Sometimes in medtech we tend to have an exceptionalism attitude—and, in part, it is justified. Our industry is unique and complex compared to many others. For instance, our unique sales process (the third-party payer system, no end-user decision makers, etc.) is one that only other healthcare companies can understand. But as we all know, we’re also not exactly like other healthcare industries. For example, decisions around the business model are very relevant to many medtech companies but are often overlooked in the pharmaceutical industry.
This leaves us with an exceptionalism conundrum. Because no other industry is like ours, we tend to reinforce our own beliefs and values. Just look at the latest reps you’ve hired in your field forces. How many of them have come from other medtech organizations? My guess is the majority, but is this the appropriate response to our situation? Certainly in some areas, it makes sense to hire within the industry, such as organizations with very clinical sales processes. However, it’s my belief that we actually have a lot to learn, and looking externally to other industries that do specific commercial functions well and, perhaps, hiring that talent is something that our industry should prioritize.
For example, given the need for both direct and indirect demand generation, the agriculture industry has evolved into one of the most professional channel management industries in the world. It leverages the scale of its national distributors to support efficient product distribution and supplements with local demand creation at the farm level. Or take the chemical industry: Its low product differentiation and large global clients require it to excel in contracting and pricing. The technical aspect of the sale hasn’t gone away completely, but supply chain integration has risen in importance. Pricing and contracting decisions go across the business, supply chain and technical service, and the industry has figured out how to rectify, segment and find a balance based on the customers’ needs.
Recently, I’ve been helping a couple of medtech companies evaluate consumer-oriented route-to-market. In doing so, memories of my previous work in the fast-moving consumer goods (FMCG) industry have returned. As I reflect on that industry, there are a few areas where I believe that medtech could benefit from FMCG approaches:
- Segmentation: The FMCG industry has hyper-segmentation figured out. It makes significant marketing investments into understanding its consumer base and focusing on how to operationalize it throughout its go-to-market strategy. As medtech evolves toward a more patient-centric business model, we have a lot to learn about our patients. Are we investing and strategizing appropriately to ensure that our business model isn’t left behind?
- Key account management: One of the most important positions in many FMCG companies is the key account manager for a large account (such as Tesco or Wal-Mart). When you look for who galvanizes an organization to action and who creates tailored solutions, it’s this brand of key account management. Our KAMs today generally preside over only contracting and discounts. They could, and should, be doing so much more to partner with our customers. In the U.S., the changing healthcare environment and focus on long-term patient outcomes is a perfect opportunity for many in medtech, but despite the conversation, there are very few organizations that are actively developing solutions to capitalize on it.
- Marketing mix: The amount of commercial tactics that FMCG leverages to influence its consumer base is exhaustive. It’s all about appropriate marketing mix (TV vs. print vs. social media vs. product placement vs. event sponsorship, etc.). In medtech, we love our sales forces, but what about other marketing tactics? And how well do we really leverage them to engage with stakeholders, especially as the patient continues to gain prominence?
- Customer experience and satisfaction tracking: FMCG is vigilant about understanding its customer’s perspective. In fact, the industry has pioneered many of the customer satisfaction metrics that have eventually made their way into our industry. But FMCG companies do more than track. They’re also diligent about acting on feedback and creating an efficient closed loop. Many of us use very simplistic customer-perception tracking. (CE11 anyone?) But how holistic is our tracking from a stakeholder perspective, and how do the results impact our commercial execution?
While all learnings must be applied with the appropriate medtech lens, companies that start to implement learnings from outside our industry bubble will find differentiating value.