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5 things that have influenced pharmaceutical digital marketing expansion

August 15, 2012 9:35 am by | 4 Comments

Pharmaceutical companies have been increasing their investment in digital marketing strategies including websites, e-marketing and social media, despite the potential risks that lurk just below the surface like so many stinging jellyfish that tend to hug the mid-Atlantic Coast this time of year.

But despite the lack of a comprehensive regulatory framework for direct-to-consumer social media marketing, adverse event monitoring and reporting, and fuzzy return on investment, a recent report from Cutting Edge Information, based in Durham, North Carolina, found that digital marketing as a percentage of marketing mix rose to its highest level last year. Digital channels are defined in the report as owned websites, sponsored websites, ad spots, banner ads paid search, mobile and social media including blogs, LinkedIn and Facebook, Twitter, Flickr video share portals like YouTube and forums.

Here are five factors that have influenced that growth, including a couple that have the potential to at least flatten it for an industry that’s just beginning to get a sense of the possibilities digital marketing offers.

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The recession: The need to scale back advertising spend was the obligatory pebble in the water that prompted pharmaceutical companies to take a hard look at their TV and print advertising spend and turn their heads to the relatively lower costs of digital channels. One element some companies have appreciated is that they can make use of YouTube as a stand-in for television.

Poor ROI for traditional media: One company singled out in the report, though unnamed, transformed its allocation from 5 percent for digital marketing channels to 90 percent in just two years after an evaluation of its online strategy and finding it came up short against competitors. The shift included abandoning its TV and radio allocation, which had accounted for 50 percent of its marketing allocation before and scaling back its print allocation from 25 percent to 10 percent.

Mobile: More than any other digital channel, mobile surged in 2011 as more companies allocated resources to the channel. About 69 percent of companies with a brand said they used mobile technology for marketing or medical affairs initiatives, a figure expected to rise to 100 percent in the next year, according to the report. For those with mobile apps, 95 percent say the majority of them are directed to physicians such as QR codes, with 45 percent directed at patients and the rest among healthcare professionals like pharmacists. “Pharma is in the process of deciding which part of the mobile app fray it wants to join,” the report said, although it seems to be leaning toward developing apps for clinicians and patients. Beyond apps, one example of how pharmaceutical companies are looking at this space is Pfizer (NYSE: PFE)’s  launch of 10 consumer-facing websites optimized for mobile devices for drug brands such as Celebrex,Viagra, Premarin, Chantix, DetrolLA and Lyrica.

Social media: Research reports indicating that one-third of people use social media to discuss medical issues is reason enough for pharmaceutical companies to be there. Pharmaceutical companies have found they can forge more effective marketing strategies by observing how consumers interact with and talk about brands, whether it is theirs or their competitors’. AstraZeneca’s live tweetchat on Twitter and Facebook audiences provide a certain amount of information about likes and dislikes, and feedback for a targeted audience.  Most recently, patient community PatientsLikeMe forged a partnership with Merck. Treato tracks drug side effects as reported by patients and compiles it into a file that includes comments, ratings by other users and recommendations of alternative drugs based on feedback. You can also look up symptoms and get a list of drugs recommended to you.

Regulatory concerns:  There’s no denying that the looming shadow of the U.S. Food and Drug Administration exerts an influence on the pharmaceutical and device companies, summed up by the 57 percent of respondents reporting that little FDA guidance on direct-to-consumer social media strategy had a significant effect on their company’s strategy. Only 21 percent said it had little effect. There is also recent history to consider. Three years ago, there was a red letter day in the world of pharmaceutical marketing that has had a constipating effect on companies’ digital marketing ambitions. About 14 Notice of Violation letters were sent in April 2009 over pharmaceutical marketers misunderstanding that they could not place required risk information one click away from a sponsored online link promoting a specific drug and its indication. The report notes the one-click rule had a chilling effect on the industry’s attitude toward digital marketing. One interesting response to regulatory concerns is the development of niche marketing companies claiming they are specially equipped to work with companies on regulatory matters, the report said. Time will tell whether this emerging niche proves worth its salt or if it’s just another add-on to attract clients.

 

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Stephanie Baum

By Stephanie Baum

Stephanie Baum is the East Coast Innovation Reporter for MedCityNews.com. She enjoys covering healthcare startups across health IT, drug development and medical devices and innovations deployed to improve medical care. She graduated from Franklin & Marshall College in Pennsylvania and has worked across radio, print and video. She's written for The Christian Science Monitor, Dow Jones & Co. and United Business Media.
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4 comments
BirgitWalsh
BirgitWalsh

@pharmaguapa Thx for the RT. Enjoy your last week of leasure!

12mass
12mass

@BirgitWalsh Do you think you're getting the most out of Twitter? Are you doing all you can do for your clients? http://t.co/ZWH0WlFP

12mass
12mass

@Uni_Graphic_Inc We actually think we're the next big thing ;) Using twitter better through direct engagements. http://t.co/ZWH0WlFP

RedEmpressC
RedEmpressC

@SpitzStrategy thanks for the follow and RT. have a great weekend !