Readers Write: Healthcare IT Commercialization Success: Sophisticated Markets Require Sophisticated Strategies

Healthcare IT Commercialization Success: Sophisticated Markets Require Sophisticated Strategies
By Dean Kaufman

Dean Kaufman, MS is founder and CEO of Healthcare Service Consultants of Millburn, NJ.

About 75% of US-based healthcare IT start-up companies fail. That’s a shocking statistic.

Many blame lack of long-term funding. In reality, the failure can often be tied to not providing hard evidence of value and lack of understanding financial drivers. While these companies develop complex, sophisticated products to meet highly specialized needs of healthcare end users, their go-to-market strategy often follows the old “if you build it they will come” approach.

This just doesn’t work. Nor do common B2C and B2B commercialization strategies. Healthcare IT and digital health companies need a well thought out commercialization strategy that is tailored to meet the demands of a complicated and specialized buyer who is risk averse. This becomes even more difficult when a novel solution touches more than one clinical specialty.

The commercialization strategy for a healthcare IT or digital health company must include the following.

Step 1 – set the stage

Before launching the product, many pre-commercial activities need to occur. These activities center around market understanding and developing the proof points that are necessary to establish credibility and interest across clearly defined target audiences. Activities include:

• Establishing pilot sites. Early adopters can provide real use case examples and proof points to support claims. Pilots go beyond clinical trials or validation projects. They exist in live clinical settings that can prove tangible ROI.
• Understanding the sales cycle. In healthcare IT, sales cycles are often longer than expected. It’s important to understand buying cycles and who the decision makers and influencers are.
• Identifying what’s needed to support sales. Healthcare IT often requires a sales support team that can answer complex clinical, workflow or technical questions related to the deployment and use of the product.
• Supporting customers. Ensuring a smooth and timely implementation that results in a delighted customer is critical. but it’s often an underappreciated step in commercialization success. A team with the appropriate skills should be hired as developers typically do not have the people and workflow skills.
• Meeting regulatory requirements. Some healthcare IT solutions need to prove safety and efficacy via a 510(k). In addition, marketing teams need to discern what claims can and cannot be made before and after receiving official clearance.

Step 2 – develop and implement an effective sales strategy

Let’s be honest. No company in this space is selling their products on Amazon or Etsy. With complex healthcare IT products, a direct sales strategy is typically best. It results in complete control over the customer relationship and provides the best opportunity to gain an understanding of customer needs.

In some situations, a channel partnership strategy can be beneficial, especially when the product complements, augments, or can be embedded in another existing system. If pursuing a channel partner strategy, remember that ongoing training and support of the partner sales force is critical.

Step 3 – set realistic sales targets

Sales projections are an important component of a commercialization strategy. Take into account third-party market data as well as soft data such as sales and budget cycles, the prioritization of the challenges addressed by the product, and the complexity of the sale. Many large companies pulled out of the healthcare vertical because they could not realize revenue targets in the projected time frame.

Step 4 – establish a clinically-focused product awareness and demand generation program

A product marketing program that leverages early customer success in the clinical setting is key. These case studies should be leveraged to generate awareness of a solution’s value.

These go-to-market activities should start 12 to 24 months before the planned launch date. This affords enough time to gather proof points, establish a viable sales strategy and forecast, and generate market awareness and demand.

Healthcare IT companies need to have the internal or external talent required to bring these strategies to fruition. When it comes to product marketing in this space, the key to success lies in the ability to authentically connect with target audience. This not only requires content and outbound product marketing strategies that resonate with a sophisticated audience, it also calls for leadership that understands the clinical workflows and problems facing key decision-makers.

To truly connect with a target market, position the company as a thought leader by:

• Keenly focusing on developing messaging and content that reflects the lived experiences of target audiences. Content needs to build the credibility necessary to move prospects beyond awareness and build genuine interest in products and solutions.
• Demonstrating an understanding of clinical and technical challenges  and how the company’s innovation could solve them. Some startups mistakenly prioritize impressive leadership resumes over direct experience to impress potential investors.
• Understanding the unique pain points of healthcare organizations, leaders, and end users. For example, marketing teams need to create campaigns and materials that expressly illustrate how healthcare CIOs are concerned with issues such as cybersecurity, staffing, and systems integration, while radiology directors are fretting over employee burnout, quality of care, collaboration with clinicians across the spectrum, optimal dosing, and patient safety.
• Tapping into clinical knowledge. Such intelligence makes it possible to clearly communicate the value propositions of products and how they fit into clinical workflows or integrate with peripheral systems and devices.

When outsourcing marketing functions, it is important to ensure that potential partners have the needed clinical domain as well as product marketing understanding. For instance, a small company focusing on medical imaging should prioritize hiring a product marketing agency with a deep understanding of this specific clinical domain. This ensures that the messaging is effective and resonates with the target audience.

Healthcare IT marketing leaders and teams need to convey a depth of industry knowledge that resonates with a risk-averse, critical, and educated healthcare audience. This ability is far more important than experience in other industries or jumping on marketing trends that are prevalent in consumer or other commercial circles.