Every year, pharma companies spend billions of dollars in the U.S. on TV advertising. But the industry’s media planning and buying are still based largely on assumptions grounded in traditional linear TV—even though TV consumption has become increasingly fragmented across platforms and devices. Today, ads served on internet-connected devices—also known as CTV advertising—present an untapped opportunity for pharma marketers. To take advantage of these, pharma must rethink its media strategy and gain an understanding of the role CTV can play in connecting with audiences across devices and formats.
To uncover some key insights driving these communications, MM+M partnered with PulsePoint on a survey entitled CTV Advertising: An untapped opportunity for pharma marketers. The survey results presented here will help those in pharma marketing and brand management understand emerging CTV trends across the industry, and how they can leverage these trends in order to reach consumers in a more targeted way.
The survey was conducted in September 2021 and was sent to a list of professionals from healthcare and associated industries. About half were individuals in agencies (52%) and half identified as being from “non-agencies” (48%). Among the non-agency respondents, 72% were involved in pharma (including Biotech, Device/Diagnostics and CPG), and 22% said they were associated with Hospital/Health System/Medical Care facilities. Most respondents were either at the VP/SVP/EVP level (37%) or directors (25%); fewer were managers (17%) and C-level executives (16%).
The numbers are similar for TV and CTV advertising: Half the survey respondents reported that their brand is currently using TV advertising (50%). About one-tenth are not currently running TV ads for their brand, but previously did so within the past two years (11%). By the same token, half of respondents do CTV advertising (50%), while more than a tenth (12%) previously used CTV advertising but aren’t currently doing so. But it’s worth noting that almost twice as many agency respondents currently run CTV ads than non-agency respondents (63% versus 36%).
Among those who currently run TV advertising, about four out of five are also using CTV advertising (79%).
When asked “How would you break down your TV and CTV advertising budget?,” respondents who reported doing both TV and CTV advertising said that they allocate similar budgets for both, with an average of 49.8% for their TV budget versus 50.2% for the CTV budget.
The survey also asked how the respondents bought CTV advertising. The results show that almost half of those currently using CTV use a digital media agency (48%), while almost a quarter use a TV media agency (23%). Smaller percentages reported using a cross-channel buying platform (or programmatic trade desk; 15%) or a CTV buying platform (12%).
In response to a question about when they buy their CTV advertising, almost nine out of ten said they do it “throughout the year” (88%). (Other options were “Once a year, during upfronts,” and “Once a year during newfronts.”)
Next, the survey investigated how the respondents define their audiences for CTV advertising. More than half of those who are currently buying CTV advertising reported that they use geo-demographic targeting to define their buy (54%). Almost one in five use conditional populations (17%), and one in ten use prior condition content consumption (10%). Only 4% said that they coordinated their CTV buy with their linear TV buy; the same percentage chose “coordinated with display buy.”
The next question narrowed down which audiences are targeted in CTV buys. Nearly six out of ten respondents who are currently using CTV advertising (58%) reported that they target both healthcare professionals (HCP) and direct-to-consumer (DTC). However, more than a third of these are targeting DTC only (37%). The percentage targeting HCP only comes in at just 6%.
No single digital asset stands out in usage by current CTV users. The survey results show that 33% overall use 30-second ads (these are favored by 24% of agency respondents but by 52% of non-agency respondents). A video asset specifically created for the CTV buy is used by 31% overall (but by 44% of agency respondents as opposed to 26% of non-agency respondents), and 27% use a 60-second TV ad. Only 8% reported using 90-second TV ads.
What’s the top benefit perceived by CTV users for using continuous versus linear TV? “Better targeting data” was the primary choice, at 60%, with other advantages cited much less often: growth in reach is a distant second at 17%, followed by real-time measurement, buying flexibility, and 1:1 measurement, all coming in at 6%; and cross-channel coordination at only 4%.
The last survey questions were designed to uncover the perceived effectiveness of CTV advertising. Most respondents report that they use post-exposure impact (measured via offline studies) to determine the effectiveness of their CTV buy (42%). Other measures were used less frequently—video completion rate (19%), NRx lift (that is, increase in new prescriptions; 17%) and audience quality (13%) followed.
Finally, respondents were asked to describe how their CTV advertising performed versus their TV buy. Seven in ten respondents who currently use CTV ads feel that their CTV buy outperforms their TV buy (70%, saying either “significantly better” or “better”). Only 2% of non-agency respondents feel their CTV buy performs “worse” than TV, while 6% chose “significantly worse.” (Interestingly, no agency respondents replied that their CTV respondents performed worse than TV.)
The survey’s last question asked respondents to write in comments regarding the above response on CTV performance versus TV. Respondents contributed the following replies, among others:
— “Better metrics with CTV, more information is available for ROI analysis.”
— “Efficiency of spend; able to reach a small patient population more cost-effectively.”
— “Better and more efficient in terms of cost, but also not as efficient in terms of broad reach.”
—“Each serves a different purpose. TV for broad branding, awareness; CTV on more specific message/action.”
—”We receive better data with CTV so we can actually see the impact of ad spend.”
Brief replies included the following: “Better reach,” “Higher response,” “Better coverage ratio over wider audiences,” “More targeted reach,” “More data,” “More engagement,” and “More measurable for Rx lift.”
One of the few negative comments received was, “The cable zones and broadcast signals are not specific enough geographically for our local advertisers.” Another said “Better audiences but not better pricing.”
A number of respondents felt they lacked enough experience with CTV to weigh in, but one wrote, “Still early in our CTV journey, but we love the reporting transparency, real-time measurements, and more creative options with this platform.” Another said, “We receive better data with CTV, so we can actually see the impact of ad spend.”
As advertising rebounded in 2021, CTV emerged as the fastest-growing video advertising platform for all verticals. Given this development, it’s anticipated that 2022 will be the first annual cycle where CTV ads take a meaningful market share of life science advertisements away from traditional TV—in part due to the fact that cookies are on the way out.