• Using Value Selling To Compete In Medical Sales

    When you’re buying a new car or appliance, a meal or a suit, you’ve probably come to expect your options to be offered in several tiers, from basic to premium. Are you looking for a premium car, supported by an attentive dealer who provides ongoing services? Or perhaps you’re looking for a basic flat-screen TV, and you’re going to buy it from whatever big-box store currently offers the best price. Most people fall somewhere in between: value-oriented customers.

    Value-oriented customers are relatively new in the medical sales marketplace, but there’s already a growing demand for products that offer good value. As a result of the Affordable Care Act and other current social and economic trends, hospitals and healthcare providers face increased pressure to improve quality while cutting costs, according to an article on SalesTrainingConnection.com.

    Reaching this market with value selling requires a revamped sales strategy for companies that have previously focused on selling premium, innovative products – or those that compete on price alone.

    To thrive in the value segment, “manufacturers need a deep understanding of the value segment’s needs and profit pools,” according to a recent report by the McKinsey Group. “The key to success does not always lie in changing the product itself but could involve altering sales models or service offerings.”

    The report suggests three business models for companies pursuing value selling:

    1. Lean Selling
      An inexpensive, streamlined medical sales management process allows manufacturers to break into value selling by offering lower prices. McKinsey suggests this medical sales model for products like “wound dressings and disposables with simple sales cycles, recurring purchases and limited service-support needs,” as well as products approaching the end of their lifecycles.
    2. Stripped-Down Service
      Another way to reach the value segment is by scaling back certain service areas, such as clinical support. This model “requires a strong sales organization focused on capturing new accounts,” according to McKinsey, and is most appropriate for selling products with high service levels in a complex sales cycle.
    3. Basic Products
      Instead of scaling back the sales process or services, companies could offer lower-cost alternatives to premium products. This works best for products with many components and processes, because they offer more opportunities for reducing costs.

    As decision-makers at hospitals and healthcare systems become more cost-conscious, medical product manufacturers must find new value-selling strategies if they want to capture this emerging market segment. In addition to a business model that focuses on today’s value-oriented customers, you need a well-aligned healthcare marketing strategy and medical sales management process to identify potential markets, estimate demand and deliver effective messages.

    By combining and aligning these areas of your business, you’ll be better equipped  to take advantage of today’s medical sales opportunities.

    Ready to get the most from your healthcare sales leads? Download “Decoding Your Sales Data,” a free, 30-minute webinar from the Sales Scientists™ at Invenio Solutions®.