European medical device company with a global presence and over €1.5 billion in sales. It is the market leader in specific niche products in Europe and North America.
Growth has been slow in the EU and North America for the client. In order to achieve its sales targets, the client is betting on the emerging markets to revive sales growth. The company asked us to scan 17 country markets, explore the existing market dynamics for one of its major product categories, and develop a high-level, market-entry roadmap.
Approach and Key Findings
The project involved a high-level scan of 17 country markets across Latin America, Africa, Middle East and APAC. The primary goals were to estimate market size vis-à-vis the in-scope product category, the division between public/private healthcare spend, and the degree of centralization of the spend; study price ranges for the products; identify if cheaper substitutes are being used and whether market conditions are conducive for foreign products. Based upon these factors, it would be possible to tier the markets in terms of attractiveness for deep-dives and market entry analysis.
The project was a combination of secondary market research scan and selected primary interviews per market over a seven-week period. Secondary market research incorporated government data sources, regional or country-level tender databases, and other healthcare resources in each market. Primary research interviews targeted government healthcare employees and large hospital chains.
The work enabled a fact-based prioritization of the markets for investments; On the one hand, there were small markets with easier short-term opportunities, but where growth would stagnate quickly; On the other hand, there were larger markets that could be further segmented into two types; ones where the product portfolio was suitable to compete, and others where the portfolio would need rethinking due to low product prices and the existence of cheaper substitutes. We also learned that the procurement process of the in-scope products was typically done at the hospital level and bundled with other products (in most markets), with implications on sales and distribution strategy.
The client is revisiting its “product-approach” toward markets and developing alternative operating models for selected emerging markets. In addition, the client will begin work on deeper-dive analysis of the tier one country markets.