{"id":2503,"date":"2018-07-17T07:21:09","date_gmt":"2018-07-17T11:21:09","guid":{"rendered":"https:\/\/ioipartners.vp77wsn4-liquidwebsites.com\/?p=2503"},"modified":"2018-07-17T07:21:09","modified_gmt":"2018-07-17T11:21:09","slug":"healthcare-startups-how-to-ensure-successful-product-launch","status":"publish","type":"post","link":"https:\/\/www.ioipartners.com\/articles\/healthcare-startups-how-to-ensure-successful-product-launch\/","title":{"rendered":"Healthcare Startups: How to Ensure a Successful Product Launch"},"content":{"rendered":"

Startup companies in particular have the critical task of ensuring their product launches are successful, because the alternative can mean that the company itself ultimately fails. The problem is that while many startups believe their new products will change the world, they fail to deliver. A successful launch hinges on creating a foundation for success with certain key steps, as the IOI Partners team has experienced in our client engagements.<\/span><\/p>\n

\"Healthcare<\/a><\/p>\n

In this article, I will share what I have learned to be best practices for preparing for commercialization. These views are based on actual experiences and what has been proven to deliver results. While the spirit of the article reflects these experiences, the actual names, events and dialogue have been modified for dramatic effect and to protect privacy and confidentiality.<\/p>\n

Several weeks ago, I met with Dr. Ben Frank Lynn, CEO of the startup company Static Charge, to review their new product that they believed was going to revolutionize the healthcare industry. I vividly recall his excitement. Dr. Lynn told me all about the innovative features, including the nanowire fabrication, flexible design, and rapid healing rates. His company was started a few years ago, having successfully raised $15 million from friends, family and angel investors. Clinical studies were complete, and the results were excellent. Dr. Lynn is an accomplished engineer with more than 50 patents. His team comprised other scientists and medical professionals.<\/p>\n

Dr. Lynn told me he was ready for commercial launch in 90 days, once FDA clearance was obtained. I then asked Dr. Lynn how he was going to commercialize the product? What customers was he targeting? What customer need was he solving? How would he beat his competition? He said that there wasn\u2019t any competition; his product was unique, and there was no other product like it in the world. He said, \u201cThere is no need for all that up-front commercialization \u2018stuff\u2019; there is no time for that. Once customers see my product, they will buy it.\u201d Uh oh, I thought.<\/p>\n

How was I going to tell him it was highly unlikely that his product launch would succeed if he didn\u2019t take certain key steps?<\/p><\/blockquote>\n

Does this story seem familiar? Why do so many startup companies believe their new and shiny object will change the world, but then fall woefully short on delivering the expected results? How many companies can you name that experienced product launch failures in the first year? Who remembers the Apple Newton? Google Glass? Sony Betamax? All of these failures were from major corporations. Can you name any product launch failures from startup companies? Probably not\u2014because a launch failure from a startup company means the company fails, the investors lose their money, and the employees look for employment somewhere else.<\/p>\n

Joan Schneider and Julie Hall sum up this false sense of security: \u201cThe biggest problem we\u2019ve encountered is lack of preparation: Companies are so focused on designing and manufacturing new products that they postpone the hard work of getting ready to market them until too late in the game.\u201d [1]<\/p>\n

With this in mind, my conversations with Dr. Lynn offer six best practices for any startup that strives for a successful commercial launch.<\/p>\n

I. Set aside enough cash to support the commercial launch.<\/h2>\n

Dr. Lynn is an accomplished inventor and assembled a brilliant team of engineers and scientists. However, I noticed a lack of sales and marketing experience. Dr. Lynn, are you ready to launch your product? Do you have enough cash on hand to staff this function and support all of the commercial activities? A successful company must invest in the development of sales and marketing collateral such as product brochures and pricing models. Your sales people also need tools such as positioning versus the competition and how to handle customer opposition.<\/p>\n

Dr. Lynn responded to my concerns by telling me not to worry and that he followed the advice I gave him when he started the company, which echoes IOI Partners advice given in recent articles on the topics of Voice of the Customer (VOC)<\/a> and value proposition<\/a>. Static Charge interviewed 50 healthcare professionals in a VOC study and tested their proposed value proposition. Ben, that\u2019s great; I am glad you did that. But remember, you did that work three years ago. The market has changed and it\u2019s a good idea to make sure your product\u2019s value proposition and positioning still resonate. Ben then said, \u201cOh! That\u2019s a good idea. As a scientist, I know I need to validate my hypotheses. I guess I\u2019ll need to reprioritize the budget, so we can allocate more money to support the commercial launch.\u201d<\/p>\n

II. Make sure your initial customers are in the right target segment.<\/h2>\n

Ben, let\u2019s review our discussions on customer segmentation. It\u2019s critical to ensure the first customers are in your product\u2019s sweet spot. You should recall that market segmentation is a subgrouping of customers that have one or more characteristics in common, which causes them to have the same product needs. [2] Dr. Lynn, you told me earlier that \u201ceveryone\u201d would love your product. As a scientist, you know that\u2019s not true. Ben, let me provide an example. Imagine a bottled water company trying to sell their water to everyone. While everyone needs to drink clean water, some people might be traveling and need bottled water, while others might be working from home and need a water purifier. If you try to sell bottled water to everyone, you\u2019ll end up wasting precious marketing resources on people who just won\u2019t buy it.<\/p>\n

Ben stopped me. He said, \u201cI think I get it. If Static Charge doesn\u2019t focus on the right customers, we won\u2019t have the information needed to attract the leads who are a perfect fit for the product. Rather, my team will waste a lot of sales time trying to close sales. Our first customers may be unhappy, because our product doesn\u2019t fit their needs. Worse, in this age of Twitter, Facebook, LinkedIn, and healthcare blogs, those unhappy customers might debase and devalue my company and product. I remember this restaurant down the street. They received a lot of one-star reviews and soon went of business. I don\u2019t want that to happen to my company.\u201d<\/p>\n

Ben, you got it! By specifically targeting the right segment, you can hone your sales and marketing efforts and\u00a0maximize the effectiveness of your commercialization efforts. If you want to learn more, I\u2019ll send you some recommendations of articles and books on customer segmentation. [3,4,5]<\/p>\n

III. Validate value proposition and positioning versus the competition.<\/h2>\n

Dr. Lynn, you indicated that you agree it is wise to revalidate your product\u2019s value proposition and positioning versus the competition. Why don\u2019t you tell me how you will do that? Ben then told me that he planned to ask his team to take several key steps:<\/p>\n