Direct-to-consumer advertising officially becomes a "tweenager" this August—and, oh my, how it has grown. DTC was officially born in 1997 when FDA gave the green light to companies to advertise their drugs to consumers. In the first year, pharmaceutical marketers bounded onto the scene and spent more than $1 billion. Years passed. Debates ensued. Patients learned more about drugs. And, yes, spending grew. The latest available figures for 2006 show that the industry spent $4.8 billion on DTC advertising, a 13 percent increase over 2005 and the second year of double-digit growth.
"There is definitely an extra feeling of credibility conveyed by magazines," says Tim Kelly, practice leader of promotion management for IMS Health. "There's something tangible that resonates with people with print advertising. It's something they can hand to their doctor."Dr. Dot-Com
Twenty-seven percent of today's online dollars for patients are spent on educational "sponsorships," according to the benchmarking consultancy TGaS Advisors. (Web sponsorships are primarily defined as an ongoing deal with a third-party site—like WebMD—involving some tool or editorial content.) Two-thirds of these deals achieved or exceeded their target goals in 2006, says Stephen Gerard, founder of TGaS Advisors, and investment is expected to increase in 2007 and 2008. Other areas of investment include banner ads and paid search, which when taken with sponsorships, make up 61 percent of the total online DTC budget.
Search-engine marketing is still in vogue, but the opportunity there is dwindling. Years past saw pharma companies buying up keywords on major search engines like Google and Yahoo! and focusing on search-engine optimization. Companies that weren't early movers were early losers.
As in previous years, paid online banner advertising has remained a staple in the marketing mix as biopharmaceutical manufacturers continue to find the Web a good place to reach their target audience. The more complex drugs become, the more likely consumers and patients will spend time searching the Web for health information. And as drugs on the whole become more specialized, particularly with targeted therapies in oncology, this online marketplace of healthcare information is expected to deliver even more value.