Home Health Care D2C in healthcare: Why now is the perfect time

D2C in healthcare: Why now is the perfect time



The healthcare industry is entering a new phase – poised to impact how healthcare is provided and consumed. Yes, the digital revolution has permeated healthcare.

It’s easy to point at the Covid-19 pandemic as having spurred this change, but it has been in the works for some years, although admittedly, the pandemic has had an impact. In conjunction with innovative telemedicine practices, there has also been a rise in D2C (direct to consumer) healthcare brands entering the market and in patients taking a more proactive approach to their own healthcare. These factors, fueled by several other emerging trends, have created a new paradigm for the healthcare industry.

Trends Propelling Changes in Healthcare: Costs, De-prescribing & Shifting Consumer Mindsets

Data compiled by the Peterson Center on Healthcare and KFF demonstrates the dramatic rise in traditional healthcare costs. In 1970, the US spent just under seven percent of the GDP on healthcare costs. Decades later, in 2019, healthcare spending represented almost 18% of the GDP. To put that into perspective, healthcare spending in 1970 was approximately $350 per person, while in 2019, the cost was $11,582. If looked at from the value of the dollar in 2019, this represents a 6-fold increase.

The high cost of healthcare deductibles has driven a fundamental change in how younger consumers view the industry. Many now prefer to pay slightly more for a doctor’s visit if it means not having monthly payments for services they might not use. However, the lack of a healthcare plan leaves this growing group susceptible to paying much higher costs for prescription drugs as they can’t take advantage of the discounts negotiated and supplemented by big healthcare companies.

For patients who only need the occasional prescription, the situation isn’t going to break the bank, but for those with chronic diseases, the costs can become astronomical. For instance, data from the Medical Expenditure Panel Survey showed that the average annual cost per user for glucose-lowering drugs which treat diabetes increased 47% (from $1,106 to $2,727) in 2015-2017 compared with 2005-2007.

Over the past few decades, we have also witnessed a significant uptick in doctors overprescribing medications. One only has to look to the opioid epidemic to see this, but it can happen with any number of drugs and particularly around medicines that treat chronic conditions. Patients have become aware of how much money pharmaceutical companies spend on marketing drugs and the deep relationships they build with doctors to push those drugs.

This consumer realization has fueled two more trends: de-prescribing and seeking natural alternatives. The Canadian Deprescribing Network defines de-prescribing as a “means for reducing or stopping medications that may not be beneficial or may be causing harm. The goal of de-prescribing is to maintain or improve quality of life.” Of course, life-saving medications should not be de-prescribed. However, many drugs aren’t providing enough benefits, all while patients are filling more prescriptions, popping more pills, and paying more for them than in years past.

Today, patients are taking a more active role in their healthcare. They are questioning doctors about how necessary a given medication is. They are using more wearable devices to track their health, and they are seeking natural alternatives to prescriptions. As the tides turn, the market has opened up for less traditional approaches to patient care, and D2C healthcare brands, whether their focus is on telemedicine, wearables, or natural supplements, can fill the void, delivering the care and solutions that patients demand.

The Challenge and Opportunity for D2C Healthcare Brands

D2C brands face several potential obstacles when entering this budding ecosystem, but with the right approach, they can be tackled and turned into advantages.

The challenge that may be most difficult to overcome is to collect user data. Today, consumers are much more aware of how their data can be exploited, sold, or exposed by accident. A Rock Health report showed that while 73% of people are willing to share data with physicians, only 10% and 19% will share data with tech and pharmaceutical companies, respectively. Data is critical for companies, especially those who want to leverage it to deliver more personalized services.

Trust is a significant factor for users, both when it comes to the patients sharing data and purchasing products from new companies. Patients inherently trust medical professionals they know, but D2C brands need to build their online reputation to create customer confidence. By acknowledging this and using optimized e-commerce strategies, brands can leverage current customers to bring in new ones. Encouraging consumers to leave product reviews and answer other patient’s questions about products will go a long way to establishing validity, trust, and authentic social proof.

Central to every brand’s strategy for success should be an emphasis on consumer engagement and adding value to each consumer beyond a mere product. D2C brands should look to establish an active online community where consumers can discuss their health journeys and solicit advice and support from peers in a safe environment. When brands invest in building online communities, they emanate and establish themselves as empathetic, customer-centric companies focused on holistic approaches, not just sales. A true D2C healthcare company needs to truly build that kind of empathy into the organizational culture.

The Winning Approach of D2C

There’s little doubt that the mobile healthcare era is upon us with 85% of Americans owning smartphones. Forward-thinking healthcare providers can capitalize on the fact that patients have access to anything from the palm of their hands, 24/7. By implementing D2C strategies, healthcare providers can meet customers where they are and provide them with the information they need on-demand.

D2C brands with tangible products can also take advantage of the rise of e-commerce. It’s now easier than ever for them to open e-commerce shops online and market directly to those most likely to be interested in their products. By going straight to customers, brands can build direct relationships with personalized service  and easier access. D2C brands can fill the ‘instant everything’ mentality that consumers have become accustomed to thanks to eCommerce, a convenience that more traditional healthcare providers don’t offer.

By leveraging technology and using a combination of digital patient intake forms, artificial intelligence, and monitoring technology, D2C brands can make themselves invaluable to everyday people. They can deliver relevant educational materials through push notifications or alerts based on user actions or in-the-moment biometrics. This one-to-one approach provides the personalized care that consumers now demand from any company they engage with, including those in the medical industry.

Now is an exciting time to venture into the world of D2C healthcare. Opportunities exist in many areas of the industry, and patients are hungrier than ever for more engaging and humane experiences. For D2C brands that are ready to capitalize on the changing market, the sky’s the limit.

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