03.07.2007

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Healthcare at Retail

Imagine you've just been put on hold. Ugh, waiting! This is exactly how consumers feel when they are told to "take a seat" until their doctors can see them. It shouldn't be too surprising then, that consumer attitudes and behaviors toward traditional healthcare and medicine are changing.

Consumers gravitate toward convenience and low price. While this is certainly true in the traditional retail marketplace, it is becoming quite evident that these two factors are primary drivers in the emerging healthcare retail space as well. So much so that large corporations are investing piles of money in creating retail channels that provide accessible and affordable healthcare and medical solutions to mainstream consumers in traditional retail settings.

Yet, like an armchair quarterback, we can't help but wonder why the one player with all the healthcare cachet that traditional retail channels lack is standing idly on the sidelines watching the game unfold. That player is the hospital. The bastion of all healthcare knowledge, solutions and practitioners, the hospital is the one channel that can bring all its resources to bear to create an authentic and relevant healthcare retail experience that's sure to resonate with consumers regardless of their level of involvement in the world of health and wellness.

While there's no doubt that the idea of "wellness" is compelling and meaningful for consumers, how can traditional retailers leverage the health halo surrounding hospitals and healthcare systems and set the stage for individual wellness lifestyles that encompass living, shopping and using health and wellness products and services in the traditional retail mass marketplace? In other words, how can traditional mainstream retailers "bring the hospital into the store," thus creating an entirely new dimension of healthcare experiences in the marketplace?

Wellness is something more than a product or potion

Currently, consumers do not attach the label of "wellness" to specific products; instead they use "wellness" to describe a way of life. A challenge for healthcare systems lies in their ability to alter perceptions about who consumers can turn to as a destination for wellness products and services. By creating the appropriate authentic, unique retail experiences within traditional retail environments, both the retailer and the hospital stand to out-compete other retailers as key providers of wellness products and services sought after by health-minded consumers.

At its most basic, most American shoppers of mainstream retail outlets view such stores as simply helping them get the job done. These utilitarian stores provide consumers with staples - for example, food and household products for themselves and their families. Many traditional mainstream retailers, however, don't provide consumers with memorable shopping experiences - they don't give shoppers a reason for wanting to shop the store any longer than they have to. In this era of an "experiential economy," healthcare retailers should be thinking seriously about how to make changes in their businesses in order to attract shoppers from conventional channels and provide them with more than just a "functional" moment of their day.

Given the consumer definition of wellness as an "ultimate, all-encompassing experience" and the general perception of conventional retail settings as being very low on the "emotional experience" scale, there is a tremendous opportunity for healthcare at retail to bridge the gap that exists between conventional retails and their ability to serve wellness lifestyles. Specifically, healthcare retail environments need to communicate with their customers about how the products and services they currently offer, as well as new ones they consider adding, can aid consumers' search for and participation in wellness.

Why consumers are ready for a new healthcare experience at retail

Ever on the lookout for anything new under the sun, this revolutionary "retail approach to routine medical care" (as the NY Times refers to it) has not just caught media's attention, it has become its latest darling. Terms, such as "quick-serve health clinics" and "walk-in clinics" have been coined to give stories a sex appeal long absent in traditional retail storytelling. The reason for the allure is simple: healthcare retail is an industry on the brink of a major metamorphosis.

Why is this "gold rush" toward mini-clinics and other healthcare-related services happening? One reason is because consumers' attitudes and behaviors towards traditional healthcare and medicine are changing. Consumers drive the marketplace. And the shifts occurring amid the population in this country have a direct impact on the healthcare retail marketplace.

Consider also that the most significant demographic shift is taking place right now. This year, as the first Baby Boomers are turning 60, marks the beginning of a time period when the number of people older than 60 will eventually surpass the number of children in America (Newsweek, Dec. 6, 2004). Aging bodies require more health maintenance, a sad but undeniable fact. Maybe it has been somewhat exacerbated by the boomers' excesses of the 60s. From this perspective, it would seem the future belongs to Boomers. Add to the mix the estimated 71 million American adults with some form of cardiovascular disease and you have a recipe for reinventing the healthcare retail landscape.

The aging population has implications that touch virtually every aspect of retailing, most profoundly, healthcare retailing. From product mix to retail experience, hospitals and healthcare systems have an opportunity to rethink and reinvent themselves. Should hospitals and healthcare systems get into the mini-clinic business? How? What's relevant and resonates with consumers? What channels and market opportunities are there for healthcare retail - both on campus and in the mainstream marketplace?

Easing the Pain

Healthcare in a retail setting is as much about convenience and accessibility as it is about costs; perceived compelling retail experience is very much another issue. A visit to a hospital's emergency room and the formidable guard of gatekeepers (administration and billers) is pretty intimidating stuff. Throw in a 4-6 hours in a crowded waiting room that has the ambience of a gulag and it's easy to understand why people are hungry for alternatives.

As we've said before, given consumers' definitions of wellness as an "ultimate, all-encompassing experience" and the general perception of the mainstream retail setting as being very low on the "emotional experience" scale, there is a tremendous opportunity for bridging the existing gap between health and wellness, as it relates to healthcare retail shopping in consumers' minds.

The most significant point about defining experience, especially in the newly emerging world of healthcare at retail, is that it be grounded in a thorough understanding of consumer lifestyles. At the moment, no single retail channel has captured the minds of consumers when it comes to providing solutions and meaningful experiences for the pursuit of wellness. This opportunity sits waiting for anyone from hospitals and healthcare systems to retailers and CPG manufacturers, to offer compelling shopping experiences to wellness-minded consumers. You can be sure that if traditional retailers won't do it, the hospital just might.