Early-Stage Life Science companies want to generate sales first, then invest in marketing. Will this strategy work?

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“Sales” is more than just generating orders. It has been my experience that successful selling starts with an integrated sales and marketing plan. While early-stage Life Science companies often feel the need to get sales before proceeding with all other  “non-revenue generating” commercial activity this has proven to be a  misguided strategy which is likely to fall short of reaching the desired goals. To commercialize successfully companies need to undertake an integrated sales and marketing plan and invest in it as a long-term program rather than a short term activity. If done right, it needn’t cost a lot but it will pay big dividends.

 

A good marketing plan sets the framework from which the sales effort can move forward in a directed manner. Good products or services need a well thought out plan to maximize the likelihood of success. Without such a program, the company will not realize its full commercial potential. Of course small companies are under a lot of pressure to generate near-term revenue and the seemingly simple answer is to start selling. However, to optimize the ROI salespeople need to understand who their markets are, how to position the products for those markets and must possess the right selling tools. In the absence of such guidance, sales revenues will be disappointing and much of the sales budget will be wasted in a hit-or-miss sales effort. Thus, the effort to sell first and market later actually delivers a much lower return.

 

Holding off on strategic or tactical marketing in favor of getting out and selling will limit your revenue potential. It is the intangibles (target market ID, messaging, positioning) as well as the tangibles (web site, sales collateral, demand generation,etc.) that, together, comprise a sales and marketing program. It may cost money to go this route but it will costs more not to. Trying one thing (such as a technology-centric web site or an email blast that is lacking in message and focus) may give you some payback but nowhere near what could be achieved with a well-designed program.

 

The most productive route for early-stage life science companies to take is to start strategically:

  • ID the target market
  • Determine what your product/service does for them that others don’t.
  • Develop your message: HOW your product will help them succeed and what are its key differentiators?

Then, using this laser-like focus on your target you begin to perform tactical marketing (for awareness and leads) and jump-start your sales effort. With a properly equipped team and a well executed plan (with value proposition, messaging, leads, web site, etc.) your sales effort is enabled to achieve its full potential.

 

Effectively Marketing “Cost-Effective” in Life Science

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Some products or services offer higher quality AND lower price. “Cost effective” solutions with other benefits and advantages must be marketed and sold carefully. The issue is how to successfully position the offering.

  • High Quality may scare away prospects who assume it has a High Price
  • Lower Price may mean Low Value to many in the Life Science Community

While great price and great quality is a compelling message, it sounds a lot like “Better, Faster, Cheaper”. Bringing attention to “value” is important but careful attention should be paid to “how” and “when” this attribute is promoted.

There are two schools of thought on how to best address the High Price/Low Cost Conundrum:

  • Bring Price Advantage in Early because if you wait too long you risk losing the client due to high-price perception.
  • Focus on Quality: Stress the Quality and wait until late in the Sales or Marketing Process to point out your price benefit. Establishing value before price will make the price advantage seem even more compelling.

My Thoughts: Quality, Quality, Quality then Price

Quality Trumps Price, pure and simple. While people want lower pricing, they will pay for quality due to hidden cost of lower priced offerings (time lost due to failed experiments or compromised results). Lead with the your value proposition and your key differentiators that will make an impact on their work whether in written or verbal communications. After the value is established, bringing greater focus to cost-effectiveness should pique their interest. If you bring in price early then it becomes the key focus making your sales or marketing effort a “race to bottom” with your competitors to see who can offer the lowest price. Margins suffer, perception of your product/service suffers and your company loses.