How to Adapt Your Diagnostics Go-to-Market Strategy to the Changing Market Dynamics

The demand for faster, more accurate and accessible testing is driving innovation and creating new opportunities for diagnostics companies. These opportunities also bring unique challenges for the traditional go-to-market (GTM) strategies of diagnostics companies, especially in the three primary segments: large capital, desktop instruments and cancer diagnostics. In this article, we will explore the key market trends affecting the diagnostics industry and how diagnostics companies can adapt their GTM strategies to align with the changing customer needs and preferences.

Key Market Trends

Based on our research and analysis, we have identified five key market trends that are shaping the diagnostics industry:

1. Site-of-care migration: The growth in point-of-care testing (6.5% projected CAGR) is shifting testing volume away from centralized acute settings and creating competing options for diagnosis.
2. AI ramping up efficiency and development: Artificial intelligence and machine learning (34.8% projected CAGR) are being used to develop new tests, improve lab automation, analyze datasets and images, and improve the overall accuracy and efficiency of the diagnostics industry.
3. Wearable tech data integration to EHR: Wearable technology (25.7% projected CAGR) is creating greater data for diagnostic testing, but gaps in clinical reliability create an opportunity for companies to leverage data for better outcomes and integrate into electronic health records.
4. New product investment: Interest from private equity and venture capital has resulted in increased product development and M&A activity since 2021, but bringing new products to market will be challenged by the removal of pandemic-related regulatory easing.
5. Telemedicine as a diagnosis source: Clinicians are seeing a shift in diagnostics from hospitals to homes and community centers as telemedicine and at-home testing continues to gain acceptance, increasing the importance of urgent care and retail channels.

Let’s explore how these trends impact your go-to-market strategy.

GTM Strategy Priorities

To succeed in the evolving diagnostics market, diagnostics companies need to rethink their GTM strategies and align them with the customer segments, value propositions and channels that are most relevant and profitable. Based on our benchmarking and best practices, we have identified the following GTM strategy priorities for each of the three primary segments:

Large Capital

• IDN capital equipment standardization: Key accounts need coordinated coverage with clear rules of engagement between key account managers and field sales, and segmentation based on decision-making criteria.
• Customer renewal risk mitigation: Develop programs for competitive risk mitigation, using data and analytics to identify at-risk accounts and create sales plays to “resell” and lower churn risk.
• Maximized current account utilization: Deploy customer experience (CX) models that leverage inside sales, customer success, field-based account managers and other roles to increase share at current accounts.
• Connected products and AI advancements: Map AI advancements to customer needs and identify accounts with the greatest potential to benefit from AI capabilities and deploy specialized sales teams to highlight the evolving value proposition.

Desktop Instruments

• Improved lead qualification: Unlock marketing to allow for more engaged selling and use inside sales and distributors as lead sources for new customers.
• Enhanced digital training capabilities: Train customers to use product education content and use customer success models to provide on-demand training and support.
• Unused instrument targeting: Reengage underperforming accounts to grow revenue, and segment accounts by potential volume and identify underutilized instruments.
• New product commercialization: Create a transition plan for new products, and update sales compensation, sales process and sales roles to reflect the new product value and costs.

Cancer Diagnostics

• Targeted digital outreach: Use digital marketing to create physician awareness and use lead scoring and sales development reps to qualify and pass leads to the sales teams.
• Reinforcing value messages: Use customer success models to maintain awareness and create metrics to demonstrate the efficacy and ease of use of testing.
• Jobs evolving with product maturity: Assess coverage strategy as territories mature and consider bifurcating hunting and farming responsibilities and using lower-cost resources to support the commercial model.
• New routes to market: Address telemedicine as a channel to home testing, and update sales and service responsibilities, sales compensation, and sales crediting to reflect the impact of the additional revenue source.

Diagnostics companies need to focus on these go-to-market strategy priorities to succeed in the market.

Conclusion

The diagnostics industry is facing unprecedented opportunities and challenges as a result of the changing market dynamics. Diagnostics companies need to adapt their GTM strategies to align with the customer segments, value propositions and channels that are most relevant and profitable. The Alexander Group can help you assess your current GTM strategy, benchmark your performance against the industry, and design and implement the optimal GTM strategy for your diagnostics business.