Category Archives: Framework

Developing Your New Market Entry Strategy: The 3Cs Framework

Imagine you’re a large medical technology company carrying a wide range of healthcare products. You see huge opportunity in a new market. How do you decide what innovation to lead with, what products to offer, and what your market entry strategy should be?three_c_V2

Here’s a framework that can help you narrow the universe of possibilities. We call it the 3 Cs, which stands for Company, Customer, and Competition. All three are critical factors that converge to reveal the sweet spot for market entry.

Company: This is often the starting point for med tech companies. They see a lucrative market, want a piece of it, and figure they have something good that will sell there. The driver is the company’s desire for growth and their belief in the solutions they offer. The “company” factor narrows the universe by identifying three things: 1) Core competencies and existing assets that can be leveraged for entry into a new market, 2) New competencies the company wants to develop, and 3) New care areas they want to expand into.

Customer: This is about identifying and understanding unmet needs and meaningful problems customers care about, as well as needs and problems they may not be aware of yet. The driver is what customers desire and will pay for. Determining these things requires being really tuned in to your customers. The “customer” factors narrow the universe by revealing 1) what customers want and need and will buy, 2) what their hidden desires and aspirations are and  what better state they envision, and 3) what customers don’t want, don’t value, and won’t pay for.

Competition: The competition factor focuses on identifying what customer needs are and are not adequately met by competitors, and what solutions you have that are already provided by others in the market you want to enter. The driver is finding an open niche of sufficient size for your innovation to take hold. Generally, companies will stay away from markets where there is domination by one or two competitors – unless they are willing to make a huge investment to unseat market leaders. The “competition” factors narrows the universe by specifying 1) where there is space for innovation, 2) what solutions exist and which are still needed, and 3) where there is good growth potential.

The danger is that the company’s hunger to enter a new market can lead to rash decisions and action without a guiding strategy. To mitigate that risk, give serious consideration to customer desire and to the competitive space. That way you avoid being driven by company solutions and wishes, rather than customer problems and desires.

What’s your experience developing new market entry strategy? What were your decision drivers? What lessons did you learn?

More resources:

How to Grow Your Business with Customer-Centric Innovation

How to Get to Breakthrough Innovation: Desirability First!

New Product Innovation: How to Determine the Winners

 

Think or Know? Disarm Dangerous Marketing Assumptions With The “Sandwich” Approach

Which new idea should you invest in?  What’s the right value proposition for your portfolio? How should you position your game-changing product for a winning launch?

These are significant questions that if not answered correctly, can cost you a lot of time, money, and trust. Here’s the “sandwich” approach we use to help med device and other health tech clients avoid making risky moves based on unspoken assumptions.

The Bottom Slice: Identify your high-risk assumptions. Gather your team together for a hard-hitting work session, with all egos aside. Set the expectation that you’re going to identify the key assumptions that must be validated because they’re so mission critical that if you’re wrong, you’re, well, screwed. Here’s how in detail.

The Filling in the Middle: Validate your assumptions. Do the needed research with customers to determine which of your assumptions were on target, and which need correcting. To get the most from your investment, focus on your top priority, highest-risk assumptions.

The Top Slice: Refine Your thinking. Bring your team back together. Review the assumptions you had earlier identified as high-risk and in need of validation. Consider the customer research results by noting which assumptions were right on target, which would need fine-tuning, and which were way off base. No shame, no blame. Now refine your thinking based on what your learned.

This “sandwich” approach works because 1) it gives team members much needed permission to not know everything, 2) it acknowledges that customers can provide many answers, and 3) it lets your team refine their thinking together and get on the same page.

Most important, the “sandwich” approach efficiently and effectively helps you avoid assumptions and wisely answer the tough questions that can spell the difference between success and failure.

The Better MVP: Why “Minimum Viable Products” Are Dead

The basic idea of a “minimum viable product” – popularized by Eric Ries and the Lean Startup movement – is good: Create just enough to validate that what you’re making meets a customer need. And it’s led to many hugely successful companies, like Dropbox and Zappos (more here by Vladimir Blagojevic).
mvp_2
The problem we’ve seen is that “minimum viable product” can also lead to a product-centric mindset in which value to the customer takes a back seat to minimizing features. The dominant thinking is how little can we put in this product to be viable.

What’s the alternative? The intersection of “minimum viable product” and a different MVP we call “maximum value product” (others call it that too, like in this solid prezo by from Liquid Reality’s CEO Adam Smith).

“Maximum valuable product” is not about how many features you can pack into a new product. It is about how well can you solve whatever problem you’re addressing. That’s how you maximize value. The dominant thinking is not about how little, but how much; specifically how much of that particular problem you can solve for the customer.

The order and integration of the MVPs is critical. Here’s the 5 step sequence we recommend:

1) Maximum value: Start with the “maximum value product” perspective. Identify how much you value you can provide customers on a particular problem. Specify in details what aspects of the problem you’re solving, what benefit is created, and how important each is to customers.

2) Value validation: Validate with customers the meaningfulness of the problem you’re solving and have them rank order the importance of the benefits your product can provide.

3) Features: Make a list of what technology or features are needed for customers to experience each benefit and its value. Be sure to include low tech and high tech possibilities. Align features with the ranked benefits.

4) Minimum viability: Now bring in the Minimum Viable Product approach to decide what it will take to provide the required  features. Start with the features needed to deliver the most highly ranked benefit, then continue down the list. Think about trade-offs like this:

Option A: Do a good job at providing for the most important benefit, so that you’ll have enough resources to also provide for the second most important benefit.

Option B: Do a great job at providing for the most important benefit. Pour all your resources into that, and come back to the second most important benefit later.

5) Viability validation: Use lean and agile research techniques to get customer feedback on option A vs. Option B. Now you’re ready to take something to early adopters that has the optimal balance of providing value to customers and being viable to make.

Please share your experience with MVP vs. MVP!

Be Like Vegas!… and 6 Other Tips to Increase Wellness Program Participation

Why aren’t more members signing up for our free health programs!?!

The 3Es behavior change framework offers a fresh approach to solving the problem of low enrollment in valuable health programs. Education, Engineering, and Enforcement are the components of the 3E framework, which traditionally has been used in the Injury Prevention field (CDC is a leader here). It’s time for others to harness its power as well.

A simple example: If we want people to drive slower, we can convince them why (education), we can add speed bumps (engineering), and we can ticket them (enforcement).

Another example: If we want people to quit smoking, we can convince them why (education), we can establish no-smoking zones everywhere (engineering), and we can fine them for lighting up in public (enforcement).

A third example: If we want people to participate in our Wellness program, we can convince them why (education), we can integrate Wellness into other membership activities they have to do with us (engineering), and we can charge higher rates to non-participants (enforcement).

OK, the last example may be a bit oversimplified, but you get the point. Now let’s dig deeper. Seven key takeaways:

1. Health Behavior Change is Hard

Doctors, insurers, and public health agencies all want people to adopt specific behaviors that will help those people be healthier. It may be taking meds as prescribed, losing weight, avoiding injuries, or a host of other behaviors that ostensibly benefit the individual, the organization, and society at large.

But sometimes the target behavior is simply getting people to check out a program that can help them, like CMS’s Health Insurance Marketplace. Or insurers getting their members to sign up for free Wellness programs. Typically, participation is disappointingly low. Program developers, marketers, and outreach specialists that create and run these programs are astounded by the number of people that don’t sign up for their offerings.

What’s going on??

2. Compare Company/Customer Perspectives

Insurance company: Our Wellness program is designed to help our members. It can improve their health and save them money. And it’s free. All people need to do is go on our website and enroll. Why aren’t people signing up like crazy?

Customer: Why would I do a Wellness program with my insurance company? They’re number crunchers, they don’t know about wellness and prevention. Anyway, it’s probably just a way for them to cut my benefits and make more money.

These contrasting perspectives indicate a serious relationship problem. As an industry, health insurance companies rank among the lowest in customer satisfaction in 2014, according to the American Customer Satisfaction Index (about the same as airlines, the US Post Office, and cell phone providers – but better than cable companies!). If satisfaction is low, trust is likely to be low too. This means insurers start pitching their Wellness program with a credibility deficit.

3. Don’t Make Assumptions

Insurers and others presume that members should value their Wellness programs. This is mistake #1, and for a couple reasons.

First, members need to know about the program in order to decide if they will enroll in it or not. You telling them about the program does not mean they know about it. All it means is you provided them with some materials.

Second, for members to care about your Wellness programs requires them to: a) understand what Wellness is, b) value Wellness,  c) want to enhance their Wellness now, d) want help in doing it, and e) want that help from their health insurance company.

Figure out what your Value Proposition is: Determine exactly what makes your Wellness Program unique and valuable to members. And from their point of view of course.

4. Go Beyond Convincing (aka “Education”)

It’s one thing to get members to take time and seriously think about your Wellness programs, commit to trying them, signing up, etc. And a small segment of members (the “low hanging fruit,” so to speak) will do just this. All they need is the opportunity.

Consider your own life. Let’s say you own a Toyota and your local dealer was offering a “Car Wellness” program with all kinds of helpful information so you can take better care of your car. To take advantage of their free program designed just for Toyota owners, simply go to their website, enroll, choose classes, attend, etc. You want your car to be in good shape and last many years. Would you do it? (I’m not talking to the car buffs here!). If not, why not?

There are a lot of answers to why not. Most people will say time and money, but that’s far from the whole story. We spend on what we care about. And we don’t always think through things and make rational decisions.

That’s you’ll need to go beyond the traditional and assumption-filled Education strategy, and bring in Engineering and maybe even Enforcement.

5. Be Like Vegas – Embrace “Engineering!”

In Vegas, slot machines are ubiquitous – they’re in bathrooms, by airport gates, everywhere. The environment is engineered to entice people to play. In fact, people need to go out of their way to not gamble.

Because Engineering changes the environment or product, it doesn’t require people to make any choices. The behavior just automatically happens (like slowing down over speed bumps or signing up for a default Wellness program as part of overall enrollment). Evidence suggest that this passive or automatic approach is usually more effective than those that require more active decision-making.

The key Engineering question is this: How can you make participation automatic? How can you make it so it’s easier for members to participate with your Wellness content than it is to not participate?  Really think about this. List your assumptions, which can then be validated or corrected.

To start, understand the member experience, so you can identify the best Wellness touch points from a timing point of view. For example, maybe when people newly enroll as members they are so inundated with information, that Wellness Programs are the last thing on their minds. But when they get their surprise hand-signed Welcome card from you (right?) a few weeks later, they may be very receptive. What are the best touchpoints for engaging members in Wellness?

Consider bundling the process of enrolling in Wellness Programs with other sign-ups. But don’t just focus on getting them to enroll. Focus on getting them engaged. Here are some suggestions to think about Engineering from the perspective of marketing content: Consider small tidbits of Wellness tips that can be included in every single interaction with members. Think about integrating invitations for your Wellness program at times when people may find them more relevant. Put heart health tips on EOBS for cardiology visits, add smoking cessation tools on rate cards that show the differential for smokers, put cold and flu prevention tips on Back to School pieces. In short, meet people where they’re at.

6. Make Them Participate: Enforcement

Enforcement is the “hammer” strategy (or “carrot” if designed well). If members don’t enroll or participate in your Wellness programs, it’s gonna cost them. Could be on the front end, could be on the back end. This approach requires policies or regulations that you then enforce.

Enforcement means you have clear boundaries, expectations ,and consequences. Most people don’t love enforcement, but at the right time and place, and in combination with Education and Engineering, it is a strong motivator of compliance and behavior change.

7. It’s About Them, Not You.

Bottom line, tailor your Wellness programs to fit the lives of your members. Don’t expect them to mold their lives to fit your programs.

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Good overview of the 3Es: The Three Es of Prevention: Education, Enforcement, and Environment

Good example: Railroad Safety

 

3 Powerful “B4’s” that Put First Things First in Winning Innovation

Let’s say you need to come up with new products and services that will make a lot of money.  Here are 3 customer-centric principles that help you do first things first in new product innovation, and get far better results. We call them our “B4” principles (as in what comes “before” what).

Purpose B4 Profit: Your company exists to achieve a certain purpose (what Simon Sinek calls your “why”). Be clear and passionate about your purpose. And know that turning a profit is not it. Successfully fulfilling your purpose is how you make money; it will always entail satisfying desires of your customers. Which requires…

Customer B4 Product: It all starts with the customer.  The notion of putting customer desirability ahead of technical feasibility is a hallmark of Human-Centered Design.  Avoid the seduction of making things because you can, rather than because customers value what it does for them and will pay for it. This means…

Problem B4 Solution: First focus on identifying meaningful problems and unmet needs that customers care about before diving into technology and solutions. Even if you initially come up with a great idea of a new product, think through the lens of how it will improve the customers’ situation.

What is your experience practicing these “B4” principles?

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More here:

How to Get to Breakthrough Innovation: Desirability First!

New Product Innovation: How to Determine the Winners

“But We’ve Always Done It That Way” – Zen, Zero-Based Thinking, and a Fresh Approach

Best Marketing Framework: 6 Ms, 4 Ps, or Customer-Centric 4 Es?

When I was serving on an expert FDA Risk Communication Advisory panel last week, a colleague described the “6Ms” marketing communications framework to the FDA staff we were advising. It’s been around for awhile and is still a useful mnemonic to remember what to consider when crafting a campaign. The 6 Ms are: Mission, Market, Message, Media, Money, Metrics.

Of course the classic marketing framework – or marketing mix – is the 4Ps popularized by Dr. Phil Kotler: Product, price, place (of distribution), and promotion.

Now the 4Ps have morphed into the 4Es: In our version, Product becomes Experience, Price become Equity, Place becomes Environment, and Promotion becomes Evangelists. I see this 4Es model as being the most customer-centric and thereby useful for developing a powerful customer/patient experience. More here.

What framework or mnemonic do you find most helpful?