Document Basket

Saved pages

Saved documents

Please note: This information is saved in a cookie. In case your browser deletes cookies after a session, the information will be lost.

Setting the PACE for global consumer healthcare trends

Setting the PACE for global consumer healthcare trends

The demand for consumer healthcare products is rapidly growing around the world.

Deloitte projected that global healthcare expenditures are expected to exceed USD 10 trillion while increasing at an annual rate of over five percent up to 2022.

In Asia, spending is projected to exceed USD 2.3 trillion by 2026 driven by higher demand for self-medication and rising healthcare costs. The growth is also due to an aging population that is more prone to contracting diseases, developing mental health issues and are more aware of the availability of over-the-counter (OTC) drugs.

For businesses involved in healthcare, there are four areas – pharmacy, adjacency, consumer and eCommerce (PACE) – that will play an important role in shaping the industry going forward.

Pharmacy point-of-care will become a crucial aspect of a pharmacist’s responsibilities as their role has expanded from only dispensing medications to counseling, immunizing and now also diagnosing and treating. An example of this is the rise of point-of-care testing at pharmacies. A patient can undergo screening and testing and is supplied with the necessary medication at the same premises. This is what patients are demanding today: simplicity, convenience and a remedy all in one place.
 

Adding to this enlarged role, the pharmacy sector generally is also undergoing significant retail consolidation, including in Asia. Established names like CVS Pharmacy, Watsons and Boots are actively entering into mergers and acquisitions, joint ventures and company affiliations. These moves are expected to result in a more organized way of delivering care among coordinated healthcare entities leading to improved efficiencies and increased economies of scale.

As healthcare brands need to constantly look for growth opportunities beyond their core business, adjacency is a strategy that leading players are undertaking. This means taking what they are best at doing and using it to access markets where that service or product is lacking.

 

When faced with competitive squeezing, too often brands simply look for a new market to go into without quantifying why they should go there and the unique value they will add to the market by being there. Many quickly find themselves pitted against seasoned competitors in that space. Our advice: a market is only worth going into if you are going to bring something new to it.

 

An area that is rapidly growing is diabetes care, which is showing a growing market for OTC prevention, symptom management and adjacencies. With the increasing prevalence of more than 422 million diabetic patients globally, this is one important segment healthcare businesses can look to tap into.

Brands are no longer able to compete by hoping to win over every consumer in the market. With the emergence of more product competition and enlarged channels, targeting the right demographics is extremely important.

 

One brand that has done it successfully is Eve Quick. By just focusing on the women’s health and the aging population sectors, the brand achieved over EUR 76 million in sales and a more than nine percent compound annual growth rate in the Japan market.

 

The aging population segment is a huge market in Asia. By 2020, an estimated 13 countries in the region will be "super-aged", meaning more than 20 percent of their population will be aged 65 years or older. Japan is already there; 21 more countries will join the ranks of the super-aged including Hong Kong, Singapore and Korea by 2030.

eCommerce should not be seen merely as a business model, but instead how your brand can fulfill a lifestyle choice by consumers. Technology has given the ability for consumers to compare prices, review products and services, as well as give feedback and provide ratings.

 

“Word-of-mouth” marketing has led to a greater product variety being offered and a greater increase in the quality of services as compared to when it was only bricks-and-mortar stores. A good example is sexual health products: previously deemed embarrassing for consumers to browse or obtain information on products and usage at a physical store, today with eCommerce, consumers can easily obtain all this information and proceed to purchase them without having to feel uncomfortable.

 

Asian online service provider Alibaba has already taken significant steps in the region’s healthcare market. Expecting to house two billion customers by 2036, its Alibaba Health platform, which opened in 2015, houses more than 3,300 partners and chalked up annual online sales of over USD 3 billion in 2018.