Is this the 2008 e-Commerce moment for Digital Health?
Having worked in digital health for a decade now, I often find myself evangelizing digital transformation to healthcare organizations rooted in traditional business models. The business and clinical reasons for a revolutionary digital disruption in health remain more obvious to me than to many people I speak with. While this is changing, too many healthcare stakeholders still see digital as a nice subject to discuss at a weekend conference than to drive home urgently in office on Monday morning.
A recent conversation compelled me to reflect upon and draw learnings from e-commerce that has disrupted the retail industry over the last 15 years.
It was about 2007–8 that Flipkart and some of the other earlier e-commerce businesses set up shop, looking to digitize the retail business in India. The industry is now worth billions of dollars, has changed shopping behaviors and importantly, has also disrupted how traditional retailers look at selling. Even traditional retailers now have omnichannel sales strategies, are harnessing consumer insights and their valuations are driven by how robust their digital strategies are (or whether they even have one). So, it was fascinating to be reminded that the e-commerce industry in India is worth less than 10% of the total retail market!
Think about it — we have spent billions in venture capital, celebrated the e-commerce startups, delivered multi-billion dollar exits to the startup entrepreneurs, made it cool to work for e-commerce retail startups, talked endlessly about these businesses in national and local media. Despite all of this, the last 15 years have ceded less than 10% of the retail market to e-commerce. In other terms, with just 10% market share over 15 years, the e-commerce industry has had an outsized influence on our shopping behaviors and the fundamentals of the retail industry.
I am painfully aware that healthcare is not retail and has far greater complexities. But the need for innovation in healthcare is much more urgent. We don’t have the resources to continue to fund our growing healthcare needs using traditional delivery channels. It’s only the thoughtful application of digital innovation that will ensure that you and I can access the best care we need in the next 10–20 years.
But maybe we don’t need a complete disruption of the traditional healthcare model to effect change. As other industries have shown, a 10% share of the market could be enough to drive meaningful change. Crudely, that may mean transitioning an average 10% of every healthcare transaction to a digital platform. Some of that will lower transaction costs and increase efficiency within the system. More importantly, the digital interventions done right, will provide digital health players with a disproportionate understanding of consumer health behaviors. This is the true competitive edge, the true value creation, that will place them in pole position to drive consumer centric health innovation for the next two decades. The companies that are positioning themselves to best learn from consumer insights will be the ones leading meaningful change.
If e-commerce’s 2008 moment is any indication, there is much to be excited about digital health and the future of our health experiences.
