Healthy Advice Networks Articles-Point of Care DTC Will Surge

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This article originally appeared in the June 22, 2005 issue of DTC Perspectives, an e-newsletter from DTC Perpsectives, Inc. REPRODUCED WITH PERMISSION.

Point of Care DTC Will Surge

By Bob Ehrlich, Chairman, DTC Perspectives, Inc.

DTC is undergoing a transformation in how media is allocated. It is about as slow as human evolution, but it is happening. Marketers are questioning the 70% allocations for branded television, and instead trying to find alternate ways to spend some of their large DTC budgets. What is first on many of their wish lists is point of care media. Point of care media is at doctors' offices, hospitals, and pharmacies. For a number of reasons, this type of DTC has received less spending than it should have in the past few years. Why the low allocation?

First, there are still a limited number of options available to spend in a point of care setting. A few companies have developed in office tools from magazines to exam room television. Their coverage sometimes is limited in terms of reach. Their inventory is finite and also frequently has manufacturer category exclusivity, also limiting its potential. Second, companies have been looking for ways to get a big bang, and quickly. Point of care media is usually very effective but does not have the mass clout to move market share quickly. Given limited reach of doctors participating, and the trickle nature of the impact on consumers, it takes time to get impact. Television has, albeit inefficiently, been shown to get presence and impact quickly. The desire of drug marketers to reach consumers at point of care has never been stronger. The reasons for this evolution are several. The FDA wants to see better explanation of risk information. Clearly, having this expanded risk discussion makes sense in a medical environment. Second, drug makers are trying to find ways to reach current patients to improve on retention and compliance. What better way to reach current users than at point of care. Third, having media at point of care allows for direct sales force involvement in placing it, and/or explaining it to medical practitioners. Fourth, ROI is higher when programs are targeted. So, how will this evolution take place? Companies currently offering point of care programs will likely invest more in expanding reach so their impact can be faster and a market share mover. This opportunity will undoubtedly lead to mergers of smaller point of care companies to get to critical mass in reach and product line.

We will also see larger media companies try to get into this area. Major media print and broadcast companies will want to hedge their bets by buying or starting companies in this area. My guess is that we will see a point of care business, within five years, that is 5 times bigger than now. Television will still get the majority of spending, but instead of 70%, it will probably cede 5-10% to other media including point of care, direct and Internet. That shift means several hundred million dollars of revenue to these point of care companies. Drug makers have the money and are anxious to shift some of it to point of care. Now it is up to the service providers to offer the right tools to drug marketers. That is a nice opportunity to have.

DTC Perspectives
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