Articles

Start With Point of Care

By Bob Ehrlich, Chairman, DTC Perspectives, Inc.

This article originally appeared in the September 22, 2006 issue of DTC Perspectives, an e-newsletter from DTC Perpsectives, Inc. REPRODUCED WITH PERMISSION.

The traditional media planning process for a $75 million plan starts with the big dollar allocations to television and print, followed by point of care, Internet, direct and demographic allocations. Unfortunately, some of the best targeted programs fall away because the budget is then cut back as companies look for earnings out of cost cutting. This is why we see non mass media get less than they deserve. My recommendation then is to start allocations with the most targeted and highest ROI media. Point of care should be first to receive adequate funding and last to get cut. I hear from my industry friends that point of care has such a high ROI compared to standard mass media. If that is true, and I assume it is, then why do such targeted efforts get cut so often? The same can be said for Internet, email marketing, Hispanic, and other small budget programs. The reason for the lower priority to non mass media is that they impact less people than mass spending. An effective 5 to 1 payback on a million dollar investment has less impact than a 2 to 1 on $50 million. So when cuts are required the smaller programs, despite higher ROI, are seen as nice to do rather than must do. They are also more labor intensive for brand and agency people to negotiate and track.

That being said, it still makes sense to maximize higher ROI spending before one looks at lower ROI programs. It may take some more effort to deal with point of care because programs are more fragmented than buying mass media, but it is still wise to maximize that first. Based on sales of some point of care companies I know, they are growing nicely but still receive much less investment than they deserve. If I could reach patients via the doctor's waiting room and pharmacy, I would spend as much as I could. If I could find ways to email target, I would use all lists I could find. The same is true for direct and ethnic. My guess is that these targeted programs are probably only getting 25-50% of the allocation that they could provide to marketers. As marketers spend more on point of care, those companies will find new ways to reach consumers and expand reach. Because many of the point of care companies are small, they cannot afford to invest in expansion until more is spent by drug companies. So as we do our 2007 media plans, try a reverse approach. You still will have a rich mass media plan, but you may find you are better maximizing ROI on your overall plan.

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