This post is the second in a multipart series.
In a previous post, we explored how new products aren’t created equally and how to determine the best approach to launching them. We talked about how launches should be prioritized based on answering a couple of questions: How compelling is the new product’s value proposition from the customer’s perspective? How large is the realistic, addressable market opportunity for this product?
Then we showed how answering these questions can lead to selecting different priorities and strategies for launches across markets. However, the real world isn’t always this clean and easy to figure out. In reality, if you’re a global business unit leader, regional president or country manager, real life is much more complicated. In some cases, multiple new products are launching in parallel, or the answers to the questions above are different depending on the country. In this framework, we highlight a common situation that we see for many companies over a strategic planning period:
Here are some potential real-world situations and what to consider in each:
1. Multiple launches in parallel in different “quadrants”: Global marketing and portfolio management can help cross-functional partners and regional counterparts on resource allocation and customized strategies. There are lots of launches happening, and many functions require a minimum level of activity for any launch regardless of the business opportunity, so it’s important to make sure that these functions are focusing their time on products A through D and less time (or none at all) on Products E through J. They would probably be willing to do this if asked, but how often do we? Also, developing and deploying customized strategies supported by appropriate tactics, tools, content, etc., for each situation can help resource-strapped countries to focus their energies in the most effective places. And for all markets, it’s critical to make sure that products in smaller markets with a weaker value proposition don’t distract anyone. It might make sense to stage the launch of those products to be “off cycle” vs. the other products, as opposed to when R&D is ready to “commercial release,” or companies should question whether they should be launched at all. Choosing not to launch in a particular market might be the best decision to ensure focus on more important launches or other markets where the prospects are better.
2. Same product launching in multiple countries, but the quadrant is different by country: In this example, you want to make sure that the UK general manager has the right resources and focus on Product A as that’s your winner. Product A is still a great opportunity for Germany and Italy, but the opportunity is smaller so the focus relative to the UK should be different. There should be excitement in Germany and Italy but also realistic expectations about the revenue potential, unless there are new market opportunities that could be uncovered via activities like real-world evidence development to expand indications or pursuing new sites of care. Conversely, product A for France is going after a big market opportunity but the value proposition needs to be strengthened, so the focus in France should be around developing evidence during the early days to strengthen the value proposition or to identify market niches where the value proposition is stronger. The former may take longer while the latter may shrink the realistic, addressable market. If the answer doesn’t change after exploring these opportunities, then we strongly believe that it's prudent to question whether to launch in the market.
3. No products in the “prioritize and invest” category, or too many in the “weaker value prop” category: If this picture were different, and all the products for a particular market were in a small market with a weak value proposition (lower left), then what should you do? While this might sound extreme, unfortunately we see this over and over again at our medtech clients globally. Typically when we see this situation, we hear comments about the lack of value coming from the R&D pipeline, yet there’s pressure to launch. While it might sound great to “refuse to launch,” in many companies this just isn’t an option. A forecast is handed to you by up above and, whether you like it or not, you have to deliver. Don’t despair, though. Here are some potential options:
- Can the new products give you a reason to visit customers where access is a challenge? There’s often no better way to get a meeting with a customer than when there’s something new to talk about. Once the rep has the meeting, they could use the time to briefly talk about the new product and spend most of the time selling the other parts of the portfolio that are more important.
- Could you potentially move right or up in the graph? Just because the value proposition is weak or the market opportunity is small today doesn’t mean that it always has to be. It could just be that the portfolio management and R&D efforts weren’t enough for what you needed. Perhaps there’s a way to carve out an opportunity that’s attractive. Tread lightly here so you don’t throw good money after bad.
- Could the new products give you a broader portfolio story to tell organized customers? Most organized customers (IDNs in the U.S., government payers outside of the U.S., etc.) are more interested in discussing portfolios of products vs. individual ones. Perhaps the new products aren’t interesting in and of themselves, but they enable you to tell a portfolio story that was previously a struggle.
- Could the new products give you an opportunity to raise price? Often, these “weaker value prop” launches are line extensions or small improvements on existing products. If so, there could be an opportunity to raise price vs. the existing product and either sunset the old product or target the new one in places where the customer would pay a higher price. Even a small increase in price could make a big difference to the bottom line.
Taking a “one size fits all” approach to product launches is unlikely to be successful. Using the framework above can help separate the wheat from the chaff and realize the growth expectations that we as an industry hope for from our investments in R&D.
MICROSITE: Marketing Excellence in Medtech