5 Techniques to Boost DTC Success
Getting more for less is one thing. Getting more from less is an entirely different enterprise—and that’s what DTC marketers need to figure out these days. Here are five proven tactics for increasing your return on investment.
By Kevin Clancy and Eric Paquette
DTC advertising may be down these days, but it’s certainly not out. “There is a lot of highly visible spending in DTC,” explains John Mack, a consultant for VirSci Corp. “When the economy goes bad, that visible spending is one of the first areas to be cut.” It’s not just the economy at work, however. Many pharmaceutical companies have actually decreased media costs because it’s a buyer’s market these days when it comes to GRPs. According to IMS, the advertising ROI for DTC averages about 2 for the top 25 brands. Not bad considering that in other industries marketers often get back less than a dollar for every dollar spent on advertising. Yet delve a bit deeper, and you see why questions and concerns about effectiveness and value might come up. Recall the study by IMS Management Consulting that found the probability of a positive ROI increased if a brand had a large market, high price, and high level of refills. Unfortunately, these favorable conditions are getting fewer and farther between. Many categories today have a narrow market with fewer patients, and the big blockbuster drugs have been fewer than in years past, so there’s no across-the-board buoy of a big market. True, high prices offer some buffer—you don’t necessarily have to drive big volume to see a positive return. With the amount of time decreasing that any Rx can “own” a market before patent protection expires and the use of generics on the increase, high prices certainly don’t guarantee anything, particularly in the longer term.
Further piquing corner office scrutiny are the results of studies such as Nielsen IAG’s annual ranking of the most-recalled prescription drug ads, which found that DTC efforts had become less memorable over the course of the past year. “Consider the volumes of money being spent by some of the major brands—ad budgets in the range of $200 million a year,” explained Jon Swallen, a senior vice president of research for TNS. “As the guy who’s approving the spending, you want to know that you’re getting good value for your dollar. And whether you’re talking about a $200 million budget or a $10 million budget, the pressure is there to deliver a good return on investment.”
The big question on the minds of DTC marketers everywhere is what the heck do we do to ensure delivery of the kind of return that senior management wants to see? And, particularly with a smaller budget, how are we going to get more sales and profits from less? We have five ideas.

1 Chart the Process
Big budgets do not necessarily equal big success. In reality, pouring dollars into advertising and media rarely increases profitability, sometimes doesn’t even boost sales, and doesn’t lock in effectiveness or a favorable ROI. Why? Well, for one, DTC advertising is not a one-size-fits-all tactic. It’s appropriate and very effective for some brands, but not for others. It might be effective for one brand in a category and not for another. It might be effective at one spending level for one product, but at a different spending level for another. The individual brand dynamics are crucial in determining potential success.
DTC marketers would do themselves and the ROI of their campaigns a world of good if they understood how much weight to place on DTC efforts in the first place. What is the buying process in the treatment category? What are the triggers that lead patients to think about treatment? How do they make treatment decisions? Depending on what the predominant drivers of treatment choice are, the relative emphasis on DTC efforts in combination with others becomes clearer.
Now this may sound a bit counterintuitive—DTC marketers want the biggest budget they can get, right? So why would anyone in the field want to push for this kind of analysis? But remember the end goal is to improve ROI. If the physician primarily drives the treatment choice, producing a favorable ROI on a triple-digit budget for DTC efforts could prove nearly impossible. On the flip side, if consumers or brand perceptions are the critical factors, there’s evidence to suggest investing a greater proportion of the budget would pay off.

2 Stack the Deck
When marketers need to hit ROI numbers that deliver to expectations, a good way to stack the deck in their favor is to identify the patients that hold the greatest potential value for the brand. Undertaking a market segmentation exercise that captures clever measures of current and future profitability will pay for itself many times over because it provides clear direction on which group or groups offer the highest return on marketing investment.
On the revenue side of the profitability equation, for example, there’s lifetime value, current share for your brand, and future growth. On the cost side, there’s cost to reach and influence with media. Financial information is one thing, but there are other characteristics that make a buyer more valuable because he or she is easier to get and keep as a customer. Gathering information for each individual respondent on these characteristics provides a much more robust and marketing-oriented picture of value.
Wouldn’t it be nice to know, for instance, how interested a patient is in treating his or her condition, how open he or she is to a prescription therapy as a treatment option, and whether he or she is likely to continue using the brand? Patients vary dramatically in their comfort level and willingness to start the discussion of treatment options with their doctor. Wouldn’t it be nice to get to the folks who are willing to initiate these discussions?
There are likely patients who are open to considering and trying a brand if they’re not already using it. They know your brand exists and have positive feelings about it. They are primed to talk to their doctor about it if encouraged to do so. On the other hand, there are people who have no interest in or maybe even hate your brand. Perhaps they’re Bostonians and associate your brand with the New York Yankees—forget about winning them over. Why waste marketing dollars on them?

3 Feel the Pain
Every DTC marketer is well aware of the difficulties inherent in marketing prescription drugs directly to patients. Not only do they have to prompt patients to remember their brand, but they also have to stimulate them to call their doctor, make an appointment (for which there’s at least a co-pay charge), go to the appointment (which is sometimes several weeks away), ask about the brand, and then fill the prescription. Phew! We’ve got to think that it’s going to take one heck of an exceptional positioning to inspire patients to do all of these things. Exceptional positionings—those that truly motivate patients—often address their problems and pains. The bigger the problem, the bigger the market response. Let’s be clear about what exactly constitutes a “problem” though. Fixing the symptoms of an underlying condition certainly offers a solution, yet if a host of branded and generic competitors fix the same symptoms, patients don’t have a “problem” finding treatment options. They may very well perceive all the options as equally adept at delivering relief or treating their condition, so building a positioning around “treats symptoms” isn’t going to make one brand stand out more than the next.
Positioning opportunities abound when patients perceive your brand as delivering on a particular attribute or benefit—“faster relief,” “no unpleasant side effects,” “longer lasting”—better than competitors, or, even better, where no one currently offers an adequate solution. Think Botox, a wrinkle treatment, the brand to use to look your best at your high school reunion, wedding, job interview, or other important event. Think Seasonale, a birth control pill that provides the convenience of just four periods a year. Think Boniva, an osteoporosis treatment and Sally Field’s preferred brand, with a once-monthly dosage.

4 Connect the Dots
We keep a Top 10 list of research complaints that we hear from marketers, and “this segmentation is just not actionable!” is always the chart topper. A big beef marketers across categories have is that they can’t find the market segments in media databases. Even if they know who the most valuable patients are for the brand, they have no way to reach them efficiently. After all that work, they still end up blowing their budget and ROI goals anyway. Luckily, it’s not an impossible task to connect the dots between the most valuable targets and the databases media planners use to craft strategies.
Including questions about media habits and preferences in research and analysis efforts is one way to make sure you get the media folks data they can use to guide planning. Interestingly, DTC marketers can marry a segmentation to a syndicated media database, such as MRI and SMRB, in order to provide rich insights into the media exposure patterns of every patient target identified. Though the extent to which DTC marketers will be able to use digital media to reach patients is still evolving, exploring openness to receiving marketing information through digital channels and digital media habits in general would only enhance the ROI of these efforts as well.

5 Test the Waters
Most of us wouldn’t jump into a pool without dipping a toe into the water first to gauge the temperature. DTC marketers should take the same precaution before a full-fledged real-world campaign launch. Using marketing mix modeling and forecasting to predict the real-world outputs (including new and repeat prescriptions) from marketing plan inputs (such as prime-time network television rating points per month) is sometimes used to make a go or no-go decision on a campaign, but it can provide additional diagnostic insight and identify the appropriate budget size to support ROI objectives. Doing it before spending a dime in the real world, of course, gives marketers the best shot at getting the campaign on the right ROI trajectory from the get-go, yet even after the campaign is running, there are very likely ways to fine-tune a brand’s marketing plan that will further enhance performance and boost the ultimate ROI numbers.
These tools aren’t just something to drag out of the shed once all the other research has been done. As every DTC marketer knows all too well, the launch sequence for a DTC campaign is often pretty abbreviated. Because of time constraints, marketers are backed into a corner to make decisions without the benefit of solid data. Don’t let history repeat itself! Get a sense of the viability of DTC from the very beginning, when there’s a hefty amount of time and effort put into developing the physician campaign. Broadening research efforts even minimally in the early stages of brand strategy development can provide many of the all-important inputs to a forecast and offer an indication of what to do about DTC if and when it is up for consideration.

Onward and Upward
The last thing most DTC marketers can afford right now is to become complacent about ROI. There’s just too much negative energy out there conspiring against marketing Rx brands directly to consumers that could easily tip the scales in the minds of CEOs and CFOs in favor of abandoning it all together. Even if a campaign’s ROI is currently positive, if a DTC marketer doesn’t have a plan of attack for improving on that number, it’s all the more likely his or her budget will shrink.
That said, there’s a reason that pharmaceutical companies spend over $4 billion—and that’s in a down year—on DTC advertising: it can and does drive sales. No, it’s not for every brand in every category, but for many it can have a transformational effect on the bottom-line success of an Rx brand. Figure out the appropriate emphasis to put on DTC, find the most valuable patient targets, identify an inspiring positioning, figure out how to most efficiently reach the targets, and test out the marketing plan for fine-tuning. These are all techniques DTC marketers can use to achieve the ROI numbers that will keep management happy.
Kevin Clancy is Chairman of Copernicus, a research-driven marketing consulting firm. He can be reached at kevin.clancy@copernicusmarketing.com or 781-392-2500.
Eric Paquette is a Senior Vice President at the company and the resident pharma industry expert. He can be reached at eric.paquette@copernicusmarketing.com or 781-392-2527.