The stem cell industry is one of the fastest growing industries in the world today. Steady growth and private funding have provided the right platform to the stem cell industry. As the application of stem cells grow, the market potential increases exponentially, which also means that there is bound to be cut throat competition. The promise and potential is extremely high and in order to compete in this emerging market, stem clinics have to identify and analyze competition as well as customer need, and then provide stem cell therapy solutions.
Stem cells have played an important role in medicine since 1968, when the first bone marrow transplantation (BMT) met with success. Today, bone marrow transplantation using stem cells are quite commonplace especially for treatment of genetic blood disorders and cancer. That is not all; stem-cell treatments are being applied globally for treatment of a variety of medical conditions and diseases including neurodegenerative diseases, diabetes, cardiovascular diseases, traumatic brain injury, hair cell re-growth, wound healing, infertility, and blindness and vision impairment among others.
The ability of stem cells (SCs) to be incorporated for a wide variety of treatment has led to rapid growth in the industry and analysts predict a promising future.
Report studies have been conducted to analyze the forecast period of 2015 to 2020. It is a growing market and the forecast have revealed that it is poised to grow at a compound annual growth rate (CAGR) of 39.5% between 2015 and 2020. Stem cell industry is expected to reach $330million by 2020.
These numbers not only indicate a promising future for stem cell clinics but open the doors to a wider playing ground.
Right now, the promise of $170 billion industry, new innovation and technology are grabbing attention from whole healthcare ecosystem.
So, are there any roadblocks? Well! For starters, there are specific challenges that clinics have to deal with when it comes to stem cell procedures.
The platform and opportunity is right there but stem cell clinics are juggling with new set of challenges like regulations, how to attract new patients, how to educate them, how to build a sustainable practice to grow their business among others.
One of the primary issues that that cannot be discarded completely by stem cell clinics is to identifying and understanding their competition. As this industry matures over a period of time, the competition will become more intense. Clinics will be required to understand the global nature of the stem cell market from the standpoint of innovation and technology, and have to work towards acquiring patients locally as well as beyond local boundaries.
Stem cell therapy is one area where patients may have to consider traveling beyond local boundaries due to several factors including availability of the procedure, cost, technological advancements, latest research, etc. The problem lies in positioning a stem cell clinic in such a way that it can attract patients and help them to take the decision of traveling beyond local boundaries.
Some clinics have inflated expectations from the market that patients would be willing to pay $50,000 or $100,000 for a therapy that has not yet been approved by FDA or considered only as experimental medicine. The core of the problem lies in the expectation that patients would be willing to incur huge out of their pocket expenses as it is not covered by any insurance. Patients are also expected to visit stem cell clinics without the availability of any reliable data.
This expectation puts stem cell clinics in a situation wherein they will not be able to attract and retain customers and hence, will not be able to take advantage of the promising future.
In such a scenario, is there any possible solution at hand? Are there any key factors that stem cell clinic need to consider in order to sustain their identity and offering in a highly competitive and growth oriented marketplace?
The factors that stem cell clinics need to consider for long-term sustainability in the industry include:
Identify your key competitive advantage in stem cell industry
The best way to compete in this growing stem cell industry is to identify and analyze your competition. At the same time, you need to draw similarities as well as lessons learned from other industries that have seen similar industry projections in the near past.
The first step towards this begins by getting a thorough understanding of your competition. This understanding should be the basis for customization of the products and services offered by stem cell clinics and should be aligned to the customer’s point of view. How products and services are customized should also provide clinics with a competitive edge in the overall marketplace.
In the stem cell industry, the growing competition could be local, regional or at a global level. In order to stay ahead of the competition, it is important for clinics to have a clear understanding of the technology, innovation, and information related stem cell therapy based on which they can create an effective price point that can be independently validated.
Top 10 Questions to Analyze Stem Cell Clinic Competition
Competition in the emerging stem cells market can easily weaken the strongest and hence clinics need to focus on building strength. The best method would be through identifying questions that will help in analyzing the stem cell clinic competition in the market. Here is a list of 10 questions that stem cell clinics should try to answer:
- Which top 5 or 10 stem cell clinics do you consider as your direct competitors?
- Who are your indirect competitors for stem cell therapies offered by your clinic like surgery, medications, etc?
- What are the strengths and weaknesses of your competitors’ in their stem cell practice?
- Are there any direct and indirect price points of your competition that can be compared with your price points?
- What types of direct and indirect technology is being offered by your competition (e.g., types of stem cell therapy)?
- Have your competitors published any clinical data through direct and indirect channels?
- What is the legal, religious, and social acceptance of stem cell therapy in targeted countries?
- How is your competition marketing their services or products in the market (irrespective of good or bad strategy)?
- What do patients think about the stem cell treatments and results of your competitors’ (through testimonials, website feedback, etc.)?
- How are you going to position your stem cell clinic in comparison to your competitor’s medical practice? Would it be meeting the competition, beating the competition, or countering the competition?
5 Ways to Analyze Stem Cell Clinic Competitors
Where there is intense competition, the only way to beat the competition is by analyzing the fundamentals driving the “competitive nature”. There are 5 different ways through which stem cell clinics can analyze their competitors and they are:
- Treatment Offered
There are a variety of treatments that can be offered by stem cell clinics but they need to go through a “self identification process” that helps in answering some relevant questions like:
1. What type of stem cells you are using?
2. Which diseases you are treating using stem cell therapy?
You will be in competition with other clinics offering same procedures irrespective of type of cells you are offering. Generally a patient will not be aware of the various types of cells but slowly they will get educated. Hence, it is extremely important to analyze your offering vis-à-vis what your competitor is offering.
For example: if you are offering treatment for diabetes, then you may want to do an extensive research on stem cell clinics offering stem cell diabetes treatment using current innovations in diabetes medicine/insulin, alternative medicines, etc. You need to get an insight into their pricing packages, before and after results, location, convenience, and patient reviews. This will help you in forming a strategy that will enable your clinic to compete in the said market segmentation by offering a unique value proposition, which is competitive and doesn’t exist in the market or industry.
- Customer Point of view
Customer is still the king and hence their point of view is the most reliable path to achieving success!
It is important to ask the relevant questions and analyze the answer like:
1. Do you understand patient’s point of view?
2. How does patient suffering from a disease searches for the options to solve their problem?
You need to put yourself in the shoes of the patient and search for medical procedures currently offered by your clinic. This information can be accessed using various methods like internet, print media (newspaper and magazine), primary physicians and other relevant channels that are accessible to any patient.
This search will aid in providing you with an insight into how your stem cell solution for a specific disease fares as compared to your competitors especially from a patient’s point of view. This will also establish who you are competing with and how. Today, the internet and social media dictates what the patient sees and experiences and how they will interact to access the treatment they are seeking as well as establish emerging trends. This is exactly the reason why it is important to analyze your competition locally, as well as regionally, which will essentially help you to understand competition at various levels.
For example: if you are providing solution for osteoarthritis using stem cells with a high success rate, you may search your local publications, billboards, phone listings, internet, social media on how people perceive a demand for osteoarthritis. If there are many orthopedic surgeons offering the same procedure using surgery, it is critical to understand patient’s key decision making factors such as cost, opinions about surgery, downtime, and reviews of your competition as this will facilitate the process of developing a stronger and better market strategy that can help you compete successfully.
- Market Point of View
The customer point of view is not the only governing factor; the market point of view matters too!
It is important to ask the relevant questions and analyze the answer like:
1. Who are your direct competition in the stem cell industry, your market segment and your strategic group?
Understanding competitor offerings such as promotional offers, bundling of services, extra patient care, aftercare services, etc. could prove to be beneficial in designing your program in the initial stages and this can provide competitive advantage.
For example: if you are offering anti aging treatment using stem cells, you should be able to identify the average cost of anti aging products and services in the local and regional level. Based on the information available, you can review pre and post-care, bundling of services such as “all-inclusive” programs with complete price transparencies.
Apart from this, conducting marketing research and deriving an in-depth understanding of existing market trends will definitely help in understanding your customers in a meaningful way!
- Identifying your Target Stem Cell Customers
Who is your customer? One of the most important aspects towards competing successfully in the emerging stem cells market is clearly identifying who your target audience is. Identifying and presenting your stem cell solution to the targeted customer is more important as compared to taking a shotgun approach where the strategy is dependent on a single thought, which is “you can treat anyone and everyone”.
Such strategies have failed to attract customers in the past as the message the customer receives is unclear and thus they are never able to make a concrete decision. The message needs to be clear enough for people to make a shift from their current treatment plan of using traditional medicine towards the more innovative and technology enabled stem cells therapy.
For example: when a center in Latin America or Caribbean starts focusing only on American & Canadian patients and ignore any of the local or regional patients who were in their target market, the program becomes expensive and leads to failure. Unproven target market leads to chaos and is often followed by disappointment. Hence, ignoring core business from local and regional markets can lead to a downfall.
- The Competitive Advantage in Stem Cell Practice
Listing your stem cell clinics strengths and weaknesses as well as opportunities and threats objectively could be a very useful exercise as it will enable you to understand your actual positioning in the marketplace.
You will be able to identify your position using pre-defined industry established criteria such as technological innovation, data-driven research protocols, case studies, price, inclusions, exclusions, customer service, pre and post care, etc.
An extensive understanding of the legal, political, economical, socio-cultural and technology environment in stem cell industry is essential towards developing a strategy that will help your clinic in gaining competitive advantage. If a stem cell clinic is unable to understand these basic principles and only focuses on random patient acquisition strategy vis-à-vis focused efforts then they are bound to be left far behind in the rat race.
It is important to understand that the stem cell market is not a “quick money making machine” and hence, stem cell centers need to invest time and money in creating a working and practical business plan. They need to take into account competitive factors, pricing strategies, and legal parameters, among other factors.
The entire process of understanding competition in the stem cell industry is one that is detailed and exhaustive. The process entails planning, collecting and analyzing information that is available around us and decisions that we have to make.
The competitive analysis is vital process, which provides stem cell centers with the specific information regarding the existing market, and allows you to develop specific market targets. It also helps in positioning your stem cell practice based on what your competitors are offering in terms of treatment options, technology, and price packages.
Good competitive research can assist you in greatly positioning yourself in the stem cell market, while a poor or inaccurate research can lead to bad and expensive market decisions, which essentially translates into failure.