Post on 29-Dec-2015
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Product Launch and Lifecycle Management
Guido Sandulli
Director of Marketing – Merit Medical
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Agenda
• Background• Academia vs Real World• Marketing’s Role• Pre-Launch – Upstream Marketing• Product Launch • Lifecycle Management
Launch Growth MaturityEnd of
Life
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Background
Decision Resources - Boston MA 1995-1999 Pharmaceutical Industry Market Research and
Strategy Consulting
IBM Life Sciences – San Francisco CA 2001-2005 Product Management/Marketing Management –
Life Sciences IT
Applied Biosystems / LIFE -- Foster City CA 2005-2012
Strategic Planning/Product Management – molecular testing
Merit Medical – South Jordan UT 2012-current Director of Marketing – Medical Devices
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Academia vs Real World
How to apply academic concepts?
“It works in practice….but does it work in theory?
How to learn from real world experience?
“This one time, we did this thing….”
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Role of Marketing
Marketing vs Sales vs R&D – Marketing is often the last one to the party
R&D already has an idea about what they want to build
Sales already has an idea about who they want to sell to
Marketing – identify where the value is being created – and plan the most efficient way to communicate and deliver it
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Market – Human Identity DNA assays
• DNA tests used by law enforcement – DNA profile from criminal suspects put into databases
• Samples from crime scenes analyzed and matched to suspects• Used to generate evidence and investigative leads
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Market Background – Human Identity DNA testing products
• Public and private contract labs use reagents, instruments and software to perform DNA analysis and deliver usable DNA profiles
• Testing reagents are extremely profitable – pharma-like margins
Quantitation Amplification Detection Data AnalysisDNA Extraction
• Customers are employees of government law enforcement agencies• Typically from science PhD background, often with long term
government service
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Pre-Launch – Upstream Work
Understand customers’: Segments Problems Priorities
Build Value Proposition and Targeting Plan Which segment are you targeting? How can you reach them? What do you say to them?
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Challenges facing forensic laboratories
More and more samples
Difficult and damaged samples
Political pressure to reduce backlogs
Shortage of trained scientists
Increasing quality standards
Workflow bottlenecks System validation
Sample preparation
Data analysis and report writing
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Upstream Work – Customer Segmentation
Databasing
Predictable Standardised collection High yield, high quality
DNA High throughput,
continuous-flow processing
Casework
Unpredictable Highly variable samples Low yield, low quality DNA Mixed source Aged Batch or custom
processing
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Upstream Work – Example: Identifiler Plus
Market research is your friend – use it early and often
Review the user specs – the value designed into the product is what you need to communicate
Key Requirements of a Forensic Casework Analysis Kit
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Identifiler® Plus Example
Better results from tough samples
Old Kit New Kit
Enable more uses for tests
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Pre-Launch – Value Proposition
What is the value your product is delivering?
Solve more cases, fewer wasted reagents, enable more DNA investigations
Who is realizing the value?
Society at large? Political leadership? Lab Management?
Who is the decision-maker and who gets to weigh in?
Lab Management? – Law enforcement leadership?
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Setting the Price
Value Extraction – how do we keep the value we created?• Pricing on value – how do we calculate this?
Forensics -- investigation time saved – $500,000 for successful rape investigation $40,000 for successful burglary investigation
Pharma – clinical benefit and cost savings over current gold standard
Medical Device – Procedure time saved Typical cardiac cath lab costs $1600 per hour
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Setting the Price
• Value extraction – what additional value are customers getting?• Price discrimination – can we package the value in a differentiated way
to different customers?• Competition will try to commoditize – how to prevent?
Package hardware, software, and services together
Price at Premium to gold standard
Avoid price war with competition
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Know your channel• Sales Channel Selection -- do your sales teams know the right people?• What if the channel you have isn’t the right one?
• Crime lab staff often not allowed to have access to email or web access• Travel budgets for crime lab staff extremely limited
How do you reach your target audiences?
Road ShowsCelebrity EndorsementsConferences
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Test Launch
• Limited release in 1 region vs. mass global launch• Test the assumptions in your plan• Extract the info you need• Adjust and scale
Test Sites candidates were prioritized based on Access to compelling casework samples Threat to existing business Opportunity for competitive win
Data from test sites confirm superior performance in difficult DNA casework samples.
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Launch Roll-Out
Repetition!Launch Plan from 2009:
• NA sales training scheduled for week of July 6 2009.• Communicate to US customers during roadshows in July-August 2009
Customer-facing presentation and Forensic News article distribution to field by end of August
• Formal US Launch at ISHI in Oct • Follow-on presence at ISFG and AAFS in Seattle in Feb 2010.
Old Kit
New
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Launch - Logistics
“Amateurs talk tactics – Professionals talk logistics”. -- Old Army saying
Goals• Support launch – but limit inventory carrying cost and scrap• Limit risk of quality failure• Limit risk of backorder
• 1st Lot– only enough to support test site evaluation• 2nd Lot– enough to support test site adoption• 3rd Lot – support single-region launch• Additional builds over next year to support additional regions.
• Manage expectations of executive team!
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Product Lifecycle – Growth
Establish strong market share as quickly as possible by:
1. Global Expansion – China, Russia, South Africa
2. Market Development – New applications enabled by new product
3. Line extensions -- additional product R&D
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Product Lifecycle – Growth
Geographic Expansion• Large countries with focus on security• Channel development needs to be done very carefully!
• Focus marketing on localized needs• China – trafficked children• Russia – terrorism• South Africa – sexual assault
• Training and Lab set-up are bigger needs• Needed to develop professional services team to support
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Product Lifecycle - Growth
Market Development – Property Crime
New Product enabled the analysis of more samples Made analysis and investigation of property crime much easier than
before, however….. Average property loss from burglary is $2,000 – investigation and
prosecution cost of over $40,000. How to convince law enforcement to use DNA in property crime? Pilot programs to demonstrate value – can catch one perpetrator for
multiple crimes!
Once a program is started, likely to stick with our product.
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Example: Denver Burglary DNA ProjectDenver focused on the use of DNA in solving property crimes and found:• $36.8 million in property loss was avoided and $5 million in police costs
were saved over 2 years.• $90.50 was saved for every $1 spent on DNA testing. • Cases with DNA:
• Eight times more likely to be prosecuted• Three times more likely to result in a conviction• 10 times longer prison sentences for home burglars and 6 times longer for
commercial burglars
• The burglary rate in Denver dropped 26%. Prior to the Burglary DNA Project, property crimes had increased by about 5% annually.
SOURCE: “Using DNA to Solve High Volume Property Crimes in Denver: Saving Money, Lowering Crime Rates and Making Denver Safer.” The Prosecutor, July/August/September 2008, ISS No. 0027-6383, National District Attorneys Association)
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Product Lifecycle – Maturity
Fight commoditization – preserve value extraction
• Highly profitable assay business draws strong competition
• As later entrants, try to mimic performance and compete on price• Attempt to commoditize market as much as possible• As global economies slowed, governments seek cost savings
aggressively
How to prevent head-to-head price comparisons?
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Product Lifecycle - Maturity
Delay commoditization by building/buying the workflow components competitors didn’t have:
• Instrumentation:• Services:
• Training• Validation• Lab set-up• Instrument service contracts and warranties
• Lab Automation
• Offered together at bundled price – difficult to break bundle or compare line-item pricing
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Product Lifecycle – Decline
Goal – maximize value extraction prior to end-of life
Repurpose:• different application• different customer/geography• different channel
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AuthentifilerTM Example
• Old Product discontinued
• Components reassembled, rebranded for new application
• New Channel• New Pricing• Value proposition and marketing plan
completely different
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Product Lifecycle – End of Life
Raise prices!• Offset operational inefficiencies• Help motivate users to move to new generation product
Make available as build to order only• Limit inventory carrying cost• Motivate users to move to new generation product
Provide advance notice of discontinuation and offer introductory offer on new product
Be disciplined enough to go through with it!
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Thank You
Questions?