Wednesday, May 30, 2012

The market ecosystem

CerberusI’ve been thinking about the Customer lately.  With my business fully funded and powering through a year of Development Stage work to product release, Requirements, Scenarios, Risks and Usability fill my day, and these require dialog with my end-user.  It’s not quite as simple as connecting with a buyer though. In MedTech the Customer is a three headed beast: the Patient/Physician/Payor.

Or maybe not.

Supply and demandFelix Salmon of Reuters was recently interviewed on the Slate Culture Gabfest about art market economics.  His thesis is that pricing doesn’t follow the usual rules of supply and demand, but is instead driven by emotional, psychological, and social factors.  That’s part of it, but I think that the other is that art exists in a market ecosystem rather than a supply chain, well described in Seven Days in the Art World and by the diagram below:


Artists sell in a context of schools, shows and critics who define what is Art, what is Hot, and who is Trending.   Their works circulate among galleries, collectors, and museums.  Any and all of these can be defined as the artist’s Customers.

In MedTech, we create products and services, manufactured as discrete units of commerce: these are also sold into ecosystems that also sell into an ecosystem.  There are Guidelines, regulators, standards groups, trade shows and influencers who judge and promote our works; distributors, hospitals, and exporters who trade in them.  They all interact in complex ways that can drive pricing and demand and, therefore, determine business success more than simple demonstrations of performance, safety, and value.

Within this ecosystem there are leverage points: key intermediaries that drive awareness and shape perceptions.  I’ve seen marketing people try to unfold this in chains and pyramids that govern launch strategies for new products.

ZinC SoC Pyramid

But I think that you have to treat it as a living system, with perceptions and motivations rather than just cash and product flows.  As such, it can’t be dissected.  Rather, you learn about it by observing it’s behaviour, trying small experiments to see how it responds.  It’s a process that should begin far ahead of the product launch, working your way into the gears rather than giving them one definitive kick.

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