Asian Health Inc. ( go global )A presentation by Dr. Ritesh Malik forLondon School of Economics MG-101
SECTION 1PROFILE OF THE MARKET AREA AND COMPANY CHOSEN
PROFILE1. Company : Asian Health Inc.2. Industry : international healthcare3. Demographic area : India as well as caters to the health needs of the world4. Operations :• 2004 : Asian Hospital , a 500 bedded corporate hospital opened in New Delhi to cater the increasing demands of specialized care for the people of India .• 2008 : acquisition of 26% stake in the Indian Pharmaceutical giant Star pharma ( now Asian Pharma Inc. ) becoming the largest stake holder of the firm .• 2010 : in april 2010 the board decided to launch a medical tourism company seeing the surplus international demand for medical tourism .
Profile ( cont. ) 5. Board members – The company is run by a group of 6 people who constitute the private board of the company . 6. Vision : the vision of the every employee from the peon to the chairman of the company is to provide state of art facilities at a reasonable cost . 7. Logo : 8. Brand statement : go global
Growth Forecast • It is estimated by MTA ( medial tourism association ) that there will be a steap 30 % annual growth in the medical tourism sector of India till 2017 . This gives emmence hope for rapid take over of the relative market share . • The cost of a heart bypass surgery in the United States Of America is 2,00,000 usd . The same surgery in India cost less than 10,000 usd including the stay at a 5 star hotel and the return tickets .
Overview of the Market Area1. The developing economies such as Thailand , Spain , India etc are the market for cheap healthcare .2. It has become a potential industry for more than 50 nations grossing more than a billion USD $ GDP share .3. More than 2 million Americans travel annually in search of cheap healthcare as well as tourism in developing economies . This tolls to some 10 million people who travel for health world wide per year .
Description of the Market AreaThe market area is virgin as thecompetition is low and the customers arecraving for quality health care . The basicmotive of Asian Health Inc. is to introducethis virgin market to high standards ofhealth and cultures of different countries ofthe world at a reasonable price .
Attractiveness of the marketThe attractiveness of the market lies in the fact that some 10 % of the cost of healthcare which is claimed from the patient directly or from the insurance company is the profit .
Characteristics• Size : 10 b $ usd• Origin : formal medical tourism was initiated when the patients from the developing nations had to go to the developed nations for health care . This scenario was reversed in the late 19th century with the corporate attention to the healthcare sector in the developing countries because of low real estate costs , low wages and professional income of the doctors . This led to the concept of medical tourism .
Competition analysis• The basic competition of the company will be with the companies like Bumrungrad International corp., med retreat , world med assist etc. they have a strong reputation in the market . But still the customer satisfaction needs to be improved . Thus we still have huge potentials to fill the gap .• Though our company has risen above the competition level by not fighting on cost but on quality . Bumrungrad international is the most profitable hospital in the world ( half the revenues are from med. Tourism ) .• Medto go is another medical tourism giant which has tremendous market share in the medical tourism of America .• Also the newly opened MEDANTA MEDICITY ( A Dr. Naresh Trehan Project ) is also a strong competitor for our company .
SECTION 2DESCRIPTION AND JUSTIFICATION OF TARGET SEGMENTS
Customer Segments1. Existing customers : people with no insurance , this is the major segment for the need of medical tourism for the fact that medical care is very costly in the developed nations . THESE ARE THE BASIC CUSTOMER BASE OF THE COMPANY .2. Emerging customers : these are those customers who are waiting to adopt the product by the power of words .
Customer segments ( cont. )3. Potential customers : these are those customers who undertake high involving surgeries such as cardiac ones which give high revenue ( and higher profits ) . Paretos principle @) % of customers will peap 80 % percent of profit .
ANALYSIS OF THE 4 P’S• PRODUCT – high class quality healthcare .• PLACE – at 16 of the central hubs of the world . With JCI accredited hospitals• PRICE – Just 1000 $ USD more than the competitors. We are working on the intrinsic factors rather than the extrinsic factors . Thus quality is our major motive which is not the centre of focus for our competitors .• PROMOTION – usage of both traditional as well as non traditional methods .
PROCESS OF MEDICAL TOURISM Patient calls to the toll free number or mails the companySurgery + post operative Complaint recorded healthcare + tourism with the past history Itinery is set and the Within 30 minutes a patient is contacted by a doctor from india calls junior advocate for legal and analyzes the issues condition
Economics of the company1. Headquarters – New Delhi , on the 13th floor of the Asian Health Inc. hospital a 1,000 sq. ft area has been alloted for the company operations .2. Start up finance – a capital of 20 million $ usd is required to start up the international operations world wide . With 30 % of the finance alloted to the marketing of the company .3. Other offices : we have set 16 offices in different demographic parts of the world .
Offices around the globe Offices for regional healthOffices for developed economies management• London • New Delhi • Bankok• New York • Spain • Lisbon• San Fransisco • Kochi ( kerala ) • Mexico city• Zurich • Bangalore • South africa• Sydney • Egypt• Dubai• Toronto
Psychology of the medical touristPeople usually opt for medical tourism for the following reasons –• Low expense ( at a fraction of what is in the developed economies )• Tourism• Regional therapies ( Eg. Bangkok therapy massage , Lisbon hot water spring treatment , Indian Ayurveda etc . ) this gives a sense of rejuvenation to the customers .• Opportunity to experience the different cultures of the world .
PEST Analysis Poltical Economic ( national industry more than a bilion ( according to the Mc Kinsey medicaldollar valuation will lead to the growth tourism will gross in the top 10 sectors of the country ) of the country in near future ) PEST Social Technological ( increase in employment in the ( will increase the health standards of country ) the national customers as well )
Competitive Advantage This includes all the adverse effects the customers face during a normal medical visit . We plan to curb all of these and have a competitive edge over the other companies : MEDICO LEGAL ISSUES : in case of a medico legal issue the patient is the centre of troubles due to the fact that the laws are different from country to country . Thus , Asian Health Inc. has a contract with the K Collinwood and associates for the legal issues ( they are spread oversees and are specialists in medico legal cases ) . Before the departure of the patients , a junior advocate will call them and explain them every detail of the legal hassles which the patient may apprehend off .
Competitive Advantage ( cont. ) LANGUAGE BARRIER : it is very difficult to converse in developing countries specially with the lower staff ( who do not know english very well ) . For this we have recruited special staff or the international patients who are well versed in english . And we have a multi lingual person at each of our hospitals who knows more than 6 languages fluently . QUALITY CARE : most of the medical companies claim of having quality healthcare facilities but the actual condition is very different . The intruments are not updated and the staff is not well trained . For this , have made sure that all hospitals in our network should be affiliated to the JCI ( joint commission international ) as well as the MTA ( medical tourism association ) . This ensure optimum quality .
Competitive advantage ( cont.) POST OPERATIVE CARE : most of the hospitals do not provide any post operative care . After the operation of the patient there are specific regulations and diet precautions which a patient must follow . According to the international laws the patients should be under medical assistance ( in an area of 5 km to a hospital ) after 2 days of surgery . This is not followed by the usual medical tourism company hospitals . ASIAN HEALTH INC. plans to take care of this in a very different way . We plan to appoint a male nurse ( on extra cost ) to patients who need tertiary levels of care after the operation . This will ensure round the clock safety of the patient .
Competitive Advantage ( cont. ) Tourism – after the surgery and the post operative care the patients are ready to experience the native beauty of the country of visit , most of the medical companies to reduce their expense and increase their profit , make plans which do not include the best of the country . For this we have tied up with the very famous COX AND KINGS to organize exclusive trips to the most exotic places of the world . Because we feel that medical tourism is not just for medical care but also and opportunity for people to have an exposure to different cultures . We have even included a free cruise to the lakshwadeep islands for the travellers to the delhi hospital for medical care .
SWOT Analysis STRENGHTHS ( Quality focus rather than the extrinsic cost focus ) WEAKNESS ( Medicolegal implications are costly ) OPPORTUNITY ( Fast growing sector far away from saturation ) THREAT ( Increasing competition and reducing costs for medical care in the developed nations )
Creative Market Space Entry1. The company board has decided to rise above the competition and not to directly collide with other companies with respect to the extrinsic factors ( COSTS ) .2. We have decided to charge 1,000 usd more than the normal companies , but give total quality experience and focus on improvement of the companies intrinsic factors ( eg. Service delivery ) .3. We also plan to give patients a key chain after their treatment ( this will be embeded with all the key reports and data of the clinical history of the patient ) .4. At the end of the treatment the patient will be given a card along with a password . This will allow the patient to access his data of clinical history any time he goes to any hospital in the world having such kind of a software .
RESEARCH• Research was conducted by the Medical Tourism Association , which states that 8 out of 10 people in the united states of america had no issues using the medical tourism ( it was conducted in the metropolitan cities only ) .• Thus the idea of medical tourism is acceptable to the majority of people .• We had a conversation with Dr. Rohit Singh ( Pain super specialist Scranton Hospital ( Pennsylvania , USA ) . According to him the idea of medical tourism has deeply penetrated the market of USA .• We also had a conversation with Dr. Purushottam Lal ( chairman Metro Hospitals group ) also suggests that 25 % of his hospital sales are constituted by the medical tourism .
SECTION 4PRODUCT CONCEPT STATEMENT AND LIFE CYCLE
PRODUCT LIFE CYCLE• Product Life Cycle (PLC) refers to different stages through which a our service goes in its life time ( apprehensive ) .• INTRODUCTION PHASE : Asian health inc. will not take much time to get noticed by the customers due to the fact that it already has a reputation of quality in the field of health care and management . Thus the board members apprehend that due to less competition the introduction phase of the company will be comfortably profitable .
Growth• In the growth phase our service starts to pick up pace in the market .It is now getting deeper in the market .Its recognition, value, availability etc start to increase .Moving from introduction to growth stage can also be taken as the threshold point where after the product/service starts to make profit.We believe that our service will have a longer growth stage as its demand is more and supply is less .It has a huge potential .Statistics show the growth rate at which the industry is growing so it is time to see the other stages.
Maturity • After the growth stage is the maturity stage. It is every company’s aim to remain at this stage for as long as possible, so is ours .In this stage, the product or the service is at its peak. It is generating maximum revenue and hence maximum profit. It is densely populated in the market, it is widely available and it is working at its maximum potential. There is no further scope of growth at this or after this stage till the time some changes or new introduction is done.
Decline• Lastly comes the decline stage. Though no company wants to be in this stage . It comes when the technology used, becomes obsolete and competitors both new and old are out with better and efficient product/service. In our case if we do not regularly update the machines or train the staff we will soon discover that we are in the decline phase.
Result• We believe that we will again start the trend of introduction at the maturity stage by introducing something innovative which has never be seen by anyone before .It could be vaccination or a new innovation which was in a along wait .This will shift our PLC graph from moving to decline stage to again heading towards the growth stage.• A strong competitor is one whose PLC remains above its competitors PLC. We will go for DEMAND STIMULATION at that stage of the service cycle .
MARKETING OPPORTUNITIES1. Marketing by doctors and insurance companies , this will be done on commission basis . For every case the doctors will be getting 2% of the entire cash payment .2. Marketing by TRADITIONAL METHODS :• Newspapers• Internet• www.asianworld.co.in ( we plan to start a community for people who have undergone medical tourism as well as those who are about to use it . This will act as information channel . Thus we can promote medical tourism .
TRADITIONAL METHODS • Brand Virgin Atlantic : we have made VA as are brand flight . For the transport of our passengers internationally . This will give us opportunities to advertise in the flight in the VIRGIN ATLANTIC magazine as well as brochure distribution . • Airports : advertisement at the international airports of NEW YORK , LONDON , DUBAI , SYDNEY . Terminal 3 of new Delhi airport will be having a separate guest receiving lounge for all the medical tourists.
NON TRADITIONAL METHODS OF MARKETING1. RECYCLE WORLD :• We plan to carry out a campaign against the use of polybags in New York , London , DUBAI, Sydney . This will be in association with the largest non govt. organisation the GREENPEACE . we plan to manufacture some 10 million brown bags ( recyclable ) . On every bag we will have a ad of the company . And on the other side it will be of the Greenpeace . This will be a program for 4 days . By this we will get media hype as well as recognition . This will be carried out by the founders of Greenpeace . At the final day of the campaign there will be a speech on global environment conservation at Burj al Arab by Kumi Naidoo, Executive Director greenpeace .
Marketing mix strategy ( cont. )• TOILET CAMPAIGN : research suggests that a person has maximum free time in the toilet . So we plan to advertise heavily in the toilet cabins in the major cities in the world .• The best marketing will be QUALITY : the more we focus on the quality the more people will be attracted to us by the word of mouth , by our regular customers . There is a concept known as patient salesman , in this we will explain our patients what all we do and what are the quality measures which we use to ensure safety and total care of the patient . Research also suggests that it takes 6 times more resources an finances to create more customers by traditional advertisements than by the word of mouth .
V*=QR* - C*• V* - net benefit from consumption of the service.• R* - gross benefit .• Q – probability of successfully evaluating quality of good .• C* - cost of service .• Instead of the cost of service , our company has planned to focus on the quality of the good .
MARKETING WARFARE STRATEGY• We plan to avoid the direct collision from the other competitors on the basis of price , but to improve our overall quality ( just being a bit better than our competitors in everything ) .• We also aim to serve our industry to the employers who validate a medical insurance to their employees . As that is very expensive we plan to give packages to these companies at low prices so that they can be relieved from the high budgets of the insurance companies .
BCG matrix model RELATIVE MARKET ASIAN MEDICAL SHAREMARKET PHARMA TOURISMGROWTH INC. (QUESTION RATE ( STAR) MARK ) ASIAN HOSPITAL ( DOG ) ( CASH COW )
SOURCES OF COMPETITIVE ADVANTAGE FOR ASIAN INC.THUS WE ARE FOLLOWING THEDIFFERENTIATION STRATEGY OF Competitive MICHAEL PORTER advantage AVOID BE BETTER THAN COMPETITION THE COMPETITION FOCUS ON INTRINSIC FACTORS DIFFERENTIATION VIRGIN INDUSTRY RATHER THAN THE ADVANTAGE EXTRINSIC ONES
FINANCIAL CHART FOR THE FIRST 4 MONTHS OF ASIAN HEALTH INC.MONTH NO. OF MONEY PROFIT RMS BEDS RECOVERE OCCUPIED DApril 2010 1079 8 million $ 0.4 million 1.6% $May 2010 1809 16.8 0.9 million 2.4% million $ $June 2010 2550 24.7 1.5 million 2.2% million $ $July 2010 3490 30.98 1.9 million 3% million $ $
THE GROWTH PERSPECTIVE OF THE ASIAN HEALTH INC. • THE GROWTH PROSPECTIVE OF 20102010 • 8 MILLION $ ( USD ) • THE GROWTH PROSPECTIVE OF 20112011 • 20 MILLION $ ( USD ) • THE GROWTH PERSPECTIVE OF 20122012 • 60 MILLION $ ( USD )
APPENDIX• PHILIP KOTLER ( principles of marketing )• Dr. Rohit Singh ( pain sp. ) USA• Dr. Purushottam Lal ( Chief Cardiologist , METRO GROUP )• Dr. Ravi Malik ( CMO , RADIX hospital )• Case study on Bumrungrad International Hospital .• Case study on medical tourism By medtogo .• The concept of international global travel for health : an interview with Mrs. Suneetha Reddy ( chairman Apollo group ) ( youtube) .• LAMBDEN STRATEGIC MARKETING• LSE course slides on moodle• Class lectures by Vishal Talwar sir ( his guidance helped us a lot to finish the project ) ( BCG model , plc model )• Medical tourism survey 2007 by treatmentabroad.com• Apollo hospital marketing strategy for GLOBAL HEALTHCARE research .• Artemis hospital marketing strategy research .• Strategy followed by HOSPITAL CORPORATION OF AMERICA in early 90s for medical tourism .
EXECUTIVE SUMMARY• Medical tourism is a rapidly growing practice of travelling across international borders for healthcare .• FACTORS THAT HAVE LED TO AN INCREASED POPULARITY OF MEDICAL TOURISM :• - High cost of healthcare in the developed countries because of the high real estate prices , professional wages and the expense of medical and surgical equipments .• - Long waiting time for patients for certain procedures eg. 782936 canadians spend time on medical waiting in 2005 , average waiting 9.4 weeks .• - Specially the uninsured people face problems related to the high cost of medical treatment .• - Even the people who are insured do not get reimbursement for certain orthopaedic operations eg . knee replacements
Thank you..!A presentation by Dr. Ritesh Malikfor Internship at London School ofEconomics Marketing Project 101