What is the core of strategic marketing for medical devices?
Well, this short article is the first of a couple posts in which I consider what I have found about the trilogy of strategic marketing: Segmentation, Targeting and Positioning, to be useful for our industry.
Hence, I will use it as an opportunity to share some patterns I have seen in several companies during my career.
Introduction
“If you’re not thinking segmentation, you’re not thinking.“
Theodore Levitt
As a salesperson, it was difficult for me to understand and accept that there were customers that I shouldn’t be targeting because the offering wasn’t going to convince them.
After all, I had a general idea that my job as a marketer was to help potential customers see why that particular product was a must-have.
In the real sense, there are several potential customers, but these customers have different needs and buying practices- The sooner I accepted this, the more productive I became as a salesperson.
Furthermore, I realized that the companies in any specific sector of the huge medical device market vary widely in their abilities to serve different segments.
Therefore, in this environment, companies must design customer-driven strategies to develop the right product and marketing for the right customers. And here is where segmentation, targeting and positioning is so essential.
What Are Segmentation, Targeting And Positioning?
Strategic marketing of medical devices is a culture that I have seen successful companies imbibe and practice.
Hence, below I’ll shed more light on each aspect of this form of marketing.
Segmentation: this is the process of dividing a heterogeneous market into few homogeneous groups of customers.
Targeting: this aspect of strategic marketing focuses on the process of approaching one or more groups of customers that the company has decided to aim its sales and marketing efforts at.
Positioning: is the process by which the company’s marketing efforts tries to create an image and identity in the mind of their target segment(s)- for the company and its products.
With that being said, let’s do a close and intense review on Segmentation. And shortly you’ll also learn more about it’s strategies and requirements.
Segmentation
The goal of the segmentation is to divide the total market into distinct and homogeneous sub-groups of customers with similar needs and characteristics.
Once that is achieved, these needs and characteristics make the segment inclined to respond to product features, benefits and to the marketing activities.
Please note that, not every game is worth playing, and not every segment is worthy to be a meaningful segment.
Requirements for Effective Segmentation
The requirements are straightforward and easy to adhere to:
Firstly, the different segments must be based on a logical framework. An example is having common needs or characteristics that will imply responding to a specific marketing mix and marketing program.
The market should be heterogeneous. That is, if the customers’ product needs are the same or very similar, then the segmentation makes no sense.
The size, sales potential, costs to serve and profits of different segments must be estimated with a sufficient degree of accuracy.
One or more segments must generate a potential profit that would justify developing and commercializing the product.
The company should be able to reach the target segment.
Segmentation Strategies
Selecting the right segmentation variable is critical. The variable must be measurable to segment the market accurately and you can use one or more variables to segment the market.
The most common strategies are:
- Demographic (based on age, career stage, sex, socio-economic information, etc…)
- Psychographic (based on lifestyle, social status, activities, opinions, interests, etc…)
- Behavioural (based on behaviour ex. usage rate H/M/L, loyalty, benefit sought)
- Geographic (based on location)
- Hybrid approach (a combination of the previous)
Although the variables used to segment the market were developed with a focus on consumer goods, they can be applied to the medical device market.
Criteria For Segmentation
Segmenting the market for a medical device product is generally based on a combination of the different criteria; for example, the rhinoplasty market could be segmented according to the specialty of the surgeon performing the procedure.
Likewise, ENT (ear, nose and throat) surgery, plastic surgery and maxillofacial surgery combined with the number of procedures per month.
In this way a company can build up a marketing program designed for the segment of ENT surgeons performing a high volume of rhinoplasty procedure per month.
Similarly, the spine market could be segmented into different groups based on the typology and complexity of the cases.
That way, a company can have a product and marketing activities dedicated only to spine surgeons performing endoscopic cases.
Final Remarks
Think you know all there is about strategic marketing?
Well, as informative as this is, I’ll like to remind you that Segmentation is only one of three aspects of strategic marketing.
The second part of this article will concentrate on targeting from the marketing and sales perspective and on product positioning. Stay tuned and subscribe to avoid missing a post.