Alexander Group’s recent roundtable revealed how industry leaders are using practical strategies to grow revenue.
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.
Types of Specialization
Alexander Group research revealed that companies think about specialization in three ways:
- Product Specialization – most Life Sciences and Analytical Instruments companies start here. They bring innovative, market-making technology to market and deploy scientific, technically oriented sales resources.
- Segment Specialization – as industry players win share in core markets they look to adjacencies to deliver the next wave of growth. They experience issues getting sellers to broaden their focus from core markets (i.e., Academia or Pharma) to these adjacencies (i.e., Environmental, Testing, Food and Beverage, and others). To gain focus, companies will commonly deploy overlays or separate organic quota carrying sales teams
- Customer Specialization – as companies grow their share in a segment they will often shift the breadth and depth of sales coverage to those customers that deliver the lion share of revenue or represent the greatest growth opportunities. They will create key account teams with specialization on the top customers and use scalable motions to cover long-tail or small accounts.
Specialization Advantages and Disadvantages
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.
Life Sciences and Analytical Instruments Industry Benchmarks and Trends
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.
Sign Up
You may also be
interested in:
Author
Matt Greenstein is a principal based out of the New York office. He works with clients across technology, life sciences and healthcare. He has responsibility for leading the firms Life Science and Analytical Instrument and Digital Transformation practices. His areas of focus include large scale transformation and integration across all commercial functions–tactical marketing, sales and service. Matt has global consulting experience and is known for his fact-based, hypothesis-driven, problem-solving style.
