Is Connected TV a "Must Buy" For Pharma Marketers, or Merely Incremental?

By DeepIntent InSites Archives
Cover image for  article: Is Connected TV a "Must Buy" For Pharma Marketers, or Merely Incremental?

Ask your average television viewer to explain the difference between linear and connected television, and they will be hard-pressed to respond. However, that is not the case for those in the business of buying and selling advertising, where connected television (CTV) continues to be considered incremental reach to the overall television advertising buy. This is certainly true for pharma advertisers; linear television has been the backbone of their media plans for decades.

And that's led to a critical question: Should CTV continue to be considered incremental reach or a "must buy"?

When answering that question, some pharma marketers are definitely in the must-buy camp. "CTV is experiencing a huge amount for growth right now and is becoming a core component in some pharma campaigns," said Andrea Palmer, President of Publicis Health Media.

Data supports that. CTV is expected to grow 14.4% in 2023, and linear will decline 6.3%, according to IAB projections. However, Palmer sees the most value in a combination of the two. "While linear can drive broader awareness, CTV shines when it comes to delivering targeted reach, stronger measurement and premium inventory," she said.

CTV clearly extends reach; those who watch are not necessarily the same people who watch linear television, according to Amit Chaturvedi, COO of DeepIntent. "The scale of CTV is larger in terms of number of households," he explained. "The [number of] hours consumed on CTV is larger, ad targeting is more robust, performance measurements are more quickly available and optimization is faster and smarter," he said.

Yet the term "incremental" appears hard to shake. Sure, with CTV pharma can target anonymized audiences with relevant advertising, an obvious benefit to pharma marketers whose goal is to have scripts written. But Chaturvedi recognizes it is still easier to implement the linear portion of any buy. "The execution on linear TV is infinitely simpler, and the currency Nielsen uses to evaluate it is more established," he noted.

Lynda Gordon, Vice President of Global Data and Analytics for dentsu health, said that what marketers are buying with CTV needs to be properly understood. "In compliance with privacy regulations, the target audiences for pharma campaigns are not lists of actual verified patients but are 'lookalike' audiences built based on demographic and lifestyle data attributes that are associated with analysis of verified patients," she explained. "Once a campaign goes into market, the exposed audience is matched to an actual medical claims audience in a privacy-safe data clean room using anonymized patient IDs in order to validate the quality of the look-alike model used to build the audience.

"Most target audiences for pharma campaigns match back to verified patients at a <10% rate, depending on the therapeutic area and disease state," she continued. "The 'unmatched' portion of the audience is still a valuable target, as it may well be reaching individuals who have not yet been diagnosed but are interested in learning more about the disease's state. This integrated approach -- of reaching verified patients, through lookalike modeling, and potential at-risk patients -- provides the benefit of both privacy management and valuable information sharing to reach individuals with information that may be important to them."

Some technology platforms, including DeepIntent, have mitigated concerns that pharma buys are compliant with the Health Insurance Portability and Accountability Act (HIPAA). In addition, Chaturvedi noted, "Close to a billion dollars of the $14 billion U.S. pharma media market is CTV already, up from almost zero three years ago." That represents significant change in a relatively short period of time.

While targeted viewers are key, wider audiences have value, too. "The privacy-safe data practices used to reach relevant audiences for pharma company campaigns are adding value to health media by creating a greater focus on patient needs for information," Greg Reilly, President of dentsu health, explained. "While this addressable targeting approach will continue to be refined to drive up relevance, there is likely to always be a role for broader awareness campaigns that reach larger audiences with key messages and information."

According to Statista, the share of U.S. TV households without a traditional TV subscription has reached 53%, and there's a growing percentage of GenZ and younger Millennials who have never had cable. As audiences shift further away from linear, it is possible that the term "incremental" will change as well. Perhaps one day marketers will not see any difference between linear and CTV. And television will just be television, no matter what the platform.

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