This report originally appeared in the January 2010 issue of DOTmed Business News, now online.

For a moment during the summer of 2009, I thought the health care diagnostic imaging market was turning a corner and we'd see some recovery in the fall. What was I thinking? At exactly the moment that hospitals, clinics and vendors felt it was safe to poke their heads above ground, Congress decided to play Whack-a-Mole with 18% of the GDP and began pounding away at health care reform.

The debate continues and my head's still throbbing. New taxes, draconian $500 billion cuts in Medicare and what looks like an intentional wholesale devastation of the private health care insurance industry are all in play. Prior to the health care reform debate available capital was holding us back. Now buyers fear their government and are delaying purchases.
It's difficult to comprehend what the future holds for vendors of equipment, providers of services or for patients needing medical attention. What we do know is there will be a future and we need to address it as we begin the new year.

The larger vendors with broad offerings in medical imaging demonstrated in 2009, that the old model of being all things to all people doesn't work in this economy or under the threat of legislated health care reform. In 2009 they reported poor sales and people at various levels of the job food chain found themselves unemployed.

Anecdotally, smaller vendors seemed to be experiencing stronger year-to-year sales. These smaller vendors by virtue of their size have a lesser effect on the larger marketplace as compared to big vendors. But in their specialized area, their niche, they can make a substantive impact on sales and profitability.

So why are smaller companies successful while larger companies struggle? Smaller companies offer a much narrower range of products resulting in an almost unconscious move to "niche" markets. It's about survival and adapting to one's environment. For many companies that supply products and services to the medical imaging markets, niche marketing strategies may be the key to success and growth in 2010 and beyond.

If niche marketing strategies can carry vendors and providers forward in these difficult and changing times, how does one plan and implement a successful niche strategy? First you identify the market niche you wish to service. Some folks make this step complex. Keep it simple.

For example, in the January 2010 issue of DOTmed Business News (now online) there's a feature on children's radiology. This is a niche market. Evaluating the niche market opportunity doesn't have to be difficult. Here's how I approached it. From the Internet I was able to determine that children's radiology services are highly specialized and almost always located in children's hospitals. In just a few more minutes of searching I found the National Association of Children's Hospitals. This group claims to represent 80% of all children's hospitals in the USA and they say they account for 5% of all hospitals. If this is accurate information, we can draw a conclusion from their statistics. There are 4,875 hospitals and 5% or 243 are children's hospitals. That's a well-defined niche.

Will niche marketing single-handedly turn the clock back to the heyday of medical equipment sales? I don't think so, but as you specify products and services for different niche markets, you may find you can sustain sales levels and build profitability year-to-year even in difficult times.

Like everything in life, there are no panaceas and niche marketing won't work for everyone. But if you've defined a niche, have a focused, well-defined offering and a specialized marketing and sales team, niche marketing can be a very effective tool for advancing the sale of products and services.

Wayne Webster is a consultant in Medical Imaging Business Development. You can send comments or questions to W.Webster(at)Proactics.net.

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