How advertising made America’s healthcare mess worse

Let me be clear. I am not placing blame for all the healthcare problems in the United States at the doorstep of the advertising industry. There is plenty of blame to go round–insurance companies, pharmaceutical companies, hospitals, physicians, lawyers, patients and legislators all deserve a measure of scorn. That being said, there is no doubt that the practitioners of the dark art of marketing have contributed their fair share, and perhaps a bit more, to the crisis. I don’t wish to write a book on this subject, so allow me to shine a light on three particularly shameful points:

1. As a percentage of revenue, drug companies spend more on marketing than they do on R&D. That’s right. They spend more money on selling drugs they have already developed than they do trying to create new drugs that could treat or cure cancer, AIDS, arthritis, drug-resistant tuberculosis, etc. In fact, marketing their products has such a high ROI that they’re willing to spend billions of dollars paying criminal fines and penalties for marketing their drugs illegally. Yves Smith, in “Drug Marketing Continues to be Criminal” on the Naked Capitalism blog, details the fines by major pharmaceutical companies for repeatedly marketing their products to treat conditions for which they were not approved by the FDA: ”Since May 2004, Pfizer, Eli Lilly & Co., Bristol-Myers Squibb Co. and four other drug companies have paid a total of $7 billion in fines and penalties. Six of the companies admitted in court that they marketed medicines for unapproved uses….” Fines of this size would destroy most companies. Drug companies just pass along the cost to consumers and shrug.

2. Television advertising for prescription drugs is indefensible. “Ask your doctor about Cialis.” Or Lipitor. Or Flomax. Or anything else. Who could possibly think this is a good idea, other than pharmaceutical companies and the healthcare advertising agencies who are lining their pockets by creating and running the ads? Essentially, we are encouraging janitors, secretaries, farmers and fry cooks to suggest prescription medicines for their own treatment. Last time I checked, one had to go to school for rather a long time to be qualified to do this. And so great is the pressure this advertising brings to bear on physicians, far too often they give patients what they ask for rather than what they need.

Please bring me in argument in favor of television advertising of prescription drugs. I’m begging you. Anyone who does will be flayed with ease and joy. I realize this is the bedrock of the gigantic healthcare advertising industry–one of the only areas that continues to generate enormous profits during tough economic times. It’s still wrong.

3. The practice of medicine in this country has been perverted by applying totally inappropriate marketing metrics to the healthcare industry. Today hospitals and doctors fret about “patient satisfaction.” What’s wrong with that? Plenty. We shouldn’t be measuring whether patients are satisfied. We should be measuring whether they’re healthy as a result of the treatment they receive. But aren’t these things related, you ask? Not necessarily. One reason healthcare costs are out of control in this country is that patients insist their doctors “do something” even when it won’t do any good. Doctors send patients with headaches CAT scans they don’t need, write them prescriptions for antibiotics they don’t need, and give them drugs they saw advertised on TV because they’ll be angry if they don’t. It all costs money, and we all pay.

What’s coming with health care “reform”–the quotation marks seem appropriate given what is in the 2,000-page bill currently in the Senate–that no one wants to talk about is doctors beginning to say no when their patients ask for treatments, drugs or diagnostics they don’t need. If we want to reduce costs, it is unavoidable. Universal healthcare will mean less healthcare. That’s not necessarily a bad thing, even though it will not result in higher patient satisfaction.

 

Why Every Cheeseburger Ad Is Also An Ad for Twinkies

A new study published  in Health Psychology by Jennifer Harris, John Bargh and Kelly Brownell of Yale says in so many words that whether we realize it or not every food ad we see on television (or in any other medium) is actually an ad for whatever food we have in the pantry at the moment:

“Children consumed 45% more when exposed to food advertising. Adults consumed more of both healthy and unhealthy snack foods following exposure to snack food advertising compared to the other conditions. In both experiments, food advertising increased consumption of products not in the presented advertisements, and these effects were not related to reported hunger or other conscious influences.”

What’s interesting about this is that the basic idea of food appears to be stronger than any specific suggestion made by advertising. The authors conclude:

“These experiments demonstrate the power of food advertising to prime automatic eating behaviors and thus influence far more than brand preference alone.”

In other words, much as we want our ads to be rifles, they are shotguns. Let those who claim otherwise be condemned to eat nothing but Milk Duds for all eternity.

Why Ad People Burn Out

A whip-smart  white paper by Dsyke Suematsu called “Economic Treadmill: Why We Are Destined to Burn Out” should be required reading for all ad agency leaders regardless of discipline. He argues that using one’s mind for highly skilled or creative jobs (as opposed to doing tedious assembly-line-style work) has no bearing on the likelihood that a worker will burn out. What matters is the connection (or lack thereof) between the worker’s job and and the things he actually cares about:

What is deceptive, especially in the West, is our assumption that repetitive and mindless jobs are dehumanizing. On the other hand, the jobs that require us to use the abilities that are uniquely human, we assume to be humanizing. This is not necessarily true. The determining factor is not so much the nature of our jobs, but for whom they serve. “Burnout” is a result of consuming yourself for something other than yourself. You could be burnt out for an abstract concept, ideal, or even nothing (predicament). You end up burning yourself as fuel for something or someone else. This is what feels dehumanizing. In repetitive physical jobs, you could burn out your body for something other than yourself. In creative jobs, you could burn out your soul. Either way, it would be dehumanizing. Completely mindless jobs and incessantly mindful jobs could both be harmful to us. 

Good managers are able to align the goals of an organization with the goals of the individuals who comprise it. It is an increasingly rare skill. When the de facto goal of an advertising agency–or any other organization for that matter–becomes nothing more than to make the quarterly numbers (or to do whatever it takes to make the client happy), the tether to the hearts of its employees is cut. This is why caring about doing great work is important. This is why your employees need to be proud of whatever is on the computer screen in front of them at all times. We have all seen how much advertising people despise staying one minute past 5:00 to do mediocre work. On the other hand, when they are doing something they are genuinely proud of, you cannot force them to go home.

That being said, pride in one’s work may not be enough. Dyske writes persuasively on how increases in productivity that have come thanks to technology (so often a jackal in sheep’s clothing) actually have increased the likelihood of burnout for those in creative positions:

…take graphic designers. Now with computers handling everything from typesetting, layout, image processing, color management to printing, what used to be done by several specialists are now combined into one person. The number of jobs one can handle in a year increased dramatically. Now designers spend more time being creative, and less time creating the final products. This may sound good, but in terms of stress and rewards, it is not. Because creativity is irrational and unpredictable, coming up with a creative solution can be highly stressful. Designers now have to come up with significantly more creative solutions per year for the same amount of money.

Perhaps worst of all, burnt-out people don’t quit. They keep coming to work. They just stop caring. Human beings have an almost limitless ability to put up with things that make them unhappy. Don’t make them. Every manager’s job is to give his people something to look forward to when their alarm goes off in the morning and they put their feet on the floor. Make your agency stand for something they care about.

Want your ad agency’s employees to be smarter? Stop sending them to industry conferences.

Stephen Strong–Global Director of Interactive at Alberto Culver, connoisseur of fine beers, noted bon vivant, poster boy for all that is good and right in America and a reasonably good amigo of mine–has a post on his Platforms Optional blog called “The Ad:Tech Analysis That The Man Doesn’t Want You To Read!” Rather than quoting anything from it, I think I can best sum it up by sharing a Tweet that Stephen sent me from the floor of Ad:Tech in Chicago: 

“This thing [i.e., Ad:Tech] could use a couple bloody lips.”

Let’s be frank about advertising industry conferences. At best they are delightful boondoggles (I’m looking at you, Cannes). At worst, they’re a waste of time. I grant that there is a possibility, albeit remote, that someone somewhere has learned something of value from a speech at Ad:Tech (I say this as a former speaker at the conference). Let us be generous. Maybe even a handful of people have. But in these tough economic times, agencies should be demanding a higher intellectual ROI than conferences deliver. Add up the registration fees, airfares, hotels and meals and you can get into some fairly serious money pretty quickly. This would be OK if not for the fact that most presenters are conferences are ill-prepared, ill-informed, insipid and/or uninteresting. I should note that this is not always their fault. Conference organizers have a bizarre habit of assigning topics to presenters, regardless of whether the topic matches their area of expertise. By way of example, last year at Cannes I was put on a panel about socially responsible advertising–something I  was capable of expounding on after putting in a little study, but definitely not in my wheelhouse. (By the way, there is a special place in hell for the organizer of panel discussions–perhaps the greatest time-waste conceived since the weekly status meeting.)  

I am proposing a radical alternative that I guarantee will build infinitely more intellectual capital for every agency that adopts it, while costing a tiny fraction of what they are now spending to send people to conferences all over North America and the world. And it’s stunningly simple. Build a reading room at your agency–comfy leather chairs, good lighting, no computers or iPhones allowed, lots of signs that say “no talking.” Once you’ve done this, require every single employee to spend at least eight hours per year in it reading books assigned by his or her supervisor. The reading room must be treated as inviolable. Neither client calls nor nastygrams from accounting about incomplete time sheets may be allowed to breach its threshold. Do this and the people who emerge from the room will in every single case be more valuable than the ones who went in.

Funny thing–the people who actually have something worthwhile to say eventually get around to writing it down. The mere act of writing something down almost invariably means it is more thought-out, better argued, and more complete than the alternative we get in spoken form. Proclaiming this is heresy, of course, in the age of the image and presentation. Yet I am not about to argue that image and presentation are unimportant. What I will argue, however, is that the people who have spent time reading, absorbing and learning the wisdom contained in the great books written about advertising over a period of hours (rather than being exposed to lesser thoughts for a matter of minutes) will in every case be better prepared to leverage what they know in their work and share what they know in their own presentations. 

So if your objective is merely to reward your people, keep sending them to conferences in Vegas, Austin or Dubai. But if your objective is to make them better and more valuable, tell them to sit down, shut up and read.

The science is clear: “People in brainstorming sessions produce fewer and lower quality ideas than those working alone.”

A recent post on Psyblog reports on research that confirms what I have long suspected. Group brainstorming sessions don’t work. Oh, they give the participants a nice, warm feeling. Being part of a consensus does that for you. But there’s a problem with consensus, and Margaret Thatcher summed it up thusly: “To me, consensus seems to be the process of abandoning all beliefs, principles, values and policies. So it is something in which no one believes and to which no one objects.”

I do think it’s possible for a couple of people to “think together” productively. But a roomful? Almost never. Thinking is an individual sport, not a team sport. Committees don’t get ideas; they make compromises. If you’ve got an advertising concept that everyone created together and everyone agrees with, you should be deeply suspicious of its quality.

Now if you absolutely must have a group brainstorming session–and some of you will insist on it–Psyblog does offer a few suggestions that may help make it slightly more useful. Of course, most of them involve going off and thinking by yourself either before or during the session itself.

You can have a good idea or you can have everyone feel good about a lesser idea. Which is more valuable to your organization and your client? For most advertising professionals, the answer isn’t as obvious as it would seem.

“Persistent ad formats” persist with a wrongheaded approach to online advertising effectiveness

Today in Adweek Brian Morrissey writes about the latest attempt to infuse online display advertising with value. Video Egg and Meebo have come up with something called “persistent ad formats,” which means they now have ads that consumers can’t scroll away from. The ad units stay on the screen in front of them no matter what. Here’s the problem: It’s 2009 and advertisers are still trying to shoulder their way in front of unwilling consumers.

Perhaps Video Egg and Meebo’s numbers are true, and the “persistent ad formats” are performing well. It doesn’t matter; it won’t last. Consumers will adapt and become just as good at ignoring these new formats as they are at ignoring standard banner ads.

We are in a world where consumers increasingly can choose the marketing they see. Forcing them to look at ad units they don’t want to see merely provokes them. The answer isn’t to come up with new, clever ways to ensure consumers cannot avoid your ad; it’s to come up with ads that exert magnetic force on the marketplace. Brands must draw customers to their communications by delivering some form of compelling value. It could be a smile, a piece of information, an application that will make their life just a little better or something else entirely. In 2009, barging onto their screens as an uninvited guest is simply bad manners.

If you want the math done right, ask a creative director: Traditional media is overpriced by 58%

According to Kathy Durham, VP of Marketing at HP, 40% of the media people consume today is online, yet advertisers spend only 5% of their money in the online space. Allow me to do a little math for you. This means 95% of media budgets are directed at 60% of media consumption. This means that advertisers are overpaying for traditional media by 58%. On the other side of that coin, it means they are underpaying for interactive media by 87%. 

Now, the mossbacks will immediately come that advertisers know what they’re going to get for their investments in traditional media, whereas they’re unsure what they’ll get for their investments in the interactive space. Set aside for the moment that we know with some certainty that 21st-century consumers are more likely to believe a recommendation for a product they receive from a friend or independent third party online than they are to believe pitch that comes uninvited through their TV set. Just because something is easy to measure doesn’t make it the right thing to do. Advertisers and agencies alike have been slow to take the steps that are necessary to build compelling mathematical models capable of breaking out ROI by individual media. Make no mistake, not only is this possible, some of the better brands in America already do it and do it well. The math required is complex, but very doable.

The math about how much advertisers are overpaying for traditional media, however, isn’t complex at all. A child could do it. Why do the numbers seem not to bother anyone?

Do marketers overestimate the value of the iPhone?

The Wall Street Journal reports that Apple and RIM (i.e., the Blackberry guys) “accounted for only 3% of all cellphones sold in the world last year but 35% of operating profits, according to Deutsche Bank analyst Brian Modoff. The disparity will become even starker this year when, he estimates, the two will take 5% of the market in unit terms but 58% of total operating profits.” Obviously, this is jolly good news for Apple and RIM, but is it good news for marketers?

iPhones are undoubtedly one of the coolest technology products ever, and they sold 5.2 million units in the last quarter (up a staggering 626% from the same period last year), yet they still hold a very small percentage of the mobile phone market. How many brands are rushing headlong into the development of an iPhone app even when the market share numbers may not justify it? Of course, there’s something to be said for the caché of having a brand presence on the latest gadget, but I suspect the allure of that approach is fleeting in this challenging economy (at least for the clients who are paying the bills).

Will Baby Boomers kill Facebook? Will Facebook kill them back?

Deborah Rogers, professor of English at the University of Maine, shares some provocative thoughts about Facebook in “I poke dead people: The paradox of Facebook”  on The Times (i.e., of London) Higher Education website. One of the things she wonders about is the likelihood that the arrival of droves of overweight bleached blondes in mom jeans and dorky forty-something white guys will devalue the digital real estate. When they start showing up on Facebook, the cool kids say “there goes the neighborhood,” and look for a new place to hang. Even if that doesn’t happen, Rogers is fairly confident that the curious form of interaction on social networks will make us somehow less human. She sees evidence of this in how Facebook deals with, among other things, death. Below are a  few choice quotations to whet your appetite:

Even as it facilitates our ability to connect, the collective social-networking culture changes our way of thinking about everything from friendship to death. And not in a good way. As a technological medium that fetishises individualism, Facebook invites disaster.

*     *     *     *     *

Facebook redefines what it means to connect to each other and provides a huge audience for self-absorption. Nothing is insignificant. Everyone wants to know everything about us, all the time. In the minutiae that mark the triteness of an inherently boring everyday life, we may recognise our own situation. Facebook’s fixation on individualism makes ordinary people feel important enough to warrant such attention – or inconsequential enough to need to document every aspect of their existence. The trope for this exhibitionism may be outing ourselves – and everyone we know.

*      *     *     *     *

…the medium fails to allay our sense of despair and loneliness. For example, several months ago, Paul Zolezzi, an aspiring actor and model, hanged himself on the monkey bars in a Brooklyn playground. He had posted his suicide note on Facebook, where he said that he was “born in San Francisco, became a shooting star over everywhere, and ended his life in Brooklyn … And couldn’t have asked for more.” On Facebook, even suicide notes sound flippant. In fact, apparently assuming Zolezzi was joking, a friend commented on his Facebook page: “Are you dying? Or just staying in Brooklyn?”

Is conspicuous consumption being replaced by conspicuous expression?

I’m not sure I’m buying their argument in its entirety, but Stephen Linaweaver, Brad Bate and Michael Keating have written a provocative post on GOOD, “Conspicuous, but not Consuming,” that certainly merits discussion. Their theory is that social networks are filling the hole left in our lives by our inability to buy as much stuff as we used to. The lads write:

…”conspicuous consumption’ is being replaced by “conspicuous expression” as the driver of identity. This new paradigm emphasizes the conspicuousness of ideas, interests, and opinions rather than accumulating more stuff than your neighbor. This is not insignificant. How billions choose to distinguish themselves from one another will be just as important to global sustainability as how they power their homes, what they eat, and how they commute to work, making online social networking a critical “leapfrog” technology in the developing world and a surprisingly powerful source of behavioral change in the developed world.

Are Facebook and Twitter the medicine that will cure our addiction to acquiring things? Let’s wait a bit before we draw that as a final conclusion. An enormous preponderance of the self-expression on social networks winds up like the proverbial tree that falls in the forest. Not a sound is made. Nor am I certain that 65-inch HD TVs will lose their allure because people will choose instead to forsake them and turn to the fleeting rewards of digital egotism. Nevertheless, in the short term at least, it does seem as if many are amusing themselves in a down economy by taking refuge in the social networks and doing what Ken Kesey used to refer to as “starring in their own movies.”