The Not-So-Secret ingredient to Business Success in the Medical Technology world
Segmentation plays a pivotal role in driving commercial success. Despite its significance, many companies in the medical technology sector have yet to implement a robust segmentation and targeting strategy, missing out on the immense benefits in efficiency it can bring.
Why segmentation matters more than you think
In the highly competitive medical devices industry, segmentation plays a pivotal role in driving commercial success. Despite its significance, many companies in this sector have yet to crack the code and implement a robust segmentation and targeting strategy, missing out on the immense benefits in efficiency it can bring.
Segmentation involves dividing the market into distinct groups based on various factors such as demographics, medical conditions, customer attitudinal and behavioral criteria or healthcare settings.
By understanding the unique needs and preferences of each segment, companies tailor their commercial strategies, creating targeted customer engagement programs that foster meaningful interactions and facilitate positive customer experiences. This approach leads to increased customer satisfaction, loyalty, and ultimately, a higher return on investment.
Whereas it can be a daunting process due to the complexity of the market and the type of data that exists, companies in the medical device sector that effectively segment their customer base and deploy tailored customer engagement programs experience higher customer retention rate compared to companies without segmentation strategies. This indicates that segmentation plays a crucial role in fostering customer loyalty.
Segmentation holds a unique significance in the medical technology: 3 key aspects
By leveraging segmentation effectively, medical technology companies can drive business growth, improve customer satisfaction, and make a meaningful impact in healthcare delivery. There are however 3 key aspects that make segmentation unique and challenging.
- Complex and multiple buying processes: Purchasing decisions in the medical technology sector often involve multiple stakeholders, intricate procurement processes, and regulatory considerations. Segmentation helps companies navigate these complexities by customizing their marketing and sales approaches to meet the specific requirements of each segment.
- Varied and multiple decision makers: One of the significant challenges in the context of segmentation in the medical technology sector is the presence of multiple decision makers. In this industry, purchasing decisions are often complex and involve various stakeholders, each with their own interests, priorities, and decision-making authority.
- Account-level versus product platform level: one notable challenge is deciding whether to adopt an account-level approach or a product-level approach.
This challenge arises from the need to determine whether to focus on segmenting customers based on the organization as a whole (account-level) or on individual products or product lines (product-level).
- Account-Level approach benefits and challenges:
This approach allows companies to understand the holistic needs, priorities, and preferences of the account. It enables them to develop tailored solutions and engagement strategies that address the organization’s specific challenges and objectives.
However, implementing an account-level approach requires access to comprehensive data about the account, including its size, structure, patient demographics, and strategic goals. Gathering and analyzing this data can be resource-intensive, especially for large and complex accounts.
Additionally, the account-level approach may overlook variations in needs and preferences within the healthcare institution’s different departments or decision-making units.
- Product-Level benefits and challenges:
This approach allows companies to align their segmentation strategies with the unique features, applications, and benefits of their products. It enables them to develop targeted messaging and marketing strategies that highlight the value proposition of each product and address the specific needs of different customer segments.
Implementing a product-level approach requires in-depth knowledge of each product’s market and customer base. Companies need to gather data on customer preferences, usage patterns, and product feedback.
Furthermore, focusing solely on products may overlook the broader organizational context and miss opportunities to provide integrated solutions that cater to the organization’s overall needs.
- Account-Level approach benefits and challenges:
How medical device companies flourish with targeted strategies
By implementing robust segmentation strategies, companies like Medtronic, Philips Healthcare, and Boston Scientific have achieved remarkable results. They have successfully developed targeted customer engagement programs, tools, and services that have enhanced customer satisfaction, fostered brand loyalty, and ultimately yielded a strong return on investment.
Medtronic stands as a prime example of a company driving commercial success through a robust segmentation strategy. They employ a multi-dimensional segmentation approach, considering factors such as medical conditions, geographical regions, and healthcare settings. By deeply understanding the needs and pain points of each segment, Medtronic has successfully developed targeted marketing campaigns and customer engagement programs. For instance, they provide disease-specific educational materials and support groups for patients, while offering specialized training programs and tools for healthcare professionals in specific regions. Medtronic’s segmentation-driven approach has allowed them to build strong relationships with customers, enhance brand loyalty, and achieve remarkable commercial success.
B. Philips Healthcare
Philips Healthcare, as a global leader in medical imaging and patient monitoring solutions, exemplifies the power of segmentation in driving targeted customer engagement. By understanding the unique needs and challenges of each segment, Philips Healthcare tailors their product offerings, customer support, and after-sales services. For instance, they provide specialized imaging solutions for radiology departments in large hospitals, while offering compact and portable monitoring devices for remote clinics or ambulatory care settings. This targeted approach allows Philips Healthcare to deliver tailored solutions, enhance customer satisfaction, and drive a strong return on investment.
C. Abbott Laboratories
Abbott Laboratories demonstrates the power of segmentation in driving targeted customer engagement. They segment their market based on various factors, including medical specialties, patient demographics, and geographic locations. By understanding the distinct needs of each segment, Abbott Laboratories tailors their marketing strategies, customer support, and after-sales services. For example, they offer specialized support programs for healthcare professionals in cardiology or endocrinology, while providing user-friendly diagnostic tools for patients of different age groups. This targeted approach enables Abbott Laboratories to deliver value to their customers, build trust, and achieve significant returns on their investment.
From trivial to tremendous: Harnessing the power of segmentation
In the rapidly evolving medical devices industry, the importance and power of segmentation cannot be overstated. Companies that embrace segmentation as a core strategy are able to unlock significant commercial success by tailoring their offerings, marketing efforts, and customer engagement programs to meet the unique needs of different market segments.
It is important to note that while many companies have recognized the importance of segmentation, there are still those that have yet to implement a comprehensive strategy. To succeed in the medical technology industry, companies must recognize that one size does not fit all. A tailored approach, driven by segmentation, allows for a deeper understanding of customers, more effective marketing, and the ability to develop products and services that truly make a difference in patient care.
As the industry continues to evolve and new technologies emerge, it is essential for companies to prioritize segmentation and leverage its power to inform their commercial strategies. By doing so, they can build stronger customer relationships, drive innovation, and achieve long-term success in the highly competitive medical devices market.