Rock Health, a full-service seed fund supporting startups in digital health, recently released findings indicating a growing trend in consumerization within healthcare, moving away from B2B (business to business) and towards D2C (direct to consumer).
As digital health has transformed from a nascent term into one of the most lucrative sectors, digital health companies have gone from working with payers and providers and bringing their product onto the market, to now marketing directly to patients.
“Now it is mainly B2B, but in the past few years there has been this resurgence in certain pockets where direct-to-consumer seems to be taking off a bit,” explained Sean Day, a research analyst at Rock Health. “I think a good example are these startup consumer pharmacies, the Hims and the Romans, which have their own questions around them: are they just driving up utilization or are they contributing to improved access? That is a debate that will be resolved in the next decade, but at the moment those are some of the really highly capitalized [companies in the] direct-to-consumer space. I think some of the other spaces that are really interesting are the 23andMe model because they are direct-to-consumer at one end of the business, and then they are selling [data] to enterprise ... on the other end of the business.”
This is also reiterated in a new study conducted by Rock Health and Stanford University. The report analyzed how the consumerization of healthcare is shaping the future of the industry. Findings of this research pinpointed three major trends; how patient data is creating opportunities and challenges in the field, how online health information is changing the provider relationship, and attitudes over a consumer’s willingness to share health data.
Over the last two years, there’s been an increase in patients using digital health tracking tools who then, in turn, share their own data with their medical providers. As the old adage goes, ‘never Google your symptoms,’ but patients are progressively looking online for health information to better equip themselves for conversations with their doctors.
The number of participants using digital health tracking has grown every year since 2015. While 42% of participants indicate that they use at least one of these tools, 75% say they tracked their health through digital tools and subsequently shared the data with a medical professional.
Yet, marketing directly to consumers comes with its own setbacks. It can be both extremely expensive and time-consuming
Right now, the topic of consumerization of healthcare is on everyone’s lips. Whether we’re talking about consumer fitness apps or Googling symptoms, technology is innovating the way people interact with healthcare. And while it may not be feasible for companies to be strictly direct-to-consumer, we may see startups leaning towards this, especially in areas where customers are already paying out of pocket for care.