Perception is Reality

Posted by Scott Provost, Percepta

It was a hectic close to 2010 which shows us that biotools industry is alive and healthy!  Though the future economic environment for the globe remains uncertain and public funding levels for life sciences in the US may plataue of or even dip in 2011, there were several things that we noticed at Percepta that we believe will be trending this year.  The short list of trends in no particular order is:

Trend #1 - biotools companies are increasingly looking to markets like China and Southeast Asia not just for manufacturing capabilities but also for sales revenue.

It is not surprising to see increasing interest in revenue growth in China and other Asian markets as breakneck economic growth in these geographies translates into research and development investments in academic, government and industrial life science laboratories.  Percepta recognizes the need to access current market information from these markets and is investing in the needed infrastructure now to meet the demand for market research and market intelligence in 2011 and beyond.   

Trend #2 - personalized medicine is real and growing and will require more companion diagnostics biotools.

The promise of the genomics revolution a decade ago is coming to fruition.  Pharmaceutical and diagnostic companies are now entrenched in the process of segmenting their drug markets and developing companion diagnostics to accompany there lead drug candidates whenever possible.  In doing so they are relying more and more on molecular methods and technologies common in biotool portfolios as a means to get regulatory approval as well as revenue.  This will open new application markets for biotools companies as support organizations (CROs and companion diagnostics companies) add to market demand and create new growth.

Trend #3 - with the expiration of key patents in 2011 innovation (and growth?) in Q-PCR markets will be increasing.

Does this mean all need for licensing will vanish?  No.  But as the Haguchi patents wind down there will no doubt be increasing innovation around the Q-PCR field (See this article).  This could mean more enabling technologies that have been under development in the research community could become more commercially viable and spur on a new wave of growth in the amplification segment for both research and diagnostic applications.  Percepta will be watching this closely in coming months and years so keep an eye out for the next Nucleic Acid Amplification Life Science Dashboard.

These trends will be interesting to follow in this and coming years as the biotools market naturally evolves to meets the needs of the market.  Percepta looks forward to keeping track of it for you. 

As always, your comments are welcome (no spam please).

Posted by Scott Provost, Percepta

We have all been so busy as the year (and the decade) draws to a close at Percepta that I have been pulled from these blog posts for the better part of two months.  But that is a welcome sign that the biotools industry is alive and relatively healthy.

Considering all that we encounter in the industry as a marketing consultancy we probably have a somewhat unique perspective on the wants, needs, and desires of the collective biotools segment (companies and customers alike).  The list can essentially be summed up in three main wants, needs, and desires. 

The Wants: The number one thing researchers want from the products they use is that they perform as promised.  Researchers are most tolerant if they try some product for an off label application and it fails, but they rightfully expect it to deliver results as advertised.  Assuming most biotools companies have learned and understand this well, it is still too common to see some products rushed to market before they are really ready for prime time.  A bad first impression for a product (or worse yet - a company) is a hard burden to overcome.  Avoid this like the kiss of death.

The Needs: This need is so obvious but so important that we couldn’t leave it out.  Here goes – biotools companies need to honestly recognize that if the product isn’t obviously and distinctively different from other products then it is perceived by researchers as a commodity and that perception is the reality. That’s it.  How you define the “obvious and distinctive difference” will vary greatly depending on your skills as a marketer and on your product and/or company but it better actually mean something to your target audience or it is sure to just lie there disappointingly.   When that happens, companies have only one effective lever to pull – price - which is just fine. Winning on price is perfectly respectable, just ask Walmart.  But don’t kid yourself into thinking about premium pricing if you are not truly differentiated in some meaningful way.  The emphasis is on meaningful.  Marketing and pricing managers need to remember this important reality.

The Desires: Researchers desire that suppliers treat them with respect.  Seems obvious but companies sometimes fail to realize that poor or non-existent technical support, or unknowledgeable field representatives, or even poorly designed automated phone systems  leave researchers feeling like they are not important.  Ask yourself honestly the next time you are navigating an automated telephone systems for three or four minutes only to be told the offices are now closed.  The problem isn’t that the offices are closed – it’s that they wasted your time.  Why?  Because you must not be very important – or so it seems.

Let’s agree that 2010 is going to be the year that biotools companies shine like never before because they are getting much more in touch with their customers and really understand their needs, wants, and desires.  Happy New Year!