The Future of Point of Care
“POC will be at least 10% of DTC budget allocations in 5 years..“
Point of Care (POC) advertising has been around a long time. It is the advertising done at physicians’ offices and pharmacies. Most drug companies use it and have for over 20 years. My best estimate is that it comprises about 3-5% of all DTC spending. Most brand managers have run ads on television waiting rooms, done bag inserts at retail pharmacy, placed blood pressure machines, advertised in special in-office health magazines, used exam room posters, or used some display at the office.
These techniques generally have a good ROI and can be validated using actual script changes versus control offices or retail locations without the program. Most media plans incorporate POC. So why is now the time to expect an acceleration of its use? Why after 20 years will things change rapidly?
There are several forces at work that will expand the use of POC significantly. First, we are and will see consolidation of POC suppliers to make it easier to buy more reach. There are many small entrants who have a piece of the physician office market. Big pharma likes scale so these they can build market share. While high in ROI, many POC programs are too small to meaningfully impact sales and market share. Yes, that 500k may bring 2 million in sales but on a billion dollar brand the increase is marginal.
Second, there will be 30 some million new patients under Obamacare going to physicians offices and getting prescriptions at pharmacies. Certainly that will make those channels more important to advertisers. In fact, retail clinics will provide much of that primary care.
Third, the Obamacare emphasis on electronic medical records (EMR) will mean more digital connections between providers and their patients and pharmacies. While this will happen slowly, we can expect a much more seamless connection between health care parties. The advertisers will help fund some of this as EMR companies sell ad space. Much of this may be unbranded as physicians are careful about plugging brands. They will be happy, however, to allow disease education information especially if the advertising subsidizes lower prices for software and practice management. We can expect physicians to use online tools to talk more to patients and provide test results, and follow up care. That will mean opportunities galore for drug and device companies.
Fourth, the cost of healthcare must be slowed and that means prevention education will boom. Most of this effort will be on outright preventing disease or earlier identification of the disease. Diabetes and obesity education will be the big categories to save money. That means getting more people screened for blood sugar, cholesterol and blood pressure issues. That is most likely to happen at pharmacies offering free screenings more frequently. Millions of Americans will be incentivized to get screening and counseling at POC locations. Many of these newly screened will be minorities so expect multicultural POC to boom.
POC will be at least 10% of DTC budget allocations in 5 years or so. That would put it at about $400-500 million in spending. That market expansion will mean a lot of venture capital will be available to fund new companies. There will be a need for POC that is highly integrated covering awareness advertising, initial use, and retention and compliance programs.
All this was supposed to happen in the late 90’s when Web MD first pushed office digitization. It was an idea before its time but cost pressures will make it a reality this decade. It is about time it happened.
Bob Ehrlich, Chairman
DTC Perspectives, Inc.