Simplicity is Best!

March 5, 2013 at 10:47 AM 1 comment

All businesses search for opportunities to deliver more value to their customers.  Often, the path leads towards complex innovation that is costly, time-consuming and risky to bring to market.  On the other hand, sometimes, the best solution is simple and right in front of our nose.  This is the story of the latter.

A client was searching for an innovation that would enhance the dominating position they play in their market.  Our client’s product is used a thousand times a day in every hospital and every physician’s office.  Our client’s product is one that looks simple but is filled with nuance to design, develop and build.

As the product has been around for centuries, the question they faced was what innovation they could pursue that would change the market.  After considering many options, their solution was simple but brilliant.  Change the color of one component of the product.  Our client recognized that changing the color of the component could deliver enhanced safety and ease of use.

Our client asked MedSpan Research to confirm their expectations regarding the value of their simple innovation.  More specifically, they sought to:

  • Compare and contrast the value their innovation delivers for hospitals and physician offices.
  • Determine customers’ willingness to pay for their innovation
  • Determine customers’ willingness to convert to their innovation
  • Identify the sales and marketing messages that will most effectively convey the benefits of the new design

Using our RapidAccess® database, MedSpan Research quickly recruited nurses from primary care physician offices and many hospital departments (e.g. ICU/CCU, oncology, emergency department, endoscopy, LDR).  We first conducted four focus groups.  Two were composed of hospital-based nurses.  Two were composed of physician office-based nurses.  MedSpan Research’s internal logistics group arranged for the research facilities and support services (e.g., audio-visual, food and beverage, transcripts).  The focus groups enabled our client to watch how nurses use and react to the new feature.

The focus groups confirmed that changing the component’s color delivers value.  Nurses exclaimed “Oh my, how could nobody have thought of this before?  So simple yet so effective.”  “This simple change makes my life easier and lets me do my job quicker.”  Hospital nurses were uniformly supportive of our client’s innovation.  Physician office nurses’ reactions differed.  While supportive of the innovation, pediatric nurses and internists’ nurses each had concerns that slightly lessened their interest in the innovation.

MedSpan Research followed the focus groups with an Internet survey.  In addition to gathering feedback on the innovation from a large number of nurses (n=250) to refine the focus group results and to evaluate the nurses’ willingness to pay for our client’s innovative design.  As the only variable attribute is the product’s price and nurses tend to not be aware of the product’s price, MedSpan Research opted to use a Gabor Granger methodology.

We discovered that almost all nurses have a positive perception of the product’s new feature.  Nurses are willing to pay an incremental price for the simple innovation due to the value it delivers in terms of safety and ease of use.   As the innovation is simply a change in color, the impact on manufacturing costs is limited.

Based on the study, our client decided to pursue its simple innovations and was able to craft effective sales and marketing messages.  As the innovation warrants an increase in pricing, cannibalization of our client’s dominating market share is not a significant issue.  Based on the research, our client has a solid foundation for developing simple but innovative marketing strategies that mirror those characteristics of its innovation.

One-third of MedSpan Research’s work involves products used in hospitals.  Our exceptional access to hospital-based decision makers and our expertise regarding this complex environment adds value and insight for our clients, be they medical device manufacturers, supply companies or pharmaceutical companies.

Author:  Robert Kaminsky


Entry filed under: Gabor Granger, Healthcare Economics, Healthcare innovation, Hospital Care, Medical Device, Pricing Study, Willingness to convert. Tags: , , , , .

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