Research was presented showing highest performing companies maintain focus on core markets while making bets on growth markets. Participants discussed strategies commonly used as they make bets on growth markets.
Alexander Group research revealed that companies think about specialization in three ways:
Specialization delivers depth of focus and expertise. The motion is most appropriate for early stage life cycle products, technically complex solutions, new markets or unpenetrated customer segments, and products or customers that would otherwise not receive focus from generalist teams or channel partners. The strategy allows sellers to focus and leverage their technical depth and areas of expertise.
Specialization comes at the cost of reach of sales resources and frequency of customer engagement. It also inhibits workflow or solution selling – and the implied cross-selling that comes along with this approach. As companies add lines of business multiple specialist teams can create customer confusion.
While specialization has disadvantages, companies are willing to invest in expertise and competencies to bring their products to markets. Based on the roundtable audience survey, 94% of attendees currently use product specialists, followed by approximately 40% using both segment and customer specialization. The group shared that customer needs and their coverage strategy were the drivers behind how they use specialization.
We shared detailed benchmarks that showed the difference between how companies used specialization to cover the research (Academia, Pharmaceuticals and BioPharm) and applied (Clinical, Testing, Environmental, Food and Beverage, and other) markets. Companies invest more heavily in application specialists when selling into research markets. They invest more heavily in product specialists when selling in applied markets. Additional benchmark information is available here.
To learn how high-performing companies drive above market results, contact us for a full readout of the findings from the latest Life Sciences and Analytical Instruments Industry Trends Study or register for one of our upcoming virtual roundtables.