Medtech Multinationals: Betting on the Brand


Factors such as changing consumer behaviour, increased competition, rapid technological transformation and regulatory uncertainty are constantly influencing price, innovation and service quality within the Indian healthcare sector. Hence, top medtech companies are reinventing their branding strategies to achieve brand equity

Did you know why top multinational medtech companies so far have a competitive edge over its domestic opponents in India?

Largely people would attribute this advantage to the brand equity these top companies savour. In some ways that is a valid viewpoint. Authors and branding experts Denise Creary, Mortgage Processor, BankAtlantic and Corey Shore Executive Director, JPMorgan Chase write that brand names have the potential to influence market structures. It also has the ability to shift demand curves of products in any given industry.

Amit Mookim, GM, South Asia, QuintilesIMS, opines that a strong brand image enables organisations to earn customer loyalty, command high prices as well as leverage brand equity and expand their offerings. For instance, top medtech multinationals world over have enjoyed brand equity which enables them to capture huge market shares as well as monopolies in certain product segment across globally.

This global dominance for a long time has also influenced consumer behaviour in India, making them market leaders in here.

Chandu Mukkavalli, Partner-Business Advisory Services and Narendra Sengupta, Director-Advisory services, EY,  are of the opinion that brand image has facilitated top medtech companies in India to enjoy price advantage over their competitors. It has also earned sweet spots within the sector.

An analyst from a reputed company, who does not wish to be quoted cites examples of how top medtech companies have market control on certain product segments in the market. He informs that, Siemens holds a large market share for MRI systems in India, GE Healthcare dominate the ultrasound segment globally and infant warmers in the emerging markets, Medtronics is famous for its stents and J&J for orthopaedic implants.

To understand this better, Express Healthcare conducted a small exercise and spoke to some leading hospital CEOs, administrators, radiology department heads, purchase managers, and diagnostic imaging promoters to understand their thought process while making a purchase decision on equipment for their organisations. The parameters set for this exercise were: cost effectiveness, features, after sales services, training facilities, innovations and brand name and the experts were asked to rank them in terms of their priority.

Here is a priority list based on their choice:

  • Cost effectiveness and ROI
  • Innovations and features of the products
  • Brand name
  • Response time for repair service
  • Training services

This exercise indicated that cost-effectiveness of the products, ROI and brand name plays a significant role in medical technology purchase decision. Another interesting observation was that while speaking of brand name as a parameter for a purchase decision, most people confessed that they would first find out on the offering given by top multinational companies as these companies have a great brand recall.

So far, so good; medtech giants played it right. However, now the tide is turning.

Changing consumer behaviour, increased competition, rapid technological tranformations and regulatory uncertainty that influences price, innovation and service quality has created a volatile market condition for top medtech players in India. The pressure now rests upon brands to perform well in order to stay ahead in the race. Are these companies ready to take the next leap?


Reinventing brands

In certain ways top medtech companies have had the foresight to sense these changes and act upon in the right way. Most of these companies have already started investing heavily in research, product innovations, M&A, collaborations with governments and marketing activities in order to re-establish their company marques and achieve the desired brand equity even in these difficult times.

Here are few examples of the same.

Siemen as a health enabler

Last year, Siemens hived off its healthcare business as part of their global strategy to manage healthcare as a separate entity. The healthcare company now enjoys entrepreneurial freedom and flexibility to deal with the market challenges in each country. When the company announced the new strategy it also stated that this move will strengthen its focus on the healthcare segment in India, by aligning it with its global strategy and management framework as well as margin accretive. The new name for the company is Siemens Healthineers. As part of their branding strategy they now project the company as an enabler of healthcare providers.

“Engineers and Pioneers together makes Siemens Healthineers,” says Vivek Kanade, Executive Director, Siemens Healthineers. He further reiterates the words of their global CEO, Bernd Montag, who during the launch of the new company mentioned that Siemens has had an exceptional track record of engineering and scientific excellence and are consistently at the forefront of developing innovative clinical solutions that enable providers to offer efficient, high quality patient care.

“Going forward as Siemens Healthineers, we will leverage this expertise to provide a wider range of customised clinical solutions that support our customers business holistically. We are confident in our capability to become their inspiring partner on our customers’ journey to success. Our new brand is a bold signal for our ambition and expresses our identity as a people company,” the CEO announced last year.


This move has not only given Siemens a new name but also poses a new challenge of establishing Siemens Healthineers a brand. So how does the company plan to build the brand?

Way back in 1960s, Siemens entered the Indian market with the glocalisation approach for product innovation. They intend to move on with the same approach but with an added advantage of new branding strategy. “Our new approach offers pioneering spirit and its engineering expertise in the healthcare industry. It is unique and bold and best describes the organisation and the people accompanying, serving and inspiring customers, the people behind outstanding products and solutions. And these people, the 45,000 employees worldwide, are working on the basis of seven business principles, which give them a common language and a common culture with a vision to empower healthcare providers to optimally serve their patients,” adds Kanade.

Well, the strategy seems right for Siemens as soon after the company re-established their healthcare business as the company’s shares rose up 3.5 per cent in Frankfurt at €108.20 the last quarter of 2016.

GE’s personalised marketing tool

Similarly, when GE Healthcare and Philips Healthcare took on the mentorship role for fostering innovation in healthcare both companies increased their market share worldwide. They focus on encouraging research and innovations in various disciplines of healthcare by setting up innovation hub in various countries. GE Healthcare’s innovation Hub in Bengaluru itself is a vital cog in driving the digital transformation. Moreover, in 2015, GE Healthcare opted for a personalised marketing strategy by using automation to track customer behaviour. In an interview with a marketing magazine based in the US, Stephanie Meyer, Global head of marketing, GE Healthcare explained how the concept of personalised marketing works for the company. She said, “We thought if there was a way to talk to a radiologist in the UK who has very different needs from a radiologist in India. How would we talk to them differently and wouldn’t that be cool? In addition to that, just within the UK you might have a director of radiology, a chief financial officer and potentially a technician who can all make purchase decisions. In the former world, we would give the same message to all of those people. Now we tailor these messages and it has challenged us to think differently about content. There have been some amazing things we have been able to think about in terms of elevating our marketing skills and content but also our reach and relevance in the market place.”

This approach was instrumental in pushing up sales for the company.

Philips innovation path

Philips Healthcare on the other hand has embodied  a strong social media marketing strategy. The company posts variety of contents. As per experts, this strategy contributes to the social sphere  that focusses on healthcare and technology.  Of particular interest is the brand’s LinkedIn page, Innovations in Health—a vetted community of health professionals who are interested in sharing, developing and fostering innovative solutions in healthcare. By creating an exclusive community of like-minded individuals with a passion for innovation, the brand stands to gain a great deal of insight into its audience’s interests.  With this  the brand opens itself up to a pool of the knowledge it can use to bring in new innovations—and with 140,969 members currently active on the page, that pool is clearly deep.

Mookim further provides examples of multiple strategic options adopted by top medtech giants to tap into opportunities available in the Indian market.

Product localisation: Companies have leveraged local market insights to develop value products which are relevant to Indian healthcare landscape.

  • GE Healthcare has introduced various products in India, which are designed to meet the local requirements e.g. GE introduced MAC i machine which was battery operated, weighs less than 1kg and requires minimal training and analysis cost.
  • Philips launched compact VISIQ ultrasound system which is a portable device and can scan continuously for 2.5 hours on a single battery charge. Due to compact size and less complexity with VISIQ, Philips tried to address the challenges around accessibility to ultrasound devices in the remote areas.

Low cost strategy: To compete in the value-driven Indian environment, companies are adopting strategy focussing on becoming a cost leader. Companies are achieving this either by increasing their efficiency i.e. delivering the same quality of care with lower resources or by increasing their effectiveness i.e. delivering a higher quality of care with same resources. This allows companies to deliver healthcare at lower costs and/ or higher margin.

  • Philips launched Efficia ECG100 which is portable, easy to use device, built to work with app-enabled smartphones and tablets for android. This low cost ECG functions without any additional infrastructure e.g. Wi-Fi.

Geographical expansion: Companies are to looking increase their presence in the tier-II and tier-III cities of India. Companies are partnering with government agencies and service providers to increase their presence. In July 2010, Wipro GE along with Medall Healthcare entered into an agreement with the Andhra Pradesh government to build facilities and install equipment for diagnostics.

All of the above mentioned strategies clearly indicate that these medtech giants look at branding in a very different light. Its not just a marketing strategy but a business culture that they intend to expand as their business grows.

Sengupta points out that innovation will play a significant role in branding strategies of all top medtech players. Companies will continue to reinvent strategies to have a brand recall on their customer’s mind. Also, factors such as cost and maintainence will also drive buying decisions in the future for which medtech players will need to adhere with.

Going forward, Mookim warns medtech players on the times to come. He says that the current Indian government is determined to bring the medical equipment and device manufacturers under regulatory framework. A strong brand recall is therefore needed.

Mookim further suggests ways to strengthen their existing brand image.

  • Companies should build on their brand equity and engage directly with patients so that patients/ customers are able to appreciate the value that quality players bring to the table
  • Companies should adopt Health Technology Assessment (HTA) programme to establish the economical and clinical effectiveness of their products.
  • Companies should strive to innovate and develop India-specific solutions thereby improving their acceptance in resource constrained settings.

At the end….

Examining the efforts taken by these medtech giants in building their brands, it certainly reveals a compelling link between strong brands and market performance. As experts put it, powerful brands drive consumer choice, improves business performance and ultimately increases shareholder value. We have already seen this happen when Siemens hived off its healthcare business and came up with a new strategy and their shares surged thereafter. Having said that, I would once again draw your attention towards changing consumer mindset where cost effectiveness of a product becomes a dominant factor for a purchase decision. Are medtech companies addressing this requirement while they build their brand name? Also, the current regulatory pressure and increased government oversight demands for redesigning pricing policy within organisations. Are medtech players willing to consider price control to make medical devices and equipment affordable? Will price control ever be  part of their business strategies? Or will medtech players continue to bet on their brands to enjoy price advantage?