Every medical device marketer is familiar with Key Opinion Leaders (KOLs), Key accounts, and their spokesperson- the Key Account Manager.
In this post, I will discuss two common traps in New Product Development: the conflict between following your KOLs, or the biggest and most essential account versus addressing the needs of a large market listening to the VOC.
Let’s start with KOLs.
Key Opinion Leaders: A Definition
A key opinion leader (KOL) in the healthcare field is a physician, nurse, researcher, hospital executive, etc that has proven experience and expertise in a specific discipline, who is trusted and respected by his/her colleagues.
Medical device companies can use their KOL network to gather valuable insights in various phases of new product development.
Moreover, KOLs are influential, so companies leverage the relationship to access the target audience, disseminate their experience with the product and facilitate its adoption.
The Role Of KOLs In New Product Development
The scientific base of KOLs involvement in product development is the studies and articles of Eric von Hippel that were applied successfully in 3M and many other companies.
According to von Hippel:
“Lead users are known to pioneer new types of products and services that later prove to be of general value to many others.
Lead users are defined as having two characteristics:
- they are ahead of the majority of users in their populations with respect to an important market trend
- they expect to gain relatively high benefits from a solution to the needs they encounter at their leading-edge market position.”
By interacting with KOLs properly and effectively, product managers can identify opportunities to enhance existing products or conceive new products or services.
In addition, since KOLs are generally well-versed about the new trends in their domain of interest, their behaviors, practices, and needs may be helpful to predict the future & overall market directions.
Opportunities And Risks Of KOLs Involvement In Product Development
For example KOLs can provide useful insights in:
- identifying unmet needs and new tendency
- participating in early tests and product validation
- ensuring that the product design meets expectations
- developing clinical trials or clinical experience
- designing and delivering training for users
However, there are a couple of risks in relying on KOLs. Luckily, I’ll discuss some of them with you below.
First, relying “only” on KOLs can pose a risk to developing a product that meets the requirements of a restricted group of users. And you may, therefore, discover either close to market launch, or after the launch, that the appeal of the product is limited.
In my experience, KOLs often treat complex cases that other physicians never see or refer to. Consequently, KOLs could have different needs and wants compared to mainstream physicians due to the population of the treated patients.
Another risk is related to the KOLs and leads users’ definition.
Since the two definitions do not overlap, there is the chance that a KOL leader involved in product development does not have the correct profile to be considered a lead user.
For example, a KOL could have knowledge and expertise about his discipline. But could be very conservative regarding new trends and therefore not be the correct person for breakthrough innovation but, for example, adequate for incremental innovation.
How To Avoid The Risks Of KOLs Involvement In Product Development
To minimize the risks, you need to clearly define your criteria to select the participants (KOLs or not KOLs), in order to obtain qualified individuals that will provide useful information.
When using KOLs as a source of your VOC, my suggestion is to not limit the market research to KOLs alone. But enlarge the panel to include participants with different characteristics to collect information that represents the target market.
Moreover, during the data analysis, you should compare the results from KOLs against that of the rest of the market.
Another trap in product development is the responsiveness to the needs of the key account(s); instead, of the needs of the market-at-large.
In many companies, product development pipelines are full of projects to develop products designed for their key accounts. Although this is natural, these projects, if not deeply evaluated, risk using resources for other projects that might result in more innovation and profitability.
Key Accounts: A Definition
There are several definitions of Key accounts, and in another post, I will discuss how to identify key accounts.
My favorite definition is: Key accounts are the most valuable customers of the organization. The problem is that in many medical device companies, the only parameter used to identify Key Account is sales volume. Hence, the key account is often the biggest account. And if we are talking about the international market- the biggest distributor.
Opportunities And Risks Of Key Accounts Involvement In Product Development
Your Key Accounts (distributor) can provide some benefits:
- Address the needs of a big market for the company
- Increase the level of relationship toward a partnership
- Sign contracts locking in volumes potentially covering part of the development costs
- Increasing the prestige of the company due to the strong relationship with the key account
However, as for the KOLs, there are a couple of risks you should be aware of.
The first is the amount of R&D resources focused on projects for the key account(s).
In my experience, R&D resources are very limited, and giving too much attention to one single account, customer, market could endanger the development pipeline.
The second is that when following your key account, it’s unlikely you will radically or substantially innovate. More so, the reason why it is your key account is that your products already satisfy the most important needs.
How To Avoid The Risks Of Key Account Involvement In Product Development
Consider the R&D resources invested in “custom” products for key accounts and those invested in more general products; if necessary, rebalance.
Be aware, the Key account manager who is the voice of the Key (biggest) Account in the company, will advocate for his customer by forecasting unimaginable future results. And suggesting that the product will have an appeal to other customers.
Unfortunately, it is not always the case.
Basically, don’t let key accounts decide your entire new product pipeline.
As already discussed, product development should be based on solid VOC research, as exploring the needs of only a very limited sample is fundamentally wrong.
In addition, interviewing a broad cross-section of customers in the market will provide useful information to validate or invalidate the new development for your Key Account.
Final word
Collecting the VOC is not an exact science, and some compromises are often needed.
KOLs and Key Account can be useful sources of insight and ideas.
However, knowing the traps that they can create is the first step to avoid falling into.
Are you aware of other traps in new product development? Please share your ideas in the comment and remember to subscribe.