Is the Medical Device industry finally catching up?
The State of Digital Media in the Medical Technology Industry
Coming into 2015, the United States accounted for ⅓, or $110 billion, of the global Medtech revenue. This is certainly a positive, however the industry growth has stagnated and has allowed overseas competition to grow. The Medtech growth rate through 2020 is expected to be only 5%, compared to a 15% growth rate over the last 10 years. Meanwhile, countries such as Japan and China are generating increased competition against US companies.
One of the root causes of this market slowdown is the lack of VC investment in the US. Venture Capital funding peaked in 2007 and then regressed along with the American economy as a whole, and has since only made modest gains in the industry. The chart below on VC investment in medical devices and equipment clearly shows the ridgeback of a classic Stagnasaurus.
However, there is perhaps a light at the end of the tunnel: Digital Marketing.
By the time a customer reaches out to a product or service supplier, their purchase is 60% complete. This means that the majority of the transaction has occurred before that customer has even met a representative. From a marketer’s standpoint, this means there is a tremendous increase in the need to deliver experiences that inform customers and partners about the specific differentiated value of the company’s products and solutions, not simply their features and functions.
We are talking about immersive websites, engaging advertising, and 3D medical animations that engage the audience while describing the features and benefits of a given medical technology.
Just a few years ago, medical device company websites were mostly brochure-ware, but this industry is finally catching up with the times and beginning to engage its customers, whether they are selling B2B or B2C. It’s an exciting time.
Social media matters now, too: if a company isn’t engaging with a customer on the customer’s preferred platform, it doesn’t mean the conversation isn’t happening, it means it’s happening without them. It is therefore vital that Medtech companies and customers evolve together, shifting the focus from static sales channels to dynamic platforms that require engagement.
In addition to engaging customers better, digital marketing aids companies in the discovery of meaningful insights and causes changes in their behavior. More significantly it can provide real-time access to performance metrics, allowing marketers to maximize the efficiency of their investments. A great example of this is Infuse Medical’s Ether DCP, a mobile platform that enables an administrator to log into a web-based system, upload content into the system, and that content then dynamically and wirelessly syncs over the air with all the sales reps’ iPad apps. They don’t want to have to call marketing or track down the email that was sent out three weeks ago. They want the latest and greatest information and they want it at their fingertips, and so that’s why that really forms the foundation of being able to dynamically sync content with all the iPad applications out in the field.
Don’t worry if you aren’t there (yet). But it’s time to make sure you aren’t stuck in 2010 (or worse, 1999 — and yes, many of you are ….) and no, a one-page website with a text summary of your technology and an image is not cutting it.
Despite the clear advantages digital marketing brings to the industry, many Medtech companies are still lagging behind. In 2013, Grey Matter Marketing conducted a survey of workers in either the medical device or pharmaceutical and diagnostics fields. Almost 20% responded that they had made no digital marketing efforts, with 2/3 of that group saying they would do so in the next few years. 50% of all those surveyed said they do some digital marketing, but that it is not comprehensive. The final 30% responded that they have an annually updated plan. This means that 70% of the industry has yet to take full advantage of the progressive strategies digital marketing brings to the table.
That said, the market is trending in the right direction.
Two thirds of those that had a digital marketing budget in place increased that budget from the previous year. However, a majority of those companies stated that they lacked the internal resources to accomplish their goals. Other challenges come from difficulty securing funding and measuring the impact of digital marketing. At least 35% found their content to be too static and unengaging. 20% found a lack of support from leadership, which means the true value of digital marketing has yet to saturate the top ranks of the industry.
There is clearly a long way to go for Medtech companies to realize the quick impact digital marketing can make on their customers, but I am optimistic that this department will soon catch up to R&D, though only thoughtful and strategic marketing programs that understand and take advantage of these opportunities and evolve alongside them will see the ultimate result: Increased revenue performance and reduced cost of sales.
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