Pharmaceutical companies spend billions on advertising.
Advertising is vitally important in the pharmaceutical industry. In 2007, for instance, Glaxo Smith Kline spent nearly $2.5 billion on advertising, Johnson & Johnson spent more than $2 billion and Pfizer Pharmaceuticals spent about $1.2 billion. Advertising plays an essential role in turning both prescription and over-the-counter brands into blockbusters. Advertising is mandatory for pharmaceutical companies to generate sales, build brand preference, make profits, remain competitive and sustain a leadership position in the industry.
Advertising Builds Billion Dollar Brands
Advertising can turn into a marketplace blockbuster, generating billions in sales.
While ad expenditures by companies in the pharmaceutical industry can be viewed as staggering, so are sales. For example, the $2 billion Glaxo Smith Kline spent on advertising in 2007 played a huge role in 2008 reported sales of $35 billion.
Pharmaceutical Companies Rely on Direct to Consumer Advertising
Some drugs, like Tylenol, become household names, synonyous as a remedy.
Advertising to consumers is essential to build preference for one brand against another. The industry refers to this as "direct to consumer advertising," meaning that the message of the advertising is designed to target consumers. The industry's desire is to advertise and market a drug that eventually becomes a household name. For example, the brand name Tylenol is virtually synonymous for the relief of headaches and minor body aches and pains.
Advertising Demonstrates Compliance with FDA Regulations
The Food and Drug Administration has a division that reviews advertising for prescription medications, called the Division of Drug Marketing, Advertising and Communications (DDMAC). The division is designed to ensure that pharmaceutical companies abide by federal laws and provide consumer information that is true and accurate. Companies voluntarily submit advertising to DDMAC for approval as a safeguard against being found in violation of FDA laws and regulations. That is why consumer advertising, in particular, includes lengthy information detailing potential health risks and side effects for prescription medications.
Advertising Makes Cash Registers Ring for OTC Drugs
Pharmaceutical companies also use store shelves as advertising media. They use tactics such as buy-one-get-one-free to increase sales for over-the-counter drugs, and run special advertising during different seasons, such as the cold and allergy seasons. The overall effect of in-store advertising, also called shopper marketing, is extremely important to pharmaceutical companies. Brands that generate the most sales get preference on where the products are placed on store shelves. It also influences how much shelf space the retailer will give to a particular brand, or group of brands from one company.
Advertising Can Entice Consumers to Switch Brands
Competing companies also use advertising to make consumers switch brands by seizing on a crisis, such as a drug recall. The competing company will often seize the opportunity and increase their advertising, with the goal of getting consumers to switch brands. In 1982, Johnson & Johnson had to recall 31 million bottles of Tylenol after discovering some bottles had been tampered with and laced with cyanide. The company spent $100 million just in recalling the product. Brands such as Anacin and Datril gained sales and volume from consumers who switched from using Tylenol during the crisis.
Related posts
Freedom from Smoking, a smoking-cessation program from the American Lung Association, outlines seven educational modules designed to help people kick the nicotine habit. The organization emphasize...
How Do Life Insurance Companies Check Medical Background?Before an insurance company issues a life insurance policy, it typically reviews your medical history. This is because the company does not...
Companies use different types of urine drug tests to screen for specific drugs.Many companies require a pre-employment drug test from their prospective employees to ensure a drug-free workplace. U...
Smokers who kick the habit with the help and support of others are more likely to stay smoke-free. In fact, according to New Jersey's Atlantic Health hospital system, "Smokers are four times...
How Drug Tests WorkWhen you take a drug of any kind, it takes a certain amount of time to be fully processed and expelled from the body in waste matter. During this time, the drugs are broken down...
