The biggest shifts in health ad spend in 2020, on both sides of the Atlantic

We explore shifts in pharmaceutical and health ad spending

2020 was the year that upturned public health and advertising, so it is no surprise that health marketing went through a period of flux too. As part of our Health theme, The Drum explored the biggest ad spend shifts in the sector with exclusive research from Nielsen and Kantar.

Over the year, we’ve detailed how footfall and traffic to select mediums migrated. Cinemas were hardest hit, but out-of-home was rear-ended in the most locked-down markets too (although roadside estates stayed strong).

We’ve seen ad spend raced into digital where it could to find the eyeballs on screens and personal devices. Insider Intelligence figured that digital advertising in the healthcare and pharma industry was to grow by 14.2% to reach $9.53bn in 2020. The sector was behind only consumer electronics for growth.

But the move wasn’t without its difficulties. In health and pharma, restrictions exist on what can be advertised. Google, for example, only allows pharmaceutical manufacturers to advertise in Canada, New Zealand and the United States. Over-the-counter medicines enjoy more markets, but vendors must be certified by the tech giant. Unapproved substances, opioids and experimental treatments are banned too. We've gone into Google's tackling of fraud and hate in ads here.

And that’s not mentioning Covid – the term heavily blocklisted from content at the start of the pandemic and enjoying similarly tight restrictions in advertising. Facebook’s policy is: “Ads must not contain content that exploits crises or controversial political or social issues for commercial purposes.” That severely limited opportunities. Hand sanitizer, disinfected wipes and non-medical masks were allowed, but it had to remain vigilant to the sale of medical masks, miracle cures and Covid test kits.

With these caveats in place, marketers had to operate online. Intelligence Insider's US Healthcare and Pharma Digital Ad Spending 2020 report outlined that the pandemic “restricted in-person touchpoints“ across B2B and business-to-consumer (B2C) – traditional advertising slumped as a result. Search and display were the biggest winning formats from this shift.

Offering some visibility of this in the UK, Nielsen shared its Ad Intel report for 2020. It found that health and wellbeing ad spend across cinema, outdoor, press, radio and TV hit £230m, down 20% compared with 2019.

In the UK, vitamins and tonics were the biggest ad spend category with £19m measured across these media. The creative touted the strengths of strong immune systems without over-explaining the wider context of the pandemic. Next, ’other pharma’ followed at £18.46m.

Following was health, beauty clinics and clubs (£18m), indigestion remedies (£15.7m), germicides and antiseptics (£14.2m), cold remedies (£12.8m), hearing aids (£11m), analgesics (£11.2m), prescription frames and lenses (£11.2m) and slimming aids/foods (£9.4m). One notable trend, Nielsen bridges health and tech – the two fastest-growing categories. Smartwatch ad spend increased by 33% year-on-year to £7.3m. Apple comprised half that spend, and Samsung roughly a fifth.

Meanwhile, from the US, Kantar Media offered some oversight on ad spend. Jayne Krahn, vice-president of product and research, says: “Historically, new drug launches have been the biggest drivers of pharma spending. One other change is that pharmaceutical companies have begun to invest more for drugs related to conditions like cancer, which in the past had not received significant advertising support.“

With pharmaceutical companies keen to show more of the important work they do to a more health-conscious public, they’ve still had to tip-toe around the difficulties in operating in digital.

Krahn says: “Pharma brands have typically been slow to advertise in digital due to concerns about the perceived impact on patient privacy as well as limits on the ability to target digital advertising for conditions like cancer. Many of these brands are also more focused on patient education, so are investing digital budgets in creating condition-specific websites or sponsoring content on health sites.“

But pointing to Kantar’s data, one of the major trends is an almost quadrupling of digital ad spend from December 2020 to January 2021 in the ’fitness, diet, spa’ category. It jumped from $9,462m to $36,372m. The year previous the jump was less pronounced, from $21,471m to $28,812m. It was one of the few categories to grow after the big festive advertising crescendo that happens every year. This is what the widespread closure of gyms does to ad spend, it appears. Many apps and DTC fitness brands have capitalized.

Krahn says: “Many advertisers cut back significantly over the course of 2020. With the nation poised to open up further in 2021, companies seemed to have increased spend during the traditional January push in order to coax back as many consumers as possible.“

As the restrictions loosen up, Krahn sees the spend from over-the-counter remedies and fitness brands set to continue, with the public likely all the more aware of the importance of each category.

Check out The Drum’s special Health hub, which examines how the key players – from health agencies to pharma firms to brands – are doing their part to return the world to normality.