Pharmaceutical marketing is big business—pharmaceutical companies spent $4.3 billion in 2010 in direct to consumer (DTC) marketing related activities. Hispanic marketing is big business, too. In 2011, $7.1 billion was spent in major media advertising to the U.S. Hispanic market. However, these two industries are essentially two ships passing in the night. In 2011, less than 1% of pharmaceutical DTC ad spending went to Hispanic marketing.
Hispanic marketers have long coveted the untapped potential of pharmaceutical DTC advertisers. The big Spanish-language media companies such as Univision and Telemundo, as well as many agencies and industry pundits, have been making numerous efforts over the last 10 years to convince pharmaceutical companies to invest at higher levels in the Hispanic market. Everything from data to industry admonition has being employed.
So what is the deal? Are pharmaceutical companies missing a huge opportunity because they’re too busy with other issues? Pharmaceutical OTC marketing budgets have been reduced significantly over the last few years, so maybe Hispanic budgets were just the first to go? Or is the Hispanic opportunity not so much of an opportunity? As is often the case with multi-million dollar questions, the answer is often complicated.
Let’s break down what we know.
Let’s start with the “givens”—generally accepted “truths” about Hispanics and the demand/use of prescription medications. Public health data indicates that Hispanics have higher incidences of chronic conditions, such as heart disease, diabetes and obesity. This, combined with the rapid growth of the Hispanic population (see 2010 Census data), points to a significant market of consumers that is potentially untapped. We also know that poor compliance is a big issue with Hispanics, which is either driven by or exacerbated by a lack of culturally competent healthcare providers. Hispanics tend to have larger families and a broader definition of “family” and they rely more on this larger network of family and friends for health information, compared to their general market counterparts. So education and behavior change is a potential prerequisite to effectiveness for pharmaceutical drug companies.
The market potential of the Hispanic communications gets further complicated when we start to introduce some lesser known characteristics about the market. From a demographic perspective, the most recent Census highlights the fact that the majority of U.S. Hispanics (63%) are U.S. born. A population of mainly immigrants is now primarily a community of second/third generation, partially-acculturated and acculturated Hispanics. This more acculturated Hispanic population is considerably younger than the general market, with almost 40% of the population under the age of 40 (compared with 60% of the non-Hispanic white population over the age of 40). This is not an ideal cohort for companies that sell most of their products to older Americans. Lesser known healthcare behaviors within the Hispanic market also present additional challenges for pharmaceutical companies, complicating the distribution and influence model they rely on in the general market. Hispanics are less likely to see specialists (secondary and tertiary), often go to clinics instead of medical offices and engage in cross-border healthcare.
On the flip side, many marketers also do not realize how digitally “connected” the Hispanic population is today—with upwards of 70% having regular access to the Internet. And yet 70% of Hispanics have health insurance (below the 88% of the general market) that covers branded DTC drugs.
The complicated Hispanic market is a challenge for pharmaceutical companies in many other ways. Hispanics, particularly first-generation immigrants, have a cultural preference and affinity towards natural remedies and ailments. Hispanics are likely to view non-prescription (OTC) medications and generic products as just as good as branded prescription drugs (Experian Simmons, 2012).
However with these challenges come opportunities for pharmaceutical companies. As more and more Hispanics are born in the U.S., we are seeing trends towards different attitudes about health, medicine and wellness than their immigrant parents and grandparents. This, combined with a persistent lack of culturally relevant providers and health content (particularly online), offers opportunities for marketers looking to go beyond driving awareness, to educating and providing culturally relevant information. As the growing second- and third-generation Hispanic market looks for health information online that is relevant to their lives, there is an opportunity for pharmaceutical companies to be part of the dialogue.
It’s clear that the Hispanic market is a significant opportunity, but it is not getting the attention of pharmaceutical companies because of its complexities. Savvy marketers understand that simply creating Spanish language advertisements won’t cut it. As the market grows, it’s getting more complex, creating challenges for those looking for simple solutions and opportunities for pharmaceutical and healthcare companies willing to do their homework and make long-term investments.