Apple's ad blocking heats up debate, but what does it mean for pharma?

Last week, Apple ($AAPL) stirred a long-simmering controversy into a raging debate: It unveiled ad blocking in its newest operating system. iPhone and iPad users of iOS 9 can now quickly and easily download blocking software to knock out ad units including display and banner ads, pop-up ads and autoplay videos.

While ad blocking technology is not new, Apple's considerable mainstream influence had publishers scrambling and advertisers worried--perhaps rightly so, because within a few days, several ad-blocking software apps topped the iTunes download charts.

Pharma companies are affected mechanically in much the same way all advertisers are. Display and banner ads placed on a publisher's web site won't be loaded, and pop up ads or promotional videos that autoplay won't be visible on phones with ad-blocking apps installed. A 2015 study from Pagefair, a provider of counter ad-blocking solutions, said ad blocking software will cost publishers $22 billion this year.

Klick Health VP of strategy Michael Spitz

However, Klick Health VP of strategy Michael Spitz, who blogged about the issue last week, said in a follow-up interview that ad blockers could have some specific effects for pharma. Some pharma companies, for instance, rely more heavily on digital advertising than other media placements, especially for marketing smaller-reach specialized drugs. When Auxilium Pharmaceuticals ($AUXL) first launched a promo campaign for the erectile dysfunction drug Stendra, for instance, it relied on online video rather than TV placements.

Meanwhile, pharma companies have fewer digital opportunities to engage with doctors and patients, as they tend to place ads on fewer publishers' sites. Drugmakers may focus in on sites that are relevant to healthcare or specific diseases, Spitz said. Consumer companies can try to make up for blocked digital ads by using social media for content marketing, but pharma marketers with fair balance restrictions--and less experience in social media--aren't as likely to do the same.

"In a nutshell, we have fewer tools and fewer opportunities for engaging," Spitz said.

But there is a silver lining, Spitz said. "Users in general are getting tired of incessant banners and interstitials that force you to view some content you don't want … The good news is that it puts the onus on content creators and brands to create content and experiences an audience really wants. Not pop up ads no one wants, but websites, social experiences and other content that are more appropriate, more relevant and more desirable."

It could also be the marketing wake-up call that pharma needs, he said. With fewer and less effective banners and display ads to fall back on, pharma companies will have to find new and innovative ways to reach their audiences. Spitz said the rise in ad blocking will likely result in more partnerships in which pharma companies work with publishers or even professional organizations to co-create healthcare content that consumers want or need. He advised pharmas to shore up content strategies and work to make content more relevant and shareable, including figuring out how to best take advantage of social media.

- read the Klick post
- browse the Pagefair report

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