Adapting Commercial Strategies for 2024

Profitable Growth is on the Horizon

With disruptions in the global economy and healthcare systems, life sciences companies continue to face new challenges and opportunities as they adapt to changing market conditions and customer expectations in a post-pandemic environment. A return to profitable growth is on the horizon―organizations that take advantage of the following key trends can thrive in 2024 and beyond:

• Continued Emphasis on Efficiency
• Investment in Post-sales Customer Experience
• Significant Plans to Deploy AI
• Rationalizing Investments in China
• Investing in Revenue Operations
• Cautiously Optimistic About Market Recovery

Continued Emphasis on Efficiency

One of the primary priorities for 2024 is to improve operational efficiency and reduce costs. This is important in the post-pandemic era, where the demand for biopharma products and services may fluctuate depending on the recovery of different regions and sub-markets. To achieve this goal, most companies are rationalizing their sales, marketing and service investments to align with the new growth curve. When possible, many are trying to reduce the level of cost-cutting coming from commercial teams and finding it elsewhere through manufacturing, supply chain, inventory management and real estate. These efforts are rationalized to minimize disruption to top-line revenue.

Investment in Post-sales Customer Experience

While it’s necessary for some to possibly take cost out of their commercial organization, there are investments required to avoid possible customer churn and NPS detractors. One area of the buying experience that is continuing to receive attention and focus is the post-sales customer experience. Whether it’s reimagining how vendors bring workflow and application expertise to scientists at the bench or automating customer service activities by retooling online self-service portals, it’s important to look at possible immediate efficiencies. Commercial leaders must continue to focus on automating activities and pushing for investments into their digital roadmaps.

Significant Plans to Deploy AI

Another major trend for 2024 is the early adoption of artificial intelligence (AI) technologies across various aspects of life science businesses, including research and development (R&D), manufacturing, quality control, marketing, sales and customer service. AI can help life science companies accelerate their innovation, enhance their productivity, improve their quality and personalize their offerings.

As AI technologies continue to quickly evolve, they will be deployed to reduce operational costs. For example, life science companies are exploring using AI chatbots for ordering, customer service, technical support and other routine tasks. These chatbots go beyond the typical recursion if-then formulas and can engage buyers of all types based on their needs. These examples may include helping scientists around specific workflow questions by mining educational material across the website or peer-to-peer communities or automating purchase recommendations based on purchase history and the questions being asked.

Rationalizing Investments in China

China has been one of the fastest-growing markets for life sciences products and services in the past decade. However, the outlook for China is not as optimistic as before and some organizations over-invested on the fading demand. The COVID-19 pandemic exposed the vulnerabilities and risks of relying too much on China for sourcing, manufacturing and distribution. The geopolitical tensions and trade wars between China and other countries have also created uncertainties and barriers for doing business in China. Moreover, the regulatory environment and the competitive landscape in China have become more challenging and unpredictable for foreign life science companies.

As a result, many life science companies are making significant cuts in China after years of growth. They are reducing their headcount and footprint across Sales, Marketing and Service functions. They are also diversifying their supply chains and markets to reduce their dependence on China. Instead, they are using the savings to invest elsewhere, including emerging markets like India and Southeast Asia, or in developed markets like Europe and North America.

Leveraging Revenue Operations

One of the strategic initiatives that life science companies are investing their time and mindshare in 2024 is to consolidate and streamline their revenue operations. Revenue Operations is the alignment and integration of all the functions that contribute to the generation and retention of revenue, such as Marketing, Sales, Service and Customer Success. Revenue Operations aims to create a seamless and consistent customer journey, from awareness to advocacy, and to optimize the efficiency and effectiveness of the revenue-generating processes and activities. By investing in revenue operations, life science companies can achieve several benefits, such as:

• Improving the visibility and accountability of the revenue performance and pipeline across the organization
• Enhancing the collaboration and communication among the revenue teams and stakeholders
• Reducing the friction and silos in the customer experience and the revenue cycle
• Increasing the agility and scalability of the revenue operations and systems
• Driving the revenue growth and retention through data-driven insights and actions

Cautiously Optimistic About Market Recovery

Despite the challenges and uncertainties, life science companies are also cautiously optimistic about the market recovery in 2024. The COVID-19 pandemic has highlighted the importance and value of life sciences products and services, such as vaccines, diagnostics, therapeutics and medical devices. The pandemic has also stimulated the demand and investment for innovation and collaboration in the life sciences sector.

The biopharma industry has benefited from increased R&D spending, accelerated approval processes and expanded market opportunities. Though there has been a recent decline, the biopharma segment offers sustained long-term growth. Therefore, life science companies are planning but not deploying biopharma-specific teams, though those plans are ready to be executed as there is long-term potential.

Preparing for 2024

The life sciences industry is facing a dynamic and complex environment in 2024, with both challenges and opportunities. Life sciences companies need to adapt and innovate to survive and thrive in the post-pandemic era.

These trends are not mutually exclusive, but rather interrelated and interdependent. Life science companies need to understand and leverage these trends to create and deliver value to their customers and stakeholders, and to achieve their business goals and objectives.