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Pricing Your Services in Health Tourism, PT 2

Pricing Your Services in Health Tourism, PT 2 February 7, 2024

This is a continuation of an earlier article Pricing Your Services in Health Tourism, PT 1.

PRICE AND VALUE IN HEALTH TOURISM

Price and value are different, and each is important for pricing your health tourism services. Value is the benefit of goods or services derived by purchasers. If your customers are purchasing a week at a destination spa with nutritious meals, healing mineral waters, and carefully planned exercise programs in a relaxing environment, the benefit anticipated is relaxation, rest, restoration, and improved lifestyle and well-being. At the other extreme, if your customer is purchasing treatment for a life-threatening illness such as cancer, the value derived may be survival itself, or the customer’s quality of life.

Other health tourists seek cosmetic procedures to alter or improve their appearances, so the value these customers derive is improved self-esteem and self-image. In life-threatening situations, cases when the customer desperately wants a specific outcome such as becoming pregnant or taking part in a retreat by an acclaimed spiritual guru, the value to the client will be more important than the price as a decisive factor.

NEED VERSUS WANT

Understanding whether a potential customer needs your service offer or wants it is a central element in creating your marketing messages. There is an essential distinction between what a customer wants, such as a week at a destination spa or a certain cosmetic treatment, and what a consumer needs, such as a cancer treatment.

There are factors other than price which impact the consumer’s decision, such as:

  • Need v. Want
  • Distance
  • Culture

The motivation of the consumer plays an enormous role in how the customer chooses the services purchased. If the person is motivated by wanting a stress-reducing holiday in a relaxed setting, his or her approach to identifying the destination and selecting a spa or treatment provider can be somewhat casual. On the other hand, parents of a sick child who do not have access to needed cancer treatments will approach their choice with a much higher degree of urgency. These two extreme examples show the range of possibilities.

One way to show this range of possibilities is by placing these needs on a scale from low to high. The urgency or what we call “acuity” of spa or dental treatments is lower than the acuity for hip and knee surgery (orthopedic), cancer treatment, or cardiovascular surgery (cardiac).

At the lower end of the acuity scale for spa treatments or cosmetic procedures, price will be much more important in the consumer choice, than at the upper end of the scale, where the importance, urgency, and complexity of the services being sought and provided are much greater. At the lower end of the complexity scale, the price of a spa weekend or dental treatment will probably be more competitive than the price for highly complex medical services, such as cancer treatments and cardiovascular surgeries.

PRICE AND DISTANCE

Physical distance affects health travel decisions because of transportation costs. If the health services, anticipated outcomes, and success rates are equal between two destinations, the cost of transportation can make a tremendous difference in a consumer’s decision of whether or not to travel. This potential barrier to travel is one of the reasons why the Turkish Government implemented a program providing co-financing of air transportation costs for international patients up to $5,000 USD (Turkish Airlines).

The term distance can be more than geographical distance – it can also mean cultural distances. If the culture of the potential host destination is too different from that of the health traveler, guests may choose the destination where the culture is closer to their own, even if the prices at this destination were higher. The anticipated risks of an unknown culture can be offset by higher prices.

Because of the pandemic related travel restrictions, there may be significant barriers which represent additional obstacles to health travelers. Providers and destinations are being forced to adapt quickly to this price & distance shift in the health tourism markets.

Irving Stackpole is President of Stackpole & Associates, a marketing, market research and training firm at www.StackpoleAssociates.com. He can be reached for direct consultations at: istackpole@stackpoleassociates.com. Or contact his mobile / WhatsApp:  +1-617-719-9530.

About the Marketing Handbook for Health Tourism 

Health tourism and wellness travel markets are in turmoil. The marketing challenges and opportunities for health tourism destinations and providers of health, wellness, dental and medical services have never been greater – or more complicated! Established destinations and providers of health, wellness, dental and medical tourism are looking for ways to remain competitive, and new entrants to these competitive health, wellness and medical travel markets are looking for the path to success. The Marketing Handbook for Health Tourism offers practical, applicable insights for all these audiences.

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