Estimating market size depends on four different cuts of market data: (1) demand, (2) addressable market, (3) realistic opportunities vs competition, (4) targeted selection of "winnable" market opportunities. Discuss with respect to your team's new business.
(1) demand – The demand for products centered on systems integration is very large, so long as those products can satisfy Meaningful Use and Affordable Care Act requirements. These laws and federal mandates are driving hospitals and healthcare facilities (in some cases begrudgingly) to adapt electronic systems to capture patient data and transmit it between systems and facilities. Marketing material for OGC should heavily emphasize these benefits as this is the main area where our product can add value to facilities both small and large.
(2) addressable market – while the total size of the ‘addressable market’ can be defined as any healthcare delivery facility, our discussions have led us to understand that, for the purposes of a launch, addressable market should be narrowed down to be smaller healthcare facilities for whom a product such as this yields considerable gains at not much cost. Specifically, facilities that are on the road to integration, but cannot afford the larger, more expensive 'all-in-one' systems that come integrated out of the box.
(3) realistic opportunities vs competition - As far as realistic opportunities are concerned, the above customer segment is really the most realistic opportunity; the competition in this market is growing ever tighter, and as budgets get smaller and smaller, the need to demonstrate ever-increasing value at ever diminishing cost takes on additional importance.This is an area where OGC can actually excel, since the product meets a very specific need, and can be priced as such; many integration solutions offer a broad array of functionality; small facilities with very specific integration goals benefit more from the OGC than they would from other comparable products.
(4) targeted selection of "winnable" market opportunities - we've chosen to target smaller outpatient and extended care facilities as the most 'winnable' segment for launch. Since these facilities want to access government stimulus money for meeting Meaningful Use and ACA requirements, but do not have large discretionary budgets, a product like OGC can enable them to real rewards for not a lot of cash.
I think you guys are on the right track. Targeting the smaller, and often independent, facilities should allow you to make deals on a small scale at the start. As good as it would be to get a huge deal with a hospital network, there are many issues associated with convincing them of adopting your system. Going after smaller places that can implement your system with ease should support sales in the beginning and act as great case studies when pitching to the big places down the road.
ReplyDeleteI agree with Jnolan, using what you learn from implementation in these smaller facilities can help your sales pitch to the larger firms. You will have substantiated proof of the benefits and ease of implementation of your product, which can be translated to a larger setting. If what you say is true about these smaller firms being able to access significant government stimulus money for meeting certain requirements and your product is a low cost solution, then it should be a "no brainer" for them to try it... and should be an easy sell for your sales force.
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