Essay About Target Market And Electrosurgical Probe

Silverglide Surgical Technologies Case Analysis
University of Southern MaineSilverglide Surgical Technologies Case Analysis Tatiana MorinMarketing StrategyBUS 360Professor Patricia Griffin January 29, 2016Situation AnalysisIn 1998 Jonathan Thorne, an engineer and an entrepreneur, has started his own business after working for others for too long. He acquired a license for an electrosurgical probe, a patented product that he had helped develop earlier in his career, confident that it had great potential. He assembled a team of experienced and knowledgeable people and acquired $80,000 from friends and family in investment funds to work on making this product successful. The probe was unique in that it was reusable as well as non-sticky to the human tissue, a common worry among the surgeons due to the cosmetic complications a sticky surgical tool could cause. Jonathan’s plan was to target this probe specifically to plastic surgeons. This target market was chosen due to the fact that the majority of plastic surgeons ‘work was done in their individual clinics, where they had a say in the choice of the surgical tools and equipment, and did not have to deal with hospital bureaucracy. After the initial feedback and the redesign of the original probe that followed, Jonathan’s colleague, Kevin Morningstar, acquired FDA approval, and they were ready to present at the trade shows and make sales. The probe was a hit among some surgeons, however there were too few of them to make profit. The distributors also were not willing to make a commitment to the probe due a number of reasons. First, the company was brand new and not known to the surgeons. Second, the distributors would have to work really hard trying to convince the surgeons that the probe was non-sticky and a useful tool. Third, there was no incentive for the distributors to show the product because it lasted a long time, there was no need to reorder, and the product line was too small. The company was running out of money quickly and had to make important decisions: should they switch to a new product, bipolar forceps, use neurosurgery as the new target market, do both, or continue promoting their current product.SWOT Analysis: Silverglide Surgical TechnologiesStrengthsWeaknessesReusable designNot sticking to human skinFDA approvedRegistered patentLittle direct competitionPotential for a large market shareCompetitive advantage/novel productManagerial expertisePoor sales/no profit madeMost surgeons have not used the probe beforeDistributors have no incentive to sellPremium pricing New product/unknown to the marketPoor financial standingLimited human resourcesOpportunitiesThreatsReusable non-sticky forceps are in great demandLarge number of  surgical specialities available as potential target markets Hospital bureaucracy/regulationsCompetitionAssumptions and Missing InformationSilverglide’s financial standing as of now is not ideal. It is not known how much money and human resources the new project will require if undertaken. We do know, based on the estimated assumption from Morningstar, that the new endeavor will take about a year or so until the product is ready for limited production and sales. Potential lack of needed funds for the new product development, however, could not only crush the project, but will also run the company out of the money that they still have and can use on marketing the existing product. The assumption can be made that Silverglide would be able to acquire the funds through other means like loans (considering the economy is stable) if the stockholders are not willing to invest more. Based on the current feedback from the surgeons, it is assumed that if Silverglide came up with the reusable, nonstick forceps, the surgeons would purchase them right away. There is also risk that any of the current well established companies that dominate the disposable non-stick market will develop a similar product taking away Silverglide’s opportunity to get in first. Another piece of missing information is the knowledge about the customer needs, i.e. surgeons. The marketing research in the form of interviews and surveys should be put together. What do the surgeons by each speciality prefer? What do they need? This information can be very valuable when making a final decision.