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.

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).

Paris Hilton, Pauly Shore, Jimmy Fallon? Solving the mystery of the persistence of fame without talent.

Looking to save a little dough on your next celebrity endorsement, or at least feel better about paying someonewho has absolutely nothing going for him to endorse your client’s product? Check out “How Celebrities Stay Famous Regardless of Talent” by Ewen Callaway on newscientist.com. Pretty interesting stuff for advertising professionals as well as for anyone who must live in a world where Michael Jackson’s funeral is considered an important global event.

The Current TV agency search (which started on Twitter) has been “delayed.”

You may recall all the dust kicked up a few weeks ago by the Current TV agency search. In order to advance to round two, agencies had to make their submissions on Twitter. Many responded–some cleverly, most less so. A bird on the inside of the process tells me there are deep political and strategic divides on which direction the network should be headed. There have been significant staffing changes at Current TV as well. To protect the innocent, I shall not go into further detail here. 

As a result of all this, the network’s agency search has been delayed (you may wish to read that as “canceled”). 

While I would like to think the network has delayed the review to get all hands on deck and put them to work trying to free its two reporters who are now languishing in one of Kim Jong Il’s prisons, I doubt it. Mere marketing types are rarely invited into such lofty orbits. That being the case, I have two words for the management of Current TV about their calling a review, getting agencies to spend a lot of time (hence money) responding to it, and then yanking the emergency brake: Not cool.

Of course, in this economic climate in which most agencies would cheerfully rip the still-beating heart out of a kitten for a chance at a little revenue, I’m certain that if the review starts back up in a few weeks with entirely different parameters, agencies will come running.

Did Malcom Gladwell get it wrong? And no, this is not a story about his hairdo.

A Psyblog post, “Can The Unconscious Outperform The Conscious Mind,” reports that efforts to verify the conclusions in Malcom Gladwell’s Blink: The Power of Thinking Without Thinking have come up short. 

“…a team at the University of New South Wales and the University of Essex describe four separate experiments searching for the fabled power of unconscious thought? One of these was a straight replication of Dijksterhuis’ study [which Gladwell based many of his ideas on], and the other three were variations on the theme. All four experiments pointed towards the same conclusion:

‘In stark contrast to the claims in the literature and the media we found very little evidence of the superiority of unconscious though for complex decisions.’”

Irreproducible results are, as they say in the scientific world, problematic. For my advertising friends who attend faithfully the church of the snap decision, it may be time to pour yourselves a brandy and ponder at length whatever perplexes you.

Will Wright (The Sims, Spore) on building and managing a creative organization.

Adam Bryant of the New York Times has done a very interesting interview with Will Wright, developer of The Sims and Spore, on how he hires and manages creative people. Advertising agencies in particular could learn from his ideas on the importance of celebrating failure and limiting unnecessary meetings (Wright makes people give him a dollar if they want him to show up–a brilliant idea). Check out the full interview here.

@mousavi1388 – Iran, Twitter and the Disintermediation of News

In today’s New York Times, a story by Brad Stone and Noam Cohen, “Social Networking Spreads Iranian Defiance Online,” almost makes up for all the idiotic tweets and Facebook updates you’ve had to endure (“Shoes feeling a little tight, need to trim toenails before bed”) while trying to figure out what to do with social networking. Maybe social networking is not about sharing the stultifying details of your life. Maybe it’s not a new way to sell stuff. Maybe it’s about creating momentum for social change. Not only do Stone and Cohen show how people in Iran are using digital tools to coordinate their protests, they also make it possible for you to monitor what’s going on in real time: 

A couple of Twitter feeds have become virtual media offices for the supporters of the leading opposition candidate, Mir Hussein Moussavi. One feed, mousavi1388 (1388 is the year in the Persian calendar), is filled with news of protests and exhortations to keep up the fight, in Persian and in English. It has more than 7,000 followers.

Mr. Moussavi’s fan group on Facebook has swelled to over 50,000 members, a significant increase since election day.

This is more than social networking. This is the disintermediation of news. No reporter or state filter of information stands between events and the public. It’s a powerful concept, and one that will be extraordinarily difficult for the marketers of the world to monetize. I am not convinced that is a bad thing.