The Low Cost of High-Impact Ads

Point of Sale: A cheap way to (almost) forget about DTC ads
Feb 02, 2006

Direct-to-consumer (DTC) drug advertising has been a blessing and a curse for the pharmaceutical industry. On the plus side, DTC ads inform the public, spark interest, and spur action— generating prescriptions and revenue. But DTC has also fueled controversy. If not executed properly, critics charge, ads mislead consumers. It's no secret that consumer groups have been vocal in their criticisms of DTC, arguing that money spent on advertising ($4.15 billion in 2004 according to IMS Health) results in higher healthcare costs and other consequences. Regulatory problems related to DTC have cost companies credibility, not to mention millions and millions of dollars in fines.

Pharmaceutical companies need viable alternatives. One inexpensive way to accomplish many of the same goals as DTC, such as creating product awareness and informing patients, is point-of-sale (POS) advertising.

Building Awareness

Convenient Explanations
Positioned in food stores, retail pharmacies, and mass merchandising chains nationwide, point-of sale ads offer complete in-store placement flexibility. Ads can appear in the over-the-counter (OTC) aisles, at registers or pharmacy counters, in shopping baskets, in the parking lot, or in the pharmacy waiting area. POS can include messaging vehicles for prescription and OTC products in an atmosphere where the patient actually considers health-product options.

Point-of-sale initiatives have received scant notice in part because, next to TV and print, they represent minor budget items. POS carries an extremely low cost-per-thousand (30¢-$3.00) compared to $17.78 for a 30-second TV spot, or $8.61 for the same length spot on radio. Nor do they have the heavy guns of traditional ad agencies behind them. The limited visibility of POS does not create the same buzz as TV and print, nor does it normally win major awards—but POS advertising creates product awareness and builds an informed consumer base.

Equally important, the ads appear in a context where treatment options and patient education are foremost in providers' minds, and information is routinely shared with pharmacists and healthcare professionals. The media buys for this particular type of advertising are typically offered in 4-6 week cycles. Targeted placements could be anywhere that consumers and patients congregate, and the length of the campaign ensures a prolonged exposure to the message.

Because the environment is such an important element of POS, a key strategy in creating a campaign is developing a cohesive strategy for placement. As with any advertising initiative, simply funding "opportunities" is not necessarily good marketing. Production of POS material comes only after a well-developed and intelligent strategy has been designed to reach the target market.

All things considered, POS is undervalued and therefore underused, given its inherent potential to build recognition and increase demand.

The Pharmacist Connection

Existing programs using POS have shown a three to seven percent lift in prescription sales, although some programs have reported rises of 10 percent or higher. There is an average return of $4 to $8 for every dollar spent. Campaign tactics not only drive new prescriptions but also act as refill reminders.

For All Intents and Purposes
One likely reason for these numbers—and an important factor to consider in POS advertising—is that a pharmacist is always available near the spot where the ad is viewed. A consumer who reads or views an ad at home and has questions may have to wait to get an answer. A consumer viewing a POS ad is only steps away from authoritative information.

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