The market for medical devices can be divided into segments, each with its own needs and wants. The key to successful marketing is understanding these different segments and targeting them with the right products.
One of the most popular methods for performing market segmentation uses demographic factors like age, gender and income.
Other methods use psychographic factors like lifestyle, motivations, values, likes and dislikes as well as behavioral factors like purchasing habits, how someone intends to use a product or service, how often they will use it, the benefits they seek, or brand preference that they have.
However, the segmentation of the medical devices market is different in the sense that the customer’s choice of device is often governed by factors out of their control, factors like the medical condition they are suffering from, the severity of that condition, their age, or even their insurance coverage.
In this article, we will perform medical devices market segmentation using the following 10 variables: type of device, disease state, geography, customer type, end user, usage pattern, application, location of use, regulatory environment, and reimbursement landscape.
But first, let’s start by understanding why medical devices market segmentation is important.
The Importance of Segmentation of the Market for Medical Devices
The segmentation of the market for medical devices is essential because it allows medical device manufacturers and retailers to target specific groups of consumers with laser precision.
By understanding the needs and wants of different segments, medical device businesses can create products that are more likely to appeal to them and retailers can stock products that their customers are most likely to buy.
The market for medical devices ranges from those looking for a simple portable thermometer or an oximeter to measure blood oxygen levels to a patient requiring a life-saving implantable cardiac defibrillator.
The segmentation of the medical devices market allows businesses to focus on specific groups of consumers and create products that meet their needs.
Variables for Medical Device Market Segmentation
Medical Devices Market Segmentation can be performed along the following 10 axes:
- Type of device
- Disease state
- Geography
- Customer type
- End User
- Usage Pattern
- Application
- Location of Use
- Regulatory environment
- Reimbursement Landscape
Different people have different needs, wants and motivations for purchasing a product or service.
And so most medical device manufacturers do not cater to all buyers. Instead, they focus on those segments of the market that are most likely to buy their products.
With market segmentation, they can target specific groups of consumers with tailor-made products or services that satisfy their needs.
It is therefore essential that businesses decide which segments they want to target and then design their products, marketing, and sales strategy accordingly.
Let’s now look in detail at each of the 10 variables used in medical devices market segmentation.
#1. Segmentation Based on Type of Medical Device
One way to segment the medical devices market is by type of device. This falls into seven main categories: medical imaging, in vitro diagnostics, medical therapeutics, medical implants, medical supplies and equipment, telemedicine and mHealth.
Each of these categories can be further divided into subcategories. For example, medical imaging includes X-ray machines, computed tomography (CT) scanners, and magnetic resonance imaging (MRI) machines.
In vitro diagnostics includes medical tests that are performed on samples of blood, tissue, or other body fluids.
Medical therapeutics covers a wide range of treatments including surgery, radiation therapy, and pharmaceuticals.
Telemedicine is the use of telecommunications technology to provide medical care from a distance.
mHealth is the use of mobile technology to improve health outcomes.
#2. Segmentation Based on Disease State
Another way to segment the medical devices market is by disease state. This includes four main categories: chronic, acute, preventive and cosmetic.
Chronic diseases are long-term conditions like diabetes, heart disease, and arthritis. Acute diseases are sudden and often severe, like a heart attack or stroke.
Preventive medical devices are used to prevent diseases. These include vaccines or blood pressure monitors. Cosmetic medical devices are used to improve appearances, like botox injections or hair transplants.
#3. Medical Devices Market Segmentation Based on Geography
The medical devices market can also be segmented by geography. The main geographic regions include: North America, Europe, Asia-Pacific, Latin America and the Middle East and Africa.
Each of these geographic regions can be further divided into subregions. For example, North America includes the United States, Canada and Mexico. Europe includes Western Europe and Eastern Europe.
Asia-Pacific includes China, India, Japan, South Korea, Australia and New Zealand.
Latin America includes Brazil, Mexico and Argentina.
The Middle East and Africa include Saudi Arabia, the United Arab Emirates, Turkey and South Africa.
#4. Segmentation Based on Customer Type
Another way to segment the medical devices market is by customer type. The four main customer types are hospitals, clinics, home healthcare and ambulatory surgical centers.
Hospitals are the largest customer type for medical devices. They are followed by clinics, which are smaller than hospitals but provide similar services. Home healthcare refers to medical care that is provided in the patient’s home. Ambulatory surgical centers are medical facilities where surgeries are performed on an outpatient basis.
#5. Medical Devices Market Segmentation Based on the End User
When it comes to medical devices market segmentation there are three main categories of end users: physicians, patients, and caregivers.
Physicians are the largest end users of medical devices. They use medical devices to diagnose and treat patients. They also recommend medical devices to their patients.
Patients use medical devices to manage their own health. Caregivers are usually family members or friends who help patients with their medical care.
#6. Segmentation Based on Usage Pattern
Medical devices market segmentation can also be performed based on the usage pattern of medical devices. There are two main categories: disposable and reusable.
Disposable medical devices are used once and then thrown away. Reusable medical devices are designed to be used multiple times.
#7. Medical Devices Market Segmentation Based on Application
The medical devices market can also be segmented based on the application of the device. There exist four main categories of applications: diagnostics, treatment, monitoring and research.
Diagnostic medical devices are used to diagnose diseases. Treatment medical devices are used to treat diseases.
Monitoring medical devices are used to monitor patients’ health. Research medical devices are used to study diseases.
#8. Segmentation Based on Location of Use
The choice of a medical device can change based on where it will be used. And so location of use is a factor to consider during medical devices market segmentation.
Location of usage can be segmented into four main categories: home, hospital, ambulatory and mobile.
Home medical devices are used in the patient’s home. Hospital medical devices are used in hospitals. Ambulatory medical devices are used in ambulatory care centers. Mobile medical devices are used in mobile settings, such as ambulances and airplanes.
For instance, medical devices used in the home are designed to be easy to use by people with no medical training.
Similarly, for people undergoing home health care treatments, medical devices must be portable so that they can be taken with the patient when they travel.
On the other hand, medical devices used in hospitals are more complex and require trained medical staff to operate them. They are also often for treating more serious conditions.
#9. Segmentation Based on Regulatory Environment
The medical devices market is regulated by various government bodies around the world. The main regulatory body in the United States is the Food and Drug Administration (FDA).
Other major regulatory bodies include the European Commission, Japan’s Ministry of Health, Labour and Welfare, and China’s State Food and Drug Administration.
The Regulatory Environment is an important segmentation factor because it affects the medical devices market in two ways.
First, it affects the medical devices that are available in a given market. Second, it affects the way medical devices are marketed and sold in a given market.
Medical device manufacturers often have to modify their products to meet the requirements of different regulatory bodies.
For example, a medical device that is approved by the FDA in the United States may not be approved by the European Commission for use in the European Union.
#10. Segmentation Based on the Reimbursement Landscape
Health Insurance and the reimbursement landscape are important factors to consider when segmenting the medical devices market.
The reimbursement landscape refers to the policies and procedures that health insurance companies use to reimburse medical providers for the medical devices they use.
The reimbursement landscape varies from country to country and to a large degree it affects patients’ access to medical devices.
In some countries, patients have to pay for medical devices out of their own pockets. In other countries, health insurance companies reimburse medical providers for the medical devices they use.
The reimbursement landscape also affects the way medical devices are marketed and sold. In countries where patients have to pay for medical devices out of their own pockets, medical device manufacturers often have to direct their marketing efforts toward patients.
In countries where health insurance companies reimburse medical providers for the medical devices they use, medical device manufacturers often have to direct their marketing efforts toward medical providers.
Conclusion
As you can see, the market for medical devices can be segmented using many variables and can be analyzed from different angles.
In this article, we performed medical devices market segmentation following these 10 factors: type of device, disease state, geography, customer type, end user, usage pattern, application, location of use, regulatory environment, and reimbursement landscape.
Medical device manufacturers and retailers often use market segmentation to better understand their customers and figure out how to appeal to them.
With medical device market segmentation, they can better understand which of their products are likely to sell well and can target their audiences more effectively.