Direct-to-Consumer Advertising Still a Winner for Many Drug Brands, Finds Cutting Edge Information

While DTC contributes positive ROI, a traditional powerhouse trails other marketing tools

RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)-- Pharmaceutical and biotech companies using direct-to-consumer (DTC) advertising, such as television and magazine ads, report generating 14 percent more revenue than they would if they discontinued DTC advertising and maintained spending levels on all other marketing activities.

Direct-to-consumer advertising represents the fastest way to reach a wide audience,” said Jeremy Spivey, senior research analyst at pharmaceutical consulting firm Cutting Edge Information. “If some brands in a therapeutic class choose to use mass-marketing campaigns, companies that do not follow suit risk having their message overwhelmed.”

While direct-to-consumer advertising is the largest overall marketing expense for U.S. brands, the ROI on DTC advertising is lower than most other marketing activities, according to findings in the new report, “Pharmaceutical Marketing Strategy: Key ROI Benchmarks to Drive Brand Success.” Given a hypothetical 10 percent budget increase, none of the U.S.-based marketing executives interviewed for the study would spend more on direct-to-consumer advertising. They all reported a higher return-on-investment for other channels and tools.

Two factors appear to be driving the changing ROI calculation. With the rise of digital marketing, social media and physician assistance programs, pharmaceutical marketing teams have a wider selection of tools than they did even a few years ago. They also must evolve their strategy to reflect changing patient expectations of healthcare information. Many companies have determined that spending more on advertising does not add value to theirs brands.

The optimum marketing mix is proving different in regions such as Asia, Latin America, Africa and Eastern Europe. “Marketing groups in some of the emerging markets would dedicate a slice of a budget increase to advertising,” said Adam Bianchi, chief operating officer at Cutting Edge Information. “In part this reflects the reality that the definition of advertising varies from country to country. In many countries, branded mass-marketing advertising is prohibited, blurring the lines between disease education, advocacy group support and advertising. For most of these regional teams, any substantial allocation to DTC represents a testing of the regulatory waters.”

For more information on direct-to-consumer advertising and patient-centric marketing, contact Eric Bolesh at 919-403-6583 or visit http://www.cuttingedgeinfo.com/research/marketing/pharmaceutical-marketing-strategy/



CONTACT:

Cutting Edge Information
Eric Bolesh, 919-403-6583

KEYWORDS:   United States  North America  Illinois  North Carolina

INDUSTRY KEYWORDS:   Practice Management  Health  Biotechnology  Pharmaceutical  Communications  Advertising  Marketing  Managed Care

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