More companies are seeing the wisdom in starting their operations online before they set up bricks and mortar locations. In today's crowded marketplace, these businesses need to reach consumers with messages about the products and services they offer.
In a post last month, I mentioned that big drug companies have been cutting their direct-to-consumer (DTC) ad spending. In 2012, total spending was $3.4 billion which was a 14% drop from the previous year. Drug company executives say part of the decrease was the result of fewer big drugs entering the pipeline but the shift was also made because these marketers are realizing that the ‘easy’ DTC approach may not be the most effective in terms of increasing sales.
The advent of online shopping has upended many supply chains. Consumers can now download music directly from a musician’s website instead of going to a traditional retailer. Experts are predicting the same market transformation could take place in the book publishing industry. Instead of perusing books in the aisles of a brick and mortar store, consumers can download e‑books from author sites directly to digital readers. Where do these changes leave the CPG industry? Will the middlemen be cut out?
Last month I blogged about the intricate steps pharmaceutical firms are taking to follow the law when using social media tactics. In particular, most pharma companies disable the comments section on the social media sites to ensure that consumer privacy laws, especially important in this industry, are not breached. But these steps have not been sufficient to quiet the critics.