Simple, effective marketing provides Restore Medical with successful IPO

Medical device company adopts a more profitable marketing approach

From its inception, Restore Medical wanted to solve a medically difficult problem — snoring and sleep apnea — with a simple, effective solution. But when the risk-averse Ear, Nose and Throat (ENT) physicians turned a cold shoulder to sales efforts of its initial snoring treatment offer, Restore Medical decided to re-think its approach to ensure the launch of its anticipated obstructive sleep apnea (OSA) solution, “The Pillar Procedure” received a warmer — and more profitable — welcome.

Research and planning leads way for smart marketing investment

With limited internal marketing expertise and resources, CEO Sue Critzer engaged 99GS consultant Elizabeth Herberg to drive Pillar’s introduction to the market. Although an exact date was not known, Restore expected FDA 510K market clearance for Pillar’s OSA indication by the end of the summer — just four months away. That gave 99GS limited time to assess the market, create a board-approved strategic marketing plan and execute.

Market research was the critical first step to ensure that market expectations and concerns were well understood. In the space of only two weeks, 99GS interviewed dozens of ENTs, office support staff, and leading academics. Key findings regarding the decision-chain [+], business economics, and patient communications were instrumental in driving the marketing strategy.

99GS also identified key messaging [+], and recommended that Restore Medical communicate benefits to both the physician and the patient. For the ENT, 99GS created messages that highlighted clinical data supporting Pillar’s efficacy and safety, as well its clear economic benefits to the ENT’s practice — underscoring that Pillar should be part of a comprehensive OSA treatment approach. It was important to not over-promise on the product, yet assure the market that Pillar was a logical starting point for the treatment of OSA. In order to provide clarity to the patient, 99GS also recommended that Restore implement an educational campaign that directly compared Pillar with traditional treatment options — highlighting Pillar’s clear benefits as a minimally-invasive, in-office procedure with less risk and recovery time.

Three key marketing strategies

1. Re-position Restore Medical and the product, each with supporting messaging
2. Mitigate risk among physicians in two phases: "Top Doc" endorsements and an "Introduction" of this first-line procedure to ENT offices
3. Initiate patient marketing to create a "pull" through the channel [+]

Key business drivers and metrics set

99GS worked with executive management to link marketing metrics to the company’s business model – identifying four key performance metrics: physician leads, office visits, product pilots and re-orders. The marketing strategy was therefore focused on programs to affect these critical business drivers.

Working with Restore Medical’s internal teams, from sales and customer support to regulatory affairs, product development and reimbursement, marketing created programs and offers to drive business development and brand awareness.

Integrated marketing approach to launch

99GS developed integrated marketing to increase awareness with several identified segments: ENT thought leaders (Top Docs), ENT physicians, ENT office managers, OSA sufferers and their partners – the other people losing sleep!

Recognizing it as core to the marketing program, 99GS completely overhauled Restore’s website [+] to include physician and patient information – creating a “Sleep Apnea Research Center” for physicians, patients and media. The site also linked to OSA thought leader partners and associations.

While Pillar received its FDA clearance in early August, 99GS strategically timed the launch to coincide with the American Academy of Otolaryngology-Head and Neck Surgery Foundation (AAO-HNSF) Annual Meeting & OTO Expo in September. This allowed Restore Medical to avoid the typical media apathy during the summer and over the Labor Day weekend, as well as leverage larger industry momentum for this critical event. To support the media efforts, 99GS also created a media kit, including video newsreel, customer testimonials, physician testimonials and web links.

Because Pillar had previously been sold through the practice of “evaluation and trial” approach, physicians perceived that they were somehow being asked to engage in a “clinical trial” with an unproven product. Instead, 99GS recommended that Pillar Procedure should be sold with a “Practice Introduction” [+] approach – a simple shift in phraseology that radically changed the discussion between the sales rep and the ENT office. To support the sales efforts, 99GS developed a direct marketing strategy to drive interest, and created an “Introduction Kit” that included co-brandable marketing materials, advertising templates, office signage, phone scripts, quick facts, and PR support materials, for reps to provide to ENTs.

Results immediately measureable

• In less than one week, more than 200 patient leads and more than 150 new physician leads were generated
• 50% of sales resulting from new physicians were generated in the month following the launch
• Revenue for the quarter following the launch exceeded the total revenue for the three previous quarters combined
• Physician-scheduled meetings increased 586%
• Web traffic increased 149%
• Nearly 400 physician leads were generated within the next six months
• Nearly 1000 patients inquired about the procedure via phone and web within six months
• The American Sleep Apnea Association created a dedicated “Pillar Procedure Q&A” page on their website in response to an overwhelming volume of hits and inquiries
• More than 4,000 print and online stories appeared in publications like The Wall Street Journal, Reader’s Digest, Woman’s Day, Reuters and WebMD for an audience reach of more than 270 million.
• Regional coverage in all 50 states, leveraging more than 90 physicians to tell the Restore Medical story
• Monthly revenue increased from $30K to $500K per month; demand was so great that Restore had to add two more production shifts to keep up.
• Restore received approval from Health Canada in 2005
• Pillar is currently marketed in more than 15 countries
• IPO strike price of $9 per share was obtained 18 months following launch