With a population of over a billion
people, rising incidence of chronic diseases, and a perpetual problem of
malnutrition- particularly during the formative childhood years- India needs a
high amount of healthcare facilities to cater to its society. This massive need
is only going to increase in future due to rising urbanization and incomes, improving
awareness about treatments, and increased adoption of health insurance.
In 2010, India’s healthcare
industry stood at $50 billion. Compare this to America’s health care industry
which stood at $1.75 trillion and China’s at $240 billion. Per capita spend on healthcare
still remains low in India. In 2006, India spent $86 per capita on healthcare
compared to $216 by China and $3076 by US. For every 10,000 people India has 6
doctors compared to China’s 20 and US’s 548. Clearly there is a long way for
India to go (and it will!).
A glass that is half full only
means someone has an opportunity to fill the remaining half and extract value
out of it. The poor healthcare infrastructure in India represents a big
opportunity for corporations and entrepreneurs focused on this sector. It holds
a promise of outstanding growth rate and a positive social impact that cannot
be measured in just revenues.
Growth drivers:
- Growing private sector healthcare investments and improving reach to Tier 2 towns
- Rapidly improving health insurance coverage
- Increasing trend of seeking accreditation (driven primarily by insurers requiring accreditation by hospitals, to help marketing, and medical tourism)
- Better awareness among doctors and consumers on latest medical technology advancements
- Expanding aging population and higher incidence of lifestyle/non-communicable diseases
Barriers:
- Affordability challenges due to low per capita income
- Inequitable availability and access to healthcare facilities. Most investment in healthcare is still concentrated in urban areas. Rural areas, which represent majority of India’s population, still do not have access to good healthcare facilities (this is partly due lack of purchasing power and dismal supporting infrastructure such as reliable electricity, transportation, connectivity, trained doctors/nurses wanting to serve in rural areas)
- Low indigenous manufacturing and dependence on expensive imported equipment
- Low number of doctors/beds/nurses per 100,000 people
- Ineffective government policies and their implementation leaving masses without access to decent healthcare systems.
- High capital investment requirements (and lack of innovative business models and financing options)
India at forefront on medical innovation:
Yet these are precisely the challenges
which provide tremendous opportunity for corporations and entrepreneurs in
India to exploit. The challenge of delivering service at low price point has
pushed many institutions to come out with innovative products and delivery
models. Aravind Eye Hospitals and Narayana Hrudayalaya are pioneering examples
among many.
Large MNCs have also realized the
potential of the market and have invested resources to develop products targeted
to India. This has had an added benefit of being able to market these value for
money products in other emerging and developed markets- a proposition well
appreciated in these times of austerity. India driven innovations in products
such as Portable Ultrasound, Baby Warmers and Insulin Pumps have seen good
success in India and abroad.
Opportunities abound:
It is well understood that
healthcare in India presents a high growth opportunity and hence the sustained
flow of investments by the private sector. India is quickly gaining a
reputation for producing innovative value for money products and as a hub for medical
tourism. The skills of Indian doctors are well recognized and success of Pharma
industry is rubbing onto the general healthcare industry.
To serve such an exciting market,
companies need to identify demand niches, properly apply R&D investments
for innovative products and come up with ways of delivering these products to
the market at a low cost- all classic marketing challenges. We will need astute
marketing capabilities not only on the ‘sell side’ but also on the ‘develop
side’ to come up with winning products. This is where opportunities for
marketers like you and me are!
