Product Repositioning Research

Client

The company is a wholly owned subsidiary of a major Wisconsin health network.  It developed and markets a software module that links hospital financial, admitting, and treatment databases with those of clinics, insurance companies, and various other types of providers. 

Challenge

Despite marketing a product that appeared superior to the competition, sales were disappointing at less than 50% of goal over the three-year sales cycle.  A revised product and marketing strategy was critical.  Company management had been informed that either the product sales increased or the product line would be discontinued.

Research Application

McGrath Marketing met with company management and representatives of the distribution force to assess the issues.  The assessment focused on three factors (1) the current marketing and promotion plan, including distribution compensation, (2) profile of current customers, and (3) a review of competitive products. 

Based on these results interviews were scheduled with hospital executives within the company’s target market areas, Milwaukee and Madison.  The interviews focused on (1) the hospital’s current information sharing capabilities, (2) their plans to invest in information sharing technology, and (3) their assessment of the company’s information sharing software.   

The results of the qualitative research indicated that large, urban health care facilities generally developed their information technology applications internally; the likelihood of purchase by these facilities was low. 

The next phase of research was undertaken to determine if there were a market for the company’s product.  Information from the initial set of executive interviews indicated that smaller health care facilities that did not have internal development capabilities might have a demand for a software module.  A series of interviews and focus groups were held with hospital management from smaller urban and rural health care facilities.  The results of this research phase revealed demand for the product in the rural hospital markets and identified product modifications that would increase its competitiveness.

Outcome

The company is now targeting rural health care facilities and has developed a marketing and promotion strategy aimed at this market segment.

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