How to Validate Product Demand in the Medical Device Market
When it comes to bringing a medical device to market, companies must use market validation to establish demand and map a strategy based on market research and analysis to prime the product for success.
Sometimes, a great idea comes like a bolt of lightning. Other times, it stays at the surface for a while, spurred on by thoughts of “if only we had” or “this would be better if.” But, regardless how it arises, when that idea takes shape and there is a clear path to bring it to life, it doesn’t matter how it came about. It’s just thrilling that it did.
Medical device entrepreneurs are often intensely invested in their idea. And for great reason. It is answering a clear need and has the potential to change processes, improve outcomes, and sometimes safe lives. But as wonderful as that idea can be, there is wisdom in stepping back. I often encourage MedTech executives and entrepreneurs to resist falling too far in love with their ideas. People often put on their “founder’s blinders” and have a hard time assessing their product from a third-party perspective. When the blinders are on, sometimes it’s hard for executives to see what might be the most effective indication or value proposition in the market. And that can lead to missed opportunities.
The reality is that, when it comes to the medical device market, we never really know if a product will succeed until it’s actually out there, being bought and sold. But for startups, producing, marketing, and selling a product simply assuming it will succeed is not a great path forward. They need to have a palpable level of confidence that their assumptions are correct before spending the time and money getting that product to market. They need to validate the market first so they can test their assumptions and tweak their approach to ensure that their product will be well-received.
How to Validate Demand and Adoption in the Medical Device Market
When launching a new product in a medical device market, companies are either creating a new market or stealing market share from someone else. They might steal market share because their product demonstrates an improved clinical or economic benefit. It might offer better therapeutic accessibility or convenience for the stakeholder.
But regardless of the “why” behind the product, the “how” still remains. And that path, which includes factors such as overcoming market norms, effectively iterating the value proposition, establishing payment structure, and more, is not always clear. Add in the fact that physicians often resist change unless your product gives them a clear competitive advantage, and the battle becomes increasingly uphill.
Establish Stakeholder Behavior and Motivators
First, medical device companies have to understand exactly what motivates their stakeholders. They also need to understand their behaviors. For example, for many years providers have struggled getting patients to adopt medical scheduling software. While the assumption is that a digital medical scheduling solution would reduce phone wait times, offer patients increased flexibility, and more, the reality is that patients didn’t use it. But why? After diving into the research and data, it was discovered that 26.3% of respondents in a survey indicated that they would not consider a digital platform because they prefer speaking with someone. In this case, the assumptions were disproven, as the power of the human touch won out.
When it comes with understanding stakeholder preferences, companies should start with secondary research, but not limit their discovery to that methodology alone. Always test and explore the product’s value proposition by speaking directly to these individuals. But remember – asking the right questions when conducting primary research is critical.
Don’t ask if the product is good or not. Always ask from the perspective of the value proposition. Talk to stakeholders about the problem that your product is solving in the market. Some questions could be:
- How are you managing the problem today?
- What if you had a device that didn’t cause x problem?
- What if you had a device that relieved the problem?
The best medical device market validation evaluates the behavior of stakeholders in a realistic setting, rather than directly asking about their preferences. By doing so, we simulate product adoption through a customer discovery interview. And remember: getting granular with physician behavior is critical, as these are the people who will champion your product. You need to have a clear strategy related to how you will get them on board and nurture them to become brand fans.
Draft a Demand Forecast
Once you understand exactly what your stakeholders want, as well as their behaviors, you can use that information to create a demand forecast. Demand forecasting is a critical piece in strategic planning and answers the following questions:
- How quickly can you grow sales?
- What is the best way to articulate your value proposition?
- How are you going to convince people to purchase?
The answer to these questions rest in knowing the particular need in the market, what segment of the market is available, and aligning your product’s value proposition to that immediately available market. To do this, you will take the intelligence you have gathered and align it to a bottom-up analysis of how your product will penetrate the market. Start at the ground level by establishing your sales goals. From there, determine how many salespeople you need to accomplish that number of sales, how quickly they can convert, the required level of production, etc. Finally, align your analysis with what is normative in the market to best assess product performance.
Market Validation is One of the Most Valuable Tools You Have
No matter how incredible your innovation is, if you don’t align it to a specific medical device market, you are putting its success at risk. Before you launch, understand what segment of the market is available, stakeholder behavior, the right value proposition, and the sales strategy that will get you there.
Taking a medical device to market requires immense time and resources. Many would argue that mitigating risk and mapping out a strategy that is based in market intelligence is one piece that is simply non-negotiable. The truth? Market validation is one of the most important tools that medical device executives have at their disposal.
Jaunt helps MedTech executives and entrepreneurs succeed in evaluating medical device markets, raising funds, and achieving successful exits and acquisitions. Contact us for a consultation.