Nielsen Wire

Tracking the Hits Along the Musical The Long Tail

2009-11-20T18:19:47Z

Glenn Peoples, Senior Editorial Analyst, Billboard

For most people, Chris Anderson’s 2006 book The Long Tail marked a new way of thinking about selling goods on the Internet. Being free of the physical limits of shelf space, he predicted, would alter what people bought. For music, this would mean the most popular music titles would become less popular as consumers were able to tap into vast online catalogs. In most corners of the business world, and especially in the music industry, The Long Tail was controversial. Would consumers actually start to ignore the hits?

A Billboard analysis of Nielsen SoundScan data going back to 2004 shows Anderson wasn’t correct on all points. Hit digital albums have lost market share to far less popular titles. But hit digital tracks have gained market share over the years. The top 200 tracks accounted for 14.5% of sales in 2004 and rose to 15.8% in 2005, 17.1% in 2006 and 2007 and 17.2% in 2008. Through October 25, 2009, the top 200 tracks’ share stood at 18.7%.

The top 200 digital albums have shown an opposite trend in market share, steadily dropping to 21.9% in 2008 from 28.7% in 2004. At 22.1%, digital albums’ market share through October, 2009 is slightly better than 2008’s figure.

These two trends imply album and track purchase decisions may be driven by different factors. The most popular tracks may be benefitting from a herd effect due to the viral nature of the Internet. The awareness generated by that small number of songs could drown out less popular songs. Album buyers show they have more diverse tastes and take advantage of the vast catalogs at online retailers. So consumers may prefer to sample the depths of long tail through albums, not by individual songs.

Any discussion of Anderson’s book and theories should include how the record label’s role has changed. A popular sentiment of The Long Tail is that artists have all the tools they need to self-release digital music. That is true. Barriers to entry have been lowered to the point where the costs of recording and commercially releasing music are negligible. As Anderson explained in The Long Tail, cheaper tools of production and distribution have greatly increased the supply of music found online.

But acquiring distribution and getting a sale are two different things. People tend to underestimate the amount of competition faced in digital music. Over 100,000 albums were released in 2008 alone – and about half of those were digital-only releases. Not only does a title have to compete against other new releases, it has to compete against the tens of thousands of well known catalog titles that are available online. It takes resources – both money and expertise – to rise above the competition and achieve sales commensurate to what career-oriented artists need. Such resources are the domain of record labels, who can still find success in the digital world.

While The Long Tail was less explicit about record labels’ role in a changing digital marketplace, in July Anderson told The Times that record labels “are now the least important part” of the music industry. That is true for those with very low sales goals. These days a more established artist, or a mere hobbyist, can circumvent a contract with a record label by using inexpensive digital tools and outsourcing some record label functions. For the more ambitious and the less established, a record label is still by far the best way out of obscurity.

Summary of Billboard’s analysis:

As more digital albums are released, the more popular titles lose market share to the less popular titles. In other words, demand has shifted from the hits to the niches. The head (what Anderson would call the top 5,000 titles) has lost market share to the tail (all other albums). The head accounted for 77% of digital album sales in 2005. By 2008, the head’s market share had steadily dropped to 65%.
Sales of digital albums have become less hit-oriented while digital tracks have become slightly more hit-oriented. The top 200 digital albums have accounted for a smaller share of total digital album sales since 2004. In contrast, the top 200 digital tracks’ share of total sales has nudged upward during that time period.
Sales of individual tracks (those purchased independently, not as part of an album) account for the majority of digital music purchased in the U.S. Individual tracks accounted for 57% of all digital music sold in 2008 (assuming 12 tracks per album).
In any given week, the top 200 digital tracks account for nearly one in four track purchases. To put that in context, Amazon.com’s MP3 store currently lists 9.99 million tracks. So, the top 200 tracks represent only 0.002% of what a large download store stocks.
Even titles in the tail (below #5,000) have lost some market share recently. In 2008, the top 8,000 digital albums lost market share to lower-ranked albums. But it wasn’t the best-selling albums that suffered the most. Albums ranked from #200 to #800 suffered the biggest drop in digital album market share from 2004 to 2008 – between 25% and 34%
While lower ranks have gained market share over the years, any one title has not gained much. For example, an album ranked at #9,000 in 2008 sold about 1,050 digital albums. Less than 100 of those units can be attributed to gains in market share over the previous four years.

An expanded version of this story first appeared at billboard.biz.

Network Quality Most Important to Indian Mobile Customers

2009-11-20T15:45:38Z

For consumers in India, the quality of a mobile phone provider’s network is the most important factor when choosing a carrier, according to the latest edition of the Nielsen Consumer Experience Mobile Test Program. But the fact is that most Indians don’t really know which provider has the best network in their circle, as service providers focus their advertising primarily on price.

Out of the 18 metro areas tested on the reliability metric, a clear “leader” exists in just four areas, while in 10 of the circles, there is a tie for first place. In the remaining four areas, there is neither a clear leader nor a tie. Further, the leader in network reliability is not always the leader in market share. For example, Reliance is the “clear lead” in the Andhra Pradesh area (whose capital and largest city Hyderabad), while Airtel has the most market share. Reliance had the highest network reliability in three areas (Andhra Pradesh, Madhya Pradesh and Tamil Nadu and Pondicherry), while TATA was top in UP and Uttaranchal.

“As Indian consumers consider network performance as a major selection and retention criterion, there is a huge opportunity for network leaders to educate consumers about the superiority of their network performance to gain subscriber base. This can be a huge marketing differentiator in an industry that is reeling under hyper competition,” said Shankari Panchapakesan, Executive Director, Telecom Practice at The Nielsen Company.

India’s wireless market potential is second only to China – and is rapidly threatening to overtake it. With 12 service providers across 23 wireless “circles” (metro areas), and six to eight providers in each circle, competition for customers is fierce. It is expected to heat up even more with the auction of new 3G licenses and the introduction of mobile number portability.

Maximizing Super Bowl Advertising ROI in a Paid Vs. Earned Media Environment

2009-11-19T19:27:15Z

Pete Blackshaw, EVP, Digital Strategic Services and Randall Beard, EVP & General Manager, Nielsen IAG

Is the Super Bowl the ultimate marketing ecosystem of paid and earned media? 2010 will be huge test, as the new reality of consumer expression and cross-platform integration create a powerful new dynamic hovering over the largest single-spot ad spend on record.

What marketers urgently need to understand is not only total ROI on that mega-media buy, but the full return on all the other activities triggered or reinforced by this paid media stimulus. How does paid media drive earned media? And to what degree does earned media halo future paid media efforts? These are critical questions that Marketers need answers to – along with a metric or common yardstick that quantifies the blending of the two.

Getting Real about Real-Time
In an more agile and flexible marketing environment, where there’s actually a chance of making real-time changes based on available data, marketers need to understand the real-time role they can play in making tactical interventions to grow earned media impressions and ultimately, increase odds of success.

Twitter brings a fresh dynamic and promise to Super Bowl media efficiency. The platform reached a reach tipping point in 2009 – so much so that marketers increasingly use it to fan the flames for events, interact with brand mavens or enthusiasts, and, in a growing number of cases, manage or sandbag tension points like customer disappointment or service shortfalls.

Tweets are also increasingly embedding themselves in Facebook feeds, blog entries, and Google search results, magnifying their long-term value. Translated to the Super Bowl, positive playback about Super Bowl ads can have a “latency” effect and provide brands with an almost endless annuity of “earned media.” The same dynamic will be at work with Facebook brand fan pages, which can see massive growth – hundreds of thousands – following a major ad campaign, offline or online.

Quantifying the Big Picture
In the end, Super Bowl spots today need to meet two distinct “torture” tests – one measurable based on traditional TV scoring, and another based on unique dynamics of cross-platform engagement, most notably word-of-mouth and conversation. On a pure TV-impression alone, one can argue that the Super Bowl has become such an unusual magnet for consumer attention and recall – the one day of the year that we “celebrate” advertising – that it is worth every penny. Indeed, curiosity, anticipation, guessing, nostalgia come into play big time before this festival of brand persuasion. Consumers, after all, want to see the ads, almost akin to seeing a movie.

The entertainment halo certainly matters. Over the last three years, Nielsen IAG research found Super Bowl spots achieved a 31% higher break-through and 93% higher likability than the typical ad on television. But it’s not that simple. Timing is also a factor. First and second quarter spots yield more yardage than second half spots, and 4th quarter spots are about comparable to a “normal” TV buy in terms of generating ad recall. The viewer’s ability to associate the correct brand with the ad, and reported likability levels similarly wane over the course of the game. Surprisingly, branded integration effectiveness shows an opposite trend. Recall and brand opinion are lowest pre-game, moderate during the game, and big gainers post game. For Marketers, the mix is clear: focus on ads early and branded integration efforts late. Lastly, the SuperBowl is a touchdown for brands generally: purchase consideration for the average ad the week after increases +13% versus the week prior.

So that’s the foundation of pure “paid” measurements. What about the “earned” side of the equation, which factors in free media, consumer conversation, participation, and the like? Clearly, the Super Bowl in particular shines light across a far more complicated mix of marketing activity and user-engagement. Great copy finds life in other places.

An engaging, even participatory Pepsi game spot, for instance, might trigger a site visit, a Google search, a tweet, retweet, fan-page sign-up, or DVR rewind. It might trigger a desire to share, forward, discuss, critique, rate, or review. It might bleed over into the social media stream of a New York Times or any media reporter (a growing number of whom leverage social media across all platforms.)

The good news is that this digital trail can be quantified with high levels of precision – by volume, reach, tone, source, or even depth of brand advocacy. And much of this can be delivered in real-time, empowering today’s brand manager to make real-time changes or adjustments to the site. Last year, for instance, a large percentage of brands buying spots on the Super Bowl made real-time adjustments to their websites or social media efforts based on pre-game variables.

This year, Frito-Lay’s Doritos brand sits on the extreme of early-adjustments, as the four spots they are running are sourced from user-participation events and contests. In this case, the “earned media” is stimulating the paid side of the equation. Then again, this can work in reverse. When P&G’s Tide brand ran a highly engaging “Talking Stain” spot two years ago, it triggered a user-generated contest that created an impressive annuity of online video that quickly reshaped the brand’s search results for the better. Three years ago, Nationwide insurance estimated that the “earned media” dividend from their Kevin Federline spot totaled over $20 million dollars.

So in the end, it’s just not as simple as “buying” high-reach media. The broader ecosystems truly matter. This year, Nielsen is putting its biggest effort into measuring and quantifying the full return of Super Bowl advertising, combining a comprehensive suite of paid media and earned media metrics into a total “engagement” score. And we don’t intend to stop at the Super Bowl. Over the course of 2010, we’ll be applying our new cross-platform engagement metrics across our work on the Winter Olympics, Academy Awards, and the World Cup.

Webinar: Learn more about Nielsen’s comprehensive approach to the Super Bowl. Join Pete Blackshaw and Randall Beard for a webinar Maximizing Advertising ROI in a Paid vs. Earned Media Environment on December 8 at 2:00PM EST.

Viewing of Online Video Streams Up 26% in October

2009-11-19T20:00:20Z

The Nielsen Company today reported overall online video usage and top online brands ranked by video streams for October 2009. Year-over-year, unique viewers, total streams, streams per viewer and time per viewer were up, led by a 26 percent growth in total streams.

Overall Online Video Usage (U.S.)
	Oct-09	Year-Over-Year	Month-Over-Month
Unique Viewers (000)	138,623	14.8%	-0.5%
Total Streams (000)	11,226,935	26.2%	1.9%
Streams per Viewer	81.0	9.9%	2.4%
Time per Viewer (min)	212.5	23.8%	8.9%
Source: The Nielsen Company

Top Online Brands ranked by Video Streams for October 2009 (U.S.)
RANK	Video Brand	Total Streams (000)	Unique Viewers (000)
1	YouTube	6,632,964	105,923
2	Hulu	632,662	13,472
3	Facebook	217,765	31,594
4	MSN/WindowsLive/Bing	183,556	17,301
5	Yahoo!	173,482	24,265
6	Fox Interactive Media	160,698	13,142
7	ABC Television	136,348	5,642
8	Turner Sports and Entertainment Digital Network	119,850	5,741
9	ESPN Digital Network	109,799	8,625
10	CBS Entertainment Network	103,741	6,973
Source: The Nielsen Company

Note: Effective with June 2009 data reporting, Nielsen has made several enhancements to the VideoCensus service, including a panel that is 8 times larger, more granular reporting and improved accuracy and representativeness. These enhancements provide the highest quality data to our clients and the marketplace. For some sites, trending of previously-reported data with current results may show percentage differences attributable to these product enhancements and should only be compared directionally.

VideoCensus Methodology and Metrics:
Nielsen Online’s VideoCensus combines patented panel and census research methodologies to provide an accurate count of viewing activity and engagement along with in-depth demographic reporting. Online video viewing is tracked according to video player, which can be used on site or embedded elsewhere on the Web. For example, if a “Saturday Night Live” clip from NBC.com is embedded on a personal blog, that video would be attributed to NBC because of the NBC video player.

A unique viewer is anyone who viewed a full episode, part of an episode or a program clip during the month. A stream is a program segment. VideoCensus measurement does not include video advertising.

Time Spent Viewing Video on Social Networking Sites Up 98% Year-Over-Year In October

2009-11-19T17:30:25Z

Facebook is Top Social Networking Destination by Video Streams for the 2nd Month in a Row in October
Time spent viewing video on social networking sites increased 98 percent year-over-year, from 503.8 million minutes in October 2008 to 999.4 million minutes in October 2009, according to Nielsen. In conjunction, the number of online video streams viewed on social networking and blog sites increased 45 percent year-over-year, from 240.8 million streams in October 2008 to 349.5 million in October 2009.

“During the past year, online video viewing has become central to the Web experience. In conjunction with this increase, we are seeing remarkable growth in video viewing on social networking sites and it is only natural that these two trends would converge in consumers’ minds, making sites like Facebook and Myspace.com, increasingly important distribution points for both consumer and professionally generated video,” said Jon Gibs, vice president, media analytics.

Facebook was the No. 1 online social networking and blog destination in October 2009, with 217.8 million total video streams viewed during the month. Myspace.com and Stickam were No. 2 and No. 3, with 85.2 million and 26.3 million video streams, respectively.

Source: The Nielsen Company

Video Viewing on Facebook Continues to Grow
During the last year, Facebook’s online video viewing audience has experienced tremendous growth. Year-over-year, total time spent viewing video on Facebook increased 1,840 percent, from 34.9 million minutes in October 2008 to 677.0 million in October 2009. The number of unique viewers of video increased 548 percent and total streams grew 987 percent during the same time period.

“Facebook’s rapid growth in online video during the last year illustrates the site’s evolution from simply a communications focused tool to a media portal,” remarked Gibs. “Social networking sites are evolving from a venue for catching up with friends to a platform for personal expression, allowing consumers to share their experiences in the full variety of content formats available online.”

Source: The Nielsen Company

NFL Clothing Line Ad Tops Most Liked Recent TV Spots

2009-11-19T16:53:41Z

According to Nielsen IAG, an ad for the NFL’s female-focued clothing line featuring actress Alyssa Milano was the most liked ad during the time period of September 21-October 18. During that same time frame, and ad for Halls cough drops scored the highest ad recall index with viewers.

Most Liked New Ads (9/21-10/18)
Rank	Brand	Description	Index
1	NFL	NFL Touch Women’s Fashion Collection–Alyssa Milano wears team apparel and is shown flipping hair in slow motion.	181
2	Toyota	Little boy disapproves using basic car wash; father chooses ultimate wash instead; some day, this Camry could be his.	173
3	McDonald’s	Every October, real people win real money playing Monopoly; woman shown playing on laptop.	145
4	Wendy’s	Bacon Deluxe–Coworkers leap, run, and crash through window to get to a burger an employee just left.	144
5	Wonderful Pistachios	Beauty pageant contestant endorses cracking pistachio shells to help Americans build a better future.	144
6	Samsung	DualView Camera–British Royal Guard takes camera from woman and snaps a photo, before a gorilla takes the camera.	142
7	Disney Parks	Miss Piggy dreams about a date with man at a Disney park; give a day of service and get a one-day ticket.	141
8	Michelin	Michelin Man throws fuel efficient tires at an evil gas pump to save town; save up to 109 gallons of fuel.	140
9	Disney Parks	Muppets help out at a construction site; Miss Piggy bumps her head and another gets an electrical shock.	140
10	MasterCard	Little girl reads books while eating cereal before spilling milk; remembering to take it one day at a time: priceless.	130
Source: The Nielsen Company Only new ad executions considered, airing weeks of September 21, 2009 to October 18, 2009. The Likeability Score is the percentage of TV viewers who report to like “a lot” an ad they were exposed to during the normal course of viewing TV (among those recalling the brand of the ad). These scores are then indexed against the mean score for all new ads during the period (Likeability Index). 100 equals average. For example, with a Likeability index of 181 the top ranked NFL spot has proven to be 80% better-liked than the average new commercial during the past four-week period.

Most Recalled New Ads (9/21-10/18)
Rank	Brand	Description	Index
1	Halls	Refresh–Boy offers roommate’s mom a cough drop and they stare at each other.	224
2	Old Navy	Cardi Coats–SuperModelquin becomes upset when she doesn’t have her legs; she then sees them on baggage claim.	206
3	Campbell’s	Chicken Noodle–Boy at window sips noodle that stretches from billboard on an adjacent building.	202
4	AT&T	A-List with Rollover–Father plays fetch with dog using family’s "minutes"; the minutes we save, we keep.	199
5	KFC	Grilled Chicken–People in long line leading out of a building say, "I’m in"; 60 million Americans unthink alike (:30).	194
6	Microsoft	Windows 7–Little girl, Kylie, creates a slide presentation containing quotes of praise for Windows 7.	194
7	KFC	Grilled Chicken–People in long line leading out of a building say, "I’m in"; Grilled Nation is 60 million and counting (:15).	191
8	Papa John’s	Mega XL3–Papa John knows how to make a hungry crowd happy; 10 slices with any 3 toppings.	188
9	Wonderful Pistachios	Wee man shoots tennis ball at his head to crack open a pistachio; lowest calorie nut; lowest fat nut.	180
10	Walt Disney World	Boy runs into kitchen; crashing sound heard in closet; family walks into Pirate adventure; get 3 more nights free.	179
Source: The Nielsen Company Only new ad executions considered, airing weeks of September 21, 2009 to October 18, 2009. The Recall Score is the percentage of TV viewers who can recall within 24 hours the brand of an ad they were exposed to during the normal course of viewing TV. These scores are then indexed against the mean score for all new ads during the period (Recall Index). 100 equals average. For example, with a recall index of 224 the top ranked Halls ad has proven to be over two-times as memorable as the average new commercial during the past four-week period.

Little Holiday Cheer Ahead for Online Retail

2009-11-18T22:19:46Z

Ken Cassar, Vice President, Industry Insights, The Nielsen Company

Although retailers have been thinking about the 2009 holiday season since last January, consumers are just starting to think about their holiday plans. As we do every year, Nielsen fielded its annual holiday retail survey at the beginning of this month to get an understanding of consumers’ holiday shopping plans. While the economy appears to be improving at a snail’s pace, it’s apparent that many consumers intend to spend less and save more this holiday season. In fact, some 42 percent of respondents stated that compared to a year ago they were planning on spending less money on holiday gifts, compared with only 4 percent who intend to spend more.

An even more surprising trend is that of the money that consumers plan to spend this holiday season, a smaller percentage will be spent online: 63 percent of survey respondents said that they would do at least some holiday shopping online, down 10 points from two years ago. Meanwhile, 7 percent of respondents said they would not do any shopping online compared to just 1 percent in 2007.

Consumers Expect to Spend Less Money Online this Year

Among those that do plan to shop online this holiday season, many consumers expect to spend significantly less than last year. In 2008, 42 percent answered that they would spend more than $300 online during the holiday season. This year, that percentage has dropped to just 31 percent, while 22 percent of respondents said that they are going to spend less than $100 online.

So why do some consumers shop online? Interestingly, the main reason is not to save money, but for convenience. Respondents said the top reason they would shop online was the ability to shop whenever they wanted, followed closely by the ability to avoid the large crowds associated with holiday shopping.

While consumers appear to no longer view the Internet as a value channel, they still see it as a place to do comparison shopping, find coupons and do research. And it’s not just consumers coming from lower household incomes–shoppers of all ages and income levels rely on the Internet to inform their in-store purchases. In October 2009, over one-third of the U.S. online population visited at least one deal-oriented Web site.

Although many consumers don’t feel that they save money by making purchases online, they do view the Internet as a deal-seeking venue. When asked how they use the Internet before going shopping in physical stores, 55 percent of respondents said they use the Internet to compare prices across retailers and 49 percent answered that they use the Web to learn about sales and promotions available in physical stores.

It is clear that while the majority of all purchases continue to take place offline, the Internet has an important role to play—deals found online impact holiday purchase decisions and drive purchases at brick and mortar locations.

For more information and insights on the 2009 holiday season, download our recent webinar,2009 Holiday Retail Season: What Consumers Have in Store for Retailers this Season.

Canadian Consumer Confidence Rebounds

2009-11-18T16:22:53Z

Canada continues to show a steady increase in consumer confidence, with its index rising to 94, up four points since July and 10 points since April, according to The Nielsen Company. Overall, global consumer confidence rose to 86 index points – up five points since July and almost back to the same level before the worst of the financial crisis hit global markets (click here for details on the global survey). Canada was tied for 15^th in consumer confidence of the 54 countries surveyed.

Overall, Canadians were more confident than their neighbors to the south, with more positive outlooks regarding job prospects, the state of their personal finances and their willingness to spend. With respect to jobs, 46 percent of Canadians say that local prospects will be “good” or “excellent” over the next 12 months, compared to just 28 percent in the U.S. More than half (55%) feel that the state of their personal finances will be “good” or “excellent,” up three points since July and compared to 51 percent of Americans who said the same. More than two-fifths of Canadians feel it is a good time to buy the things they want and need, compared to 33 percent of Americans. All of that said, a strong majority (82%) of Canadians feel that the country is still in a recession, despite the fact that the Bank of Canada announced that the recession was over. Nine in ten Americans said that they felt their country was still in a recession.

In a sign that the consumer’s obsession with all things economic and recession is starting to recede, Canadians are once again showing concern with other issues such as work-life balance and health. But despite these positive signs, Canadians remain cautious about spending. Paying off debt is the top use for spare cash (with 39% saying that is their priority) followed by socking away money into savings (26%). When they are spending, holidays and vacations is the top category (26%) with out-of-home entertainment (23%) and home improvements (20%) rounding out the top three. Canadian men indicated that they are more likely to spend on outside entertainment and new technology, while responsible Canadian women are focused on paying off debt.

Read the full report.

74% of U.S. Adults Read Newspapers at Least Once a Week in Print or Online

2009-11-19T20:52:17Z

New data from Scarborough Research (a joint partnership with The Nielsen Company and Arbitron, Inc.) finds nearly three in four adults, nearly 171 million, in the U.S. read a newspaper – in print or online – on a weekly basis.

“While our data does show that print newspaper readership is slowly declining, it also illustrates
that reports about the pending death of the newspaper industry are greatly exaggerated,” said
Gary Meo, Scarborough’s Senior Vice President of Print and Digital Media Services. “Given the
fragmentation of media choices, printed newspapers are holding onto their audiences relatively
well.”

According to the demographic data in the study, newspapers continue attract educated, affluent readers.
In an average week:

79% of white collar employed adults read a printed newspaper
82% of adults with household incomes of $100,000 or more read a printed newspaper
84% of adults who are college graduates or more read a printed newspaper

A First-Person Social View of the FDA Hearings

2009-11-16T19:33:21Z

Melissa Davies, Research Director, Healthcare, Online Division

On November 12-13, I took part in a Washington D.C., hearing organized by the FDA on how pharmaceutical companies can use the Internet and social media to communicate with consumers. The hearing was a source of excitement in the healthcare industry – the FDA received more than 800 requests for 350 seats.

More and more consumers are online looking for information on their health…

Over two days, more than 60 speakers – representing pharmaceutical companies, agencies, research firms, search and social media websites along with consumer organizations – shared their thoughts on how companies can responsibly engage consumers online, as well as questions and areas that need clarification from FDA.

Nielsen / WOMMA FDA testimony

View more presentations from nielsenwire.

Despite the variety of industries and agendas represented, I was surprised by the amount of consistency in the presentations and recommendations. Through the two days of the hearing, a few key themes emerged:

No one can ignore the explosive power of social media.
Several speakers shared great data about how often the Internet is used as a source for healthcare information. With patients, caregivers and doctors alike going online for healthcare information, it simply is not an option for pharmaceutical companies to remain separated from this discussion.
No one company can be expected to monitor the whole of the Internet.
In our Nielsen BuzzMetrics dataset of health-specific CGM sites, we collected an average of 83,000 messages per day over the past six months. This volume will only continue to grow, and no one can expect to monitor all of it.
Pharma is ready to listen, but confusion persists.
Most pharmaceutical companies would like to listen and even respond to consumer feedback online. However, there is confusion among pharmaceutical companies about how and when it is appropriate for them to engage with consumers online, and what responsibilities they have in doing so. This confusion often results in companies holding back on engaging in social media and sometimes even in listening to what their consumers are saying online.
Adverse events are a red herring.
Companies that have not done social media listening often have a fear that they will see a high volume of adverse events in online consumer conversation. (And for pharmaceutical companies, there is a requirement that these events are followed up and reported to the FDA.) In fact, the number of adverse events in online discussion is very low and manageable within the reporting systems that pharmaceutical companies already have in place.

This last point was the basis of my testimony at the hearing. In 2008, Nielsen analyzed online healthcare discussion to define the number of adverse events and found that just 4 of 500 messages contain adverse event information, and only 1 of those messages contained all of the criteria that are required for AE reporting.

For me, the key takeaway from the FDA hearing was this: More and more consumers are online looking for information on their health. Some of the information they find online is good, but some is not, and it’s not always easy to tell the difference. Right now anyone can contribute to the online health discussion except the pharmaceutical companies, who are waiting for guidelines from the FDA about how to engage online in an appropriate and responsible way.

There was a sense of hope among attendees at the hearing that the FDA will provide new guidelines on the Internet and social media relatively soon. When that happens, not only do we empower the pharmaceutical companies to interact with consumers online, but we give them a sense of duty to contribute to the conversation in a responsible way. Of course it’s not appropriate for pharmaceutical companies to get involved in every consumer discussion about healthcare online. But where these companies can contribute value to the discussion, let’s empower them to do just that.

Like many of my colleagues in the pharmaceutical/healthcare field, I look forward to watching and participating as the discussion continues to unfold.