Date: 26th August 2020
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Health Tourism Markets: Working Toward the Thaw
Irving Stackpole & László Puczkó
Welcome everyone. We have really a global presence today. I think it’s time to start with a quick overview of what’s what and understand that health tourism is the kind of travel that the primary motivation is physical, mental, spiritual health. Under that, we have the medical tourism industry as we understand it. I think it’s very useful that we have just kickoff terminology since it gives us the framework under which we are discussing these points. You can find more in our new book, The marketing Handbook for Health Tourism.
I think the hot topic here is, what exactly is going to happen to wellness tourism after or during Covid19? Since every single trip contributes to the traveler’s well-being one way or another.
We have two major groups of impact we need to account, and motivations and one is nothing to do directly with wellness or medical. And that’s what you see on the left-hand side. We have well-being, improving options such as gifting, which is, I think, going to be a very important part of the motivation as we speak. And also, the other one will be the healthy options. Obviously, we have the medical side and the wellness side, but it’s all very academic and all very structured.
We have in medical tourism, we have the need to go to many, many countries don’t actually want to travel. They need to because of accessibility, because of the price, because urgency, because of the state of health. That’s motivation may not be changed significantly by the economic situation or the fear of issues after the current situation. Then in the world tourism side where people want to travel, they don’t need to travel. They want to travel because of spiritual reasons, because of their very own personal wellness reasons. This is their very own choice.
It may not be influenced that much by the current situation because people might say, you know what, I really deserve to have a wellness trip. So, this will be very happy to receive additional services or even information about how they can make that or make the trip a little bit more well-being orientated, or whichever service can contribute to their well-being. If you look into this kind of distribution of needs and ones, we might look into our office in a very different way because what is needed or what is wanted or what is just being just happy to have obviously has a major impact on how people might consider what’s happening in the first place.
Shouldn’t also forget that, especially nowadays, people will look into the health span and probably lifespan, which the World Health Organization has been suggesting for many years, that we should look into how to say how long we are living that should be healthy or there should be more focus on the well-being of our lives. This is probably a very, very hot issue as we speak, since people are really looking to their well-being and health.
Post Covid19 It’s very likely that people will need to do a lot of sacrifice, being worried that they might have a current situation. They might be restricted to do certain things. They might have a lot of waiting times. The motivation of the guests, the sacrifice, surprise and satisfaction makes is being is changing significantly. And again, how you promote your services, it would need to take that into consideration.
It’s a little bit of a complicated chart, but I guide you through. The situation has an impact on the distance. We travel the brand the consumer and we for the desire of what to do and the location want to visit. And the obviously the parameters go short distance, long distance, well known unknown brands market listed as it is sometimes, I really have wanted to visit this place and this is not a time because I don’t know what I can do next, or you want to be anything that is trying to prevent or you want to do something which is popular and busy or hidden or secluded, not quite knowing what exactly that means. And don’t forget, this can change from destination to destination. So, at some place you might want to have an unknown brand and it should be in order for other people. It should be a final destination, which is popular in busy because you trust the protocols of a brand, how they keep the sanitation overall in place. Just consider next time when you do any kind of promotion or service development. How do you think your market is located itself in this chart in terms of distance brands desire and location? Some might say you want to have anything which is hidden, and you don’t want to be surrounded by lots of people. But at the same time, I want to have a brand in that a situation which is by now and which certainly exists. So that’s a nice challenge.
When we talk about wellness as such, we have four major options here. For example, of what exactly is recommended in terms of the type of wellnessified, gastronomy, accommodation and room service treatments. You have wellillusion, about which is of something that looks good or sounds good and its related to wellness. But we only know that it’s not exactly something that we can trust. You can also think about wellentertainment, which is an entertainment infused into wellness activities that actually can have fun since most of the spa events, treatments are offered or have been offered in a temple like environment. But you shouldn’t be talking. We shouldn’t have chatting or enjoying yourself in a traditional way that you have to be very confined and very quiet, or you may want to be wellevent which is the leader in your own business based on your very, very highly focused service provision or like a retreat.
Again, it’s up to you to decide whether, wellness is, tuna in some oil. What would that be? Would it be an evolution, or it would be something else? But it’s we’re just about to say it. But we know that this is happening everywhere and does not help when the business is really focused on the badness provision. And one of my favorite and controversial examples is perineum sunning think you can always have a large number of new initiatives, I mean, called innovative treatments and solutions. That becomes very popular. And of course, social media has a lot of bloggers, bloggers all talk about it. You don’t quite know what the impact of these are, but they become very fashionable thing.
Still, issues like this, such as in Japan, when you do have a proven record of what he may do to you psychologically and physically may be valued again because people would like to know the evidence. I would like you to remember that you need to give some sort of details or evidence of what you are suggesting in violence, especially after the situation, because people want to know that this safe was just a joke, to be quite honest.
As a summary, we have been talking about user experiences for quite some time. But if you don’t mind, I think we should shift to building experiences, which is WX and more like responsible wellbeing experiences of whatever we are doing or the impact it may have on the environment and our situation and how those experiences may contribute to the terrible things. We might even have another book on this topic, because that really is something which is new, and they would be very happy to talk to you about.
Remember, we need to have reliable stories. We need evidence. We need to have unique well-being proposition’s, not failed propositions. This recognizes different value propositions. Why? That is good for me because I may need to reconsider all of my trips.
I need to understand why that is valuable to me and we also understand that service providers just like yourselves or planners or organizations would need to be told of how this is going to be done and how we can translate all these great ideas and new models into operations. Mentoring is going to be needed.
I hope tourism is a luxury, we believe that it’s now becoming unnecessary luxury, not just a luxury, but a necessary luxury because of the health care, because of the mental wellbeing challenges that we are observing. So, more people will be looking for these services and these value propositions that you’re doing.
Thank you so for, as always, an excellent presentation Laszlo. We’re particularly pleased that so many of our colleagues from India, Southeast Asia and other Eastern countries have joined us. So good evening and thank you. This is an extraordinarily important topic, I know these are extraordinary times, we’ve never been through a period such as this, so I want to thank you all and send my sincere wishes that and hope that all of you are well and surviving and that some of you are even thriving.
As was said at the beginning, Lazlo indicated, we hope that you’ll sign up to take a look at our new book – The Marketing Handbook for Health Tourism. We’ve added quite a bit of detail, useful case studies and the marketing basics for health and medical and dental tourism, which I trust you’ll find useful.
My intent today is to talk about how medical tourism in particular, talk about external factors, public health response to the pandemic. Talk about demand both in travel and psychologically and talk about supply and capacity and the path to recovery. As Laszlo went through his presentation. I was struck with the array of options for segmenting demand, segmenting our markets. And this becomes tremendously important, terribly important for one of the strategic options that providers health and medical and dental have in dealing with the pandemic. In the health tourism markets, there are segments to the markets that are critical to understanding how we can respond, how we can work toward the thaw.
The first end of the market of the markets is what I refer to as high volume, low unit value side of the markets in the health, dental and medical areas, dental, cosmetic or orthopedic, and all the way over to cardiac or high complex cancer treatments.
For example, these are low volume, high unit value elements or segments to the markets for health and medical tourism. These markets are frozen, any of these markets that rely on cross-border travel are frozen. There are emerging markets and demand that’s less distance specific. We’ll talk about those and there are certain procedures that, as Laszlo alluded to, although I don’t think I want to do any perineum sunning right now, there are hedonistic or those I want it ends of the market that providers which historically have focused on the low volume, more complex types of surgeries and more complex types of procedures. There are some of those service lines which providers may want to consider. So, in these markets, what’s critical for consumers is the stability, the perception of stability in the destination.
The second factor, of course, is access. Can I get there? A third factor is the economics. Can I afford it? Am I still employed in the current environment of another? Another issue is capacity. Are the hospitals, are the providers, are the dental clinics, are the cosmetic service providers or are they open to provide? Are they providing the types of services I’m interested in? And then the final issue is reputation and brand, which in a pandemic is critically important. And we’re still evaluating the impacts of reputation and brand at a national and destination and even provider level as we are, what, now seven months into this situation?
Well, certainly from a travel perspective, you have to look at the number of commercial airline flights around the world. And this is fairly recent data from FlightRadar24, which shows a comparison of 2019 and 2020.
And you can see the profound and remarkable drop off in the number of commercial airline flights around the world. This, of course, is what we refer to as a frozen market. Now, some people have used things in the popular press, some discussions about recovery in the travel markets, and we can see a very gradual return or recovery of commercial airline flights since its absolute plummet in March. To where in July they were beginning to come back, but of course, they’re still nowhere near where they had been prior to the crash in March.
How will the travel market recover? Well, looking at the traditional models, one can look at the re-engagement or the recovery of the travel market parallel with the recovery of or similar to the recovery of economics, the gross domestic product and other major economic indicators.
And what we were predicting back in March when Lazlo and I held our first webinar on this topic, we weren’t predicting a V shaped return or a U shape return, as many political pundits and wishful thinkers were suggesting. We were suggesting a Nike swoosh. So, in March, we suggested that it would be three likely recovery paths for travel activity and that these recovery paths would be based on things like the and the coordinated response to the pandemic, the ability of travel carriers to operate economically, the ability of nations to coordinate their response. Because it doesn’t matter if I can fly from Portugal, if there’s the destination I want to get or doesn’t permit me or presents obstacles for me to arrive at my destination.
Well, here is very recent data that shows the actual economic recovery that shows in Europe how the recovery has been halting. It has been up and down, and it certainly looks very similar to the curve we were predicting back in March. And that’s because of the peculiar lack of synchronicity in response to the pandemic. Around the world, hotspots continue to emerge. Countries work very, very hard at allaying or mitigating the effects of the pandemic. And so, their economies open up and yet others closed down. And this will continue probably until a vaccine is available. And there’s widespread distribution of the vaccine. And this allows consumers to restore their confidence and get onto trains, planes and busses.
The other impact that Covid19 has had, of course, is on capacity, the ability of health care providers. Elective procedures were absolutely stopped. I’m a great believer in the value of medical and wellness treatments like massage therapy, for example. And I was only able to get an appointment for a massage therapy session in June. So that’s an example of how capacity has been interrupted. Some percentage of capacity will not come back. Consumers are afraid. They’re fearful. Providers need to adapt and look at other opportunities.
There is definitely pent-up demand that’s emerging in some of our clients have noticed that it was surge as soon as the ability to travel was eased, there was a surge in demand and bookings. And then when certain destinations, either their destination or the source, location and destination began to impose further restrictions, there was another drop. So that’s an example of this whipsaw effect of the lack of synchronous or consistent response around the world to the pandemic.
What are strategic options while we’re working toward the thaw, there are strategic options and there are tactical options. The strategic options are new markets, other service lines. Laszlo went through some of the wellness and more. This is a type of service lines and even providers that consider themselves very serious and very focused on clinical matters. These providers should be considering extending their service lines into other areas. Then there’s new source marketplaces, which is frankly local. There is local demand, which many destinations and many providers that have invested heavily in international source locations.
There are local markets that need to be tapped into, and our promotions, our marketing, our communications platforms can and should be zeroed in on those new near marketplace options. And then there’s tactical options. The tactical critical options are reducing and addressing. Consumers fear that. And that’s a tricky matter. We need to demonstrate or show safety. We need to demonstrate and show that we’re testing, we’re masking and we’re cleaning aggressively. So, this is a question about if we clean it, will they come just like if we build it, will they come? Certainly, our hygiene standards need to be very aggressively performed and communicated. There are some credentialing and standards organizations that have added additional cleaning protocols, hotels, and we need to be doing that in our dental clinics, in our hospitals and in our clinics offices by showing testing, cleaning and other behaviors that will allay and mitigate and reduce consumers’ concerns.
Laszlo talked about segmenting the markets and what I want to point out is that there are two segments going back to the way the markets break out, how the markets break down the sick, the segments that will come back first are the vanity segments or as Laszlo is talking about, the hedonism. I think it’s an excellent apt descriptor for that end of the market, these consumers who desperately need or want. A procedure or a treatment or an opportunity to indulge themselves or to adjust their self-image, somehow these consumers will fight past whatever obstacles and whatever concerns that their family and friends have and begin will begin to see these markets emerge. In fact, these have been the first segments of the consumer markets to emerge. The second piece that’s going to come that has come back are high acuity individuals with bad heart valves, individuals that seriously require cancer treatments. These individuals are seeking treatments and attempting to overcome travel barriers and access obstacles in order to access treatments.
These ends of this market array will return first. So, think tactilely, tactically, think locally before you think at distance, before you think about traveling consumers. Very interesting survey. The survey data that I was reviewing recently that indicated that consumers feel safest people, consumers in the United States feel safest in their cars. I think people are going to be driving. I think this applies to Europe as well as in Asia and other locations where it can be accessed that the services that are being sought can be accessed by automobile.
Vanity and hedonism markets will come back first. Very high equity markets will come back second. Unfortunately, that leaves out the middle market of elective scheduled procedures like orthopedics. The middle market will be the last to return. We have to address the issues of consumer hesitation by our messaging, by our protocols, and by communicating those protocols aggressively into the market segments, into the audiences we have identified. We need to look at remote solutions. Telehealth and telemetry-based telemetry aided tools can and should be brought to bear to help support our brands and keep our messages in front of our audiences. And then finally, we must address fear versus risk tolerance. This will be a critical element in the emergence of reemergence, the thought of the health, travel, health, tourism and the medical tourism markets.
Question: Which country is better for healthcare?
Irving Well, so health care is an extraordinarily broad array. I believe there’s excellent healthcare everywhere. I don’t believe that any one country has the exclusive, the lock on best, anything. And as soon as you ask the question best, you have to ask the question, what would it mean? There’s extraordinarily sophisticated tertiary and ordinary care available in many destinations around the world. There’s extraordinarily valuable, important and I don’t want to trivialize important wellness services everywhere in the world. And countries that seem to specialize in one area don’t specialize in another area.
Laszlo General health care as such, whatever that means, maybe an important factor, but in 99.8 Percent of the time, people are looking for a certain a certain field, a certain area, certain kind of service, and then just echoing what’s Irving said, it makes a difference which field or area of specialty are looking for. Then there can be a discussion about is it this hospital that surgeons and this person or that person would be better since don’t forget, guests or patients for that matter, are interested in results, success rates, infection controls, evidence of previous interventions. In general, people don’t buy health care unless it’s the general checkup or an insurance.
To take this your question further, I think the country that can be good, is where health care applies and integrative health care approach. If you’re asking me personally whether they understand that we have to cure or attend or even to consider a certain indication or a certain state of health may be approached by seven different solutions, different ways. We understand the benefits, the risks of all of those seven approaches. We apply the best mix to you, to the given situation that you are in applying that kind of selection criteria. Probably a number of countries you would need to look into because not every country, even legally, would permit certain kind of interventions. Certain kinds of approaches are not considered to be healthcare related, maybe considered as wellness as in other countries. It’s considered the oldest way of looking at health. If I was looking for a country in general, I would look into how they look at health care, how they consider health in general, and they why did they do it so personally to me that better it sounds.
Irving That’s a terrific answer. I want to add one appendix to that and that’s that. The ratings systems that are published. In the press are, for the most part, beauty contests. They are an attempt by individuals, organizations to create comparative ratings standards, most of which are based only on consumers perceptions or the amount of advertising dollars spent by a destination or provider in that publication or some other factors. So, when one sees these ratings that my country is the best, my hospital is the best, look behind the curtain and look to see what the elements are in that rating system.
Question: What mental health trends are developing in the health and wellness tourism space?
Laszlo Mental health has already been a hot issue, especially at European Union level, for the last 10 years, which is now obviously being seriously affected by the Covid19 situation. I don’t like this trend based on that because it can be very different, depending on where you are, depending on the community or indeed depending on the city or in depending on the job you are, depending on the live stage you are in. The latest trend is very good for the media and for social media. The top five, top seven and top ten trends for xxxxxx. I’m not buying that, what’s more important is to say that, OK, I am located here. I would need to look into what’s relevant for me if I am a consumer or if I was a service provider, I would need to be looking to aware my prospective guests may come from and what kind of issues they might have at their home destination. We have extremes it is happening in many countries. So, both extremes of whichever end of the mental health spectrum we are in, we have cases for both because of the unprecedented situation. Depending on your personal mental state, you may respond to it in a very different way. But certainly, the media suggests that people are more into mental health, this and that. But when you translate it into actual services or needs or wants, that becomes a very different topic.
Mental health often suggests that you would need to be hospitalized. People don’t want to be labeled of having mental health issues because that’s a bad label. Even if you did, they don’t or wouldn’t admit it. It’s a difficult thing to address because it’s such a personal issue. Stress certainly is one. And not being surrounded by a loved one, certainly as another, which is a general issue and having a coffee is not replacing having coffee with someone out on the terrace, however easy that may sound. So, we do have some general issues, but I, I would suggest looking into, are you on the demand side? Are you on the supply side and looking to what can you be relevant to that actual segment, apart from this general being stressed and being confined and feeling overwhelmed depending on the government as well? Because some countries, the uncertainty of the situation creates distrust. And whatever you do, you can’t really help with that because you’re soon prone to political games. So, it’s not an easy question, but but segment wise, we can find solutions in the end.
Irving Just before Covid19, there was in certainly in certain locations around the world, there was a growing recognition that behavioral health and mental health was deserving of a greater amount of clinical attention. And there was a budding, very tentative early emergence of tele-psychiatry, the ability to provide behavioral health interventions, the telemetry solutions. And in many locations around the world, these services were emerging. And my firm had the opportunity to work with several of these emerging companies. With Covid19 now and the explosion, that’s the only way to describe an explosion of telemetry solutions. There’s very good clinical evidence that US psychiatric interventions can be effective in treating certain diagnostic categories of behavioral and mental health issues. So as these technologies emerge and as this Laszlo’s suggested, countries and cultures recognize and accept the need for behavioral health and break down old stereotypes about mental disease but talk about how behaviors can be treated. I believe we’re going to see a real emergence of tele psychiatry and behavioral health and interventions that are more structured and indeed for those providers who are interested in this, this is exactly one of the areas I had in the back of my mind thinking about you need to extend your service lines and explore other options for serving the demand in the markets that are proximate, that are closer to.
Laszlo Let me add one point here, which is I would really all everybody to not to call mental health whatever service you are doing unless your specialized mental clinic.
You want to use terminology like balance or rebalancing or harmony or whatever else is sufficient in the given language that you may want to communicate, because as soon as you start to use mental health as such, many people may turn away instantly because you don’t want to be labeled anyone who has mental issues, although you need to know what the real trigger is and why people are looking for certain services or values for that matter. But how you are introducing it, how you package and get up and how you like to communicate about it, I would really want you to be careful and not let your physician to decide what should go on, the website said.
Question: Would you like to comment on the profile of the medical health tourist during Covid19?
Irving On the psychological demographics and then psychological psychographics, and I think the demographics in the psychographics, I’d refer back to the market segmentation structure that both of us used. We used different graphs, but we’re basically saying the same thing, the individuals who are interested in and motivated to consume services not nearby, but farther away, the features of those people fundamentally won’t change in Covid19. These are individuals who are high demand. These are individuals who are either very sick because they can’t get what they want or don’t think they can get what they want or what they need nearby. So, they’re going to go somewhere else. Or these are individuals who have a very high-risk tolerance and want to get their hair transplant done somewhere else. They want to come back with a full set of hair and they’re going to do anything that they need to do in order to have that reality in their lives. I don’t think the profile, the demographic or the psychographic profile. Has changed because of Covid19, I believe that what’s happened is the externalities, the lack of access to travel, the lack of access to elective capacity. In the example I used earlier, the individual wants to get the hair transplant if he or she can’t find a clinic that will treat him or her. And that’s a challenge to capacity. What do you how would you address that question Laszlo?
Laszlo I think if someone had very strong need. Because psychologically, we need an idea that somebody wanted something to do, nothing to be transformed, let it be done, let there be some plastic surgery or some other kind of plastic surgery, the person may trade a destination and they might look for a domestic destination or a domestic service provider, even at a higher price, probably. But wouldn’t trade in the idea that I would like to have this and that done. So, they may switch from one destination to another if one destination, and they decided by whatever measure and they still had the second best third best performance, best option for the given treatment or service and should be a country where the first best option is located, not being accessible for whatever reason, they might choose the second best of third or fourth best option. When you have a very deep need for something, you really want to do something. You might change the destination, but not your mind. You don’t want to change your mind in that sense. Obviously, the same can happen with wellness. If you’re really missing hot springs, you may look for a different hot spring not the one you always wanted to visit.
Laszlo the term Irving was referring to the middle market, which is. the difficult one because they might say, you know what, I can live with whatever I have right now. I might do something in two years’ time and next year. What you can do, anyone can do, is to strengthen the need and look around domestically or even regionally what kind of markets you can look for, because most of the time, both medical and wellness side, except a couple of countries, everybody instead to look at international markets. This is the moment when you can’t look at international markets or just select markets, not any market. You need to reset your mind somehow what your market actually is. And you may need to reach out to different, as I said earlier, different segments in terms of age. You may need to be looking to generations that you may need to look into families even if you never wanted to have them, but you may need to. There are options here, obviously not as quick and not as straightforward, but you need to look into the actual motivation. Three, not how it is translated into, but what really triggers. Yes. Then you have to translate into service. It’s not an easy job, a task. That’s why I refer to the mentoring that you need a bit of help, a bit of hand holding that. OK, this is what I would like to do, but I really don’t know how to do it, especially after Covid19. This is when you need to do for some even online help, because you can’t have the real face to face. Look for online help in terms of business development, because that is the time, because the usual tactics and the usual answers may not be useful at all.
Question: which consumer group should I target as a health care middleman business?
Irving The groups you should target are the groups that are still willing and able to move, to travel, to consume services and as we pointed out we believe that the first segments to move will be the cosmetic, hedonistic wellness segments, those people that psychologically, emotionally need to perceive their desire very powerfully to consume these services. And the indicator for that will be those early opening, the early emergence of capacity in those areas. I made the comment about massage therapy. I think that that’s an analogy around the world in different markets. The first thing is to look around and see which capacity seems to be which demand in which capacity areas seem to be emerging. The other end of the market, the very high acuity end of the market, I believe the individuals seeking treatments for long standing chronic diseases that are severe cancers, blood borne cancers, these individuals will seek treatment from the best sources available, even if that means they have to overcome travel obstacles and other types of barriers to secure those treatments. So, there are two ends of the scale, you’ve got one end, which is the psychological need and the other end, which is the medical or clinical need, either one of those ends of the sides of the market that are likely to emerge earliest. And every indication is that that’s the way the market is indeed barring.
Laszlo Just to follow that up, I don’t think being a generalist at the moment, it’s going to pay off because the number of travelers is just such a fraction of what it used to be. You can’t have the economies of scale. You would need to really look into it in terms of what supply you have available and will be available given government regulations or and at the same time what special needs you might be able to identify and you had access to on the demand side. Then you may find some overlapping options and then you might say that based on the availability of supply and the accessibility of the demand. I can as a middleman can do up my own provision, which is not just bringing the supply and demand together, but also ensuring the prospective traveler is that you know very well what the local governments, health care, safety, security situations, regulations are because this is the field that no one can follow, because they might change on a weekly basis of what one government expects its service providers to comply with. And no one can follow what’s happening in another country. You can find that niche. It’s not going to be easy. However, you might find the person or medical intervention or this package and the market, and you can do relatively easily the continuous validity of your knowledge of what’s happening in a given country. And you can match these parts together if it could be relatively easy. But in general, at the moment, I would do a lot of homework first and look at and collect a lot of information and they may choose. I wouldn’t do any Google ads at the moment because that’s just not exactly the way to go.
Stackpole & Associates is a marketing, research & strategy consulting firm focused on healthcare and seniors’ services markets. Irving can be reached directly at email@example.com.
Health Tourism Worldwide provides solutions for every component of the health tourism spectrum from leisure to medical and wellness tourism.
Laszlo can be reached directly at firstname.lastname@example.org