According to a recent survey, the overwhelming majority (91%) of scientific customers have not changed their primary supplier of custom synthetic oligonucleotides (oligos) over the past 12 months. Despite this fact, the customers of market leaders Integrated DNA Technologies, Invitrogen, Sigma-Genosys and Qiagen Operon are not entirely satisfied -- indicating room for competitors to gain share.
Although the market for custom synthetic oligos has reached a level of maturity -- marked by a state of equilibrium and the absence of significant innovation -- suppliers must continue to differentiate themselves in order to retain and capture the business of scientific customers. To help suppliers in this endeavor, BioInformatics, LLC recently published "The U.S. Market for Synthetic Oligonucleotides: Establishing Differentiation for Success," which is based on a 27-question survey of over 750 researchers in the United States.
The report provides an individual as well as comprehensive look at the DNA and RNA oligo markets and is designed to help suppliers understand which attributes of product and supplier performance drive effective pricing, establish differentiation and build customer loyalty. "Marketing executives can interpret the data in our report from the perspective of their company's unique strengths and then determine the most appropriate strategy for competing in the oligo market," said Dr. Robin Rothrock, Director of Market Research for BioInformatics, LLC.
To provide an accurate picture of what is truly important to oligo customers, the report examines 10 different product attributes with regards to respondents' satisfaction with each attribute and the perceived value given the prices paid. For example, results indicate that researchers are somewhat less satisfied with the variety of modifications offered for the DNA oligos they purchase, however, this attribute is very important to them.
For RNA oligos, offering a variety of formats and the quality of raw materials were found to be relatively important, but again, researchers are not completely satisfied with these attributes in available products. "By identifying those attributes deemed most valued by current and potential customers, suppliers can focus their promotional efforts to show how their products may be superior to those of their competitors -- enabling them to differentiate their products favorably in the minds of decision-makers," noted Rothrock.
Players in this market must also focus on those supplier attributes that are seen as "important" to scientists but where suppliers' performance with regards to that attribute falls below researchers' expectations. Based on the report's in-depth analysis of 12 different supplier attributes, several attributes -- including the timeliness of delivery and a quality guarantee -- were identified as performing below expectations in the eyes of oligo customers.
Moreover, all of these "under performing" attributes are shown to be relatively more important to researchers than other supplier qualities. "Improving these qualities is essential, but suppliers should also, at a minimum, maintain their position when it comes to those attributes that are considered somewhat important and are performing either at or near expectations," said Rothrock. Clearly, there are opportunities in this market for suppliers to identify and then deliver products or related services that are valued by customers and perceived to be better than or different from those offered by competitors. "By employing a differentiation strategy, suppliers can raise scientists' perception of value to a level where premium pricing is possible.
Customer 'lock-in' can be created not only by virtue of a supplier's product offering, but also in how well that supplier either meets or exceeds customer expectations with regards to providing those products," concluded Rothrock.