Archive for December, 2009

Pharma: Socializing in a Straightjacket

Players tiptoe into social media

At first glance, the Facebook fan page for Epilepsy Advocate is like many others, with regular updates, shared links and a small base of supporters.

But the page, launched in October, is different from most in two crucial respects: it doesn’t allow comments or even the ability to “like” an item.

Welcome to the world of social media for regulated industries like pharmaceuticals. The Epilepsy Advocate is a so-called unbranded community run by pharma company UCB, maker of epilepsy treatments. As a drugmaker, UCB has to take a cautious line with its social Web efforts for fear of running afoul of rules set for all pharmaceutical advertising by the Food and Drug Administration that often make what’s allowed or not rather murky.

While UCB isn’t mentioned on the site, the company still has obligations under the FDA regulations. For instance, if a user reported an adverse reaction to its treatment there, UCB would need to report it to the FDA. What’s more, pharma companies can be held liable by regulators for people discussing off-label use of their products on their sites. That means the dynamic back and-forth of social media ends up getting replaced by a particularly static experience.

“The concept and value of the social medium as this unconstrained exchange is not consistent with the regulatory constraints,” said Chris Kuenne, CEO of Rosetta, which built the Epilepsy Facebook page for UCB.

It is a common feature of many pharma-related Web sites that the key social features, like commenting, are turned off. Nexium, a drug from AstraZeneca, has a Facebook page that won’t let visitors post to its wall, comment on its posts or share them. Yet the drugmaker does take a step towards social with a heavily monitored social area. All posts are moderated before they’re posted to the site. The restrictions make the page a mostly one-way communications channel with only a handful of posts from consumers, and several discussion topics without any consumer input at all.

“One mistake can mean the FDA forcing the pharma company to take the drug off the market,” said Shiv Singh, social media lead at Razorfish. “They’re justifiably extra-cautious in this realm.”

The gray areas that exist have led some pharma companies to shy away from the first tenet of social media marketing: listening. Some choose to use online monitoring data at an aggregate level since they are required to report any adverse conditions they come across. Jeremiah Owyang, partner at social media consultancy Altimeter Group, said that’s even led to drug companies blocking employees from visiting social sites out of fear they’ll come across a report of an adverse reaction.

Those fears might be unfounded. A report by Nielsen, parent company of Adweek, found that only one in 500 healthcare related messages met the four FDA requirements for reporting an adverse event: 1) an identifiable patient; 2) an identifiable reporter; 3) a specific drug; and 4) an adverse event. Still, the FDA does not have regulations specifically designed for online discussions. For instance, the current rules require reporting if there is an “identifiable reporter.” Since many posters use Web pseudonyms, this would probably knock out most messages, but what’s the expectation on the pharma company to track down the reporter’s real identity?

“The challenge is an internal problem,” said William Martino, vp of digital strategy at Saatchi Wellness. “It’s a manpower problem. They may not be staffed for it. In an online world people expect immediate feedback.”

The issue is pressing enough that the FDA last month held two days of hearings on pharma marketing in social media. The FDA did not offer additional guidance at the meeting, according to participants.

The larger problem of the regulations, said Kuenne, is regulations add costs, particularly in manpower, that make social programs bad investments. For instance, social media updates can sometimes need to get approval from a company’s medical-legal regulatory departments.

“Rule No. 1 of what’s becoming the 2.0 version of social marketing is having a much more rigorous view of what’s the economic benefit to the brand” of programs, he said.

The other big hurdle regulations have placed on pharma marketers is they’ve exacerbated a tendency of the industry to lag behind the overall marketing industry in adapting new tactics. Digitas is helping clients by creating “social playbooks” that they can use to design their approach to the new channels, said Bruce Grant, svp, business strategy for Digitas Health.

“In our experience, much of the hesitancy in the regulated healthcare industry is the same hesitancy we saw in other industries of how to engage in a medium that marketers can’t control,” he said.

By Brian Morrissey

Pharma: Socializing in a Straightjacket

Nearly 40% of Marketers Plan to Boost Budgets

Marketing Priorities and Plans 2010

As the economy slowly shows signs of recovery, almost 40% of b-to-b marketers say they plan to boost their marketing budgets next year, according to BtoB’s “2010 Outlook: Marketing Priorities and Plans” survey.

The online survey of 376 b-to-b marketers was conducted during the last week of October and the first week of November. It found that 39.2% plan to increase their marketing budgets next year; 47.5% plan to keep them flat; and 13.3% plan to decrease them.

This is a significant improvement from this year, when 57.7% of marketers cut their budgets in response to the recession, according to the survey.

“This year, we dramatically decreased our marketing budget—we cut across the board,” said Jon Atterbury, senior manager-marketing communications at Cypress Semiconductor Corp. The company eliminated its print advertising completely and also made cuts to online, direct mail and events.

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Cypress was not alone. Of those marketers that cut budgets this year, 63.4% decreased event spending, 63.0% decreased print advertising and 40.4% cut direct mail.

Online was one bright spot during an otherwise bleak year for advertising. Of those marketers that increased budgets, 80% boosted online spending, 24.3% increased direct mail spending and 20.9% increased events spending.

Next year, b-to-b marketers intend to cautiously raise spending. Among those that plan to increase budgets, 11.1% plan to raise them by more than 30%; 18.8% plan to increase them between 20% and 29%; 31.1% plan increases between 10% and 19%; and 39.0% plan to increase budgets less than 10%.

Among those planning to cut budgets next year, 11.7% plan to decrease them by more than 30%; 15.0% plan to cut between 20% and 29%; 41.7% plan to cut budgets between 10% and 19%; and 31.6% plan to cut budgets less than 10%.

TOP GOAL: CUSTOMER ACQUISITION

The top marketing goal for b-to-b marketers next year is customer acquisition, cited by 61.0% of respondents. Also cited were: customer retention (15.5%), brand awareness (15.0%) and other objectives (8.5%).

As to where they will spend marketing dollars next year, 73.4% plan to increase their online spending; 38.0% plan to increase direct mail; 35.7% plan to boost events; and 19.8% say they will increase print advertising. Marketers could select more than one response.

“Our marketing budget will be up slightly,” said Mark Wilson, VP-corporate marketing at software company Sybase. “The increases will be around demand-generation programs. We will be putting more into that area relative to awareness.”

Sybase will invest in Web site development, content creation, online advertising and direct response, Wilson said.

“We are doing a lot more content creation, and our direct response marketing will go up significantly,” he said. “We are looking at internally building a much stronger, bigger content engine.” The company is hiring key content development staff and will outsource some content creation, he added.

BtoB’s survey found that within online marketing, the top areas that will see spending increases include Web site development (70.7% plan increases), e-mail marketing (68.6%), search marketing (62.3%), social media (60.3%), video (50.7%) and webcasts (46.0%).

Other marketers say they will focus their marketing efforts next year on targeted programs using database marketing, direct mail, e-mail and other direct techniques.

“We will focus on our top revenue-driving accounts,” said Cypress’ Atterbury. “We are looking at targeting those companies specifically with direct marketing, events at customer sites, e-mail and contextual banners.”

For example, Cypress buys contextual banner ads on EETimes.com that contain keywords from editorial content on the site. “When there is relevant editorial content, we are seeing more value,” Atterbury said.

Christian Erickson, North America marketing manager at Tekla, which provides software for the building and construction industry, said his company will use much more targeted marketing programs next year, including online and offline.

Erickson said Tekla has been working on building up its database over the last few years and will do much more targeted marketing next year. “We will go back to direct mail,” he said. “As we digitally segment our database, we can be much more focused on targeting the people who receive direct mail.”

Tekla has also begun using webinars to reach its target audience of general contractors, steel fabricators and structural engineers, and it will use more search-engine marketing to promote its webinars next year.

“We market the webinars with dates and additional information about the webinar. We have used both Google and Yahoo for this marketing and will explore Bing during Q1 2010. It’s the call to action I believe that drives people to the ad—seeing a date in the text certainly helps the ad stand out in a list of similar-looking ads,” Erickson said.

SOCIAL MEDIA USE GROWING

Another growing platform for b-to-b marketers is social media. More than half (53.5%) of marketers surveyed said they currently use social media as part of their marketing strategy. This is up from last year, when 45.0% of marketers said they used social media for marketing.

Of those who currently use social media, the top applications are thought leadership (59.8%), lead generation (48.9%), customer feedback (45.7%) and advertising on sites (34.7%).

“This whole movement around social media has been a big change—how we participate in it, how we are reaching and building communities, and how we develop an authentic voice to participate in these communities,” Sybase’s Wilson said. “There are also some dramatic shifts in how publications are getting into social media and offering products that we can purchase.”

When asked to rate their trade media partners in terms of willingness and capacity to tailor programs to fit marketing goals, 17.1% of marketers said “excellent”; 71.3% said “OK”; 9.5% said “poor”; and 2.1% said “unacceptable.”

When asked to rate their ad agency partners in terms of willingness and capacity to tailor programs to fit marketing goals, 27.9% said “excellent”; 61.4% said “OK”; 7.8% said “poor”; and 2.9% said “unacceptable.”

The survey also found that 60.0% of marketers plan to launch new ad campaigns next year, and 25.7% plan to increase staffing. Only 7.8% plan to cut staff, while 66.5% plan no changes in their staffing levels.

By Kate Maddox

Nearly 40% of Marketers Plan to Boost Budget

Are You Ready to Market After the Recession?

The recession is over.

That’s right, I said it. Whether you agree, of course, is up to you and the economic indicators you trust. But I’m hardly alone in my declaration. From news journals on Wall Street and politicians in Washington, D.C., to Web sites dedicated to high finance, sightings of economic “green shoots” have abounded, as have suggestions that the worst of the downturn is behind us. And even pessimists who disagree still concede that the slowdown probably won’t continue too much longer.

So what do you do when prosperity returns? I raised this to the Harvard Business School’s John Quelch — who recently blogged on marketing after the recession — to get a better handle on how brands can survive the current climate while arming themselves for the recovery. We agreed that you should consider these actions for when the economy bounces back:

• Get up close and personal. One-to-one marketing is a necessity. Use personalized marketing via mail, e-mail and social platforms — and ideally a combination of all three — to stay close to existing customers and reinforce their commitment to your brand.

• Identify customers least affected by the recession. Focus on the recession-resistant part of your market and use the extensive info you have on your existing customers. That way you can come out swinging when recovery arrives.

• Determine how your customer has changed. Consumers have rethought brand loyalties and spending habits. Direct mail is easily measurable, so use your pieces to test which messages they’re responding to now.

• Stick to your core. Evaluate your brands to determine which have suffered least and focus your post-recession resources there. Now is not the time to experiment — wary consumers want what they already know. Put rebranding and expansions on hold until people are more comfortable.

• Rally the troops. Motivate and incentivize your employees to deliver a positive experience for consumers reentering the market. Educate them on any changes you’ve discovered about your customers since the recession began.

• Practice cost-effective courting. Look to social platforms, e-mail and direct mail to drive prospective customers when normalcy returns. Mail catalogs containing extensive information on a suite of products in lieu of one-off promotions.

• Take advantage of the fire sale. Leverage recession-inspired bargains before they vanish. Printers have likely lowered their prices, and contractors are eager, available and ready to deal, so ask for a discount.

• Get moving — now. Boost your marketing efforts now. If you wait for a proclamation that the rebound is officially here, you already will be behind. People will think of you first if you’re out there when the economy does pick up.

By Paula Andruss

Are You Ready to Market After the Recession?

Paula Andruss is a Cincinnati-based freelance writer. Her work has appeared in Marketing News, Crain’s Chicago Business, WomensWallStreet.com and Work.com, among other places. She also runs her own Web site, paulaandruss.com.

Marketers, Agencies Start to Consider More Ad Spending

Advertiser Optimism Report: All Media, Not Just Digital, Could Benefit

NEW YORK (AdAge.com) — Whether the arrows on the chart indicating upward movement turn out to just be a slight bump off the bottom of the market or the start of a long and constant climb, marketers and agencies, according to Advertiser Perceptions’ latest Advertiser Optimism Report for Fall 2009, are feeling more optimistic about increasing ad spending in all media. And yes, that even includes local newspapers and magazines.

The study, which surveyed more than 1,500 marketer and agency media decision makers between September and October of this year, found that, among these groups, overall optimism as it relates to ad spending over the next 12 months is improving. And, according to the study, it’s not just the new flashy media like digital and mobile that the industry is amped about as more traditional outlets start to generate some, albeit slight, positive momentum.

Ken Pearl, CEO of Advertiser Perceptions, said the results are significant because it reverses a two-year trend of a growing overall sense of pessimism among marketers and agencies.

“We were going in a downward spiral as it relates to optimism for the past two years,” Mr. Pearl said. “And all of a sudden we are seeing significant movement in the other direction.”

Using an index where zero is neutral representing neither pessimism or optimism, the fall 2009 report showed cable TV to have an optimism index of 11 compared to one four months ago; mobile an index of 54 compared to 42 in the spring; and digital to have an index of 55, up from 40 four months earlier. And while broadcast TV (-8 vs. -17); magazines (-19 vs. -26); and national newspapers (-41 vs. -46) all had negative indexes, they all moved closer to zero, representing an uptick in optimism.

“All of the leading and lagging indicators are beginning to affect what advertisers are thinking,” Mr. Pearl said. “We feel this is the beginning of a real move towards optimism among marketers and agencies. Hopefully this is not a bounce along the bottom.”

The study also found that marketers and agencies are in near total agreement in terms of spending within the different media. And while agencies are more confident about traditional media than their clients, marketers are more upbeat about newspapers, with 12% of marketers saying they anticipated an increase in spending in national newspapers compared to 5% of agencies. Nearly all other media were almost identical, including broadcast TV (22% agency vs. 20% marketer); cable TV (32% agency vs. 31% marketer); mobile (62% agency vs. 58% marketer); and digital (65% agency vs. 60% marketer).

Mr. Pearl said the study also tracked optimism vertically and found that the financial and technology sectors are both showing high levels of optimism for the next 12 months.

“In this most recent study, they were two of the most optimistic categories in the marketplace and that reverses a high level of pessimism they both towards spending in the past,” he said. “This is a real upsurge those marketplaces because they have been so pessimistic in the past. Hopefully they aren’t overly optimistic.”

by Michael Bush
Published: November 30, 2009

Marketers, Agencies Start to Consider More Ad Spending

Marketers, Agencies Start to Consider More Ad Spending

Advertiser Optimism Report: All Media, Not Just Digital, Could Benefit

NEW YORK (AdAge.com) — Whether the arrows on the chart indicating upward movement turn out to just be a slight bump off the bottom of the market or the start of a long and constant climb, marketers and agencies, according to Advertiser Perceptions’ latest Advertiser Optimism Report for Fall 2009, are feeling more optimistic about increasing ad spending in all media. And yes, that even includes local newspapers and magazines.

The study, which surveyed more than 1,500 marketer and agency media decision makers between September and October of this year, found that, among these groups, overall optimism as it relates to ad spending over the next 12 months is improving. And, according to the study, it’s not just the new flashy media like digital and mobile that the industry is amped about as more traditional outlets start to generate some, albeit slight, positive momentum.

Ken Pearl, CEO of Advertiser Perceptions, said the results are significant because it reverses a two-year trend of a growing overall sense of pessimism among marketers and agencies.

“We were going in a downward spiral as it relates to optimism for the past two years,” Mr. Pearl said. “And all of a sudden we are seeing significant movement in the other direction.”

Using an index where zero is neutral representing neither pessimism or optimism, the fall 2009 report showed cable TV to have an optimism index of 11 compared to one four months ago; mobile an index of 54 compared to 42 in the spring; and digital to have an index of 55, up from 40 four months earlier. And while broadcast TV (-8 vs. -17); magazines (-19 vs. -26); and national newspapers (-41 vs. -46) all had negative indexes, they all moved closer to zero, representing an uptick in optimism.

“All of the leading and lagging indicators are beginning to affect what advertisers are thinking,” Mr. Pearl said. “We feel this is the beginning of a real move towards optimism among marketers and agencies. Hopefully this is not a bounce along the bottom.”

The study also found that marketers and agencies are in near total agreement in terms of spending within the different media. And while agencies are more confident about traditional media than their clients, marketers are more upbeat about newspapers, with 12% of marketers saying they anticipated an increase in spending in national newspapers compared to 5% of agencies. Nearly all other media were almost identical, including broadcast TV (22% agency vs. 20% marketer); cable TV (32% agency vs. 31% marketer); mobile (62% agency vs. 58% marketer); and digital (65% agency vs. 60% marketer).

Mr. Pearl said the study also tracked optimism vertically and found that the financial and technology sectors are both showing high levels of optimism for the next 12 months.

“In this most recent study, they were two of the most optimistic categories in the marketplace and that reverses a high level of pessimism they both towards spending in the past,” he said. “This is a real upsurge those marketplaces because they have been so pessimistic in the past. Hopefully they aren’t overly optimistic.”

by Michael Bush
Published: November 30, 2009

Marketers, Agencies Start to Consider More Ad Spending