Today’s innovators finding tailored approach to marketing boosts product adoption, profits – in medical equipment and supplies
Amy Case
For successful manufacturers of medical devices, it has become increasingly clear that cutting edge technology is necessary but not sufficient. Faced with the myriad discoveries and advances afforded by modern technology, what determines which products will be adopted?
The answer lies in tailored marketing as demonstrated by today’s innovators.
Crafting a marketing message to address the primary concerns of a chosen audience is known as customer targeting. In the world of medical devices there are many possible segmentation schemes, including international vs. domestic markets, specialists vs. primary care physicians and so on. Customer targeting is focused on three market segments:
* Physicians/Clinicians
* Administrators
* Patients
Many successful companies employ customer targeting as a tactic to drive profit growth. Innovators such as Hill-Rom, Johnson & Johnson, GE Medical and Aspect Medical Systems have made an art of adjusting their marketing to best appeal to each targeted customer segment.
The Innovators
Hill-Rom delivers a variety of healthcare solutions for clinicians, manufacturing hospital beds, infant warmers and other hospital furniture.
The acquisition of Support Systems International (SSI) in 1985 provided Hill-Rom with more sophisticated hospital bed technology such as the Clinitron Air Fluidized Therapy, a bed surface that channels air through small beads to create a fluid effect ideal for patients with burns or major skin trauma.
Knowledgeable caregivers are required to change the surface of the bed at different stages of patient recovery in order to optimize conditions. While providing technical training and accessible support, Hill-Rom has consistently demonstrated emphasis on caregivers as the key decision makers.
Ethicon Endo-Surgery, a Johnson & Johnson company, was formed in 1992 out of J&J’s existing business, Ethicon, long a maker of sutures and other surgical products. In the early ’90s, Ethicon Endo-Surgery ran a distant second to U.S. Surgical, particularly in the critical area of surgical stapling. Today it is the market share leader. A critical pillar to its market success was its early sales focus on hospital administrators.
GE Medical took advantage of continuing trends toward patient influence and direct-to-consumer marketing when selling its 1.5T Signa TwinSpeed MRI system.
Finally, Aspect Medical Systems created a niche product with its Bispectral Index (BIS) consciousness monitor. The monitor aids anesthesiologists in preventing patients from either receiving excessive anesthesia or experiencing intraoperative awareness, a phenomenon in which a patient wakes due to insufficient anesthesia. The company realized the only way to compete for those shrinking health care dollars was to market its product to multiple audiences.
Reaching Physicians/Clinicians
When choosing to target physicians, technology and the training to appreciate it become the most important selling points. Thus, when considering which products to use, physicians need to satisfy themselves that the following criteria are met:
* Demonstrated improved outcomes
* Personal confidence with required techniques and related risks
* Consistency with their desire to work with advanced technologies.
* Marketing messages directed toward physicians should adequately speak to these factors.
Also recognizing that the caregiver population has substantial weight in the decision-making process, Hill-Rom targeted much of its marketing toward this audience. Hill-Rom provided caregivers with:
* Superior training: Because some of their hospital beds require a greater knowledge of the technology behind the product, Hill-Rom incorporated a technical training program into its services aimed at educating caregivers on troubleshooting techniques and special product features and benefits.
* Extensive support networks: To foster clinician comfort with its product and fortify relationships with customers, Hill-Rom released an extensive e-business strategy in October 2000 that provides quick access to sales support as well as clinical and product information, education and solutions.
To gain physician support, Aspect Medical established the BIS monitor as an effective device that would aid anesthesiologists in providing more precise drug administration. Aspect Medical Systems proved the BIS Monitor to deliver:
* Improved technology: Prior to the BIS monitor, anesthesiologists used inexact measurements of heart rate and blood pressure to determine a patient’s level of consciousness. Because the BIS monitor draws on objective metrics like EEG waves to gauge consciousness, anesthesiologists are able to properly dose their patients and prevent the occurrence of intraoperative awareness.
* Speaking the physicians’ language: With a sales force of more than 68 representatives, 40 of whom are clinicians, and an additional 20 per-diem CRNAs, Aspect is able to provide one-on-one coaching at physician sites in terms that prove their familiarity with the operating room. Aspect also tailors separate materials for surgeons and anesthesiologists.
* Unintimidating Technology: Although the BIS system is very sophisticated, the monitor provides information on an intuitive 1-100 scale, eliminating the need for clinicians to be EEG experts.
The Administrative Sell
While certainly concerned with keeping their hospitals current with progressive technologies, administrators’ main concerns often focus on:
* Cost benefits
* Lower utilization
* Greater standardization.
Ethicon Endo-Surgery’s initial marketing strategy drew from the deep relationships Ethicon had built over the years servicing the highly complex sutures market. Because of the high number of suture SKUs, and the resulting difficult inventory issues, Ethicon salespeople held a unique position as the only representatives welcome to maintain directly the inventory of their own products in each hospital. As a result, they became intimately acquainted with hospital’s everyday concerns.
When Ethicon Endo-Surgery went head-to-head with U.S. Surgical, it recognized the influence of those buying agents and made sure to:
* Price aggressively: Upon introduction, Ethicon’s stapling products often were priced as much as 50% below those of U.S. Surgical.
* Support standardization: Unlike U.S. Surgical, that catered to physician preferences, Ethicon Endo-Surgery aggressively pursued contracts with GPOs and chains structured to help administrators drive more consistent physician use of a narrower product line.
Ethicon Endo-Surgery’s initial success was built on catering to the critical decision-making audience of administrators that U.S. Surgical had failed to satisfy.
Because Aspect’s BIS monitor introduces the purchase of new equipment and disposable products to the operating room, it was critical to convey improved cost to administrators. Aspect therefore identified several ways by which the BIS monitor actually could increase profits.
* Decreased drug use: Anesthesiologists tend to dispense more medication than necessary to ensure that patients do not wake up during a medical procedure. With the BIS monitor, physicians are able to provide accurate doses of sedatives and anesthesia, resulting in lower drug utilization and reducing drug costs by 20% to 40% per surgery.
* Shortened recovery stays: Because doctors use less sedative on patients, recovery time is decreased by 33% to 55%. With patients recuperating faster than before, per-patient cost of care in the recovery room decreases considerably.
* Supporting standardization: Aspect formed strong partnerships with OEMs to insure compatibility with major equipment and signed purchasing contracts with all the key GPOs, helping administrators standardize business practices.
* Enhanced hospital revenue: Aspect has special press-kit materials for PR administrators, enabling them to leverage news of their hospital’s use of BIS monitoring to compete more effectively in their local market.
Gaining Patient Support
A significant trend in the health care arena is consumer-driven marketing. Increasingly, patients have become more involved in their own health destinies because of a quality-driven backlash against managed care and to substantially improved accessibility of information via the Internet. As their own advocates, patients are taking decision-making power into their own hands. When considering treatment, patients are concerned with:
* Comfort
* Efficacy
* Familiarity
GE Medical capitalized on the recent trend of patient influence by launching an advertising campaign aimed directly at the patient population. To convince patients its MRI truly was patient-friendly, GE Medical focused on
* Decreased patient anxiety: Anyone who has undergone an MRI in a traditional machine recognizes the level of discomfort because of the tight space and loud pinging sound of the machine. It is estimated that anxiety causes patients to forego 10% of all MRI exams. GE’s television advertising campaign tries to allay characteristic fears that accompany MRI scanning, presenting a calm patient undergoing a quiet scan in the spacious machine.
* Increased product familiarity: Placing advertising on television serves to increase brand awareness and product recognition. Patients feel comfortable using products and devices with which they are familiar.
Citing quieter technology, reduced exam time and enhanced openness, GE Medical presents its MRI as optimizing comfort while offering superior technology.
Aspect Medical also has benefited from the patient revolution. Yet to spend a single dollar on direct-to-consumer advertising, Aspect directs marketing toward patients while relying on information delivery from physicians and administrators. Rather than interceding in these relationships, Aspect supplies providers with these messages:
* Increased efficacy: Because doctors are able to more precisely administer anesthetics, patient recovery time is significantly decreased
* Increased patient confidence: The use of the BIS monitor system, with its documented performance benefits, reassures patients they are unlikely to suffer from anesthesia under-dosing
* Improved emotional state: By reducing patient anxiety about under-dosing and accelerating their return to loved ones and everyday life, BIS monitoring can provide substantial emotional comfort.
Differentiated Marketing Pays Off
Customer targeting drives significant financial benefits to innovative companies.
While some companies choose to hone in on a single population, other device manufacturers have found success through targeting multiple customer segments. However a company approaches marketing, it is key to recognize diverse customer segments and the primary concerns within each category by:
* Segmenting potential user and buyer group
* Prioritizing which segments to target
* Recognizing the most important considerations of these segments
* Constructing and communicating a message about the product that will speak directly to their concerns.
By conveying messages that speak to the priorities of their key constituencies, manufacturers can realize significant profit growth.
Amy Case is Managing Director and Katie Roda an Associate with Case Strategy LLC, Portsmouth, N.H., a consulting firm focused on driving profit growth and customer value for their health care clients. Case Strategy can be reached at 603-433-9222. E-mail Ms. Case at acase@casestrategy.com or visit the firm’s Web site at www.casestrategy.com.
COPYRIGHT 2001 J.B. Lippincott Company
COPYRIGHT 2001 Gale Group
