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Roundtable: Medical Device Marketing Today

Medtech marketers are challenged to develop consistent messages for distribution through ever-changing media.

ADVERTISING, DISTRIBUTION, & SALES

Sidebar:

Medical device market­ers today are harnessing novel approaches and cutting-edge tools to facilitate communication with their varied audiences. For this issue's roundtable discussion, MX called upon a panel of experts to provide their views about the current state of marketing for medical devices, as well as the value of new tools and techniques being implemented by companies of all sizes (see sidebar).

MX: At what stage do medical device companies typically make their first contact with an outside advertising and marketing agency? And what do they usually say they want?

Mark Perlotto: Companies that engage agencies earlier rather than later end up getting more value for their dollars. By using an agency during prelaunch planning, companies can leverage the experience the agency has gained in working with other device clients and in other industries. Overall, however, companies are currently approaching agency partners a little late in the game.

Tim Sellers: Larger device companies are often pretty far down the path toward a launch before engaging an agency partner. That has to do in part with the fact that their launch processes are a bit more formulaic. However, our firm has been fortunate to be able to work with some smaller companies as well. In some cases, we've been involved from the very beginning—from product branding and positioning to helping move a product into clinical trials and evaluations.

Steve, at what point is your company most often approached?

Stephen Colucci: Our firm emphasizes its technical depth, so we encourage companies to bring us on board early during R&D and product development. We've worked with several start-ups that have been at such an early stage of development that they have come to us for help in developing the materials needed to attract investors in a second- or third-round financing.

Are large medtech companies typically more sophisticated in their marketing needs than their smaller-company counterparts?

Nancy Byrnes Beesley: Part of the issue is a human question. Of course, company size often dictates the size of your marketing budget. But if a company hires good people, it can do a lot with a little.

Are start-up medtech companies able to make use of outside agencies, or are they usually priced out of this possibility? And what is the fallback strategy for those companies?

Carolyn Morgan: Small companies aren't necessarily priced out of the possibility of hiring an agency. They just need to have a strong understanding of their needs and priorities. They need to have a firm grasp of the audience that they're trying to reach and the different media that can be used to reach those audiences.

What level of resources are medical device firms dedicating to marketing efforts, and how does this compare with their pharma counterparts?

Beesley: I think the average marketing spend for medical device companies is currently around 2.4% of sales. Of our medtech clients, about 50% spend right around that percentage, and the other 50% spend way below that. But we're starting to see that ratio change. Our clients are starting to see the value of spending more money on marketing. But there's a long way to go before medical device marketing reaches the levels of pharma marketing. The return on investment (ROI) for device marketing just isn't there yet.

Perlotto: People often want to translate a successful pharma marketing tool into a device campaign. But the $300,000-a-year price tag might be more than a device company's entire marketing budget.

When marketing a drug with big dollar potential, pharma companies are often willing to deficit spend in the early years to establish the brand and ensure longer-term growth. However, the life cycles of devices tend to be shorter than with a pharmaceutical. So that consideration affects device companies' ability to make large marketing investments.

Where are medical device firms devoting the largest portions of their marketing budgets? How does this vary according to the type of product they sell?

Sellers: The biggest portions of device companies' marketing budgets are still anchored in surgeon education. The tools that sales reps are taking to market have shifted, but the focus is still on surgeon education. We're seeing a decline in print and trade marketing and much more emphasis on one-on-one training opportunities. We've also seen a shift toward electronic media, including online surgical platforms sponsored by device firms.

Obviously marketing is a large investment. How savvy are medical device marketers in evaluating their returns on investment? What are some of the latest tools and techniques being used for measuring ROI?

Perlotto: This has always been a thorny issue. Everybody wants to measure ROI. But in a world of smaller marketing budgets, sometimes the methodology to measure ROI can cost more than the promotional spend that's being measured.

Colucci: The only area in which we've been able to substantially quantify ROI is in sales training. For example, if a company is planning to bring in 40 salespeople for 10 days of training, they might consider creating an online pretraining course for those individuals. Such a course might reduce the amount of on-site training required. If a company can use this approach to cut its on-site training time by 20%, those are real costs that can be quantified and compared with the cost of developing and disbursing the online course.

Sellers: We've also seen a dramatic increase in the use of search marketing to drive traffic to surgeon locators on product Web sites. Those activities have been extremely useful in terms of monitoring the performance of promotional tactics and quantifying Web site traffic.


Branding Considerations

How are medical device firms currently approaching the issue of branding? And has this changed in recent years?

(click to enlarge)
In 2006, Terumo Medical Corp. (Somerset, NJ) ended its 15-year marketing, sales, and distribution relationship with Boston Scientific Corp. (Natick, MA) and launched its own direct sales, marketing, and distrubtion stratety. In working with marketing firm Adair-Greene Healthcare Communications (Atlanta), the company's primary objective was to build awareness of Terumo as the creator of the Glidewire and to attribute the product's equity and credibility to Terumo.
Beesley: Our firm has worked with Kinetic Concepts Inc. (KCI; San Antonio) to develop its marketing program for its vacuum-assisted closure (VAC) therapy system. VAC therapy is really a blockbuster when it comes to medical devices, and branding has been critical for KCI because the company created a new category with the technology. For medical device companies that are doing things that have never been done before, building a solid branding strategy for their products is essential. Similar to the pharma model, these companies need to have their brands firmly established in the minds of doctors and other decision makers by the time the generics hit the market.

What are the benefits of corporate branding versus branding efforts focused on individual product lines? In what situations does each approach make the most sense?

Sellers: Based on our experience in working with NuVasive Inc. (San Diego), corporate branding provides an opportunity to differentiate a company's position in the market. In NuVasive's case, the company entered a device segment in which early adoption had already taken place. So the company looked to package its entire portfolio under its corporate branding, and, in a sense, that created a separate space for them. The corporate branding exercise for NuVasive has been interesting because it's the continuity of the branding that has helped position it among its clinical targets.

From a creative perspective, what are the key elements for establishing effective brand recognition in the medical device space?

Perlotto: I see many campaigns—not just in healthcare but also in other industries—that feature visuals that only serve as eye candy. They might not have any specific direct relevance to the product—they're just designed to capture the eye of the reader. But medical device and pharma audiences are a lot more savvy than that. We can't just create a campaign for the sake of catching the audience's eye. We have to make sure the visuals are tied in strategically to the message.


Going Digital

How are device manufacturers translating their conventional marketing strategies for the Internet age?

Colucci: Many companies are repurposing video and animation for the Web and developing interactive online patient modules. They're using virtually every platform available, often repurposing content to reach different audiences in different ways. For example, Ethicon Endo-Surgery (Cincinnati), a Johnson & Johnson company, has launched a site where patients undergoing the company's gastric band procedure can track their progress and the improvement in their comorbidity as time progresses.

What are the latest e-marketing tools and techniques, and where does the medical device industry stand in terms of adoption of these new tools?

Beesley: Our agency is doing a lot of customization work. We have a product called ForceBook that is essentially a customizable Web site that sales reps can build and use for their physician targets. They can post data, experiences, and case studies that their target physicians can visit. That's what the Internet enables us to do: customize content.

We're also doing a lot of work around health blogs. After all, it's become apparent that the number one thing that people are searching the Internet for is information related to their health. So for companies to be efficient in their communications, they need to talk directly to consumers and physicians in their own voice.

Medical device manufacturers communicate with a wide array of audiences. Based on your experience, which audiences are most receptive to e-marketing tools and techniques? Are there certain audiences that still require more-traditional means?

Perlotto: It depends a lot on how an audience consumes media. Even different professional audiences consume media differently. For example, our research has indicated that interventionalists tend to be a bit more savvy regarding electronic media than general surgeons. That's a broad generalization, of course. But overall, it's a matter of comfort with technology.

Obviously age skews people's comfort levels to a great degree. Technology comfort levels among physicians vary greatly depending on age and years in practice. We have a couple of clients who are applying an age skew to their use of electronic media because they realize that some audiences are consuming certain media at different rates, despite the fact that all audience members are professionals in the same specialty.

And Steve, what's your take on that? Your company develops fairly specialized electronic training tools. Are there still audiences out there who aren't ready for certain media?

Colucci: Yes, definitely. As a matter of fact, we include 2-D layouts for print in our marketing tool arsenal. No matter how advanced electronic delivery systems become or how interesting the tools are, there's always going to be somebody asking for a paper copy or something else they can carry with them and hand out. So print is going to be around for a long time.


Trade Show Marketing

Many medical device firms invest heavily in their trade show presences. What are some of the latest tools and approaches you've used in developing trade show marketing materials and displays for medical device firms?

Perlotto: In the past year or so, we've used some innovative video techniques within trade show booths. For example, we've incorporated live cameras that insert passersby into particular scenes or visual elements within the booth. It creates greater engagement with attendees who may be casually walking by and suddenly see themselves in the booth's environment.

A key consideration with trade show marketing is figuring out what will have some permanence beyond the convention itself. Our goal at trade shows is to create a user experience that lets you somehow tie in attendees and carries beyond the actual convention floor interaction.

Beesley: For an upcoming convention, we've created kiosks with a question game focused on KCI's VAC therapy. The product's been around a long time, so attendees at this convention are familiar with it already. So we created a game in which people come into the booth and play for the highest score. For example, nurses can compete against each other to see who knows more about the therapy. But at the same time, we're able to educate them on facets of the therapy that maybe they don't already know. It's not about giving away something--it's about giving them an experience.

Colucci: As soon as device manufacturers start talking about creating video or animation, or even an interactive application, the first thing we'll ask is whether they're going to use the tool at a trade show. If so, we ask if they're going to rent a widescreen plasma screen to display the animation. Because if they're planning on displaying something in a widescreen format, we need to know that up front. If dimensions and formats aren't specified before an application is designed, a company could be disappointed when it tries to display it in another format.

Morgan: We really focus on one-to-one marketing. Interactivity goes beyond just a Web site. It's the focus of everything we put together from a campaign standpoint. For example, we developed a campaign for Abbott Diagnostics called Labs Are Vital. It was focused on reestablishing a connection between the company and its audience.

We launched the campaign at the American Association for Clinical Chemistry conference. We constructed a separate Labs Are Vital booth and invited laboratorians to have their photos taken. Then we created personalized ads that featured their photos and individualized messages. The ad headlines were pithy. For example, "Because of me, 14 kids won't get cats, and 11 moms are very happy. I run allergy tests." Throughout the conference, the ads were displayed on a plasma screen at the top of the booth. And we brought our own writers into the booth to help laboratorians develop personal messages for their ads. And many of them took those ads back and hung them up in their hospitals. It was great.


Growing DTC

What marketing channels have proven to be most effective for reaching patient and consumer audiences for medical devices?

(click to enlarge)
Smith & Nephew Orthopedica (Memphis) needed a way to highlight its Journey BCS replacement knee system and give surgeons a look into the kinematics of a normal knee versus the kinematics of Journey BCS and competing products. Interact Medical Education (South Bend, IN) developed an interactive physical education CD as a trade show attractor and sales tool.
Sellers: The biggest direct-to-consumer (DTC) investment we've seen on the device side is the use of search marketing. If a manufacturer has a product with dramatic comparative benefits, what better place to speak to a consumer than in an online environment that they're using to explore alternative treatments? Patients are highly consumptive when it comes to online information, especially when it comes to procedures such as spine surgery.

To date, which device sectors have made the most effective use of DTC marketing, and what lessons can companies in other sectors glean from these efforts?

Perlotto: For a number of years, everybody in the device world was waiting for the other shoe to drop—namely, for a device company to put a significant investment into the DTC space. Pharma has been doing it for a long time. The first device campaigns to really catch everyone's attention were the ones rolled out in the joint-replacement segment.

Beesley: Device manufacturers in the diabetes space, such as those that produce blood glucose monitors, have done a very good job with DTC advertising. They operate in a highly commoditized marketplace. So you see companies bringing in B.B. King and Aretha Franklin to try to get patients to connect mentally with their products and choose their brand name over another. Distinguishing your company in a commoditized market is a big challenge for a medical device manufacturer. DTC can help do that.

Even in sectors in which DTC marketing seems a natural fit, the costs can be prohibitive. How can medical device marketers make the most of their budgets in this area?

Morgan: Companies can manage costs by segmenting their patient populations. By examining data from across the country, manufacturers may be able to identify cities with high-risk patient populations where they can target their efforts. Online channels can be a cost-effective way of reaching patient populations as well. Looking forward, companies in sectors with large patient populations are going to be increasingly exploring DTC approaches. And as the prices for DTC go down and personalization becomes more important, companies are going to be evaluating ways to interact with consumers through whatever channels make the most sense.

Medical device companies considering targeting consumers directly face an even graver concern than finances: the possibility of isolating physicians. When reaching out directly to consumers, how can device marketers avoid alienating their physician customers?

Colucci: I have a tough time reconciling DTC for joint replacement without alienating surgeons. For example, if a DePuy surgeon is approached by a patient who says he or she wants a Zimmer knee, that surgeon is not going to give them a Zimmer knee. He isn't trained on it, he doesn't prefer it, and it requires a whole new set of tools. So he's going to have to argue against what the consumer saw on television.

Perlotto: There are two rules of thumb that should be applied in DTC advertising. The first rule—which pharma took a long time to learn—is to always let the doctors know in advance if you're going to launch a DTC campaign. The second rule is to avoid brand-specific advertising for a device that is selective and technique-driven.

Sometimes marketing rules have to be broken, and companies need to evaluate the risks and benefits of the approach they choose. For example, some device companies are marketing their products by using physician locators to direct patients to physicians who are trained on or use their products. It gives their products a sense of exclusivity. On the downside, those companies risk alienating physicians who haven't been through that particular training program.

Morgan: That's a strategy we had a lot of success with when we launched the Inamed--now Allergan--silicone breast implants. We knew that surgeons needed to get certified to implant the product right away. So as soon as the company received approval from FDA, we started directing surgeons to a Web site that helped them get certified. Once the surgeons were ready, we launched an interactive campaign that directed patients to the company's site. And once the patients were ready, we could direct them to a certified physician. So it was a one-two punch. We helped surgeons by making it as easy as possible to get certified. And then we did everything we could to support them and their practices in directing these patients to them. In that respect, we approached the campaign as a partnership.


Adapting for the Future

In your opinion, what are the greatest untapped marketing opportunities for medical device manufacturers? How can they capitalize on these?

Beesley: The Web is a developing opportunity. Most agencies are working through online channels and helping to develop new tools. But everyone is still a little anxious to see how certain tools are going to unfold, especially for devices. No agency wants to be the first person on the block to spend their client's money on something brand-new to find out it doesn't work.

Perlotto: We've all witnessed the Web's evolution. It's gone from being mainly text to text with visuals to static banner ads to moving banner ads to rich media. Now there are links to microsites, all sorts of things. There's always going to be new technologies entering the marketplace. And quite honestly, in most cases, the medical world will probably trail behind the consumer world in terms of adoption. So keeping an eye on what's going on in the consumer world and the marketing technologies that are evolving there will lead medical marketers to new opportunities that can be applied in medical device marketing.

Copyright ©2008 MX
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