Despite the complexity, companies can stay within the "compliance envelope" by being proactive in their marketing.
As more and more companies in heavily regulated industries search for cost savings, greater efficiencies for dollars spent, and better matches with modern sources of information, they are aggressively shifting dollars from traditional advertising to digital and social media. These industries - which include pharmaceuticals and healthcare, financial services and insurance, alcohol and tobacco, and those that service government entities - have regulations that govern their marketing and communications, especially ones aimed at large numbers of consumers. Compliance has always been a necessary extra step in doing marketing. Now, in digital and social media, where customers' actions, conversations, and feedback are visible and recorded publicly, these companies have the additional task of figuring out which regulations apply, and how.
Some Regulations of Concern
It's not just one regulation or law that has yet to be interpreted for two-way digital channels, but many, and some are easier to apply than others. For example, sites created by companies and agencies serving government entities must be "508 compliant," meaning that they must be accessible to people with disabilities - through the use of screen readers, for example. Companies in healthcare and insurance need to ensure that their technology infrastructure, record-keeping, and privacy policies are compliant with the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
Public companies are subject to Sarbanes-Oxley and the associated requirements for disclosures, internal controls, and accountability. Pharmaceutical and healthcare companies must also abide by the Food and Drug Administration's requirements for "adverse event reporting" and other regulations that govern the adequate disclosure of safety and warning information, the presentation of "fair" and "balanced" information about prescription drugs and medical device, and what can or cannot be said or claimed about products (i.e., approved language only).
Issues and Challenges for Marketers
Why are these regulations and requirements challenging for marketers in digital, search, and social channels? The laws themselves are not new, but the interpretation of how to apply them is. In traditional forms of advertising, the guidelines are well established - for example, in TV commercials for drugs, companies must refer customers to the corresponding print ad in a magazine for further details. When advertising a product on a website, companies must link to the prescribing information (PI), which has all of the required details about dosage, side effects, adverse interactions, black-box warnings, etc.
But what happens when companies run search ads on Google or display ads on Facebook? How should they present warnings and side-effect information, given the extreme space constraints of the ads themselves? What should firms do when people write negative comments about their drugs or mention on social networks that they got sick from the drugs (i.e., "adverse events")? Are companies obliged to monitor the entire Internet or all social networks, blogs, and forums, and report all mentions of adverse events related to their products? And how could they possibly do so in the stipulated 72 hours?
Finally, what are the rules governing the new forms of personally identifiable information (PII) disclosed in digital and social channels - for example, the history of what sites individuals visited, the "social graph" of their connected friends, and what they searched for online - and how companies can use this PII to better target customers with marketing messages? Because the FDA has not published any definitive guidelines or interpretations for these new marketing scenarios, companies are forced to assess and interpret these scenarios themselves and act according to the level of acceptable risk.
However, many companies have taken the wait-and-see approach and deferred any action in these new and essential marketing channels.
Ways to Stay Compliant
Here are a few examples of ways companies in these regulated industries can use digital, search, and social media marketing techniques right now, while staying within the "compliance envelope":
Social media listening. Marketers can treat social media channels as venues for continuous listening rather than as places where they can push more ads. Because more people are having more online conversations more often, social media venues are rich sources of new insights that cannot be gleaned from traditional forms of market research like surveys or focus groups. Furthermore, in some cases these conversations have been archived for years, giving advertisers a historic perspective on particular topics.
Search as research. Marketers can use search as a form of research rather than as just another way to drive more traffic to their websites. Insights from search volume over time, or what people are seeking from related searches, will allow marketers to use search as research to collect new insights continuously. By not pushing out more ads at people, but rather studying how users look for information online, advertisers can better tailor their marketing activities and positively impact content creation, site optimization, and updates to marketing messages.
Digital analytics. The online and digital technologies are inherently two-way and also precisely measurable. As users take actions on websites, the detailed analytics can reveal what they are looking for, whether they found it, and how it impacts their purchase decision. Marketers in heavily regulated industries have many pre-approved assets and pieces of content. If they put such content on the website or repurpose it for use on mobile devices (e.g., eDetailing on iPads), then the way physicians use the information can be seen in the analytics.
The FDA's Four Adverse Event Reporting Criteria:
Identifiable patient. The post contains information sufficient to believe a specific patient was involved, such as "I experienced" or "my brother experienced," but did not contain general statements such as "many people."
Identifiable reporter. The post contains sufficient information to follow up with the reporting person, such as an email address, telephone number, or physical address.
Specific medication. The post mentions a specific medication by brand or the chemical name of a medication where that compound is unique to one specific brand.
Adverse event. The post describes a reaction that a "reasonable person" would consider an adverse experience such as death, hospitalization, vomiting, or swelling, or a side effect that is not known or expected with the medication.
Augustine Fou, founder, Marketing Science Consulting Group, will moderate a panel discussion, "Search Marketing and Social Media for Regulated Industries, on Wednesday, March 21, 2012 at SES New York.
On the heels of a fantastic event in New York City, ClickZ Live is taking the fun and learning to Toronto, June 23-25. With over 15 years' experience delivering industry-leading events, ClickZ Live offers an action-packed, educationally-focused agenda covering all aspects of digital marketing. Register today!
Dr. Augustine Fou is the senior digital strategy advisor to CMOs, marketing executives, and global brands. Dr. Fou has over 15 years of Internet strategy consulting experience and is an expert in social media marketing strategy, data/analytics, and consumer insights, with specific knowledge in the consumer packaged goods, financial services/credit cards, food/beverage, retail/apparel, and pharmaceutical/healthcare sectors.
He is a frequent panelist, moderator, and keynote speaker at industry conferences. Dr. Fou is also an Adjunct Professor at NYU in the School for Continuing and Professional Studies and at Rutgers University at the Center for Management Development, where he teaches executive courses on digital strategy and integrated marketing.
Dr. Fou completed his PhD at MIT at the age of 23. He started his career with McKinsey & Company and previously served as SVP, digital strategy lead, McCann/MRM Worldwide and group chief digital officer of Omnicom's Healthcare Consultancy Group (HCG). He writes a blog "Rants, Raves about Digital Marketing" and can be found on Twitter at @acfou.
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