How Medical-device Manufacturers can Transform Marketing and Sales Capabilities
The rules of the road are changing for the medical-device industry. While strong demand, demographics, and value still generate interest and investment, shifting expectations are placing a heavier burden on commercial organizations. The most visible of these changes may be the new US medical-device tax, yet a number of other trends are threatening margins and flattening growth estimates. Increasing government-sponsored comparative-effectiveness research, narrowing provider margins, changing utilization patterns, and evolving patient and physician expectations all combine to create an environment where device manufacturers should reevaluate their commercial model to ensure that it remains relevant and responsive.
While none of these trends are new, there is a new urgency to getting a more relevant commercial model right. A commercial transformation has the potential to decisively shift the competitive balance of power in the industry. Although the specifics can vary by company, the following elements are hallmarks of a commercial transformation:
a multiyear effort designed to improve both commercial performance and the health of the organization
a program driven by marketing and sales but strongly cross-functional
adoption of a customer-centric mind-set across all functions
a focus on building sustainable commercial capabilities and better-run processes
Commercial transformation implies going beyond half measures. Past efforts that simply added (or cut) marketing dollars or sales reps might have provided short-term benefits but did not touch the underlying sales and marketing model. A true commercial transformation addresses the entire B2B commercial engine, including new approaches to targeting specific customers, constructing product and brand value propositions, reaching chosen customers, and maximizing the overall value captured from each.