Pharmaceutical marketing

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jcm cover (i).qxd

25/11/2005

11:30

Page 1

ISBN 1-84544-855-3

ISSN 0736-3761

Volume 22 Number 7 2005

Journal of

Consumer Marketing Pharmaceutical marketing Guest Editor: Ross Mullner

www.emeraldinsight.com

Journal of Consumer Marketing Volume 22, Number 7, 2005 ISSN 0736-3761

Pharmaceutical marketing Guest Editor Ross Mullner

Contents 404

Global marketing of lifesaving drugs: an analogical model Oswald A. Mascarenhas, Ram Kesavan and Michael Bernacchi

412

Does DTC mean “direct to court”? Donna J. Cunningham and Rajesh Iyer

421

Pharmaceutical marketing on the internet: marketing techniques and customer profile Caˇlin Guraˇu

429

Direct-to-consumer advertising and young consumers: building brand value Erin E. Baca, Juan Holguin Jr and Andreas W. Stratemeyer

Direct-to-consumer advertising of prescription drugs: help or hindrance to the public’s health? Greg Finlayson and Ross Mullner

432

Understanding the dynamics of the pharmaceutical market using a social marketing framework David Holdford

Herbal product claims: boundaries of marketing and science Stephanie Y. Crawford and Catherine Leventis

437

Executive summary

442

Book reviews

447

Computer currency Edited by Dennis A. Pitta

449

Internet currency Edited by Dennis A. Pitta

451

Note from the publisher

362

Access this journal online

363

Editorial

364

Introduction

365

Misplaced marketing For the drugs we need Herbert Jack Rotfeld

369

379

388

397

Direct-to-consumer prescription drug advertising: a study of consumer attitudes and behavioral intentions Tanuja Singh and Donnavieve Smith

Direct-to-consumer prescription drug advertising: concerns and evidence on consumers’ benefit Jaeun Shin and Sangho Moon

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Holdford describes the “affordable drugs movement” and presents a social marketing framework to place major developments within a meaningful theoretical context. The author also provides referenced descriptions and examples of forces causing change within the pharmaceutical market. He also classifies forces into six conditions influencing successful social movements. Shin and Moon provide an overview of the economic and clinical impacts of direct-to-consumer advertising on both the consumer and physician. Their findings recognizes direct-toconsumer advertising as a positive force for public health and at the same time identifies its potential negative effects on the economic and clinical aspects of the health care markets. Mascarenhas, Kesavan and Bernacchi apply the concept of “analogical reasoning” (paying attention to select features of (marketing) information, discerning patterns in it, and applying said patterns to present market challenges) to the current situation in the pharmaceutical industry. The authors posit that challenging pharmaceutical companies to explore new innovations in reengineering and redesigning their products and services so that developing nations that need them the most can afford them is of the utmost importance. Cunningham and Iyer have examined the current controversy in the direct-to-consumer advertising arena, and have created an intricate “road map” of recommendations of how to prevent this concept from coming to mean, “direct-tocourt” for the pharmaceutical industry. Ca˘lin Gura˘u investigates the perceived advantages and risks associated with online pharmaceutical transactions. From this research, the author proposes specific segmentation of consumers into four main categories. Finlayson and Mullner review the issues regarding the direct-to-consumer advertising that have been identified in the literature from the perspective of consumers, consumer groups, physicians, the medical profession and the pharmaceutical industry. Crawford and Leventis explore the boundaries in marketing and science with respect to labeled claims of herbal products and other dietary supplements. They report that the need for consumer choice, meaningful information and free-market access to dietary supplements must be balanced with the demands for truth-in-advertising and consumer protection from unreliable claims and adverse health events. Included in this issue, you will also find our other sections of interest to you the reader – “Misplaced marketing”, “Book reviews” and “Computer currency”. Richard C. Leventhal

Editorial Today, pharmaceutical companies are increasing their marketing budgets to advertise directly to the consumer. This spiraling effort has begun to attract the attention of both consumer advocacy groups, as well as the federal government (in the USA), in terms of taking a closer look at the effects of such advertising efforts. In July of 2005, the US Senate Majority leader asked pharmaceutical marketers to voluntarily stop their direct-to-consumer advertising during a drug’s first two years on the market. The ability for a pharmaceutical company to affect both the physician (who can prescribe a specific drug) and a consumer (who can request that they receive a prescription for a certain drug) has virtually affected the traditional model of marketing communications, which has been used for many years. In addition, products that are not regulated by the United States Food And Drug Administration (FDA) are also gaining popularity, in terms of being advertised directly to the consumer. There is no doubt that pharmaceutical companies have discovered that appealing directly to the consumer, and bypassing the “traditional” doctor-patient relationship, has become a very effective tool. The pharmaceutical companies have been able to create a heightened awareness among consumers, as it concerns the introduction of new drugs, and have observed how consumers have the ability to literally create strong market demand a for these new prescription drugs. It will be interesting to observe how this new model of marketing communications will play out. Singh and Smith have tried to determine whether direct-toconsumer drug advertising influences consumers’ behavioral intentions. They indicate that while consumers generally have favorable perceptions of prescription drug advertising, their behavioral intentions are influenced by a heightened awareness of specific branded drugs. Consumer motivation to request drugs may be impacted by several factors. Baca, Holguin and Stratemeyer have shown that demographics influence attitudes and interest in direct-toconsumer advertising, and those younger consumers’ interest, and propensity to seek additional information for themselves and family members, increases as a result of this type of advertising.

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public-sector expenditures for prescription drugs. For example, the price of prescription drugs has dramatically risen in the last several years, and the price of drugs is rising at a faster rate than the general rate of inflation for health care. They also argue the pricing policies of the pharmaceutical companies are inappropriate and socially irresponsible. For example, prescription drugs are sold at much lower prices in Canada and Mexico than they are in the USA. And millions of US citizens are forced to purchase their drugs from these countries to lower their medical costs. The pharmaceutical companies have also been accused of keeping the prices of their HIV/AIDS drugs artificially high, forcing many developing countries experiencing the devastating AIDS pandemic to either go without the drugs or to produce their own HIV drugs at a fraction of the cost. In sharp contrast, those who favor these marketing efforts argue that the pharmaceutical companies are conducting huge, privately funded, highly visible and effective public health education campaigns. They argue these marketing efforts raise the general public’s awareness of important medical conditions, motivates the public to take action, and helps them to better and more effectively communicate with physicians and other health professionals. They also argue many people who seek care because of their marketing efforts are frequently diagnosed with medical conditions different from those that were advertised. And many of these conditions such as diabetes, hypertension, and heart disease are discovered earlier when they can be more effectively treated. Lastly, they argue that the pharmaceutical companies are responding to the public’s concerns by adopting a voluntary code of conduct that will ensure better dialogue between patients and physicians. The purpose of this special issue is to address some of the complex and controversial issues posed by pharmaceutical marketing. Specifically, articles in this issue will address the impact of direct-to-consumer advertising of drugs, the marketing of drugs over the internet, pharmaceutical companies’ marketing policies, and the marketing of herbal products, which are not regulated by the United States Food and Drug Administration (FDA). Hopefully, this issue will provide many new insights into the benefits and pitfalls of pharmaceutical marketing. Ross Mullner

Introduction About the Guest Editor Dr Ross Mullner is Associate Professor in the Division of Health Policy and Administration at the School of Public Health, University of Illinois at Chicago. He is also Adjunct Associate Professor in the Department of Pharmacy Administration at the University of Illinois’ College of Pharmacy. His research interests include health care marketing, health services research, and the history and future of medicine and public health. Dr Mullner has written six books and over 100 journal articles on various aspects of health care. He has served on the editorial boards of several journals including Health Services Research, and Inquiry. He is currently the Associate Editor of the Journal of Medical Systems. Dr Mullner received his doctoral degree and two masters degrees from the University of Illinois.

Pharmaceutical marketing In 2004, pharmaceutical companies in the USA spent more than $10 billion on marketing activities. Of the total, $7 billion was spent on one-on-one marketing to physicians by company sales representatives, and more than $3 billion dollars was spent on marketing to the general public through television and newspaper direct-to-consumer advertising. Many politicians, public policy makers, and the general public are beginning to seriously question the need for these large marketing expenditures. Physicians are beginning to restrict the number of drug company sales representatives they see, and the general public seems to be saturated from the many drug advertisements they are exposed to each day. Some are beginning to feel the nation’s pharmaceutical companies are becoming more concerned with marketing than scientific research. Those who oppose these marketing efforts argue that pharmaceutical companies aggressively market only the latest and most expensive drugs, even though other older drugs may be more effective, safer, and much less costly. They argue these marketing efforts greatly increase both the private- and

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Misplaced marketing

For the drugs we need Herbert Jack Rotfeld Auburn University, Auburn, Alabama, USA Abstract Purpose – To delineate confusions and uncertainties of the issues surrounding those criticisms. Critics assert that all marketing of medical products is abusive, while actual impacts are disputed. Design/methodology/approach – Pulling from past commentaries on pharmaceutical marketing and current criticisms of the practice, to indicate areas of confusion. Findings – The ills of pharmaceutical marketing are not as great as critics presume, but the practices are not as positive as the companies might wish to assert. With uncertainty on the actual impact of specific practices, the companies are engaging in a certain degree of warfare via ever-increasing budgets of sometimes-questionable value. Practical implications – Puts criticisms of pharmaceutical marketing in context. Originality/value – Perspectives for understanding pharmaceutical marketing. Keywords Pharmaceuticals industry, Drugs, Brand names Paper type Viewpoint

Regardless of the consumer protection problem described in our term papers, the students in our 1975 graduate marketing and society course mentioned “consumer information” as a major part of the solution. Misprescribed pharmaceuticals, deceptive loan terms, fraudulent car repairs and many other consumer problems would be solved, we often said, if the businesses were required to provide consumers with more detailed and accurate information. Our instructor, Mary Gardiner Jones, had recently completed her service as a member of the Federal Trade Commission, and while she generally agreed with us, I will always remember her lament after one too many presentations on this theme: “I don’t want to be required to be my own expert pharmacist, mechanic, accountant or doctor.” She was a lawyer by education and that, she said, was difficult enough. Over five decades ago, the US Government changed the relationships among doctors, patients, and pharmacists. Initially, prescriptions were a doctor’s recommendation of a potentially useful drug, but patients did not need the doctor’s permission to make a purchase and pharmacists could also make recommendations. The 1951 Durham-Humphrey Amendment defined the kinds of drugs that cannot be safely used without medical supervision and restricted their sale to prescription by a licensed practitioner. In theory, with

all the new drugs just starting to come out at that time, patients would be forced to have the rational and informed expertise of a doctor involved in their drug-purchasing decisions.

Advertising information or influence The doctors are the experts, or so we like to believe. And with the medical doctors as the decision makers, for many years the pharmaceutical industry exclusively focused their brandname promotional practices on physicians. Even with the more recent advent of direct-to-consumer (DTC) advertising, the companies’ sales representatives still have regular and expensive contacts with physicians, spending large sums of money per year promoting brand name drugs by giving doctors various gifts, travel subsidies, and free meals in addition to the arguably more educational, though potentially biased, sponsored teachings and symposia. The total annual advertising and other promotional spending by US pharmaceutical companies has grown into the billions of dollars, or as some industry critics like to say, well over a thousand dollars per physician per year. And to the critics, that huge sum alone is the basis for asserting a huge and improper influence on prescribing decisions. Some rare doctors refuse any gifts from the drug companies of any kind in an effort to remain free of the taint of being “bought.” Skeptical patients given a brand name prescription look for coffee mugs with that same name around the front office as potential proof that the brand’s company salesperson had recently paid the doctor a visit and generated the direction to buy an expensive product. It is hard to tell just what influence specific promotional efforts might have on the doctors who honestly assert they have patients’ interests as their prime concern. No one wants to believe that a patient will be prescribed new anti-depressant

The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0736-3761.htm

Journal of Consumer Marketing 22/7 (2005) 365– 368 q Emerald Group Publishing Limited [ISSN 0736-3761] [DOI 10.1108/07363760510631093]

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For the drugs we need

Journal of Consumer Marketing

Herbert Jack Rotfeld

Volume 22 · Number 7 · 2005 · 365 –368

or antihistamine just because the doctor has a pen with that name written on it. To some extent, it is possible that even the drug companies question the sales value of the plethora of special gifts and advertising specialty products with a brand name printed on the side. At the same time, however, the drug manufacturers must feel the competitive pressure to provide the same sales “support” as is done at the competing companies. In a competitive industry, there must be a degree of advertising dollar combat, with the different companies trying to maintain a financial share of advertising voice. It still must be admitted that like any other consumerpurchased product from cars to house paint, the physician decision-maker’s primary source of product information is provided by the manufacturers. Some critics of the pharmaceutical industry assert that the companies abuse this information power and intentionally desire to mislead medical people. Regardless of whether there is intentional malfeasance, one study found that a significant number of statements from the sale representatives contradicted information readily available to them, and that the physicians generally failed to recognize the inaccuracies (Ziegler et al., 1995). While our personal doctors might claim that they derive their information only from research articles, there exists persistent evidence that they may be misled about a brand’s value apart from the scientific data on the matter (e.g. Avorn et al., 1982). Even the medical practitioners do not always know or understand all the information they have available. Research repeatedly finds that once a company starts selling a drug to assist a certain condition, the number of people diagnosed with the problem increases by several times the original rate. Patients must at least wonder about the medical decision when their new prescription is pre-printed on the doctor’s note pad (Wazana, 2000).

payment for coverage of brands than for generic products. In theory, when a doctor recommends a brand name, the patient must decide if the specific brand is worth the higher cost. In practice, the patient is forced to pay for a unique treatment that is still under patent protection. The possible solution that some would like to see at some future time is a designation as all pharmaceutical brand names as unnecessary, or, at least, not serving the needs of doctors or their patients. In those nations that require dispensing of generic forms of prescriptions whenever they are available, this is the de facto outcome. At a more basic level, there is some question as to whether the medical system is served by brand names for any prescription drug product whose patent has expired. Some people retain an unrealistic faith in the power of brand name drugs, but the Food and Drug Association (FDA) repeatedly assures the public that any functional benefit is virtually nonexistent. Generic drug manufacturers are subjected to the same standards as their brand name counterparts. But despite these repeated assurances from the government agency charged with regulating the efficacy and purity of prescription drugs, some patients and even doctors retain faith in the brand names. Logically, the FDA could ban the use of all brand names for pharmaceutical drugs. When a new drug first comes on the market, the pharmaceutical company has a patent. No one else can make it without their permission and they can charge whatever mark-up is deemed necessary, or rather, whatever the market will tolerate. They do not need a brand name to do this. And once the patent expires, they have competition from what are now identical products. The new products’ brand name might have had an initial value to make it easier for consumers to recall the name in direct-to-consumer television commercials, but once the product becomes generic, maybe the former brand name could become generic, too. Of course, no company would ever tolerate such a change in regulations, especially since brand names have a carryover value after the initial patent expiration. Higher dose or time release variations of the product can give new extended life to a brand name, as can new approvals of the original drug in combination with other products. There are also a growing number of prescription brand names that find extended life as the product gains new approval for OTC sales. Without prescribing laws or insurance payments encouraging generic substitutions, potential brand loyalty acquires new strength with consumer purchases.

Questions of brand value When new pharmaceutical products are first introduced, the primary marketing goal is to generate awareness of a previously-unavailable potential treatment for medical problems. Yet the longer-term desire would be to generate a degree of brand awareness and even brand loyalty among doctors and their patients that extends beyond the time of patent protection to when generic substitutes are available. Such brand loyalty exists for many categories of products, including non-prescription over-the-counter (OTC) drugs B i.e. many consumers pay a premium price for Aleve or Sudafed instead of the chemically identical generic naproxen sodium or pseudophedrine hydrochloride B So it is logical for a pharmaceutical manufacturer to desire such loyalty to their brand names after the patent expires. Yet even where such loyalty might have a potential to exist, it is discouraged by state laws that encourage pharmacists to substitute the cheaper generic products for prescriptions. In addition, insurance companies have taken brand names, any brand names, as a surrogate indicator of medical profligate spending, and in the process, they also make it more costly for people to use any and all newly developed drugs. Even if is a new product without an available generic version, many frustrated patients discover that their medical coverage either refuses to pay for brand name drugs or requires a higher co-

Over-informed consumers New Zealand and the USA might be on the leading edge of what could be an international trend as consumers are expected to play a bigger role in their drug decisions as the two nations allow direct to consumers (DTC) advertising for various prescription drugs. Reportedly the physicians in the two countries are skeptical to outright opposed to the practice, and despite similar survey responses from UK physicians, there is pressure to start allowing the practice in UK and the greater European Community (Reast et al., 2004). The a priori presumed benefits and potential problems have been debated ad infinitum in the news media (for a 366




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summary, see Auton, 2004), yet one detailed large-scale consumer study on actual impacts concluded that:

A sizable percentage of patients would probably respond negatively if their physician refused to prescribe the DTC drug the consumer thinks will solve the problem (Bell et al., 1999). Physicians must feel the pressure (Spurgeon, 2000), and a possibly misplaced marketing orientation insists that the customers needs be satisfied. It would be unrealistic to think that many doctors would not give the requested drug, even when the advertised brand might not be the physicians’ first choice for treatment, or even when the patient might be better off not taking any drug at all.

The reality of DTC’s effect on consumer behavior and doctor-patient relationship [in the USA] is more benign than its detractors fear and less specifically influential on product sales than many pharmaceutical brand managers would hope (White et al., 2004, p. 65).

In theory, consumers are well informed by the new conduit of information. While the main “promotional” pages of the advertising have many appeals to consumer emotions (Main et al., 2004), the print versions are filled with the same page of print-heavy data on indications, contraindications and precautions found in medical journal advertisements, and the television voiceovers and superimposed print disclaimers themselves provide enough warnings of side effects to make the audience members nauseous. This additional regulatoryrequired information is the same materials required in the advertising to the expert audience of physicians; if the front makes a emotional sales appeal, the extra two data pages provide all the information needed for an informed rational decision. While there would exist serious doubts that the typical consumer, or any non-expert layperson, would read the data. A secondary effect of requiring the technical prescribing data in all DTC advertising is that there are fewer such messages. When a prescription drug changes to OTC status, the data pages are no longer required. With the advertising purchases now able to be a single page instead of three, an extensive study of magazine advertising in one product category found a near-immediate tripling of the number of advertisements for the brand when the former DTC prescription product became OTC (Avery et al., 2005). Such an effect of limiting pharmaceutical advertising could be an unspoken regulatory intent of the data requirements, though there does not exist any proof that rule-writers at the FDA considered this as a goal. But it is clearly an effect. Yet you have to wonder about just what impact all this DTC advertising must have or what the companies hope to accomplish. The products are often brands under exclusive patent rights, so the company is trying to establish strong and broad demand while they still have an exclusive product. And since the ads often make emotional appeals, people are encouraged to rush to doctors for what could be minor nonmedical concerns. Not every case of depression, sleep loss, or lowered sex drive should be treated by expensive drugs. Even highly educated medical students tend to spot each new disease studied in their own bodies, and freshman psychology students tend to suddenly find all sorts of neurotic difficulties in themselves or their friends, so these DTC ads can readily play on consumers’ uncertainty about their own health. Food and Drug Administrations officials repeatedly insist that, at least in their view, the medical practitioners are still gatekeepers on the drug purchases. Unfortunately, with the increasingly competitive environment of patient services and medical care, many doctors concentrate on patient satisfaction, satisfying the medical customer’s short-term perceived needs even when the therapeutic solution is not so simple. A patient comes to the office wanting a cure or something that looks like a cure, and even without DTC advertising the physicians can make prescriptions that are, at best, useless.

Meanwhile at the advertising spending war Columnists in the advertising trade magazines have questioned the value of DTC advertising. While it might generate some consumer knowledge or inquiries of a newly introduced product, there does not seem to be any long-term effects on brand demand by consumers. In the wake of a scandal over the hidden dangers of a heavily promoted branded pain reliever, the introduction of a different new product included a promise by the company to refrain from any consumer-oriented advertising for one year. It is hard to believe that a company would so quickly give up a promotional tool if it felt it was important for long-term consumer awareness and prescription sales, so it is possible that the company also questioned the actual value of expenditures on consumer advertising. The new scandaltied criticisms of DTC advertising gave the company an easy way out of expensive spending on a practice of questionable value. But then, there are so many variables in prescription decisions, every decision on promotional spending is filled with uncertainty, and valid questions exist of each specific practice’s pragmatic utility. In a highly competitive business, with a short shelf-life on a prescription brand name, each pharmaceutical manufacturer is encouraged to maintain a loud and strong spending voice. Advertising and promotional spending almost becomes an arms race of sorts, with spending on marketing increasing as fast as successes in research and development on new products. In turn, the expensive marketing becomes are added target for blame in the high costs of drugs.

References Auton, F. (2004), “The advertising of pharmaceuticals direct to consumers: a critical review of the literature and debate”, International Journal of Advertising, Vol. 23 No. 1, pp. 5-52. Avery, R., Kenkel, D., Lillard, D. and Mathios, A. (2005), “Regulating advertisements: the case of smoking cessation products”, unpublished presentation to the 2005 American Council on Consumer Interests National Conference, Columbus, OH, April 6-9. Avorn, J., Chen, M. and Hartley, R. (1982), “Scientific versus commercial sources of influence on the prescribing behavior of physicians”, The American Journal of Medicine, Vol. 73, July, pp. 4-8. Bell, R.A., Wilkes, M.S. and Kravitz, R.L. (1999), “Advertisement-induced prescription drug requests: patients’ anticipated reactions to a physician who refuses”, The Journal of Family Practice, Vol. 48, June, pp. 446-52. 367




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Main, K.J., Argo, J.J. and Huhmann, B.A. (2004), “Pharmaceutical advertising in the USA: information or influence?”, International Journal of Advertising, Vol. 23 No. 1, pp. 119-42. Reast, J.D., Palihawadana, D. and Spickett-Jones, G. (2004), “UK Physicians’ attitudes towards direct-to-consumer advertising of prescription drugs: an extension and review”, International Journal of Advertising, Vol. 23 No. 2, pp. 229-51. Spurgeon, D. (2000), “Doctors feel the pressure from direct to consumer advertising”, The Western Journal of Medicine, Vol. 172, January, p. 60.

Wazana, A. (2000), “Physicians and the pharmaceutical industry: is a gift ever just a gift?”, Journal of the American Medical Association, Vol. 283, 12 January, pp. 373-80. White, H.J., Draves, L.P., Soong, R. and Moore, C. (2004), “‘Ask your doctor!’ Measuring the effect of direct-toconsumer communications in the world’s largest healthcare market”, International Journal of Advertising, Vol. 23 No. 1, pp. 53-68. Ziegler, M.G., Lew, P. and Singer, B.C. (1995), “The accuracy of drug information from pharmaceutical sales representatives”, Journal of the American Medical Association, Vol. 273 26 April, pp. 1296-8.

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Direct-to-consumer prescription drug advertising: a study of consumer attitudes and behavioral intentions Tanuja Singh and Donnavieve Smith Department of Marketing, Northern Illinois University, DeKalb, Illinois, USA Abstract Purpose – To determine whether direct-to-consumer prescription drug advertising influences consumers’ behavioral intentions. Design/methodology/approach – Gathered data from 288 respondents using a pencil and paper mail survey. Respondents were asked about their knowledge and behavior regarding prescription drugs. Findings – Indicated that while consumers generally have favorable perceptions of prescription drug advertising, their behavioral intentions are nevertheless influenced by a heightened awareness of specific branded drugs. Consumers feel empowered by the information provided in direct-toconsumer advertising and they are concerned about governmental attempts to regulate prescription drug advertising. Research limitations/implications – Data was collected from a relatively homogenous sample with respect to ethnicity. Future research efforts could include respondents from diverse ethnic backgrounds and could incorporate questions regarding respondents’ actual behaviors with respect to branded prescription drug medications. Practical implications – Useful information for researchers, public policy makers and prescription drug manufacturers. Results suggest that consumer motivation to request branded drugs may be impacted by factors related to the quality of advertisements, trust in their physician, and personal competence. Consumer interest in advertised drugs may also depend on the strength of the relationship that they have with their physician. Originality/value – This research fills an identified gap in the literature. While researchers have examined consumers’ general perceptions of direct-toconsumer prescription drug advertising, little research has been done on the link between consumer perceptions and behavioral intentions. Keywords Advertising, Promotional methods, Consumer behaviour, Pharmaceutical products, Medical prescriptions Paper type Research paper

promotions in 2001, of which $2.5 billion went to mass media advertising. Prescription drug advertising, often referred to as direct-to-consumer (DTC) advertising, has increased at an annual rate of 13-20 percent since 1997. Thus far, there have been mixed findings regarding the overall financial impact of DTC advertising on the pharmaceutical industry. While there is some evidence that suggests a direct and positive correlation between mass media advertising and drug manufacturers’ earnings (Findlay, 2002; Anderson, 2003), the relationship between adverting expenditures and the success of specific brands is not clear. Clearly, drug manufacturers place a great deal of faith in DTC ads and the impact that they can have on consumers’ decision to adopt advertised brands, but the exact nature of that impact remains controversial. While a recent study reports that for every 10 percent increase in DTC advertising, there is a 1 percent increase in drug sales (Kaiser Family Foundation, 2003), there is also evidence that DTC advertising often serves to increase the size of a market for a specific class of drugs, but not necessarily the market share for a particular brand (Krisanits, 2003). Researchers have examined DTC advertising from various viewpoints. Some have focused on the governmental rulings that have paved the way for DTC advertising (Dukes et al., 2001) and the case law that deals with drug manufacturers’ responsibility to warn consumers about the side effects of prescription medication. Other researchers have recently addressed the efficacy of DTC advertising as an educational tool. While some claim that there is “little rationale for directto-consumer advertising of prescription drugs” (Lexchin and

An executive summary for managers and executive readers can be found at the end of this issue.

Introduction “Depression elicits Prozac, high cholesterol has made Lipitor a familiar name and hay fever sufferers are all familiar with Claritin”(Schroff, 2003). A once mysterious industry has now opened its doors to American consumers and prescription drug advertising has become a billion dollar business. From the multimillion-dollar Super Bowl ads to the repetitive spots that are shown during primetime sitcoms, advertising for branded prescription drugs abounds. Overall, the advent of prescription drug advertising has added an entirely new dimension to the role of consumers in the decision making process for prescription medications and consumers are now more informed than ever before (Smith, 1998). In order to increase brand awareness for prescription medication, drug manufacturers spent $15.7 billion on The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0736-3761.htm


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Direct-to-consumer prescription drug advertising


Tanuja Singh and Donnavieve Smith

Volume 22 · Number 7 · 2005 · 369 –378

Mintzes, 2002, p. 194), others suggest that DTC advertising benefits not only health-care organizations, but also physicians as well as patients (Calfee, 2002). Researchers (Wilkes et al., 2000) have also examined consumers’ attitudes towards DTC advertising and the actions that consumers have taken in response to DTC ads. However, research has not investigated how consumers’ self perceptions or perceptions of their relationship with their primary physician might impact their decision-making for DTC advertised drugs. Further, while all of these studies have established that DTC advertising is a topic worthy of further investigation, there has not been any research done on the individual and relational variables that might influence the behavioral intentions of consumers during their medical decision making processes. Furthermore, researchers have not investigated whether these behavioral intentions might be detrimental to the doctor-patient relationship. The debate between industry advocates and public policy advocates is often rancorous in so far as DTC advertising is concerned. Industry advocates obviously argue that there are numerous merits to DTC advertising. They contend that it is primarily an educational tool for the consumer. Conversely, public policy advocates point to the inherent dangers of such advertising and suggest that the effects of too little knowledge may in fact be harmful to the consumer. This study was designed to provide some insights into consumers’ thinking and decision making processes as they respond to DTC advertising in the current marketplace. In particular, the study attempted to answer the following questions: . How do consumers view DTC advertising in general? . Does DTC advertising cause consumers to engage in specific behaviors or behavioral intentions (e.g., asking a primary care provider for more information about a drug that they have been exposed to or asking a physician to prescribe a particular advertised drug)? . Does DTC advertising empower consumers and if so, what are the outcomes of this perceived empowerment?

and for the first time, manufacturers were allowed to provide the name of the drug and the conditions that were associated with its use. At the same time, the FDA relaxed the guidelines concerning the information regarding the inclusion of product risk information. With the relaxed guidelines, drug manufacturers would only be required to mention the most critical information – basically those risks that would be common for the general population. In addition, drug manufacturers were also required to open up the lines of communication with their consumers. Consequently, drug manufacturers started providing consumers with information on request via toll-free numbers, the Internet, print advertising and similar means (Wilkes et al., 2000). By 1999, the final guidance on DTC advertising was issued and DTC ads had gone mainstream with drug manufacturers using a broad spectrum of promotional devices for prescription drugs including the back of ATM receipts, bank statements, and airline luggage labels (Reast et al., 2004). The debate over DTC advertising While the pharmaceutical industry was once enveloped in a shroud of mystery, consumers now have more information at their disposal than ever before. On the surface it appears that consumers might appreciate the opportunity to become more involved in their medical care and it also seems apparent that drug manufacturers should benefit from the provision of information in the form of DTC ads. However, there have been growing concerns about the necessity of DTC ads and their true benefits. “Proponents and opponents of direct-toconsumer advertising have established their rhetoric and have staked out their positions” (Dukes et al., 2001, p. 2). While many arguments have been advanced regarding the legitimacy of DTC advertising, the central question revolves around whether or not DTC advertising is truly beneficial to consumers and if so, how? Drug industry advocates point to the “educational” value of advertising directly to consumers and assert that consumers are now able to manage their health issues more effectively because of the information they garner from DTC ads. Supporters also point to the criticality of time, noting that there has traditionally been a time lag in the communication between pharmaceutical companies and doctors/patients; that doctors would often hear about medical advances and new medicines well after the information was needed. Supporters assert that DTC advertising bridges this information gap by informing consumers and physicians about new and promising advances in the medical field to treat particular conditions (Calfee, 2002). Opponents of DTC advertising disagree with these assertions and charge that FDA’s decision to allow DTC advertising of prescription drugs has created or will create numerous problems (Elliott, 2002). Some lament the changing doctor-patient relationship, while others decry the viewing of patients as consumers (Reast et al., 2004). These detractors argue that DTC ads might create a false sense of empowerment for the average consumer who does not have the ability or background to effectively evaluate the claims associated with the advertised drug (Wilkes et al., 2000). For these consumers, the complexity of information presented in DTC advertisements may prove to be too difficult to

Background History of direct-to-consumer advertising Despite its origins in the sixteenth century, direct marketing of pharmaceutical products to consumers is a relatively recent phenomenon (Dukes et al., 2001). Prior to the 1980s, prescription drug manufacturers primarily marketed branded drugs to physicians in an effort to avoid disrupting the intricate, and often delicate, relationship that existed between doctors and patients (Dukes et al., 2001; Ausness, 2002). Between 1983 and 1985 the FDA requested a voluntary moratorium on DTC advertising noting that there was a lack of previous court rulings on the issue. Around 1985 the ban was lifted and the courts reached a compromise by declaring that DTC ads were to be subjected to the same regulations that had previously guided pharmaceutical drug advertising to physicians. Consumers were to be protected through “full disclosure” and drug manufacturers would be required to provide a “brief summary” of the product in the form of package insert. As a result of industry pressure, and after considerable debate and deliberation, the FDA relaxed its rules in 1997 370




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understand and interpret. Opponents also contend that DTC advertising might result in self-diagnosis of “assumed” medical conditions by the consumers, leading to unnecessary and perhaps even dangerous uses of prescription drugs (Chandra and Holt, 1999). Opponents are also skeptical about the incremental value of information provided about new drugs. Citing data from numerous studies, Lexchin and Mintzes (2002, p. 194) note that a very small percentage of new medications are truly breakthrough advances that provide “substantial improvements over existing therapies”. In fact, they claim that drug companies are motivated more by profits than they are by informing consumers about better or safer drugs that offer significant advances over existing treatments. It has also been suggested that the drive to increase profits could eventually become a detriment to drug manufacturers. Opponents believe that DTC advertising has little educational merit and that most prescription drug advertising only serves to meet the financial motives of drug manufacturers. Some feel that DTC advertising might eventually increase the costs of prescription medication as consumers “demand” branded drugs to treat their medical conditions and abandon the less expensive, generic versions of the drugs that might be equally effective. Overall, DTC advertising offers several fruitful avenues for continuing research. From a consumer context, it is important that researchers empirically assess the impact of DTC advertising on consumer decision making regarding medical treatment. This exploration should focus on consumers’ acquisition of product knowledge, the formation of consumer attitudes towards individual brands and/or classes of prescription medication and the behavioral outcome after exposure to DTC ads. For example, it would be instructive to evaluate whether DTC advertising has changed the manner in which consumers acquire, view and utilize medical information. If consumers have become more attentive to their own medical needs and have taken steps to discuss their medical questions with a medical practitioner, then DTC ads would foster positive behavior change. However, if consumers resort to “self-diagnosis” after exposure to DTC ads, have pressured their physicians to provide unnecessary prescriptions, or have resisted competent medical advice, then DTC ads would be contributing to negative and potentially dangerous behavior changes.

choice in decision making; in fact, in some cases consumers’ intentions and final brand choice may not necessarily be related at all (Biehal et al., 1992). Research also suggests that the relationship between consumer attitudes and behavioral intentions might be more complex than originally believed (Biehal et al., 1992; Burton and Lichtenstein, 1988). As such, consumers may develop a preference for a particular brand or product even when they do not have very favorable attitudes towards the advertisements for these products particularly in situations where consumers perceive greater risk levels (Biehal et al., 1992). Various studies point to consumers’ lack of faith in drug manufacturers and their perceptions regarding prescription drugs as belonging to a risk-laden product category. A recent survey indicated 57 percent of Americans do not trust corporate executives to give them honest information, with an overwhelming number of respondents expressing negative views about drug manufacturers in particular (Schroff, 2003). Additionally, a Harris poll reported that the number of respondents who felt that drug manufacturers do a good job of serving consumers dropped by 20 percent between 1997 to 2002. These statistics suggest that consumers may not be as receptive to DTC advertising as drug manufacturers would like and as consumer advocates fear. Therefore, it seems that while consumers may have negative perceptions of DTC advertising and/or drug manufacturers, they are still willing to inquire about and request specific branded drugs that they have come to know about as a result of DTC advertising. Overall, one could argue that DTC advertising has created at least some value for the consumer (Shankland, 2003). Proponents of DTC advertising suggest that as patients become increasingly more involved in decisions that relate to their medical conditions, DTC advertising enables them to be not just better informed about their medical options, but it also provides a level of control over their medical choices (Eagle and Kitchen, 2002). Supporters of DTC advertising also claim that while the rise in DTC advertising might create some discomfort for the physician, it empowers the patient as it seeks to change the previously paternalistic approach that governed the doctor-patient relationship. Drug manufacturers of course invest a great amount of time and effort into DTC advertising by spending millions of dollars on commercials and other promotional tools that purport to reach a large current and potential consumer population. These changes in the DTC promotional environment have at least partially contributed to millions of people actually inquiring about particular drugs by name and 25 percent of these requests resulting in the physician prescribing the requested brand (Shankland, 2003). Our research explores the relationship between consumers’ views of DTC advertising and the resulting behavior or behavioral intention. We suggest that consumers may have a paradoxical relationship with DTC advertising in that the factors that facilitate consumer attitudes toward DTC advertising may differ from the factors that facilitate consumers’ behavioral intentions (e.g. propensity to ask their medical provider about a drug or a disease) or actual behaviors (e.g. actually seeking information from their physician about a particular drug), interest and/or adoption of DTC advertised drugs. Whether a patient would ask his or her physician about a specific prescription drug is likely to be

Theoretical foundations Attitude-behavior research Generally, advertisers have assumed that consumers’ attitudes towards a brand directly affect the choice of that particular brand. While it is not possible to review the vast domain of attitude research in this paper, the earlier foundational theories in attitude research would lead one to assume that consumers’ behavioral intentions could be reflective of their attitudes towards advertising, as well as attitudes towards a certain branded product. In other words, it could be argued that if consumers have positive attitudes towards DTC advertising, they are more likely to adopt the specific advertised brand and vice-versa (Ajzen and Fishbein, 1977). More recent research has shown that attitude towards an ad or a brand may not always be indicative of a consumer’s final 371




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function of several variables including such things as whether the consumer perceives him/herself to be competent to evaluate the claims, the quality of DTC advertising and the value of the information contained in the ad. Therefore, we suggest the following hypothesis: H1. Consumers’ willingness to consult his/her physician about an advertised prescription medication will be a function of the perceived information value in the DTC ad, the quality of the DTC ad, and a consumer’s perceived competence.

physician’s judgment and could seek alternative sources of information. Accordingly, we advance the following hypothesis: H2. Consumers’ willingness to trust their physician’s judgment regarding an advertised drug will be a function of whom they view as the primary source of medical information, their personal perceived personal competence, and value of information contained in DTC ads.

While DTC advertising has become commonplace, the terminology used in majority of the ads can be difficult for the average consumer to comprehend. Studies have found that 97 percent of prescription drug literature is too difficult for the average adult to digest (Smith, 1998). As a result, consumers are turning to others in their personal environments to assess the credibility of information that they receive via DTC ads; consumers are asking their friends, families, and/or their co-workers about specific branded drugs (Smith, 1998). Most important, consumers are turning to their physicians to confirm or dispel specific claims made via DTC advertising (Alleyne, 2002; Wilkes et al., 2000). Research also suggests that doctors themselves have varied perspectives on the value of DTC advertising (Coney, 2002). While medical opinion in the USA was initially quite favorable towards DTC advertising, recent data seems to suggest growing skepticism and negative attitudes towards such advertising (Reast et al., 2004). Similarly, other researchers have found that of the physicians surveyed in a study, only 15 percent had a positive view of DTC ads, 33 percent were neutral, and 52 percent disapproved of the practice (Yuan and Duckwitz, 2002). As consumers become better informed regarding various drugs that are available to treat specific illnesses, their decision to insist on a specific brand will most often be a function of the type of relationship that they have with their primary physician. Generally, most physicians would be more likely to prescribe a brand name prescription medication that had been requested by a patient, when the patient had either failed to respond to or tolerate another form of treatment (Yuan and Duckwitz, 2002). Moreover, it has been suggested that doctors will prescribe a DTC advertised drug because it is indeed the best treatment available for that specific condition (Shankland, 2003) irrespective of patients’ requests fostered by DTC advertisements. Conversely, doctors offer many reasons why they might refuse patients’ requests such as potential drug interaction and the availability of better treatment alternatives. If the patient-physician relationship is good, one would expect that there is a lot of informational exchange taking place in the physicians’ offices between the consumer and the medical service provider. At the crux of these conversations lies the patient’s trust in his/her physician’s ability to create the most effective treatment plan. Therefore, if a patient views his/her physician as the primary source of medical information, there will be a higher level of trust in the relationship. On the other hand, if consumers feel that they are competent and knowledgeable about their medical needs, they might discount their physician’s advice. Finally, if consumers believe that the information in the DTC ad is valuable to them, they would tend to rely less on their

Consumer empowerment/freedom of choice Advocates of DTC advertising contend that the advent of DTC advertising has given consumers an opportunity that they have never had before. They claim that consumers can take an active role in the treatment of their medical conditions via the knowledge they acquire from DTC advertising. Industry advocates claim that consumers now have increased choice in their medical decisions, which obviously is beneficial. Research dealing with empowerment can provide the backdrop against which the issue of increased choice can be evaluated. Some researchers believe that increased choice and information availability provide consumers with increased level of control in their decision making environment. Consequently, it is assumed that a sense of empowerment will always be viewed by consumers as a benefit since increased control allows consumer to get a better match between their needs and market offerings (Kreps, 1979). Based on this argument, it could be said that a sense of empowerment about their medical decisions would be viewed positively by consumers and welcomed. However, other researchers question the generalization that consumers always view increased choice as a benefit (Wathieu et al., 2002, p. 298). Instead, these researchers believe that “providing consumers with more control may be a mixed blessing, potentially leading to a less compelling choice or a less satisfactory outcome”. In fact, some studies have found that when consumers are provided with fewer alternatives, they often feel more satisfied with the decision they make (Iyengar and Leppar, 2000). This view would compel one to argue that DTC advertising may not always contribute to the consumer’s sense of empowerment. Wathieu et al. (2002) contend that it is not merely the size of the choice set that matters in a decision environment, but it also depends on whether or not consumers have the ability to specify and adjust the choice context. Clearly medical decisions are considerably more demanding, risky and complex than many average everyday, ordinary decisions consumers make. Therefore, consumer empowerment may not be as simple as having more choice but rather would be determined by a kind of trade-off between the benefits and costs associated with the ensuing empowerment. Thus, we propose the following hypothesis: H3. Consumers’ perceived empowerment as a result of DTC advertising is a function of perceived benefits and perceived costs of DTC advertising. Some of these ideas are rooted in the “theory of choice” (Steiner, 1970) used by social scientists to explain the “perception” of freedom of choice, and may have some bearing on consumers’ perceptions of DTC advertising. The 372




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theory of choice argues that there are two aspects to choice – decision control and outcome control. It can be argued that the DTC prescription drug advertising might give consumers the perception of freedom of choice and decision control as they feel that their medical decisions reflect their own judgments and personal preferences rather than those of their physician. This sense of empowerment or freedom of choice could prompt consumers to oppose any regulatory actions that might limit their access to prescription medication information. If consumers perceive that they have been “liberated” by the advent of DTC advertising, any attempt that threatens to limit communication between information providers (i.e. drug manufacturers) and consumers could be viewed as a threat to consumers’ freedom of choice. This leads us to the following hypothesis: H4. The higher the degree of felt empowerment and the more the perceived benefits, the more negative the attitude toward governmental regulation of DTC ads.

Table I Sample demographics Percentage

Methodology Survey design and sample description A paper and pencil survey was developed after a review of the extant literature in the area. A pilot test suggested minor modifications in the wording of some statements to improve communicability. The revised survey was further tested for face and content validity by scholars working in the area of survey design. Overall, the survey contained thirty-five statements anchored from strongly disagree to strongly agree, eight questions addressing consumer knowledge and behavior regarding prescription drugs and seven standard demographic questions, resulting in a total of 50 questions. A mailing list of adult respondents (aged 21 or above) residing in a large mid-western region of the USA was leased from a commercial list provider. The survey was mailed to 2,500 randomly selected addresses from this list. It included a standard statement regarding the confidentiality of consumer data and an offer to participate in a drawing for $100. A total of 288 usable responses were received in the allowed time-frame. After taking into account the 64 surveys which were returned undelivered, the response rate is approximately 12 percent. The sample consisted of approximately 58 percent of women and 42 percent men. The subject pool was quite diverse in terms of income, education, and age but relatively homogenous in terms of its ethnic background with the majority of the respondents being Caucasian (approximately 89 percent). About 90 percent of the respondents considered themselves to be “healthy” and 94 percent reported having health insurance which covered prescription drugs at least to some extent. Table I describes the demographic information for the sample.

Age Under 21-30 31-40 41-50 51-60 Over 69

13.2 19.4 22.6 17.7 27.1

Gender Female Male

58 42

Education Less than high school Finished high school Two-year college Some four year college Completed four-year college or university Completed Master’s degree or equivalent PhD or other advanced degree

3.1 17.4 14.2 16.7 28.8 15.6 4.2

Income No answer Less than $20,000 $20,001-$40,000 $40,001-$60,000 $60,001-$80,000 $80,001-$100,000 $100,001-$130,000 $130,001-$150,000 More than $150,000

6.6 5.6 20.8 18.8 16.7 13.2 11.8 3.1 3.5

Marital status Married Single Living together Other

68.4 22.3 2.8 6.6

Political affiliation Democrats Republican Independent None Other

29.5 33.0 14.2 18.0 7.30

completely safe drugs (there is no such requirement) and about 13 percent believed that companies can only advertise safe drugs. Only about 58 percent of the respondents correctly noted that the statement, “companies cannot advertise those prescription drugs which might have serious side effects,” is false. About 40 percent of the respondents had asked their physician about a particular drug after seeing an ad and about 15 percent reported being motivated to inquire about a condition they believed that they might have, after watching a DTC ad. A total of 17 percent had requested a particular brand of drug after seeing an ad; in about 58 percent of these instances, the physician prescribed the requested brand. There was a near unanimous agreement among respondents that DTC prescription drug advertising has increased significantly in recent years. A majority of

Consumer beliefs and opinions about DTC advertising Approximately 66 percent of the respondents reported that they pay some attention to prescription drug ads. Interestingly, 63 percent of the respondents did not know whether DTC prescription drug ads require government approval (they do not) and 14 percent erroneously believed that some government agency approves these ads. Almost 37 percent did not know if companies can only advertise 373




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respondents (more than 73 percent) viewed DTC advertising as “nothing more than savvy marketing” (mean value ¼ 3:97) and there was a statistically significant difference between men and women (mean values 4.13 versus 3.84; t ¼ 2:429, two-tailed significance ¼ 0:017) in terms of how they responded to this statement. Respondents with advanced degrees were much more skeptical of DTC advertising relative to others in the group. For example, the mean agreement level with the statement about DTC advertising being nothing more than savvy marketing was 4.33 for respondents having a Ph.D. or an equivalent degree, which was significantly higher than those with a Master’s degree (mean value ¼ 3:76; t-value ¼ 1.989; two-tailed significance ¼ 0:050). However, there were no systematic differences among respondents as a function of political ideology, age, or income in so far as this statement was concerned. In general, consumers did not believe that they had become more knowledgeable about their medical needs as a results of DTC advertising (mean value ¼ 2:44) but, agreed somewhat that DTC advertising empowers people (mean value ¼ 3:22) by giving them more say in their own medical decisions. Interestingly, people aged 40 years or less felt significantly more empowered than those over 40. For example, the mean value for the statement that DTC advertising empowers people was 3.41 for people aged 31-40 years whereas it was 3.03 for people older than 60 (p , 0:05, t ¼ 2:072) About 65 percent of the consumers believed that the average consumer does not have the competence to evaluate claims made in a prescription drug ad and 58 percent indicated that they did not trust DTC ads. Interestingly, more than 80 percent disagreed that consumers are better informed as a result of DTC advertising. However, only about 46 percent of the respondents agreed that they were personally opposed to DTC prescription drug advertising and only 42 percent supported the idea of banning DTC advertising of prescription drugs. At the same time, Democrats, more than Republicans, agreed that they would personally support stricter regulations on DTC advertising (mean values ¼ 3:54 versus 3.21; t ¼ 2:146, two-tailed significance ¼ 0:033). There were no other systematically significant differences as a function of gender, income, and education. Government’s role in approving and controlling DTC ads was supported by only 31 percent of the respondents but, an equal number of respondents were indifferent to the idea. About 37 percent of the respondents supported the idea that DTC advertising should be controlled by the government.

significant indicating a relatively clean factor structure. The first factor, which contained 12 items, extracted the highest amount of variance (23 percent) and the last factor, which contained two items, extracted the least amount of variance (4.7 percent). Factor scores were used as independent variables in subsequent regression analyses to test hypotheses H1 and H2. For H1, the dependent variable was the mean of the item that asked whether DTC advertising would prompt the respondents to inquire about a branded drug that they saw advertised to treat a medical condition that respondents believed they had. This dependent variable (DV1) was labeled DOCADVICE and the mean value for this item is 3.54 on a five-point Likert-type scale ranging from strongly disagree (1) to strongly agree (5), indicating a general agreement with this statement. The first regression with the dependent variable DOCADVICE resulted in three independent variables being significant predictors of DV1. These comprised of information value (factor 1), perceived quality of DTC ads (factor 2) and perceived consumer competence (factor 3). Tables II and III present the results of the regression analysis. As shown, the F-value for the model is 44.799 with a p-value of , 0.005 and an adjusted R2 of 0.313. Thus, views about the information value of DTC advertising, quality concerns regarding these ads and respondents’ views of their own perceived competence were significantly related to their behavioral intentions regarding seeking information from their physician about a particular drug that they saw advertised. Therefore, hypothesis, H1 is supported. As shown in Tables II and III, information value is positively related to the propensity to ask one’s physician about a branded drug, along with the quality of information contained in the ad and how competent the consumer feels to evaluate the claims contained in the ad. Quality of information contained in the ad and consumer competence are negatively correlated with the criterion variable suggesting that the more competent the consumer feels about being able to evaluate the claims and the higher the perceived quality of information contained in the DTC ad, the less likely he/she is to inquire about particular prescription drugs and seek advice from his/her physician. It is pertinent to note the relative Table II Seeking advice from the physician (dependent variable: DOCADVICE) Standardized Beta t-value p-value

Independent variable Information value Perceived quality of DTC ads Perceived Personal Competence

Factor analysis and hypotheses testing A principal components analysis with a varimax rotation resulted in a six-factor solution (Eigenvalues above 1.00) with 62 percent of variance explained. A variance extracted of 60 percent or more is considered satisfactory in the social sciences, particularly in exploratory research (Hair et al., 1998). The six factors generally reflected the following dimensions of consumer attitudes towards DTC advertising: information value of DTC ads, perceived quality of DTC ads, consumer competence, views about information complexity of DTC ads, views about the primary source of medical information, and beliefs about the outcome of DTC advertising. Most factor loadings were above 0.50 and

0.532 2 0.151 2 0.121

10.897 0.000 23.086 0.002 22.474 0.014

Note: Adjusted R 2 ¼ 0.313

Table III Model Regression Residual Total

Sums of squares df Mean square 90.325 191.544 281.869


374

3 285 288

30.108 0.672

F

Significance

44.799

0.000




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importance of the first independent variable – information value, as evidenced by the high standardized beta in the equation. It is the most significant predictor of consumers’ behavioral intentions. The other two, perceived quality of DTC ads and perceived competence, while important, explain lower incremental amounts of variance in the equation. For hypothesis H2, the dependent variable is the mean of the item that asked the respondents whether they would respect their physician’s judgment if he/she turned down their request to prescribe an advertised drug that the respondent had requested. This dependent variable (DV2) was labeled MEDDEC. The mean values for this dependent variables is 3.90 on a five-point Likert-scale ranging from strongly disagree (1) to strongly agree (5), indicating a general agreement with this statement. The second regression with the dependent variable MEDDEC resulted in two variables being significant predictors of DV2. These comprised of respondents’ views about the primary source of medical information (factor 5) and information value of DTC advertising (factor 1). Tables IV and V show the results of the regression analysis. As shown, the F-value for the model is 41.548 with a p-value of , 0.005 and an adjusted R2 of 0.220. Thus, consumers’ willingness to respect their physician’s judgment about a medical condition was significantly related to whether his/her physician was the primary source of medical information and information value of DTC advertising. In this model, the higher standardized beta is associated with respondents’ primary source of medical information. Information value is negatively correlated with the dependent variable whereas views about the primary source of medical information are positively correlated. In essence, the higher the perceived information value of an ad, the less the willingness of the consumer to go along with the physician’s judgment. On the other hand, if the physician is the primary source of medical information, this translates into a higher level of trust in his/ her judgment. Thus, hypothesis H2 is supported. To tests hypotheses H3 and H4, multi-item measures were used: perceived cost and perceived benefits of DTC

advertising were measured using three items each (Cronbach’s alpha ¼ 0:7028 and 0.6662 respectively). The two dependent variables were: perceived empowerment which was labeled EMPOWER (DV3) and attitude towards governmental regulation of DTC ads, which was labeled REGULATE (DV4). Mean value for DV1 on a scale ranging from strongly disagree (1) to strongly agree (5) is 3.22 suggesting that the respondents agree that DTC advertising empowers people. Mean value for DV4 is 3.16 on the same strongly disagree (1) to strongly agree (5) scale suggesting that in general, there is some support for governmental regulation of DTC advertising. Tables VI and VII present the results of the regression analysis with the dependent variable “Empower”. The model is significant with an F-value of 68.838, p , 0:005 and an adjusted R2 of 0.320. The model suggests that empowerment is positively related to the perceived benefits of DTC advertising and negatively related to the perceived costs of such advertising. In essence, mere information and information availability do not empower the consumer. Instead it appears that consumers make a trade-off between the perceived benefits of DTC advertising versus the costs they believe are associated with such advertising. As such, H3 is supported. Finally, Tables VIII and IX present the results of the regression analysis with the dependent variable “Regulate”. As shown, the model is significant with an F-value of 16.659, p , 0:005, and an adjusted R2 of 0.098. Both empowerment and perceived benefits are negatively related to consumers’ willingness to support government regulation of DTC advertising. Thus, the more empowered the consumers feel the less amenable they are to support regulatory interference in their medical information seeking environment. However, despite the statistical significance of these results, one must interpret these results with caution due to the low adjusted R2. In effect, while H4 appears to have been supported, these results should be validated using another study to ensure the strength of the relationships in the equation.

Table IV Impact on medical decision (dependent variable: MEDDEC)

Table VI Perception of empowerment (dependent variable: EMPOWER)

Standardized Beta

Independent variable Views about primary source of medical information Information value

t-value

p-value

0.434 2 0.192

8.338 23.685

0.000 0.002

Perceived benefits of DTC advertising Perceived costs of DTC advertising


Note: Adjusted R 2=0.320

Table V

Table VII

Model Regression Residual Total


2 286 288

Standardized Beta t-value p-value

Independent variable

30.108 0.672

F

Significance

41.548

0.000

Model Regression Residual Total




375

0.445 20.193

2 286 288

49.274 0.716

7.793 0.000 23.374 0.001

F

Significance

68.838

0.000




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Table VIII Feelings about government regulation (dependent variable: REGULATE)

extra steps needed to ensure that consumers make the connection between their drug and alleviation of specific medical conditions. Behavioral intentions are positively influenced by DTC advertising in that consumers are asking their physicians about DTC advertised drugs and are more likely to ask about a specific brand, however, our findings also suggest that consumers’ willingness to take action is dependent on a number of variables. Consumer action after exposure to DTC ads is not only a function of the effectiveness of DTC ads, but also a function of their perceptions of their own personal competence, the value of information in the ads, and the overall quality of DTC advertisements. While some researchers and practitioners have noted that consumers might shop around until they find a doctor that is willing to issue a prescription for a specific brand, our findings suggest that this “shopping around” will stem more from the level of trust that consumer places in his/her doctor and the relationship that exists between the consumer and his/her physician. However, our research also suggests that the quality of the DTC ads may have some bearing on consumer’s willingness to seek a DTC advertised drug from another physician. In other words, if consumers do not have a strong relationship with their primary care physicians but find the information in a DTC ad to be useful and informative, they may be more likely to seek the brand from an another physician. This reasoning highlights the way in which the physicianpatient relationship has evolved with the onset of DTC advertising. Where consumers once felt entrapped in their relationships with their physicians, the acquisition of information regarding branded drugs has given consumers more power than ever before. Interestingly enough, our findings suggest that mere empowerment may not be enough to ensure consumer satisfaction with DTC advertising, nor might it be enough to facilitate consumer acceptance of and/ or trust in drug manufacturers. While drug manufacturers have assumed that merely providing consumers with more information would ensure consumer trust and acceptance, researchers have found that increased choice alternatives do not necessarily lead to increased satisfaction (Wathieu et al., 2002). In order for consumers to truly be satisfied with DTC advertisements, they must become more knowledgeable about the products and their efficacy. “Patients face a daunting task. True empowerment demands the truth . . . ” (Friedwald, 2000). As it stands, there seems to be a gap between consumer awareness and the “real” truth about DTC advertised brands. While consumers/patients do have more information available to them because of DTC advertising, they may not necessarily be able to effectively evaluate the costs and benefits of the given options. As such, our findings highlight the need for increased focus and attention on the manner and context in which branded drugs are advertised. On the surface it seems that advertising broad-based benefit would be attractive to consumers; however, there is no guarantee that consumers are able to differentiate these benefits from those offered by competing drug manufacturers or other nutritional supplements (Wealleans, 2003). Typically DTC advertisements show “a stream of indistinguishable communication in which execution cliche´s abound-walking

Standardized Beta t-value p-value

Independent variable Perceived benefits of DTC advertising Level of perceived empowerment

23.186 0.002 22.293 0.023

20.213 20.153


Table IX Model Regression Residual Total


2 286 288

12.414 0.745

F

Significance

16.659

0.000

Discussion and implications Overall, the advent of DTC advertising presents a wealth of interesting dichotomies and valuable insights regarding consumer perceptions. Our findings reveal that although consumers are motivated to ask their primary care physicians about drugs promoted through DTC advertising, they are not particularly knowledgeable about DTC advertisements. In particular, our findings show that consumers are not particularly knowledgeable about prescription drugs or the laws that govern DTC advertising, even though they claim that DTC advertising has increased their overall awareness of prescription drugs. It could very well be that while consumers have become more aware of the brands mentioned in DTC ads, they are not necessarily more educated about the benefits and risks associated with advertised brands. Specifically, consumers know that DTC drug ads abound; however, consumers may not fully understand the message in DTC ads, nor do they trust in drug manufacturers to provide them with accurate information. This disparity may exist because consumers are not comfortable with the format in which drugs are advertised, they do not feel competent to evaluate the claims made in such advertising, and they are not aware of the various avenues to get more information. As consumers become savvier and as drug manufacturers seek to establish profitability for their specific brands, researchers and practitioners will need to examine the types of ads that most impact the development of favorable attitudes towards DTC advertised drugs. Currently, many of the ads for DTC drugs feature consumers who are active and thriving in their day-to-day lives with little mention of the drug’s connection to the alleviation of specific symptoms related to the individual’s given condition. Perhaps, consumers are in need of more information regarding the drug’s specific impact on the condition and their long term benefits and effects. Currently, many of the ads are ambiguous and it seems that drug manufacturers have left it to the physicians to fill in the blanks regarding the actual benefits of their respective products. However, as we move into an era of consumer empowerment, we should expect that consumers will be demanding more of the drug manufacturers and their brands. These changing demands could mean that drug manufacturers may have to take the 376




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the dog, playing with grandchildren, painting, cooking, etc.” (Wealleans, 2003, p. 98). Our findings suggest that it may not be enough to merely mention a brand name and to show that the consumer is able to engage in an “active” lifestyle despite his/her medical condition. Further, as noted by practitioners, the traditional consumer goods product marketing model may not be the best option for the marketing of DTC branded drugs. Marketers must thoroughly understand the psychology of the consumer and his/her beliefs about a particular drug category before formulating an ad campaign (Schroff, 2003). While consumer goods manufacturers have relied on brand associations to build brand loyalty, drug manufacturers must create a distinct format for the successful advertisement of branded drugs. With consumer goods, it may be enough to merely get consumers to be familiar with a particular brand name; however, with branded prescription drugs there are many other factors to consider such as the patient’s disease history, their physician’s medical training, possible generic substitutions and the amount of co-pay that the patient may have to contribute (Shankland, 2003). As such, consumers may need to receive information about branded drugs that reaches beyond the scope of hearing the brand name repeated time and time again, and drug manufacturers must determine the best method to convey this information. Thus, drug manufacturers must address whether would be advantageous for them to modify the way in which DTC advertising is created and disseminated. At the present time, drug manufacturers have been successful in terms of getting more information to the public and opening up lines of communication with their consumers. Next, drug companies must determine what type of relationship they want to have with consumers. DTC advertising has been successful in making the consumer aware of various medical conditions and increasing the recognition of branded drugs (Alleyne, 2002; Krisanits, 2003; Smith, 1998; Wilkes et al., 2000). With the flattening out of DTC advertising spending (Shankland, 2003), it seems that DTC advertising is at a major crossroads and drug manufactures will have to make some critical decisions regarding the future of prescription drug advertising to consumers.

DTC advertising for this population may be of tremendous value in assessing whether it can bridge the knowledge gap that has existed for decades. The National Medical Association, the nation’s oldest and largest AfricanAmerican medical association, recently released findings from a survey of 900 black physicians in which they found resounding support for DTC advertisements, particularly for African-American patients (Alleyne, 2002). These physicians noted that DTC advertisements encourage dialogue between doctors and patients and it increases the likelihood of doctor’s visits, both of which have been fairly difficult issues for African-American patients. Similarly evaluating perceptual differences regarding the value and efficacy of DTC advertising among other sub-cultures (e.g. HispanicAmericans, Asian-Americans, etc.) might also be useful to assess whether cultural variables play a role in medical decision making, and whether DTC prescription drug advertising might be used to encourage information seeking among these sub-groups.

References Alleyne, S. (2002), “Commercial medicine”, Black Enterprise, Vol. 33 No. 1, pp. 107-8. Ajzen, I. and Fishbein, M. (1977), “Attitude behavior relations: a theoretical analysis and review of empirical research”, Psychological Bulletin, pp. 888-918. Anderson, P.J. (2003), “Study measures DTC impact”, Pharmaceutical Executive, Vol. 23 No. 8, p. 18. Ausness, R.C. (2002), “Will more aggressive marketing practices lead to greater tort liability for prescription drug manufacturers?”, Wake Forest Law Review, Vol. 37 No. 1, pp. 97-139. Biehal, G., Stephens, D. and Curlo, E. (1992), “Attitude toward the ad and brand choice”, Journal of Advertising, Vol. 21 No. 3, pp. 19-36. Burton, S. and Lichtenstein, D.R. (1988), “The effect of ad claims and ad context on attitude toward the advertisement”, Journal of Advertising, Vol. 17 No. 1, pp. 3-11. Calfee, J.E. (2002), “Public policy issues in direct-toconsumer advertising of prescription drugs”, Journal of Public Policy and Marketing, Vol. 21, Fall, pp. 174-93. Chandra, A. and Holt, G.A. (1999), “Pharmaceutical advertisements: how they deceive patients”, Journal of Business Ethics, Vol. 18, pp. 359-66. Coney, S. (2002), “Direct-to-consumer advertising of prescription pharmaceuticals: a consumer perspective from New Zealand”, Journal of Public Policy and Marketing, Vol. 21 No. 2, pp. 213-23. Dukes, D.E., Rogers, J. and Paine, E.A. (2001), “What you should know about direct to consumer advertising of prescription drugs”, Defense Counsel Journal, Vol. 58 No. 1, pp. 36-49. Eagle, L. and Kitchen, P. (2002), “Direct consumer promotion of prescription drugs: a review of the literature and the New Zealand experience”, International Journal of Medical Marketing, Vol. 2 No. 4, pp. 293-310. Elliott, S. (2002), “Pharmaceutical makers and ad agencies fight to preserve campaigns for prescription drugs”, The New York Times, July 12, p. 2.

Future research This research addressed attitude and behavioral change issues from the consumer’s perspective. To have a better understanding of how DTC advertising affects the physician-patient dyad, it would be useful to evaluate what physicians feel about the efficacy of such advertising for their patients. Since DTC advertising is here to stay, it might also be useful to get the physicians’ perspectives on what type of information should be incorporated into DTC advertising by the drug companies so that the consumers can use it more effectively and benefit from the information provided in the ad. Another rich avenue would be to address the impact of ethnicity and/or other individual differences on consumers’ response to DTC advertising. For example, it is well known that African-Americans lag behind their Caucasian counterparts in terms of access to quality healthcare and knowledge about medical issues; evaluating the efficacy of 377




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Findlay, S. (2002), “Do ads really drive pharmaceutical sales?”, Marketing Health Services, available at: web.lexisnexis.com/universe (accessed October 17, 2003). Friedwald, V. Jr (2000), “The internet’s influence on the doctor-patient relationship”, Health Management Technology, Vol. 21 No. 11, p. 80. Hair, J.E., Anderson, R., Tatham, R. and Black, W. (1998), Multivariate Data Analysis, Prentice Hall, Englewood Cliffs, NJ. Iyengar, S.S. and Leppar, M.L. (2000), “Personality processes and individual differences when choice is demotivating: can one desire too much of a good thing?”, Journal of Personality and Social Psychology, Vol. 79 No. 6, pp. 995-1006. Kaiser Family Foundation (2003), “Impact of direct-toconsumer advertising on prescription drug spending,” available at: www.kff.org/ rxdrugs/6084-index.cfm (accessed November 29, 2003). Kreps, D.M. (1979), “A representation theorem for preference for flexibility”, Econometrica, Vol. 47, pp. 565-77. Krisanits, T. (2003), “DTC grows drug class, not brand share”, Medical Marketing and Media, Vol. 38 No. 12, p. 26. Lexchin, J. and Mintzes, B. (2002), “Direct-to-consumer advertising of prescription drugs: the evidence says no”, Journal of Public Policy and Marketing, Vol. 21, Fall, pp. 194-201. Reast, J.D., Palihawadana, D. and Spickett-Jones, G. (2004), “UK Physicians’ attitudes towards direct-to-consumer

prescription drugs: an extension and review”, International Journal of Advertising, Vol. 23, pp. 229-51. Schroff, K. (2003), “Why pharma branding doesn’t work”, Pharmaceutical Executive, Vol. 23 No. 10, pp. 50-8. Shankland, S. (2003), “To DTC or not to DTC? Direct to consumer advertising can seem like a prescription for futility”, Marketing Health Services, Winter, Winter, p. 44. Smith, D. (1998), “We hold the keys and we know it”, Pharmaceutical Executive DTC Times Supplement, May, pp. 8-9. Steiner, I.D. (1970), “Perceived freedom”, in Berkowitz, L. (Ed.), Advances in Experimental Social Psychology, Academic Press, New York, NY, pp. 187-248. Wathieu, L., Brenner, L., Carmon, Z., Chattopadhyay, A., Wertenbroch, K., Droleet, A., Gourville, J., Muthukrishnan, A.V., Novemsky, N., Ratner, R.K. and Wu, G. (2002), “Consumer control and empowerment”, Marketing Letters, Vol. 13 No. 3, pp. 297-305. Wealleans, S. (2003), “DTC could use a fresh injection of strategy”, Medical Marketing and Media, Vol. 38 No. 12, p. 98. Wilkes, M., Bell, R.A. and Kravitz, R.L. (2000), “Direct to consumer prescription drug advertising: trends, impact, and implications”, Health Affairs, Vol. 19 No. 2, pp. 110-28. Yuan, Y. and Duckwitz, N. (2002), “Doctors and DTC”, Pharmaceutical Executive, Vol. 22 No. 9, pp. 114-24.

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Direct-to-consumer advertising and young consumers: building brand value Erin E. Baca, Juan Holguin Jr and Andreas W. Stratemeyer Department of Marketing and Management, College of Business Administration, The University of Texas at El Paso, El Paso, Texas, USA Abstract Purpose – Direct-to-consumer advertising (DTCA) is a pervasive element in society today. Consumers have responded accordingly by becoming more knowledgeable, developing specific perceptions and attitudes toward DTCA. The purpose of this article is to examine direct-to-consumer prescription drug advertising issues among younger adults as both consumers and caregivers to determine whether companies are, or should be, taking advantage of building brand value through DTCA. Design/methodology/approach – A sample of 225 young adults answered questionnaires to measure the effects of DTCA. The questionnaire was based on a study by the National Consumers League and only the items that were most central to the current study were utilized and/or modified to measure the following key variables: age; current health status; prescription drug use; attitudes toward DTCA; interest in DTCA; DTCA recall; and inclination to seek additional information. Findings – The findings show that demographics influence attitudes and interest in DTCA, as well as younger consumers’ interest and propensity to seek additional information for themselves and family members. Details of the statistical analysis of the study are given. Originality/value – The implications of the findings for pharmaceutical marketers, health care advisors, and academic researchers are discussed in the paper. Keywords Advertising, Brand identity, Young adults, Pharmaceuticals industry, Prescription medicines Paper type Research paper

(FDA) identified the benefits of direct-to-consumer advertising (DTCA) as, creating increased levels of awareness, involvement, compliance, reach, and clientpatient interaction (Food and Drug Administration, 2004). As a result, medical patients are recognized as an evolving market segment in terms of influence. Further noted by Mintzes et al. (2002, p. 279) “Patient requests for medicines are a powerful driver of prescribing decisions”. To capture this fast growing and profitable market, directto-consumer advertising (DTCA) has flourished with expenditures in the billions for some of the largest pharmaceutical firms. Promotional activities for pharmaceutical products is approaching that of the largest Fortune 500 firms’ products with Advertising Age (2004) listing promotion expenditures for Pfizer at $2.57 billion, GlaxoSmithKline at $1.55 billion, and Merck at $1.16 billion. These expenditures rank Pfizer, GlaxoSmithKline, and Merck as the 4th, 12th, and 19th largest Fortune 500 advertisers respectively in the USA for 2002. With such large investments in promotional activities by pharmaceutical firms, consumers appear to be responding to DTCA. Extant literature has suggested that consumers in general have positive attitudes toward advertising and feel that DTCA is a valuable source of information regarding various products and services (for examples, see Perri and Nelson, 1987; Perri and Dickson, 1988; Everett, 1991; Williams and Hensel, 1995; Shavitt et al., 1998; Paul et al., 2002). However, because prescription drug DTCA is relatively new, having only been legal since 1985 and only used extensively after 1997 when the FDA relaxed the standards for DTCA (Macias and Lewis, 2003), questions remain regarding the effectiveness of the advertisements for this segment of the industry. Thus, what is not known is how effectively these advertising campaigns achieve the goals of the firm in

An executive summary for managers and executive readers can be found at the end of this issue. While advertising expenditures continue to grow every year in the USA, marketers, executives, policy makers, academics, and the general public continue to debate its merit (Macias and Lewis, 2003). Although personal selling, sales promotion, publicity, and public relations are important elements of promotional activities within the marketing mix, advertising is likely the most visible and noticeable component (Coulter et al., 2001). This is clearly exemplified in the pharmaceutical industry where expenditures on promotions have grown from $2.64 billion in 2002 to $3.2 billion in 2003 (Slaughter, 2004). There is little doubt that the average American has seen an increasing number of advertisements from pharmaceutical firms (Findlay, 2001). For example, for heavily advertised brands, increases in consumer awareness levels have ranged from 40 to 75 percent over previous years for drugs such as Viagra, Allegra, Lipitor, and Zoloft (Slaughter, 2004). Additionally, Parker and Pettijohn (2003) suggest that information regarding DTCA for pharmaceutical products will continue to grow as the baby-boomer generation continues to age. In 2003, the Food and Drug Administration The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0736-3761.htm


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reaching consumers as well as which advertising theories are most appropriate for measuring the effectiveness of DTCA. Therefore, given that researchers have only recently examined the effectiveness and the related impact of DTCA by pharmaceutical firms and that empirical research on this subject is still emerging (Menon et al., 2004), this research is exploratory in nature. Although skepticism remains regarding whether DTCA truly educates the consumer and thus begins to establish brand loyalty or whether DTCA merely contributes to rising drug costs, “drug companies are discovering what packagedgoods companies and other consumer markets have known for years: Nothing is more powerful than building consumer brand loyalty,” (Marx, 1996, p. 56). To build brand loyalty, companies have to focus on building value for their brand (Moore et al., 2002). According to Rutledge:

of media and promotional activities. It is reasonable to conclude that pharmaceutical firms believe that increased levels of media and sales promotion spending is directly related to establishing and maintaining strong brand equity (Herremans et al., 2000). Additionally, DTCA is being placed within a multitude of media so that the actual audience ranges from young adults to senior consumers with much of this advertising placed in primetime television and national magazines that appeal to a broad-based audience. Thus, exploring the likelihood of specific demographic groups, or younger consumers, and responses to DTCA is an important research topic (Pinto et al., 1998). The majority of the literature on DTCA has focused on consumer attitudes, propensity to seek information, and comprehension of DTCA among older adults (Maddox, 1999; Menon et al., 2004). Overall, the literature suggests that consumers have an awareness of and carry a positive attitude toward DTCA (Perri and Nelson, 1987; Everett, 1991; Williams and Hensel, 1995); thus far, however, the vast majority of research efforts focused primarily on consumers age 35 and older. Studies have focused on older consumers because it is assumed they are the primary users of prescription drug medications (Williams and Hensel, 1995; NCL, 2003). However, the National Consumers League (2003) conducted a study regarding the effectiveness and attitude toward DTCA of prescription drugs, and in general, their findings reveal that attitudes toward DTCA were positive across a broad range of age groups. Variances in findings across these studies were found among different age groups with regard to interest level and DTCA. Overall, the NCL (2003) study did not investigate specifics regarding younger consumers and DTCA. Thus, it is suggested that factors such as interest level varies based on the age of the consumer. The phenomenon of younger people paying attention to DTCA may seem somewhat perplexing. Burak and Damico (1999) found 35.9 percent of 18-24 year olds were familiar with the prescription allergy medication Allegra. Although intuitive, older consumers typically need more medication and are therefore more likely to be interested in DTCA; however, many prescription drugs such as allergy medications are targeted to a broad age group. Coupled with the aging of the population, a trend involving the growing numbers of caregivers, typically younger consumers, has been a topic of discussion. Caregiving refers to individuals who undertake everything from the primary caregiving role itself to support for older relatives (Dellmann-Jenkins et al., 2000). The activities surrounding caregivers involve assistance with searching for information to help with illnesses which includes reviewing DTCA. A study by Prevention Magazine (2004) found that caregivers are more likely than other consumers to pay attention and respond to DTCA. Of the population of caregivers sampled in this study, 29 percent were in the 18-34 age group, which was the largest proportion in relation to the other age categories (Slaughter, 2004). The categories identified for caregivers (specifically, whom they are responsible for) include everything from children to grandparents. Another study found that of the individuals under the age of 40, one-quarter to one-third of this population is identified as caregivers of someone in their family (Dellmann-Jenkins et al., 2000). Additionally, the same study found that younger consumers (one in four) obtain

The brand is your customer’s belief in what you stand for as a company. The brand is what allows you to charge a little more or merit a larger market share than the companies selling no-name products. That “little bit more” translates into future incremental cash flow. The present value of this stream of future-incremental-cash-flow is brand equity. Building brand equity is the only way I know to create long-term value for shareholders (Rutledge, 1998, p. 154).

The result of building or increasing product brand value translates into increased sales and increased value for the company. For example, after Merck invested approximately $145 million into the advertisement of Vioxx, a product for arthritis and joint pain, sales increased more than 300 percent to over $1.5 billion (Bittar, 2001). Interbrand’s 2004 report, a well-respected private brand consulting firm in the UK, identified Coca-Cola as the world’s most valuable brand, possessing a brand value of $67.4 billion (BBC News, 2004); this figure represents about 68 percent of the total market value of the firm, supporting the idea that brand names add value to firms. Kirmani (1990) suggests that consumers use their impressions of advertising costs as an indication of brand quality. While the effects of DTCA have been investigated, unanswered questions remain, such as; Who is responding to DTCA? What is motivating the consumer to request a specific drug? And finally, what are consumer attitudes toward DTCA? Questions such as these are important given the enormous costs that firms, specifically pharmaceutical firms, invest in bringing products to market and the subsequent costs of promotional activities. While various efforts have been made to understand the effects of direct-to-consumer prescription drug advertising in terms of consumers’ interest, attitudes, and propensity to seek additional information (Hoek et al., 2004), the majority of the research has focused on older consumers or current users of prescription drugs. This study adds to the extant literature by empirically determining what effects, if any, DTCA has on younger adults as consumers and caregivers in terms of interest and attitudes as well as propensity to seek additional information. Specifically, we seek to extend past research by examining this demographic relationship to determine whether pharmaceutical companies are taking advantage of building brand value through DTCA.

Background Direct-to-consumer advertising research Drug companies recognize the value of DTCA, allocating a total of $2.5 billion to media campaigns during the year 2000 including television, print, radio, billboards, and other forms 380




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information from DTCA for someone else to whom they are giving care. The overarching theme is that younger consumers are becoming increasingly more aware and knowledgeable about DTCA. It seems younger consumers (as responsible caregivers) want to provide information to assist in making an informed decision. Given that prescription drug manufacturers are spending in excess of one billion dollars per year in marketing their products directly to consumers, it appears logical to assume that a variety of individuals (both target audience members and caregivers) are going to be exposed to, recall more, and have a higher level of interest in prescription drug advertising. Advertising of pharmaceutical drugs is influential in encouraging consumers to seek additional information for these products (Williams and Hensel, 1995; Hoek et al., 2004). As awareness and interest expands for DTCA, the consumer base is also expanding from users of prescription drugs to those caring for someone with health conditions requiring a prescription drug. Thus, higher recall and interest in DTCA and an increased motivation by consumers to obtain more information may cause pharmaceutical companies to re-think the concept of building brand value.

purchase request or some other positive behavioral response (Cobb-Walgren et al., 1995; Miller and Berry, 1998). The awareness and attitudes toward DTCA among older adults are particularly important to pharmaceutical companies because older adults tend to be heavy users of advertised drugs (Perri and Nelson, 1987; Williams and Hensel, 1995). However, younger consumers may be equally important to pharmaceutical companies because they often become caregivers of older adults and as this segment ages, they may also become users of pharmaceutical drugs. Furthermore, pharmaceutical companies should look at younger consumers as caregivers and future consumers for their brand as firms may be able to move those they care for along the path to purchase by encouraging younger consumers to seek additional information for others or themselves (Williams and Hensel, 1995). The path to purchase was first proposed by Lavidge and Steiner (1961) as a seven-step process, labeled the “Hierarchy of effects model” and suggested that the buying process is not a single event, but rather composed of a series of steps that a consumer goes through that ultimately leads to a purchase.

Brand value and direct-to-consumer advertising Marketing experts generally agree that there is a strong link between advertising and building value for a brand (CobbWalgren et al., 1995). Miller and Berry (1998, p. 82) note, “established brands are stronger and more robust than many suspected.” Brand value goes beyond brand awareness to include favorable attitudes toward the brand (Moore et al., 2002). Building brand equity is related to the degree of brand recognition, the strength of consumers’ mental and emotional associations, as well as perceived brand quality (Aaker, 1996). When brands are positioned correctly, consumers feel strong ties toward them (Cobb-Walgren et al., 1995). Pharmaceutical advertisers have a unique opportunity to position their brands through promoting desirable and positive benefits of their products. By expanding the target audience, firms can help develop strong consumer beliefs about product benefits and brand value through pharmaceutical drug advertising and integrate the branding strategy throughout the organization (Dunn and Davis, 2003); this approach may be critical to achieving overall success with the brand. Although pharmaceutical companies are utilizing a combination of promotional activities to add value to their brands, the majority of their brand value is being built through advertising (Kirmani, 1990; Cobb-Walgren et al., 1995; Miller and Berry, 1998; Herremans et al., 2000; Coulter et al., 2001). Because consumers cannot purchase certain medications without a prescription, pharmaceutical companies who utilize DTCA are trying to encourage some other behavioral response such as seeking additional information (Williams and Hensel, 1995). Eliciting positive attitudes and increased interest in DTCA is an important goal for pharmaceutical companies in order to move consumers closer to actual purchase by encouraging them to seek additional information about their product(s). The attempt to position a brand name in the consumer’s evoked set allows companies to build familiarity with the brand (Cobb-Walgren et al., 1995); establishing familiarity with the brand name and conveying favorable images for the brand can be translated into acceptance and preference for the brand (Bogart and Lehman, 1973). In turn, this awareness should result in

Hierarchy of effects model The framework proposed by Lavidge and Steiner (1961), as well as the numerous variants proposed over the last 40 years, can be traced back to Lewis (1898), and the AIDA model consisting of four separate attributes: (1) attention; (2) interest; (3) desire; and (4) action. In this model, researchers noted that advertising can be an important factor in creating awareness for a product or service (Moore et al., 2002; Parker and Pettijohn, 2003). This is particularly important for pharmaceutical companies because consumers have limited outlets in which to gather information about various healthcare options (Roth, 2003). The framework is a suitable model to help gain an understanding of the effects of DTCA (Vakratsas and Ambler, 1999; Menon et al., 2004), and for this study, the impact on different segments of the market. Therefore, it could be suggested that without awareness, other marketing objectives are not likely to be achieved (Roth, 2003). Lavidge and Steiner (1961) suggest that different advertisements or campaigns can be focused at different steps in the seven-step buyer process. For example, the authors posit that firms, when bringing a new product to market, should focus their advertising primarily during the first steps of the process. The primary goal of the advertiser in this scenario should be to make potential customers aware of the new product and inform them of the product’s benefits and features. However, because consumers are not the final authority in regards to the purchase of prescription drugs, it is difficult to assess the actual path to purchase (Menon et al., 2004). Therefore, this study will not examine the final conditions and determinants that lead consumers to purchase a pharmaceutical drug. Rather, this study will investigate whether consumers, specifically young consumers, pay attention to DTCA by reviewing their attitudes, interest, and recall of pharmaceutical advertising. 381




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Research hypotheses While age may impact the degree to which consumers have favorable attitudes and interest in DTCA, two other variables are suggested to impact attitudes and interest, including health status and prescription drug use as well as an additional variable, concern for family member’s condition, is expected to impact interest in DTCA (see Figure 1). To accomplish the stated objectives of this study, several research hypotheses are proposed. First, research has shown that older consumers are more likely to be users of prescription drugs and are more likely to have favorable attitudes toward DTCA (Williams and Hensel, 1995; Menon et al., 2004). Research has indicated that overall consumers feel DTCA is a useful source of information (Perri and Nelson, 1987; Everett, 1991; Williams and Hensel, 1995; Roth, 2003). What is currently unknown is the attitudes of younger consumers toward DTCA. It is unclear whether consumers who do not currently suffer from any acute medical conditions will or will not pay particular attention to DTCA. Younger consumers are less likely to have these sorts of chronic medical conditions. Thus, it can be expected that younger consumers’ attitudes may vary from older consumers’ attitudes toward DTCA. Since consumers thus far have been found to hold favorable attitudes toward DTCA, it is expected: H1. Older consumers will have more positive attitudes toward DTCA than younger consumers.

Previous studies have hypothesized expected relationships between health status and attitudes toward DTCA (Williams and Hensel, 1995), as well as health status and interest in DTCA among older consumers (NCL, 2003). These findings suggest that there is a propensity for those in poor health to have more favorable attitudes toward, and be more interested in, DTCA. Based on these results, there is no reason to expect that younger consumers would not respond similarly. Thus the following hypotheses are proposed: H3. Health status will directly affect the interest in and attitudes toward DTCA among younger consumers. H3a. Younger consumers in average or poor health will be more likely than younger consumers in good health to have an interest in DTCA. H3b. Younger consumers in average or poor health will be more likely than younger consumers in good health to have favorable attitudes toward DTCA. There has been little empirical research on the relationship between ad recall and interest in DTCA. In a study conducted by the NCL (2003), a positive relationship was indicated between ad recall and interest in DTCA among older consumers (i.e. over 35 years of age). Based on their findings and the belief that younger consumers are similar to older consumers regarding their interest in DTCA, the following hypothesis is proposed: H4. There is a positive relationship between interest in DTCA and recall among younger consumers.

Because of the multitude of media outlets chosen for DTCA, it is difficult to ascertain whether older consumers would have more interest in DTCA than younger consumers. Younger consumers have been found to display interest in DTCA (NCL, 2003). Pollay and Mittal (1993) and Shavitt et al. (1998) suggest that consumers use advertising for information about brands and product availability, and further posit that younger consumers think of advertising as an informational source for products in general more than older audiences do. Generation Y consumers have been found to be just as likely as Generation X, Baby Boomers, and Matures to recall pharmaceutical advertisements (Slaughter, 2004). Therefore, it can be expected that younger consumers would be just as likely as older consumers to have an interest in DTCA, which leads to the following hypothesis: H2. Younger consumers are as likely as older consumers to express interest in DTCA.

It is also reasonable to assume that those younger consumers currently taking prescription drugs would have positive attitudes toward and interest in DTCA. Although Williams and Hensel (1995) did not find a significant relationship between older consumers’ current drug use and their attitudes toward DTCA, the NCL (2003) study found a positive relationship between prescription drug use among older consumers with regard to attitude and interest in DTCA. As previously noted, there is an expectation that younger consumers and older consumers respond similarly to DTCA, thus the following hypotheses are proposed: H5a. There is a positive relationship between prescription drug use and attitude toward DTCA among younger consumers. H5b. There is a positive relationship between prescription drug use and interest in DTCA among younger consumers. Because DTCA has been identified as an important source of information overall for consumers (Perri and Nelson, 1987; Everett, 1991; Williams and Hensel, 1995; Roth, 2003), it is expected that a positive relationship exists between attitudes toward DTCA and an inclination to seek additional information among younger consumers. Additionally, Williams and Hensel (1995) found that those consumers with more favorable attitudes toward DTCA were more inclined to seek additional information from a pharmacist and/or a friend. This leads to the following hypothesis: H6. There is a positive relationship between attitudes toward DTCA and inclination to seek additional information among younger consumers.

Figure 1

Similarly, because pharmaceutical companies are trying to move consumers closer to an actual purchase by encouraging them to seek additional information, the AIDA model suggests that favorable attitudes and increased interest in 382




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The choices in the current study included: . good health; . average health; and . poor health.

DTCA are related to consumers’ inclination to seek additional information (Parker and Pettijohn, 2003). Perri and Nelson (1987) point out that a majority of consumers would likely ask their doctor about a product that they had seen advertised, and consumers with an interest in advertising will use this information to help guide their decision making (Shavitt et al., 1998; Handlin et al., 2003). As noted earlier, the NCL (2003) found that younger consumers display an interest in DTCA. Therefore, the following hypothesis is proposed: H7. There is a positive relationship between interest in DTCA and inclination to seek additional information among younger consumers.

The original NCL (2003) instrument may have been biased toward older consumers as the choices appeared skewed toward a negative assessment rather than a positive assessment of current health status. The modified version for this study reflected a more realistic assessment of health assessment by a younger population. Prescription drug use, ad recall, and interest were measured with questions taken from the survey obtained through the NCL (2003). Respondents were asked to report their use of prescription medication for pain over the previous year. Specifically, the question asked, “In the past year, have you used a prescription medicine for pain?” Choices included: Yes, currently use; Yes, have used in the past year; and, No, have not used in the past year. The questions for ad recall and interest were, respectively, “In the past 12 months, have you seen or heard any advertising for medications that you can only get with a prescription?” and “Were any of these prescription drug advertisements for a condition that was of particular interest to you?” Respondents were simply asked to respond to each question: Yes; or No. Additionally, to measure degree of information search, respondents were asked: “Thinking about a prescription drug advertisement you saw or heard that interested you, what did you do after seeing or hearing that advertisement? Did you seek more information?” Respondents simply answered: Yes; or No. Attitudes toward DTCA of prescription medications was measured using ten items developed by the NCL (2003) in order to assess the multiple facets of attitude toward DTCA. Overall, the scale contained both positive and negative statements regarding DTC pharmaceutical advertising. The scale consisted of ten, five-point Likert-type statements anchored by strongly disagree and strongly agree. Only one item, the second question, was modified for better understanding, with “provide information” replacing “destigmatize.” It was deemed that the rest of the questions appeared clear and straightforward so additional modifications were not necessary. All items for this scale are shown below: (1) Advertisements describe the side effects and/or risks of medications so that you understand them. (2) Advertisements provide information about the conditions that may have gone untreated due to patient embarrassment. (3) Advertisements help you when you want to talk to your doctor about a condition that you think you might have. (4) Advertisements encourage people to ask for drugs they do not need or cannot take. (5) Advertisements just help pharmaceutical companies sell their drugs. (6) Advertisements are largely responsible for the increased cost of prescription drugs. (7) Advertisements for medicines should only be in medical magazines for doctors. (8) Advertisements remind people to take their medicines or refill their prescriptions. (9) Advertisements are confusing. (10) Advertisements make you feel good about the medicines you are already taking.

Finally, it is expected that younger consumers may express more interest in DTCA when a family member has an unresolved health condition. Little research has addressed the relationship between younger consumers’ caregiving activities in terms of interest in DTCA. These caregiving activities may be heightened when younger consumers become concerned about a family member who suffers from a condition illustrated in a DTCA. Younger consumers have been found to exhibit a more active caregiving role with the emergence of a trend among young adult children and grandchildren serving as caregivers to elderly relatives (Dellmann-Jenkins et al., 2000). Thus, the following hypothesis is proposed: H8. There is a positive relationship between concern for a family member and interest in DTCA among younger consumers.

Methodology Research instrument and subjects The questionnaire was obtained from the National Consumers League (NCL, 2003) and only the items that were most central to this study were utilized and/or modified to measure the following key variables: age; current health status; prescription drug use; attitudes toward DTCA; interest in DTCA; DTCA recall; and inclination to seek additional information. Questionnaires were administered to 225 undergraduate students enrolled in a major university in the southwest USA. The mean as well as the median age for the undergraduate population is 25. Students were given the questionnaires during their classes but were not forewarned of the study in order to ensure there were no biases toward the topic. Responses from 20 participants were deemed unusable, resulting in a total of 205 usable questionnaires. Measurement Participants were asked to provide information on their current health status through a slightly modified version of an item developed for the NCL (2003) study. The item consisted of six categories and was modified from “Would you consider yourself . . . ” to the following question: “Overall, how would you rate your current heath?” Choices in the NCL (2003) study included: . generally healthy; . in good health, but have some chronic conditions; . not in very good health; . in poor health; and . do not know.

Items 4, 5, 6, 7 and 9 are reverse coded. 383




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The NCL (2003) study did not report reliability for the attitude scale. Therefore, the ten-item attitude scale was subjected to an exploratory R-type factor analysis to test convergent validity. The data is appropriate for factor analysis with an overall measure of sampling adequacy (MSA) of 0.841 (Hair et al., 1998). Factors were extracted using principal components estimation with a varimax rotation, which revealed three factors. Factor loadings ranged from 0.463 to 0.844. According to Hair et al. (1998), factor loadings of 0.40 or greater are considered important. The percentage of variance explained by the three-factor solution was 53.1 percent. Factor one included items 4, 5, 6, 7, and 9, which are negative statements related to attitudes toward DTCA in general and exhibited factor loadings of 0.463, 0.605, 0.722, 0.749, and 0.564 respectively. Factor two included items 1, 2, and 3, which include positive statements related to attitudes toward information regarding DTCA and exhibited factor loadings of 0.844, 0.822, and 0.516 respectively. Factor three included items 8 and 10, which include positive statements, related to attitudes toward DTCA prescription medicines specifically and produced factor loadings of 0.735 and 0.771 respectively. Reliability levels were assessed among the three factors, with a ¼ 0:62 for factor one, a ¼ 0:66 for factor two, and a ¼ 0:64 for factor three. A commonly used threshold for acceptable reliability is a coefficient alpha of 0.70, although this is not an absolute standard and may decrease to 0.60 in exploratory research (Hair et al., 1998). All items were retained for further analysis. The scale as a whole showed an adequate level of reliability, a ¼ 0:68. In summary, the tenitem, three dimensional attitude scale developed by NCL (2003) showed sufficient internal consistency across all dimensions and proved to be reliable measure of attitudes toward DTCA for the present study. For the attitude scale, the dependent measure was calculated by averaging overall across the scale to assess each variable. The final part of the instrument contained demographic measures of age, education, and income. Based on the median age of 25 years, the sample was split into two categories based on their responses. The first category represented younger consumers (25 years or younger) while the second category represented older consumers (26 years or older).

effects, follow-up univariate ANOVAs and Tukey-HSD paired comparisons were performed on each interest and attitude measure (Hair et al., 1998). Health status was significantly related to attitude and interest (H3a and H3b) across the three categories of health status (p , 0:05). Therefore, H3, H3a, and H3b were all supported. MANOVA and ANOVA results are summarized in Table I. Pairwise comparisons of each dependent variable on health status is displayed in Table II. These results further revealed that the differences between the groups were as hypothesized. Those in poor health had higher interest levels (with a lower mean indicating higher interest levels). Although significant overall (p , 0:05), the mean score for good health was higher that the mean score for average health in relation to attitude toward DTCA. In terms of attitudes, it seems those in good and average health have similar views toward DTCA, with those in average health with slightly less positive attitudes than those in good health. H4 predicted a positive relationship between interest in DTCA and recall. A one-way ANOVA was utilized to test the significance of the variables. Interest in DTCA was significantly related to recall (p , 0:001). Younger consumers who indicated interest in DTCA were able to recall more pharmaceutical ads (F-value ¼ 42.274, p , 0:000). Given these results, H4 was supported. The hypothesized positive relationships were examined between attitude toward DTCA and prescription drug use (H5a); and interest in DTCA and prescription drug use (H5b) among younger consumers. ANOVAs were utilized to test both hypotheses and the relationship between attitude and prescription drug use was marginally significant, p , 0:10 (Fvalue ¼ 3.551, p , 0:061), and the relationship between interest and prescription drug use and was not supported (F-value ¼ 0.012, p , 0:912). Further, the results of these tests revealed that prescription drug use has a marginally significant positive effect on younger consumer’s attitudes. Prescription drug use does not, however, relate significantly with interest in DTCA. Therefore, H5a was partially supported and H5b was not supported. To test H6 and H7, which predict that there is a positive relationship between attitudes toward and interest in DTCA and inclination to seek additional information, univariate ANOVAs were utilized. H6 was not statistically significant, (Fvalue ¼ 0.920, p , 0:538). However, H7 was statistically significant, (F-value ¼ 7.521, p , 0:007), with interest in DTCA being a significant predictor of younger consumers propensity to seek additional information regarding pharmaceutical drugs. Therefore, H6 was not supported and H7 was supported. The hypothesized positive relationship was examined between concern for family member and interest in DTCA (H8). Univariate ANOVA was utilized to test the hypothesis and the relationship between concern for family member and interest in DTCA among younger consumers was statistically significant, p , 0:0001 (F-value ¼ 21.978, p , 0:000). As expected, younger consumers who are concerned about a family member is a significant predictor of interest in DTCA.

Results H1 predicts that there is a positive relationship between age and attitudes toward DTCA and was supported (p , 0:05) as the ANOVA shows, attitude toward DTCA was significantly related to age (F-value ¼ 5.520, p , 0:020). Mean differences were examined to test if the relationship was in the expected direction. As expected, younger consumers (25 or less) hold less positive attitudes toward pharmaceutical advertising with a mean score of 3.0236 than older consumers, with a mean score of 3.1688. H2 examined the relationship between younger consumers and interest in DTCA. A correlation revealed no significant relationship (r ¼ 20:024, p ¼ 0:733) between younger consumers and interest in DTCA. Based on these results H2 was not supported. H3 was tested in a one-way MANOVA with health status used as the independent variable. The analysis shows that the set of dependent variables (interest and attitudes) was significantly related to health status (Wilk’s l4;392 ¼ 0:918, p , 0:05). Given the positive MANOVA findings for the main

Discussion This study examines the relationship between DTCA and young consumers’ attitudes, interest and inclination to seek out additional information regarding pharmaceutical drugs. Overall, the results of this study confirm and extend previous 384




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Table I Health status and attitudes toward DTCA Independent variable

Dependent variable

Health status

Interest Attitudes

Wilk’s Lambda

MANOVA Results F df

0.918

4.306

(4, 392)

P

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