Time to plant a tree:
marketing and the downturn

The troubled economic climate raises the stakes for marketing as the cutting edge of any medtech company’s business strategy. As marketing experts Baba Awopetu, Timo Fotheringham and Princewill Osaro Omorogiuwa explain, this is a make or break time: those stuck in the mud will lose, but those who can get to grips with the challenges will profit from the tough competition that lies ahead.

The sudden change in the economic climate has impacted on most industries and functions. Slowdown in sales, shift from profits to losses, redundancies and closing down sales are some of the symptoms of the most severe economic challenge for a generation. How does this affect the healthcare environment? Traditionally the healthcare market is insulated from market forces that affect other industries – but it’s important for medical technology companies to take note of these dramatic changes. In truth, there will not be a better opportunity for us to rethink our business model and practices. This article looks at some of the changes that marketers need to consider.

The bright side

First things first: the fundamentals of our business are good, so there are plenty of reasons for optimism. Though times are tough and adjustments will not be easy, there are upsides for those who can adapt. Demographics, lifestyles and expectations all mean that the underlying demand for our services remains strong. That’s the good news.

The bad news, for some, is that inauthentic marketing organisations will come under increasing pressure. The current scenario offers opportunities for genuine marketers, but will make life harder for the imposters. Value delivered to stakeholders will come under increasing scrutiny – so if you are delivering value you will thrive; if not, you are likely to be found out. In short, the lesson of the business environment is that product orientation and hard selling will not suffice!

Marketers, like other functions, are being asked to do more with less. Since it is not possible to do more of the same with fewer resources, it is crucial that we do the right things. This means that marketers need to go back to basics and make sure they get the fundamentals of marketing right. Although the current economic climate makes the life of most marketing professionals more difficult, at the same time it facilitates changes within organisations as senior management becomes aware of the need to evolve. This is an opportunity to make lasting changes and set the course for a successful future.

There are several areas where, in our view, marketers can differentiate themselves from the pack and thrive in this cold climate.

Segment or die

Segmentation in the medical technology arena is a myth: most talk about it, but very few do it. Now is the time to adopt this arguably most fundamental principle of marketing in practice. Marketing is all about ensuring that an organisation effectively identifies and meets the needs of customers profitably. Products and services are designed to meet needs, and the extent to which customer needs vary is the extent to which we need to segment markets.

Half a century or so ago, the rail industry hit a difficult patch as its growth slowed significantly. The reason it stopped growing was not that people did not need transportation any longer, but that their needs were being served better by alternatives such as cars and aeroplanes. In more recent times, the need for portable music on the go has not diminished: it has just moved from the Walkman to the MP3 player and, more recently, to the mobile phone. These examples show that although customer needs have not changed significantly, new technologies have been used to serve them better.

Companies have started to realise that product orientation is doomed to failure in the long term. As current events surrounding the US automotive industry show, producing goods that customers don’t want can be very costly and even threaten a major organisation’s existence. Though customer orientation has proved to be a far more effective approach, it is like trying to push water uphill if it is not accompanied with an authentic approach to segmentation. Without an accurate understanding of the needs we are trying to meet, how can we hope to serve them well?

It is time for us to get back to basics: to understand the needs we are serving, and define and segment our markets properly. You can segment a market without serving it effectively – but you cannot serve a market effectively without segmenting it. The future winners in the healthcare industry will have identified real segments in their market, and will have solutions that satisfy the needs of their target segments.

To brand or not to brand

We are obsessed with branding, rather than the critical art of brand building. However, this subtle difference in terminology has a huge impact on our business. Brands matter, we are told, and they do. Those who have real brands will benefit in the coming months and years, and those who do not will be found out. Nonetheless, the opportunity is there to engage in the difficult but rewarding task of brand building. Branding is about identification, naming, signs and symbols. Brand building is concerned with delivering consistent and deliberate value that is reinforced to the customers through marketing communications.

Too many marketers are heavily into the visibility that branding affords, and too few get stuck into the more rewarding activity of building brands by delivering value. Marketers need to step back from our current obsession with communicating product features, and instead lead the brand building process. Future success will be based on compelling propositions, which can only be made by those who are actively engaged in brand building. In short, we need to spend more time building the house and less time painting it.

An old proverb says: The best time to plant a tree is twenty years ago. The second best time is now. Realising the essential principles of marketing through segmentation, brand building and strategic planning will enable medical technology companies to come out of this crisis stronger than they were before.

Time to innovate

We love innovation, and rightly so – but is it time to rethink innovation? Most of our innovation is product-focused and R&D driven, but there is a need for marketers to play a bigger role in this field. Engineers left to their own (medical) devices will surely innovate; however, the new products risk being stillborn if they are not marketorientated. It is thus vital for marketers, who have a deep understanding of their customers, to be part of the innovation process and guide the new product in the right direction.

The critical point here is that we need to move away from an emphasis on ‘clever’ features and ‘brainwave’ technologies that do not deliver real value to customers – totally differentiated, yet totally irrelevant! The innovations that count are born out of an identified customer problem, and thus are customer-focused. When our marketing processes are working effectively, the whole organisation – including the engineers – belongs to the marketing team. In today’s market, where the voice for value is getting louder and louder, there is no room for innovations that are not customer-focused.

The other opportunity to optimise our innovations is by effectively managing their diffusion. Too often, the level of brainpower that goes into developing the innovation is not applied when it is time to take the innovation to market. All customers are not equal, and identifying and understanding the various adoption categories (as defined by Everett Rogers) is vital to the successful diffusion of innovation. Many viable innovations fail due to a poor understanding of how to diffuse them and create a ‘buzz’ in the market. Many papers have been published on this subject, including empirical research within the healthcare arena. Given the role that new products play in most of our business strategies, getting up to speed in this regard is no longer optional.

The current scenario offers opportunities for genuine marketers, but will make life harder for the imposters. Value delivered to stakeholders will come under increasing scrutiny – so if you are delivering value you will thrive; if not, you are likely to be found out. In short, product orientation and hard selling will not suffice!

I have a plan

We all have a plan... but now, more than ever, our plans are facing a real test. For those who perform yearly rituals mislabelled as planning, the game is up. The idea that planning is about bringing the future into the present, so that we can do something about it, has never been more crucial than now. As the old axiom goes: Only when the tide goes in do we know who is swimming without a swimming costume. The current business environment will expose those who think scenario planning and blue sky thinking are team-building exercises.

Even copycats may appear to be successful when nothing changes. But when the environment changes in major ways, only those who plan and strategise will survive. The questions being asked today require real answers, and will drive a change in orientation for many healthcare marketers. We need to get back to basics, take planning seriously and broaden our scope to allow for all contingencies. Change is inevitable, so we should look for the first signs of it.

As the economy plunges further into recession, it becomes clear that all companies should have made changes two or three years ago in order to be competitive now. Many have missed that opportunity – but the good news is that it is not too late. Another old proverb says: The best time to plant a tree is twenty years ago. The second best time is now. Realising the essential principles of marketing through segmentation, brand building and strategic planning will enable medical technology companies to come out of this crisis stronger than they were before.

Baba Awopetu ( btawopetu@yahoo.co.uk) is a visiting lecturer at the Marketers’ Forum. Timo Fotheringham ( timo.fotheringham@googlemail.com) is an international marketer who specialises in CRM. Princewill Osaro Omorogiuwa ( princewill@yahoo.co.uk) is a visiting lecturer at the London School of Marketing and CEO of the Simon Page Business School.

 

 

 

Time Management for Dummies
by Clare Evans ( Wiley, pb, £9.99 )

Ever had the feeling you really should get to grips with time management, read a book about it maybe, but there just aren’t enough hours in the day? This new addition to the successful For Dummies series (which helped Ross and Rachel get back together) may be the key. Its modular structure, with chapters broken down into sections and points presented as lists, allows you to dip in and out and to make notes quickly and easily. This is good news for anyone who is struggling.

The content of this guide is very sound: essential principles such as setting your goals and organising your day are clearly explained, and effective management of the ‘to do’ list (which many people handle badly) is discussed. There’s a helpful section on how to make efficient use of your e-mail account, so that it saves you time instead of being a black hole into which your time disappears. The final chapter explains how new technologies such as PDAs and memory sticks can make your working life easier.

This book could be a lifesaver for someone entering healthcare sales or marketing from another line of work; or someone who has developed ‘tunnel vision’ and cannot break bad habits; or someone struggling to get the best from new technology. It addresses the reader directly, helping them to embed clear thinking in their everyday work.

However, if you have been trained in time management for your role and are used to organising your workload, this book will only spell out what you already do every day. Also, it doesn’t look at the different kinds of time management challenge that might arise with a change in role – for example, having to think in terms of yearly rather than monthly targets.

But this isn’t a book for professionals who are well versed in time management. It’s a book for people looking for guidance. Dummies may need this book to help them crack time management problems, but only fools would expect such problems to solve themselves.

Michael Tinkler is Business Development Manager for On Target.

On Target special offer Wiley is offering a free copy of Time Management for Dummies to the first 3 On Target readers who answer this question correctly: Who wrote the song ‘Who Knows Where the Time Goes ’? Send your answer to: joel.lane@healthpublishing.co.uk.

The Age of Aging by George Magnus ( Wiley, hb, £17.95 )

Over the next two decades, the UK’s population of over-65s will grow in numbers by more than half. The increase in population of those under 18 will barely register. We can’t ignore the numbers. How will Western society adapt as Silver Savers outnumber our children? And how will that single statistic affect healthcare on our doorstep?

Around three years ago, George Magnus was asked to produce research reports on some of the major economic and market consequences of demographic change and population aging. Those thoughts became the dramatic spur for his intensely readable, utterly disturbing and optimistically redemptive book The Age of Aging (subtitled How Demographics are Changing the Global Economy and Our World).

Demographics make a difference because they put so much on the slide: birth, death, disease, migration. All play their part because, where aging happens at a variable rate across the globe, the close bond between demographics and gerontology cannot be ignored. Are countries like Japan, where aging is most pronounced, exporting it to less developed nations unprepared for a geriatric onslaught?

A little over 300 years ago, just 4% of the world’s people were over 65; by 2100, over 20% of us will have reached that age. The NHS has noted that cases of heart failure will increase by over 50% between now and 2031. How can that healthcare burden, in terms of both finance and workload, be shouldered?

Magnus’ book is not all dark sky, and his style is authoritative but amenable. In conclusion, he borrows Bill Clinton’s 1991 statement that we should “reinvent government to help solve the problems of real people”, using this to offer the notion that our own children have the power to engineer social change for the benefit of every generation.

David Learner is Business Development and Resourcing Manager at Delta Consultants.

On Target special offer winners: free copies of The Little Book of Medical Breakthroughs by Dr Naomi Craft were won by Ivan Clark, Cristina McDowall and Kristell Renault. Will it be you next time?

 

 

In the tenth of our series on healthcare industry professionals, David Bowie, Head of Sales & Marketing for medical device company Aircraft Medical, talks to On Target about his working life.

How has your role changed with the increasing success of Aircraft Medical?

One thing is that the travelling hasn’t decreased, but it has changed. It’s becoming more focused on serving our established and growing international distribution network, and also looking to develop new geographical partners throughout the world.

With the success of our product, the McGrath Series 5 Portable Laryngoscope, I’m now in a position to build a full Sales & Marketing team at Aircraft – because obviously we need to support our customer and distributor base. I’m now able to develop in-field support as well as support at our HQ in Edinburgh. Ultimately my role is now starting to become more strategic, as it needs to be.

In the early days, I’m proud to say, I sold the very first McGrath products myself. We were a very small company then. Now we have a network of distributors in 18 countries. So within the last two to three years, we’ve grown from a sales team of one to an effective international sales team of more than 100.

Who are your target customers? How do you reach them?

Our main end-user customers are anaesthetists, and more generally anyone involved in intubation, as well as our distributors. The McGrath Video 5 Portable Laryngoscope is aimed at overcoming issues of difficult intubations, both expected and unanticipated. So we start with anaesthetists, who are intubating day in and day out; but we’re also starting to target intensivists, emergency doctors and paramedics – and we’re finding that the McGrath is in many ways being used as a routine airway tool.

The main way to reach these customers is to raise the awareness of the McGrath product at key international congresses, airway workshops and symposia. We’ve also now built a network of international KOLs, which has led to a number of clinical studies being published; and there’s a large number that are still under way, and new ones starting all the time.

One of the things we’ve been focused on doing from the early stages is building a strong company and product brand image. This is refl ected in all our marketing communications, whether at exhibitions, electronically via e-mail or the web, or in terms of our product design and packaging. We work with exclusive distributors in each of our target markets; they are trained by us and given all the support that they need to sell the product. That’s been a crucial part of our success. We’ve vetted over 300 distribution companies so far, and taken the time to make sure that we get the right partners. Having a careful approach has been crucial to our successes to date.

What happens in your typical working week? What challenges do you face?

There is absolutely no such thing as a typical working week for me! In the past few weeks, for instance, it’s been a complete mixture. I attended the American Society of Anaesthesiologists in Orlando, Florida, with some members of my Sales and Marketing team and our Design team, together with our USA distribution partner. We showcased the McGrath on our own in-house designed exhibition stand where we took 600 square feet of space, which is pretty bold for a small company.

Then I was back in Scotland for a few days, before heading off again to Sydney to visit our newly appointed distributor and introduce them to my new Asia Pacific Regional Sales Manager, and attend a couple of exhibitions and workshops out there. On the way back I spent a couple of days in Singapore, finalising the details for one of our first Asia Pacific distribution partners there. So it’s been a very exciting last few weeks, a little tiring – Q4 is a very busy time of year for exhibitions – a lot of weekends, a lot of international travel. This week I’m in the office for four days to catch up on paperwork, make sure everything’s working fine with my team, address particular issues with them if necessary, and plan things for next year. That gives you a flavour of the things I get involved in.

As regards challenges, I think my main challenge now is to continue to build our coverage and build a successful team to service the market. We need to continue to grow the market; and we have ambitious targets in terms of being number one globally in our particular field, so we need to stay ahead of the competition. My role will continue to grow, as it will for the rest of the company. That’s what excites me: to continue to grow with Aircraft Medical.

 

 

European Commission urges infection control measures The European Commission has sent recommendations to national governments in a bid to reduce the frequency of healthcare-acquired infections (HAIs) in Europe. The Stockholm-based European Centre for Disease Prevention and Control says that one in 20 hospital patients in Europe become infected while in hospital. Such infections are estimated to cause or contribute to 147,000 deaths annually. The Commission calculates that the financial burden of HAIs on European healthcare systems amounts to €5.5bn per year. EU health commissioner Androulla Vassiliou said: “Patient safety is the cornerstone of good quality healthcare. I would like to see a Europe for patients where safety is paramount and citizens are confident and knowledgeable about the care they receive.” The Commission points to evidence that 20–30% of HAIs can be prevented, and that the measures are highly cost-effective. It is urging governments to put in place a comprehensive national strategy, developing guidelines on screening and ensuring that infection prevention and control measures are well resourced. Statistics from the Health Protection Agency (HPA) show that MRSA bloodstream infections in England are continuing to fall: there were 725 such infections in England between July and September, compared with 837 in the previous quarter.

Patient website on hip and knee implants A new website has been launched to provide independent information for patients undergoing hip and knee replacement surgery in the UK. The website, www.hipandkneenetwork.co.uk, is part-funded by the EU and employs a panel of orthopaedic surgeons. About 160,000 hip and knee replacements are carried out each year in the UK, and the number has been predicted to treble in the next 20 years. The Hip and Knee Network enables patients to access data on the quality and take-up of all hip and knee implants on the market. The website is independent of the NHS, private medicine and implant suppliers. All information on the site is produced and/or vetted by the specialist panel. Mr David Stock, an orthopaedic consultant and member of the site’s panel, said: “This project is about creating a community for patients and surgeons involved in hip and knee replacement surgery.” By combining their efforts, he said, the panel will “help patients find the right quality of information.” The site enables patients to search for a surgeon or hospital conducting hip and knee replacement surgery anywhere in the UK, ask the panel a question or take a test to assess their need for hip or knee surgery. It also provides forums for professional debate.

Bomb survivor wears prosthetic arm A survivor of the 7/7 bombing in London has received a clip-on arm that fuses directly with her own tissue. Kira Mason, 51, lost her left arm to a bomb in 2005. In a clinical trial, she was given an implant that enables her to attach a prosthetic arm to her own skeleton and skin without causing infection. The implant technique, known as Intraosseous Transcutaneous Amputation Prosthesis (ITAP), is based on the growth of reindeer antlers. A titanium alloy rod is attached to a bone protruding through the skin, which heals around it. A prosthesis is then attached to the joint, avoiding the discomfort caused by sockets or straps. “My grandson likes to call me a cyborg,” Mrs Mason said. “But the implant looks and feels much better than the prostheses I’d tried before, and is so convenient. I just wake up, clip on the arm and away I go.” Battery-powered sensors allow Mrs Mason to grip objects with her artificial hand by flexing her upper arm muscles. “I can hold both a knife and fork to eat and even do delicate tasks such as opening a packet of butter,” she said. The ITAP was developed by Professor Gordon Blunn of University College London and UK medical device company Stanmore Implants. Researchers believe it could lead to functional replacement limbs that respond to nervous commands.

Cancer strategy review stresses early intervention The first annual review of the NHS Cancer Reform Strategy identifies early diagnosis and increasing the capacity of radiotherapy services as key priorities. The NHS cancer reform strategy, published in December 2007, is a five-year plan setting out measures to improve cancer services in England. The report notes that the national Bowel Cancer Screening Programme launched in 2006 has been rolled out further, with 40 screening centres (by November 2008) leading to the detection of 2000 cancers. By the end of 2009 it should be fully rolled out across England, with 100 screening centres. A national early diagnosis initiative was launched in 2008 to encourage people to present earlier. Professor Mike Richards, the National Cancer Director, said: “Late diagnosis has been a major factor in poor cancer survival rates, and this initiative should begin to tackle the problem.” The report says more effort is needed to ensure that radiotherapy services reach the 31-day waiting time target set for 2010. A radiotherapy capacity planning tool will be offered to all centres in spring 2009. The report also notes the need for more training in cancer surgery, including laparoscopic surgery. “We are on course to meet our target of a reduction of at least 20% in cancer death rates by 2010,” Professor Richards concluded.

Medtech companies in imaging partnership Two UK medtech companies have formed a partnership to help improve surgical outcomes by providing advanced imaging techniques. Acrobot, a company specialising in computer-assisted orthopaedic surgical navigation, and Alliance Medical, part of a European medical imaging company that supports more than 400 hospitals and clinics in the UK, will provide orthopaedic surgeons with an integrated process from CT scanning through to navigated joint replacement. Alliance Medical operates CT scanners that produce data using Acrobot’s Modeller software, enabling it to create 3D models of patients’ anatomy. These models enable surgeons to create ‘Patient Plans’ that can be used to provide detailed component sizing and position using Acrobot’s Planner software. The surgeon can reproduce the plan in theatre using Acrobot Navigator, which will now be available for a wider range of procedures. Graeme Brookes, CEO of Acrobot, said: “Advanced imaging and modelling has been shown to have a significant effect on surgical outcomes. When orthopaedic components are implanted accurately, the patient’s post-operative recovery time can be reduced and discomfort and complications can be minimised.” Elaine Head, Head of Alliance Medical Imaging Centres London, said: “Our centres provide easily accessible medical diagnostic modalities to thousands of people, and we are keen to be able to bring new techniques like Acrobot to a wider patient base in the future.”

News in Brief Scotland has set a six-week target for eight diagnostic tests from April, replacing the current nine-week target. The tests are MRI and CT scans, nonobstetric ultrasound, barium enema, upper gastrointestinal endoscopy, sigmoidoscopy, colonoscopy and cystoscopy. This follows nationwide success in meeting the current nineweek target. Vodafone Group has made an undisclosed investment in t+ Medical, a provider of mobile phone-based technology used to transfer patient biometric data. The technology is used by thousands of people in the UK to manage long-term health conditions. Pathology services in the UK should be transformed to improve quality, safety and efficiency in diagnostic tests, according to a new report by Lord Carter of Coles. The report looks at making services more responsive to patients’ needs. Recommendations include rapid adoption of new technology and enhancing IT connectivity. St. Jude Medical has acquired two international medtech companies for a total of $533 million: Radi Medical AB of Sweden and MediGuide Inc. of Israel. Radi’s devices include a system used to assess lesions in heart arteries. MediGuide’s medical positioning system uses tiny sensors to navigate inside the body. Renishaw, a UK medical device company, has invested in neurosurgery robotics. The company has acquired a 75% stake in Swiss company Schaerer Mayfield NeuroMate AG, which has a wholly-owned French subsidiary. The NeuroMate image-guided surgical robot has been used in more than 9000 neurosurgical procedures.