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Why Pharmaceutical Companies Are Increasing Their Radio Ad Spend.

Big Pharma is one of radio’s fastest growing ad categories, as drug makers including Pfizer and Janssen Biotech more than doubled their ad spend on network radio from $49 million in 2018 to $126 million in 2021. That’s according to a Miller Kaplan network radio ad spend analysis provided by the Audio Active Group of Cumulus Media and Westwood One.

For a range of products, from Ibrance, which helps slow the progression of cancer, to psoriasis medication Tremfya, pharmaceutical brands are using AM/FM radio to “increase their media reach, drive impact, and achieve high audio creative scores at a fraction of the CPM [of TV ads],” Pierre Bouvard, Chief Insights Officer for Cumulus, says in a blog post.

One reason why network radio is seeing increased investment levels from the manufacturers of both prescription drugs and over the counter (OTC) brands is because it brings significantly greater reach to their TV campaigns. “It has to do with the light TV viewership problem here in the U.S.,” Bouvard says in a video summarizing the report’s findings. “According to Nielsen among adults 25-54, half of Americans are considered as light or non-TV viewers only representing 9% of all TV ad impressions. So it is virtually impossible to reach light TV viewers on linear TV.”

According to Nielsen Media Impact (NMI) the media planning tool used by agencies and advertisers, pharmaceutical/OTC brands see an average incremental reach increase among adults 18+ of 38% when including AM/FM radio in the TV media plan. Those reach lifts range from 22% for Procter & Gamble’s cold relief product Vicks to 69% for Pfizer’s Ibrance. “That is the superpower of radio, its incremental reach,” Bouvard explains.

The younger the demo, the greater the reach gains when AM/FM radio is added to pharma media plans, NMI data show. For example, a digestive ailment medication saw reach jump 149% among adults 18-24 and 107% with adults 25-34 from adding AM/FM radio to the media plan. That compares to a reach lift of 19% among adults 55-64 and 10% for adults 65+.

Share Of Voice

An increasingly popular sales tactic for the radio industry is convincing big TV advertisers to shift 20% of their TV budget to radio and watch their reach skyrocket. Yet many pharma brands worry that shifting money from a TV buy to radio will impact their TV share of voice. However, using NMI data, the Audio Action Group shows shifting 20% of the budget to AM/FM radio has positive effects for pharma brands. For example, in March 2021, an arthritis medication had a 22% TV share of voice among adults 35-64, tied with the nearest competitive brand. But when 20% of the budget is shifted to AM/FM radio, the medication’s total share of voice nearly doubles to 39%. The brand’s share of voice is now double or triple that of all the competitive brands for the same spend. The arthritis medication also saw its reach soar from 68.1% to 87.7% for the same total budget.

The deep dive into the pharma category also references a brand tracking study the Audio Active Group commissioned in February 2020 to evaluate the key images and ad effectiveness of a digestive ailment medication’s broadcast radio campaign. Working with Signal Hill Insights, four studies were completed via nationally representative samples of online surveys conducted by MARU/Matchbox. The main takeaway from the study was that ad recall for the campaign was highest among those exposed to the ads who also suffered from the digestive ailment the med was designed to treat. In addition, listeners who suffered from a digestive ailment and were exposed to the medication’s radio ads were more likely to research medication information, according to the report. Ailment sufferers exposed to the AM/FM radio campaign were also more likely to visit the medication’s website (53%) versus the total sample (30%).

According to Nielsen Media Impact, an average 38% of incremental reach was generated by adding AM/FM radio to the TV plan.

Comparing Creative Test Scores

The mostrecent Borrell Associates survey of advertisers found that radio offers one of the lowest price points for advertisers among all media channels. Now the Audio Active Group pharma report shows radio delivers results on par with TV for a fraction of the cost. Spot creative testing firm ABX took the audio tracks of pharmaceutical TV ads and tested them as AM/FM radio ads. It then tested the TV ads and compared the scores of the audio ads. The results: the pharmaceutical audio ads tested nearly as well as the TV ads with 90% of the creative score at one-fourth of the CPM.

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