Outlook for Digital Pharma and Healthcare Ad Spending is Muted

Pharmaceutical firms and other healthcare vendors are often mentioned as rising stars for the ad industry. But are these marketers missing the digital media boat? New research from eMarketer shows pharmacistthat healthcare marketers are proceeding cautiously with their digital media outlay.

Businesses in pharma and other healthcare specialties are expected to spend $1.2 billion on digital advertising in 2013. This level accounts for about 3% of digital spending. By 2017, the expected spending will be $1.5 billion or 2.4% of the predicted $61.4 billion in total digital advertising. The compound annual growth rate (CAGR) for the 5 years leading up to and through 2107 will be 10.8% for all digital ad spending. Some industries, like media, entertainment and consumer products will outpace the average growth but the medical industry will lag behind.

Analysts believe that the continued regulations for prescription drug advertising and privacy concerns in general play a part in conservative ad spending. Agencies, hospitals and others who spend on digital will invest 54% of their funds in direct response and 46% on branding campaigns. While search and display account for most of the budget, healthcare concerns will increase the funds for mobile, video and native advertising. Jumps of over 50% are likely for mobile and video ad spending while broadcast TV may see a drop of 8% and national newspapers may get hit with a 9% drop as healthcare marketers gradually move into digital.

About 75% of healthcare-​related marketing spending targets physicians and payers. Only about 25% of industry spending goes to the direct-​to-​consumer market and that spending typically includes broadcast TV and print.

To learn more about Pharma Advertising Responders, check out the AudienceSCAN report available on the Research Store at ad​-ology​.com.

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.