June 01, 2008
DTC spend down 3% in '07
Drug industry spend on consumer advertising dropped 3% in 2007 to $5.15 billion, from $5.31 billion in 2006, but spending on product advertising, particularly TV and print, continued to climb.
Pharmas cut back sharply on corporate advertising—from $577 million in 2006 to $247 million in 2007, according to TNS Media Intelligence. But product advertising was up 3% to $4.9 billion, from $4.73 billion in 2006.
For product advertising, newspapers took a hit as spending was halved, to $75 million from $152 million. Radio spend fell 45%, from $55 million to $30 million. Perhaps most remarkably, Internet spending slid 5%, from $163 million to $155 million, though that figure reflects display advertising—not spend on search engine optimization or websites.
Spending on TV product ads rose 7% to $2.87 billion from $2.66 billion in 2006, while spending on product ads in magazines climbed 4% to $1.76 billion from $1.68 billion in 2006.
The numbers suggest that pharmas are still leaning heavily on mass-market “shotgun” channels to drive awareness of the products, but that marketers, under pressure to cut costs, are trimming where they can. Overall spend has seen steady increases for a decade, but some spending may be shifting toward less-measurable means of reaching consumers, such as websites and online CRM.