Analytics capability maturity is low in medtech, which means that there’s a huge opportunity to gain competitive advantage in an increasingly competitive marketplace.
ZS and the Economist Intelligence Unit recently looked at the impact of analytics investments across industries, and found that companies’ results thus far have been underwhelming. Nearly three-fourths of survey respondents said that sales and marketing analytics are either “very” or “extremely” important to their companies’ competitive advantage, yet just 2% have managed to generate a “broad, positive impact.”
Yet medtech is different than other industries in one key way: Most companies haven’t even begun to focus on such investments. In other words, it’s not that medtech companies are struggling with analytics; they’re simply not doing much of it yet.
Why not? The traditional medtech selling model has been highly personal, based on one-on-one encounters. A lot of power rested with sales reps, meaning that companies didn't need analytics to understand the selling process and improve performance.
That’s changing, however. The traditional one-to-one relationship is giving way to more of a B-to-B sales model. Customers are now highly variable, and some of them are quite complex. Because of that shift, there’s a lot more value in using analytics to understand and influence purchasing decisions.
To start generating traction with analytics, medtech companies will need to take three critical steps:
- The value of analytics has to become clear in the organization. There’s still resistance and skepticism among some executives that analytics can create value. Leadership has to identify domains where analytics can be high value and engage in proof-of-concept work to demonstrate and align on value drivers.
- Companies need to embed analytics systematically into the existing business processes in areas like customer profiling and targeting, sales force deployment and marketing effectiveness.
- Companies need to build a world-class analytics capability, one that achieves scale efficiencies and allows companies to use the latest data sources available. The good news is that many medtech companies have already made some good investments in technology—like a solid CRM system—so they’re in a better place to build this capability than they were five years ago.
To see what success might look like, let's take a key account manager, "Bob." With more robust analytics, Bob would be able to truly understand his account. He could see the profitability levels of different departments within a hospital. He would also have access to better patient analytics, which would highlight things like a way to reduce complications and shorten hospital stays.
All of this will help Bob build a specific bundled service offering that’s precisely targeted to the hospital’s needs, at a price that optimizes profits. Bob also will be able to offer new programs and services to create a better partnership with his account. And he’ll be able to build a strong business case to show the value of this partnership.
Moreover, Bob can more effectively synchronize selling activities. He will understand which channels his customers prefer, and he'll know which reps are calling on which department. All of this information will help him coordinate across his company and create a better customer experience.
The bottom line: As the healthcare environment becomes more complex and more focused on value and outcomes, medtech companies will need to build a strong analytics capability. The value is there to support such investments, and it’s only going to grow for companies that build the right foundation—starting today.
For more findings, insights and analysis from ZS’s study, read “Broken links: Why analytics investments have yet to pay off.”