Friday, June 15, 2007

Rozerem Ad Spending Exceeds Sales!

I pointed out several months ago that Takeda is spending more money on its quirky Rozerem direct to consumer (DTC) ad campaign than it is making in sales of the beleaguered sleep aid product (see "Rozerem DTC Emperor (Still) Has No Clothes" and previous posts found referenced there).

While some DTC experts questioned whether this was true (see "What is a Marketer's Goal: Legacy or Sales Today!?"), I now have independent verification that Rozerem DTC return on investment is definitely in NEGATIVE territory!

As reported today in the Chicago Tribune ("Takeda dreams of waking slumbering pill's sales"):
"In the first quarter of this year Takeda spent more than $40 million on Rozerem ads, TNS Media Intelligence figures show, and the company reported $26 million in sales during the same period."
ROI = ($0.35)

I think that's right.

If not, here's another way to put it: for every dollar Takeda is spending on its Rozerem DTC campaign, it is only making $0.65 in sales!

How long can this lunacy continue? You tell me!

BTW, here's Takeda's defense:
"We are patient and we know it takes time," said Andy Hull, senior vice president of marketing at Takeda. "We think it is important to educate patients about a safer insomnia product."
Education, smeducation! Andy, baby, you're drinking your own Kool-Aid! DTC educates? -- NOT!

Does anyone agree with me that this guy should be fired?!

7 comments:

  1. I'm not sure about "firing" yet, but it's Friday and I'm feeling benevolent. Mr. Hull can use a big dose of reality check, though.

    I've seen the Rozerem DTC ads several times on TV and honestly don't "get" the educational message, if there was meant to be one, or how Rezerem was safer than, say, that product whose mascot is an annoying apparition of a butterfly.

    The only info I came away with was, "Do people actually dream about a guy in a deep sea diving suit or walking around with a blue unicorn? Wow."

    Jane Chin

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  2. Time to blow the dust off their beaver again...

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  3. I have often heard the two best marketing strategies are sex and humor. “They sell.” This was an interesting innovation on a market which conventionally uses neither. Even though educational value is lacking, I’m sure the point was to make wet your pallet and make you think “what was that?!” What would the average American do next? That’s right! Go online and do a little research to find out more. So, maybe their advertisements are failing, but did they have a lasting impression? You tell me if you remember the commercial with the talking beaver and Abraham Lincoln…

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  4. And you work for which Rozerem ad agency?

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  5. I just feel innovation wouldn't be innovation without risk of failure. That is why I am online now - posting about topics I know little about. I hope to gain insight, while stirring the pot with ideas and hopefully coming up with an innovative idea or two of my own.

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  6. I have no problem taking risks and being innovative. But if it leads to failaure then (1) failure should be admitted and you should move on to plan B; don't keep repeatingthe same failure, and (2) the agency that was innovative BUT failed should not be given awards for the FAILED innovation.

    There must have been many inventors befor the Wright bros that failed, but I can't imagine they received any awards!

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  7. Itchy4:12 PM

    Reported spend is generally 40% to 60% higher than actual spend,,this doesn't relieve them of an at best 1.1:1 ROI, which I'm sure they are not proud of.

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