Perception is Reality

I Want You - to tell us what you want

Posted by Scott Provost, Percepta

Percepta offers a lot of different marketing services besides market research, but market research seems to be a popular area of interest.  We offer a series of segment specific market research reports that are popular (The Life Science Dashboards), but we also like to publish complimentary reports a few time a year for our colleagues in the industry.  Recently we published a report on the stimulus funding for life science research in the US as a result of the American Recovery and Reinvestment Act.  Previously we published a report on the customer’s perspective on life science manuafacturing in low cost countries.  Now we want your input.

What would you like to see Percepta focus on in the next free report?  Give us your comments below and we will choose from the best suggestions. Then we will conduct the research, write the report and post if for a free download.  The next topic is up to you so now is the time to let us know.

Keep it Real - Really

We are far from the first or only ones to warn against marketing messaging packed with empty words drained of meaning (see Eric Karjaluoto).  The marketing promises for “better” this or “faster” that are becoming all but invisible to the customer because they are like so many grains of sand on the beach, too difficult to tell apart.  

It seems to come down to a problem of credibility – does your customer believe and trust your marketing message?   The answer depends on whether they know you (your product or company) well enough to believe they have a real relationship with you (your product or your company).  Seth Godin nails it here when asked about the related topic of the value of social media to companies.   If your customers believe they know you well enough, then it is likely they will see you (your product or company) as real and believe and trust your message - until you let them down one time too many.  

The best thing to do is treat your customers like real people that you know and interact with regularly and give them what they want.  Here are five basic rules of keeping it real that your mother would approve of.

1) People want an honest interaction and they want the truth.  Anything else is disrespectful and it’s fibbing. 

2) People don’t want empty promises.  If the product doesn’t deliver what is promised then why is it still on the website?  Would you recommend a product to you rmother that doesn’t really do what it says?

3) People want justice.  If you make a mistake, admit it and make it right if you can.

4) People want to feel loved. Once and a while, give them something real for free.  Tell them the proprietary buffer components if they ask for it.  Let them have free shipping one week out of the year.  It can do wonders for keeping it real – like a gift.

5) People want to talk to another person and NOT an automated answering system.  I’m not talking about voice mail – that is fine as long as you actually do call back like you promise.    Please invest in people that actually answer the phone and not in an electronic gadget with a voice recognition capability.  

We would love to know what you think – your comments are always welcome.

Bandwidth all tied up?

Posted by Scott Provost, Percepta

All of us at Percepta have cumulatively been involved in literally hundreds of biotools product launches in the course of our careers at various well known biotools companies.  Some of these products were fabulous successes and others were fantastic flops.  The flops failed for a variety of reasons but the successes all had one thing in common – they were fast out of the gate and delivered what they promised.

I remember one success particularly well.  I was responsible for introducing a new line of products for a major supplier.  The new portfolio  was a significant expansion of what was a minor product line for my employer at the time.  The launch was quite large with over 65 individual kits all focused on various aspects of a very common molecular biology application performed by more than 90% of life science labs.  There was a lot to worry about because we were late to market with this portfolio and we knew we were facing serious competition and an uphill battle to take share from them, yet we were confident that if we could get researchers to try the product we would be able to convert them.   Naturally, we had a sample program in place and the sales force had been trained and properly incentivized.  But there was one thing we did that I still believe made the difference between early post-launch success and trench warfare with the competition (and our sales force too).  We asked our existing customers a few simple questions.

I have always been a strong proponent of the bird-in-hand mentality, so for the sake of saving time and extending our thinly spread launch team we hired an outside marketing research consultant to poll our company customer list to identify researchers that were not all that happy with their current competing supplier for this common molecular biology application.  The goal was to prime the sales force pump, so to speak, with easy to reach customers that were predisposed to try our new products. 

It turned out that there were about 1,500 disgruntled researchers among those responding to our short survey that were receptive to  a new method/kit/supplier.  Best yet, we knew who and where they were and what they were unhappy about.

Putting this kind of information in the hands of a hungry sales force is a bit like throwing gasoline on a fire.  We decided to generate a one page profile on each of the receptive customers and divvy them up by sales territory to the respective sales rep.  The sales force really ate this up and to make a long story short the portfolio launch was the most successful revenue garneting product launch in the company’s (at the time 18 year) history!  It was fast out of the gate and just kept going.  It is still growing today.

It is a simple idea that any company can do with their own resources – but few if any try.  Why?  Because most marketing managers are too thinly spread already and have too much to do before any launch.  There is not enough bandwidth and so many internal hurdles to get over like  getting access to the customer mailing lists, writing and then setting up the survey, analyzing the data.  And who writes the one page reports and gets them sorted by sales territory?  In my experience it is almost always a matter of bandwidth and not” know how” that prevents companies from doing this at launch.

If this sounds familiar , take heart and remember that we hired a consultant to help -  and it was well worth it to do so.  Percepta’s Profile Program™ can do all the heavy lifting and help your next product launch with a minimum of your time.  We’re here when the time is right. 

As always, your comments are encouraged.  

Sustained Growth

Posted by Scott Provost, Percepta

As everyone knows, the Great Recession or 2008 and 2009 has taken its toll on most industries and the biotools supply industry is no exception.  However, there is real evidence that the light at the end of the tunnel is getting a bit brighter.  Stimulus dollars from the American Recovery and Reinvestment Act of 2009 have finally started to find their way to biotools companies’ revenue reporting.  Recently Bruker, a leading European supplier of analytical instruments with more than $1 billion in revenues, reported at an August Investor Presentation (give the PDF link a moment to load) that they have already realized greater than $10 million in stimulus funded revenues in US markets and anticipated as much of as 20% or more of their revenue could come from global stimulus efforts.  That bodes well for the biotools industry.  But the big question for all biotools companies is – will growth be sustainable or just a windfall? 

Percepta Associates recently reported that more than more than 80% of the roughly $9 billion to be distributed by the NIH as extramural grants will be hitting research budgets between now and February 2010. Ideally the stimulus will create new jobs and researchers report that new hiring is in the plans of many research laboratories.  Job creation stands a better chance to contribute to a sustained growth in the biotools industry because more researchers will presumably perform more research, which means they will use more equipment, consumables, materials and reagents.

It remains to be seen if the global stimulus efforts will promote sustainable growth, but smart biotools companies are preparing for all possibilities.  While sales departments are actively vying for the influx of funding with their current product portfolios, marketing managers should be planning for the next generation of products that will deliver true value.  Knowing what value is to the end-user is a critical part of delivering it. Has your company taken the time to understand what is important to your customers or are you assuming you know?  Trusting in assumptions is a very risky undertaking and if you have not recently polled your customers to understand their needs in detail you may be wasting valuable time and resources.   If you follow the current marketing thought leaders you will know how important it is to profile your customers and make sure you are tailoring the right message to the right end-users.  If you are not sure how to do this, Percepta can help.  Contact us any time with questions or add your comments, which are always welcome.    

Directed Evolution

There has certainly been a lot of content generated recently about the virtues of the “new marketing” and the focus on niche segments, consumer to consumer communication, and permission vs. interruption approaches.  Is it a real revolution or a fad?  The question we prefer is: what’s the difference?  So let’s see what your average dictionary says about these terms.

Revolution - noun: a sudden, complete or marked change in something

Fad – noun: a temporary fashion, notion, manner of conduct, etc., especially one followed enthusiastically by a group

Certainly there are elements of both definitions that are applicable to the new marketing.  It is relatively sudden but far from complete, and it is clearly followed enthusiastically by many but perhaps too early to call permanent (though we believe it is not likely to be temporary).  It is also a marked change from the tactics of decades of marketing, especially for the biotools industry.  While some industries have embraced the tools of the new marketing such as Twitter, Facebook, LinkedIn and the like, and have spent countless keystrokes of content on the boundless blogisphere, the biotools industry has been slow to embrace this new realm. Why is that?  Maybe it is a problem of evolution.

In Seth Godin’s nauseatingly titled, but insightful book Meatball Sundae, he points out the importance of embracing the “fashion and stories and permission and promises” of the new marketing because the old marketing is “caveman marketing”.  He has a point.  We all are saturated with in-your-face, look-at-me, push, push, push carpet bombing marketing campaigns, or as Godin calls it “interruption marketing”.   The web has made this type of marketing easier to do – but also easy to ignore.  After all a mouse click is easier than turning a page.  Last time I looked cavemen either evolved or lost out to natural selection.

So why not play to the web’s strength and let natural selection, a well understood biological paradigm, run its course?  As all life scientists understand, natural selection relies on countless random changes leading to an eventual and inevitable successful combination creating a competitive advantage.  But timing is everything.  We prefer to think of the new marketing as a healthy dose of directed evolution.

Adapt to the new environment.  That means changing. Translated to the biotools industry, Godin and other’s are actually saying you may need to change a lot about the way you try to get your customer’s attention.  Show them your cool new stuff but don’t interrupt them (in-your-face marketing) to do so.  Be confident the cool new stuff actually is going to help your customer because permission marketing is about the customer, not your products or services.  In fact, you may need to let go and just give away some value. If they like it they will want it and come back.  If they don’t like it then you learned something valuable. 

Maybe that is not such a huge change after all.  Successful biotools companies educate their customers (translation: provide relevant and informative content) and add value (translation: risk giving something valuable away because it will be useful to customers) and gain loyalty (translation: build trust by keeping promises).

Percepta can help you evolve when you are ready.

Directed Evolution

Flux Capacitor

Posted by Michael Klein

At Percepta, our first point of contact is at times an overworked product manager blurting, “I need to field a survey on…insert topic here…and I need the data back by…insert excessively tight deadline here.”  Our approach is generally to convince them to come down off of the ledge, take a deep breath, and provide us with the answers to three mission critical questions, not necessarily in the order of importance:

1)      What do you want to know?

2)      Why do you want to know this?

3)      What are you going to do with this information?

Question 1: What do you want to know?

Q1 identifies the missing pieces of the “knowledge puzzle” that exist at the client’s organization.  Knowledge gaps may be relatively simple, like a need for an up-to-date snapshot of the company’s market share in North America.  Or more complex, like understanding the performance specs, QC requirements and delivery schedule for bioproduction-scale culture media at biopharmaceutical manufacturing facilities.  Q1 helps us choose the proper market research method (maybe it’s not a survey), and select an appropriate target audience (perhaps biopharma process development and manufacturing scientists).

Question 2: Why do you want to know this?

Q2 provides the project goals and objectives, and crystallizes the overall scope of the study.  It tells us precisely what we need to ask end-users and/or potential customers, and also tells us what we don’t need to ask, which is often equally important.  Perhaps a client wants market share information to discover whether they are gaining or losing share overall.  If so, we can ask the appropriate questions now and also put a plan in place to measure performance regularly, so that the company can plan accordingly.

Question 3: What will you do with the information?

Q3 reveals the business decision riding on the results of the research.  For example, a client might be developing marketing campaigns based on an annual marketing budget and thus must decide how to best allocate resources across major product lines.  Here is where issues with market research projects often arise.  Quality market research must be accurate and actionable – actionable meaning it not only provides the necessary knowledge but also occurs in time to influence decision making.  How actionable is customer feedback related to unmet needs for a product that is in the late stages of design?

It’s our job at Percepta to make sure you get the “necessary knowledge” part right.  However, lacking the Flux Capacitor (Google it, if you were born after 1977), there isn’t much we can do to fix any “in time to influence decision making” issues.  But you can.

Get your organization to think strategically about market research.  First, add it to your budget planning. Then three months before strategic planning, meet with your product development or commercial marketing team.  Brainstorm, beginning with a focus on Question 3, to clarify the strategic decisions facing your organization in the near term.  Then, shift the focus over the next week or so to Questions1 and 2.  Identify those areas where knowledge necessary for decision support is lacking and develop a list of goals and objectives for potential marketing research projects designed to address these knowledge gaps.

Need help in guiding this process?  Percepta excels at facilitating cross-functional exercises to identify knowledge gaps and develop a market research plan designed to capture information that gives you the confidence you need to make the correct calls for the success of your business.

Companies that effectively coordinate market research with strategic planning excel at developing winning products and implementing the proper metrics to regularly measure sales and marketing effectiveness.  Don’t believe me?  I’ve got a used DeLorean I’d like to sell you…

Your comments are welcome

Slice of American Stimulus

Posted by Scott Provost, Percepta

As a marketing consultancy that serves the research biotools industry, Percepta’s business is more or less directly linked to the market dynamics of life science research in general.   These market dynamics can be – well … dynamic.   For example, as noted in earlier posts, research funding is the engine that drives the research biotools industry and to a large degree as funding goes – so goes the biotools industry.  Recent years have presented a difficult funding environment for US researchers and, as a consequence, many biotools suppliers. That’s why we believe things are about to get a whole lot better for biotools suppliers that serve the American life science research markets.

Here’s why - Percepta sponsored a research study in June/July to assess the ‘optimism’ of life science researchers in light of the American Recovery and Reinvestment Act of 2009.  There was a lot of good information that came out of that research study but a couple of facts stood out to us.  Altogether, the NIH budget for extramural grants is enjoying a 55% increase over last year.  Of the $9 billion dollars slated for new NIH grants to be funded in 2009-2010 there is still a little over $7.4 billion that has yet to be distributed to researchers.  Better yet, the vast majority is expected to hit the coffers of research labs by March 2010!

It is not exactly a secret that a significant portion of that funding will be spent on consumables like reagents, kits and enzymes as well as new research equipment though out American universities, colleges, research institutes, and potentially any lab funded by the NIH.   We should soon be hearing a great big ‘cha-ching’ for the biotools industry. 

Which companies will benefit the most?  Well that depends on many things but one thing is certain – companies that understand their customers well, because they have profiled them and use that information to serve them better, will be in the best position to capture a healthy slice of the stimulus pie.   Biotools suppliers that don’t really understand their customer and rely on one-size-fits-all, shotgun marketing may well be left licking the knife.

If licking the knife seems like a dangerous proposition, think about letting Percepta help you understand your customers and your markets better.  Also, download the free report Life Science Research Funding Optimism In The United States: A Researcher’s Perspective compliments of Percepta. 

Let us know what you think.  Your comments are welcome.

By Scott Provost, Percepta

In the past few years Percepta has had several clients come to us saying in essence “We know we have the best products - just help us find the customers”. This is illustrative of the all too common view that since we have the best widget for whatever bench application all we need to do is show it to prospective customers and we won’t be able to keep it in stock.

The presumption that the best performing product will win the business is at best a bit naïve, and at worst recklessly misguided. If building “the best products” is in a Bio-tools company’s DNA and building customer profiles isn’t, then they need some gene therapy.

In his useful book The New Rules Of Marketing & PR, David Meerman Scott reminds us to forget about the products for now and think first about our customers. Scott’s theory applied to our industry essentially translates to this – biotools suppliers need to think more about what customers want from their research tools and not how to make one message fit everyone’s needs with a bunch of, what Scott aptly calls, marketing “gobbledygook”.

This requires a fact-based and up-to-date honest assessment of your customers. But first let’s be honest with ourselves. Has your company profiled your customers? Do you really know what they are doing and who else they are buying from? Do you know if they are loyal adopters or price shoppers? Marketers need to understand what their customers are trying to do in a very detailed and precise way. If they don’t, their marketing messages often end up full of the vague, unclear, or glossy language – in other words “gobbledygook”.

Unfortunately, one-size-fits-all, shotgun marketing is overused in the bio-tools industry and a more personalized intimate connection to your customers must replace it. Customer profiles will help your company personalize a message that resonates with each one of them. Tools companies that fail to learn this will not reach their full potential and may even fail until they do. Want help with profiling your customers? Percepta has affordable programs that might be right for your company. Why not check it out?

Your comments are always welcome.

Posted by Scott Provost

Last October our little consultancy looked around and noticed things had begun to slow down a bit.  New business wasn’t banging at the door and we had to face an unpleasant truth – we were not as immune to the economic downturn as we had hoped.

Percepta is a San Diego area marketing consultancy serving biological research tools suppliers.  You know the ones I mean - big companies that buy up small ones; small ones that want to get bought, and everything in between.  Having worked for many of them over the past 20-some years we all had been through economic slumps before.  Back in the late eighties during one of the first resessions the adolescent bio-tools industry faced, we could feel somewhat secure because smart venture groups kept courting the short list of bio-tools companies that existed then telling them that biological research was almost completely funded by the federal government and the government would be sure that “research must go on”.  The suppliers, they said, were “recession proof”.

So what happened?  Why did business slow down so dramatically in October 2008?  What happened to the old mantra “research must go on”?  Well the answer is a little complex.

First there was the psyche of the tools companies.  I spoke with a bunch of friends I’ve worked with over the years at many tools companies last October when the economy was in freefall and things were a bit scary.   The VP of Marketing at one of the divisions of one of the leading suppliers to the pharmaceutical, healthcare and life science industries told me that business was slow and “management wants to keeps its powder dry” – translation: we are not going to spend any money on marketing in case we need it later.  A marketing manager at a large well known molecular biology and chemicals company told me basically the same thing – “budgets are tight until January 09 at the earliest”.  The management at these and other companies was nervous. Who wasn’t?

Second there was the exodus of investors.  Small, medium and large companies couldn’t raise money no matter how urgently it was needed.   Nascent startups were withering on the vine and even giants like Invitrogen, which at the time was trying to raise capital to complete the acquisition of Applied Biosystems, had to patch together commitments from over 300 separate banks and raid its own stock and cash coffers to close the deal.  And anyone that has tried lately knows that venture capital has all but vanished in biotech circles.  Even if it seems counterintuitive, when money is tight marketing budgets are often among the first to suffer.

Finally there is the research funding hangover resulting from the decade long paltry growth in federal funding during the Bush administration.   In the end we are all dependent on researchers buying research products.  Sure there are pharmaceutical and diagnostic companies that don’t rely on federal money but they are only half of the market and they are cutting budgets too.  Bench scientists have had to scrape by with fewer research dollars and the dollars they have don’t buy as much as they used to.

But wait a minute – didn’t we hear something about a new $800 billion stimulus package?  Didn’t that include an unprecedented $10 billion for the NIH to spend in two years as part of the American Recovery and Reinvestment Act of 2009 (ARRA), and isn’t $9 billion of that earmarked for extramural grants to pay for the advancement of scientific research?  Shouldn’t tools company’s collective mouths be watering in anticipation of the influx of fresh research money?

Yep.  So where is the money? We decided to find out.  Percepta sponsored a study to take the temperature of research funding optimism in America as a result of the ARRA stimulus.  We are analyzing the results now and in coming posts we will share some of the more interesting findings.  We’ll also post the final report on Percepta’s website so keep an eye out.     

October 2008 was a sobering month for a small business like Percepta.  2009 is much more like normal, albeit a new normal, and business is back to predictable levels because “research must go on”.   But the world is changing and bio-tools companies in the new normal will be changing too.  We can’t wait to see what happens.  

Your comments and thoughts are welcome.