S-A). Did Shirley Ledlie, aka "Ann Adams", create phony S-A FB page to post her complaints & embarrass S-A?

Pharma Should Leave Unmoderated SM Discussions to 3rd Parties

Pharma Should Leave Unmoderated SM Discussions to 3rd Parties

In comments addressed to the FDA, many drug companies and ad hoc industry groups are suggesting ways drug companies can legally "engage" with patients, physicians, and consumers in online social media discussions (see, for example, "A Pharma 'Social Media Working Group' Submits Comments to FDA").

The hope is that new FDA guidelines (or regulations) will help them do that.

Some drug companies imagine the day when they will be able to host open discussions on their web sites -- even drug.com sites.

The question is, under what terms? Specifically, what conversations will they allow and not allow and how will they deal with posts that are "not allowed?" Every social media site has to have a policy regarding this issue.

Once you allow online conversation, you open yourself up to unsolicited commercial posts (ie, spam), posts from disgruntled employees or people with an axe to grind, posts from competitors and their employees who want to bash your products, anonymous posts from your own employees trying to put your product in a better light than is warranted by the package insert, posts from lawyers trying to get a class-action lawsuit going, well-meaning posts by patients spewing misinformation about your products, etc., etc., etc.

Pharma companies are especially prone to these kinds of posts. Believe me, managing online discussions is no walk in the park with your mandolin. It takes a lot of work and attention.

It would take a lot MORE work if every post submitted first had to be reviewed by your legal/regulatory people before it could be published. Naturally, neither the L/R people nor the SM evangelists within pharma want that burden. Hence, pharmacos suggest that posts to their discussion boards should be UNMODERATED. Of course, they say that this is the only way to allow social media to work as it should - uninhibited, free speech.

What pharma wants to do is to moderate AFTER the fact. That is, remove posts that violate the terms of use. This is how CafePharma works. It has a very active community with very many useful discussions. But the pharma industry is not loving it -- there are many posts from disgruntled employees that criticize the industry. These posts are often X-rated.

Of course, this does not mean that discussions on pharma-owned Web sites would degenerate to the level of CafePharma. But, hey, it could happen!

I moderate every comment submitted to this blog before it is posted. Every day I get comments like this one from "marry": "Blogs are so informative where we get lots of information on any topic. Nice job keep it up!!" First of all, it does not add anything to the conversation. But more important, when you click on "marry" you are likely to end up ion a Web site selling something -- probably counterfeit Viagra pills!

Does the industry want its discussion boards filled with that kind of content? Of course not! But their method of dealing with it leaves a lot to be desired. I imagine one designated employee coming in every morning and reviewing the posts made the previous 24 hours and spending an hour or so deleting the ones that violate the terms or commenting on the off-label ones and keeping them around for awhile so everyone can tell it's off-label (some propose deleting these after 48 hours, some do not indicate any specific time limit).

It's all about the FTE devoted to the job -- the less, the better! Moderation before the fact may require too many FTEs. After the fact, it is much more manageable.

But in social media time, 48, 24 or even 2 hours is a long time! Just ask Ray Kerins, Pfizer's head of corporate communications. While he was busy in traffic court, the Twittersphere buzzed and re-buzzed about whether or not @pfizer_news, which was just launched, was an official Pfizer Twitter account! (see "Pfizer's Social Media Strategy: Piss Off John Mack, Get Hundreds of New Followers!")

To paraphrase Omar Khayyam: "The Moving Finger posts; and, having Tweeted, Moves on: nor all your Piety nor Wit Shall lure it back to cancel half a Line, Nor all your Tears wash out a Word of it."