Why You Should Care About Market Research

Many medical device companies are putting the cart before the horse when it comes to product development.

Brian Buntz

Many medical device companies have a flawed product development strategy. They develop a product that their engineers personally like, get regulatory approval for it, and then get it on the market as quickly as they can.

But considering how onerous it is to obtain regulatory approval for a product in the first place, it is a mistake to even start working on developing a new technology without a solid underpinning of customer input, says Jonathan Honiball, senior director, customer research at Pacific Consulting Group (PCG; Palo Alto, CA). (Ed note: Honiball will be speaking on the subject at the upcoming BIOMEDevice Boston event held May 6-7.)

Purpose-Driven Engineering

In marketing, the big buzzword now is purpose-driven marketing. Developing a product based on a customer feedback is purpose-driven engineering. Using ample market research during product development gives the organization a purpose and a shared vision, Honiball says.

But such a strategy is rare. Instead, many companies will launch a product only to see it fail or gain a relatively small piece of the market segment. They will then adapt it and relaunch it with the hope that it will be successful the second or third time around. But when you consider the number of possible permutations of possible product attributes, this seems like gambling. "If you think about a typical product, like a diabetes monitor, and list all of its properties, from the weight to the plastic to the screen size to the size of the memory, there are probably billions of combinations. The question is: if you could only have one, which one would you build?" Honiball says. "Is the one you pick going to be the one that gets a 20% share of the market?"

In addition to product features, the price of the final product is also a crucial consideration to design for early on, as it informs the entire engineering process. To get a firm handle on that, Honiball recommends doing a Van Westendorp analysis. "To understand why that is important, think of the pitfalls of asking your target customers how much they would pay for your product?" That seems like an obvious question. "But you can't actually do that," he says. "You have two basic types of people: one that will bargain hunt and the other people would get so excited about something that will pay more than it is worth," he says. "You have this bargain hunting behavior contrasted with this wild exuberance."

To get a more accurate sense of the ideal price target, you can ask your customers the following Van Westendorp questions:

While cost and feature set are clearly important, many medtech companies are so focused on engineering a product with the best possible performance that they miss the bigger picture. "Just because a product is clearly better than anything else on the market, doesn't mean there is a market for it. The product might offer a benefit that people don't actually want," Honiball says.

Engineers should try understanding their customer's thought processes and relevant routines before seeking to develop a product for them. In other words, engineers should learn to speak in their consumers' language.

Honiball points to the famous quote often attributed to Henry Ford: "If I had asked people what they wanted, they would have said a faster horse."

If you were Henry Ford and were speaking with your first potential customers about your product, you couldn't speak about your car's engine, he says. "You could talk to people about their day, their commute, their time issues, the amount of time they spend taking care of their horse," he explains. "You go from there to understanding the needs of the technology you are building."

Making Customer's Preferences Tangible

Of course, the process of developing a medical device would be much more straightforward if your customers clearly knew what they want. It is rare that they do--especially for next-generation products. "That is why we would recommend not asking direct questions to consumers (or physicians depending on the product)," Honiball says. "In these cases, it is about finding the expressed need." This could be a desire to, say, get to work faster or to have fewer alarms sounding in a hospital. Device engineers can craft their product development to meet those kinds of needs. "By conducting research ahead of time, you can understand the size of the market that would react to that need being satisfied," he says. 

Another type of research called the PCG Net Optimizer can also be helpful. "In it, you can show virtual prototypes (product mock-ups--including commercial features such as availability and price) and ask people to choose their preferred product," Honiball explains. "Based on customer choices, we could give engineers a simulator to help guide their designs to ensure optimized product acceptance."

For testing initial comfort and feel of a product, PCG has exposed customers to word descriptions, images, and in some cases videos. "Prototypes have been used in the past, but due to cost constraints related to production was limited--usually to one interview at a time where the prototype could be displayed," he adds. "With new technology, 3-D printing and so on, the cost and time involved are greatly reduced, I can definitely see this playing a larger role in getting survey respondents more familiar with products."

Brian Buntz is the editor-in-chief of MPMN and Qmed. Follow him on Twitter at @brian_buntz.

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