Jim Poggi
By Jim Poggi
How distributor reps can help a product launch succeed
For month’s column, I spent some time thinking about the new product launches I’ve managed or experienced. Almost all of those launches started with boundless enthusiasm and excitement by me and the product’s supplier. Some were obvious winners like flu kits and reader technology. Others either failed outright or never met expectations.
I plan to share my thoughts and experiences so you – the account managers tasked with understanding and selling these new products – can benefit from what I’ve learned. Many of my experiences are related to lab products, but the themes apply to any product category.
Once your company has evaluated and agreed to launch a new product, you can be confident they’ve done their due diligence and have some well-established expectations about market acceptance and revenue and margin achievement. How should you do your due diligence and prepare to succeed?
Defining “new”
First, understand what “new” means for this product. Just how new it is makes a big difference to your customers and you. Is the product or service unique and a revolutionary change in patient care? These types of products typically require more time to take hold in the market. I think of allergy and cancer immunotherapy as well as BNP when it was launched a few years ago when I think of truly revolutionary products.
Sometimes new simply means a step forward, an improvement in current tests or products. Influenza test readers come to mind, as does EMR connectivity for smaller lab instruments. These incremental improvements are easier to explain to customers and typically address an unmet customer need. With the right amount of focus, they can take off quickly.
“New” sets the tone for much of our thinking about how much time, energy and focus to devote to the product. As you think about the new product you have been offered, it makes sense to direct your thinking to the customers you serve.
- Which of your customers will be most interested in this product?
- Will it be a mainstream product used widely by most customers?
- Does it replace current technologies or simply represent “a better mouse trap?”
- Is it only suited to your most forward-thinking customers?
- Can it help you to finally bring an exciting new product to prospects you want to convert to customers?
Setting your targets appropriately can save you a lot of time and wasted effort down the road.
We all know that medical practice tends to adopt new tests and therapies slowly to assure proper performance and true value to clinicians and their patients. Adoption of EMR comes to mind. Despite generous incentives to adopt EMR, the massive change in the clinician/patient experience and questions about how to migrate current records into the new EMR solution held adoption back to a large degree.
I also like to test the new product I am offered against well established benchmarks of clinical customer value. Does the product improve clinical patient outcomes? Does it improve workflow? How about better economic outcomes for the practice? The more balanced the customer benefits are, the more likely it is to be adopted readily.
We have all seen the challenges we experience when a benefit in one area leads to a disadvantage in another area. There are lab tests that offer exceptional clinical value but take longer than the 15 minutes typically considered the average patient visit time. It takes greater care to effectively sell these types of products and practice acceptance is usually based on how well the benefits match their practice objectives.
For lab products in particular, does the new product offer greater accuracy and faster time to result, or does it address an important patient condition clinicians encounter every day, such as heart disease, cancer and diabetes? Finally, does the product help to initiate or modify a patient treatment program?
Price
How does cost and price fit into the equation? This can be tricky whether reimbursement is high OR low compared to end user cost. Make sure you can confirm with the supplier that your cost and the customer’s end user price are grounded in reality. All too often, list prices tend to be unrealistic in the marketplace. The distribution account manager needs to be confident in the margin based on anticipated average customer selling price. At the same time, beware of differences in end user cost to reimbursement that are so large that they cause different problems: risk of over-utilization and ultimately scrutiny, particularly be private payers.
Input
What about customer input? Ask your supplier for references, especially local ones, and be sure to verify the customer perspective. What is the reason they adopted the technology? Is it clinically better? Which types of physician practices do they see this product helping?
When I had a territory, I used the “two types of customer” test. When I wanted to gain input on new products, I used to expose the products to two very different types of customers. I wanted to hear from my loyal customers who trusted me for products that delivered excellent clinical value along with my knowledge and expertise in lab. I also wanted to hear from the customers who considered me “just another sales guy trying to sell us something”. Their perspectives were typically very different and I learned different things from the input of both groups. When their opinions were similar, whether positive or negative, I could be confident that product acceptance would follow their opinion. When different, it caused me to seek further input.
Finally, trust your supplier and colleagues. Every established supplier relies on product quality, market fit and credibility to gain your trust and acceptance and to assure that their solution fits smoothly into the customer’s setting as an important solution. Make sure to ask the right questions and ask to visit current customers with your supplier or to set up a workday to expose the product with your customers and prospects.
Your colleagues in the field and the home office can help you gain additional perspective and help you formulate thoughts and questions you might not have thought about before.
At the end of the day, while we are always looking for an answer to the often-asked customer question “What’s new?”, a little advanced planning can help us grow our business quickly or avoid needless fire drill management down the road. Time spent now assures happier customers, better references for you and an even stronger reputation as a consultant to your customers and prospects. Plan to win.