When it comes to customer loyalty toward med tech companies, the most common story we hear from hospitals and clinicians goes like this:
“The sales reps give us a lot of attention when they want to sell us something. Once we buy, we rarely hear from them or their company. All they care about is making the sale. There is no relationship or partnership. All they are to us is another vendor.”
Turns out that for most med tech manufacturers, their healthcare customers either feel no loyalty, or place their loyalty with the rep. While hospitals and clinicians may have a brand preference, it is quite rare that they feel strong loyalty toward a manufacturer. In fact, surprisingly often, clinicians don’t remember the brand of the devices they use, even those they use day-in and day-out.
What’s causing this absence of loyalty to the companies that make and sell important and often life-saving equipment? I believe there are two factors at play.
- The business model of many med tech companies puts short-terms sales over long-term relationships. Hitting quarterly numbers (even if it means greatly discounting prices) trumps maximizing the lifetime value for a customer. As a result, downstream marketing does not invest in sustaining long-term customer relationships. That clearly hurts customer loyalty.
- Many med tech companies still think they’re in the business of selling boxes or software. Really, they’re in the business of improving healthcare. But when their focus is so product-centric, it’s hard to see the need to invest in building strong relationships. This sets up a dynamic in which customers choose between product A or B. The promise of partnering to help hospitals and clinicians provide better care over the long-term isn’t even on the table. This too takes away the opportunity to create customer loyalty.
That said, some reps are so good that they overcome these obstacles and are able to engender extremely strong loyalty from their customers, like in these two stories:
“It was almost midnight and we suddenly had a serious malfunction with our new ventilators. We called Sandy, the manufacturer’s rep, who happened to be 8 months pregnant. She immediately came by and with profuse apologies got us up and running. Then she came back the next day and provided a more permanent fix. When we need new vents, we buy from Sandy. Doesn’t matter what company she’s with. We trust her and whatever she recommends for us.”
“Dan advised us not to buy his company’s newest monitors yet. He said they were still working out some connectivity kinks and to wait until next year. He recommended we buy from his competitor if we really needed new monitors right away. That was a huge trust-builder. We’ll stick with Dan forever!”
These are true examples and the kind of thing we hear occasionally from clinicians when we’re doing research for our med device clients about how to generate customer loyalty. These reps are like gold and should be valued as such. You want these reps to stay committed to your company.
However, to get healthcare customers to be loyal not just to your reps but to your company is a big lift. It requires a long-term investment in what we call customer intimacy. It also requires a different business model and compensation structure. And it requires a cohesive strategy for prioritizing what customers want and need over what your solutions and technologies can do. Finally, it requires you to convincingly demonstrate to your customers how committing to buying from you over the long-term (i.e. loyalty) will measurably improve their situation.
In the always-changing healthcare space, I believe that the few med tech companies courageous and committed enough to fulfill these challenging requirements will be the big winners.