A lingering difficult competitive environment pushes the Consumer Health industry and companies to seek new ways of advertising. Euromonitor International explores recent trends in regulation and advertising activities.
Does industry self-regulation work?
The Consumer Health industry in the United Kingdom and the United States maintains self-regulatory organizations to keep the advertising activities of members under certain parameters. In the last quarter of 2010 the Advertising Standards Authority (ASA) in the United Kingdom overhauled its oversight to include social media under the initiative of “Extending the Digital Remit of the CAP Code” to go into full effect on 1 March 2011. The CAP Code is the Committee of Advertising Practice’s Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing. The new initiative is set to prevent misleading advertising, apply social responsibility and protect children as social media technologies such as Facebook and Twitter emerge forcefully in the digital world. New guidelines will cover all digital marketing communications in the member’s or advertiser’s website and social media platforms.
In the United States, the National Advertising Review Council (NARC) is the umbrella organization providing guidance and policy standards to the National Advertising Division (NAD), which is part of the Council of Better Business Bureaus. NAD already keeps an eye on the advertising taking place in the internet and social media platforms. However, some concerns related to health claims, invasion of consumer privacy and marketing to children still need to be improved.
NAD currently receives a portion of funding from the Council of Responsible Nutrition (CRN), the leading industry association of makers of dietary supplements, to help in the regulation of health claims related to vitamins, dietary supplements, weight management products and sports nutrition. NAD works closely with the Federal Trade Commission (FTC) to enforce advertising guidelines and educate members on regulation. NAD also engages in an “Advertising Review” that provides useful advertising recommendations to members and companies so they can comply with the law. The Food and Drug Administration (FDA) is set to issue new “Draft Guidance on the Internet and Social Media” in 2011 to help companies establish lawful digital marketing communications.
Self-regulatory initiatives in Consumer Health are typically reactions to further regulatory activity by the government. Increased regulation through tighter advertising guidelines can hinder growth and punish future sales. Consequently, the self-regulatory approach works in the sense of protecting the interests of the industry while establishing an image of responsibility to the government and to consumers. The industry seeks to prove that no further regulation is needed when they are a step ahead in doing what is “best” for all parties.
An update in advertising efforts
In December 2010 NAD submitted a “discontinue claim” recommendation to The Procter & Gamble Co related to the promotion of its brand, Prilosec, against the competitor’s brand, Prevacid 24hr”. NAD found that the health claim “superior acid control” could not be supported by scientific evidence.
In contrast, Pharmavite LLC obtained a favourable recommendation from NAD related to the scientific support of health claims for the supplement Nature Made GreatMind in January 2011. NAD reviewed claims in print advertising, the internet and the packaging of the supplement related to improved cognitive health. The claims provided enough support of scientific evidence.
NAD recommendations can also be disregarded by its members. In February 2011, NAD issued an inquiry on medical health claims made by Iceberg Labs for its Immune Shield dietary supplement. The company claimed that Immune Shield can prevent diseases, including cancer. NAD referred the inquiry to the government regulatory agencies, FDA and FTC, for further review after Iceberg Labs failed to provide scientific evidence.
In the United Kingdom, ASA upheld and adjudication against Seven Seas Ltd related to JointCare Opti-Release, a supplement claiming to provide a sustained release of glucosamine that helps maintain connective tissue. ASA found not enough scientific evidence to support the claim in February 2011.
Alternatively, The Mentholatum Co Ltd promoted the claims of prescription strength ibuprofen and deep relief for the brand Deep Relief Gel 5% ibuprofen in television. In spite of the advertising approval by the Proprietary Association of Great Britain (PAGB), ASA found that the claim of prescription strength misled consumers to believe they were actually using a prescription drug, and that deep relief meant deeper skin penetration.
New challenges will arise as the world moves deeper into the internet and social media platforms. In the mean time, companies innovate via new social media campaigns. Bayer Consumer Care launched the “Said/Heard Mishaps” contest in February 2011 inviting people to post their most memorable miscommunication story in Facebook and win a trip to New York City to tape an online video of the story. The company uses the character, Speedy, as the face of the campaign.
In another innovative campaign, Honey Naturals LLC launched a social media campaign asking consumers to upload a picture of them discarding products from the competition in exchange for a free bottle of Zarbee’s All Natural Children’s Cough Syrup.