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Pharma’s shift away from TV to digital is inevitable, report says

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It’s time for pharma marketers to look beyond TV, at least according to a new report from Publicis Media’s Zenith agency. The healthcare ad spending forecast predicts declines in TV spending across all healthcare, even in the TV-ad-entrenched pharma sector.

Zenith didn’t break out pharma’s share of its estimated $35 billion in global healthcare spending, but pharma’s shift away from TV is inevitable, said global intelligence manager Anne Austin, who was the lead on the report. Overall, healthcare companies spend more on TV than other industries—it accounted for 54.7% of pharma’s spending in 2018, versus 30.8% of other industries’ advertising spending—but it is shrinking faster than the spend of other industries.

Pharma is already looking at switching ad budgets from TV to digital in the U.S., driven partly by the government push for lower prices through attempts such as requiring drug prices in TV ads, Austin said. That specific regulation from the Trump administration was blocked in court this summer, but the pressure isn’t likely to let up. Add to that digital advertising’s better targeting and personalization capabilities and TV starts looking like a less-attractive place to spend media dollars.

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“Multinational pharma companies are more used to exploring the possibilities of digital advertising outside of the U.S., because in many markets, TV ads for prescription medicines are banned. So the big players will have sufficient experience to understand how to approach such a reallocation of budgets from TV toward digital when they judge the time is right to do so. We think that time is now,” she said.

Another pressure point noted in the forecast is shrinking budgets. As pharma companies face lower growth and diminishing returns on investment, they will need to shift marketing strategies. One idea is to focus on what differentiates their drugs from competitors’ offerings. As Austin said, “It is essentially an area where judicious marketing comes into its own and can be very effective.”

Other anticipated trends Zenith revealed for healthcare and pharma include the increasing pressure to incorporate digital health technologies and more out-of-home advertising such as billboards, digital poster screens and point of sale.

RELATED: Hey, big spender: Pharma’s $6.6B TV ad outlay outranks most other industries, report says

Still, for all the pressures on its business, pharma has time on its side.

“Despite the fact that core business is under threat from increasing costs and downward pressure on prices, in the long term, the picture is quite good for pharma, with an aging population, and internationally, rising incomes in developing markets, meaning more and more customers becoming available. Really, it is a question of pharma companies meeting the challenges of this transitional phase in the market,” Austin said.

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