The global healthcare market is experiencing a surge in innovation, yet healthcare has one of the lowest rates of consumer digital adoption compared to consumer-facing industries such as entertainment, banking and utilities that are investing heavily in digital engagement.
“This isn’t because of a lack of innovation or a reluctance to prioritize digital consumer engagement,” explains Michael Scholz, vice president of product and customer marketing at commercetools. “Rather, many healthcare organizations are being held back by legacy technology systems that are only just beginning to communicate with each other, which is hurting their progress toward digital maturity.”
With 20 years of experience in retail and software with big brands like SAP, and countless years consulting to Fortune 50 companies like Ford, Michael Scholz knows a thing or two about unified commerce strategies. He joined commercetools in June 2021 as VP of Product and Customer Marketing. At the time, the company was experiencing a period of incredible growth, adding over 120 new customers. Today, commercetools is an established global company, operating primarily in the Americas, EMEA, and ANZ, helping organizations deliver unique commerce experiences.
We spoke with Michael to explore the healthcare market and how providers can reinvigorate their offerings to customers and B2B buyers by adopting the latest and most innovative digital commerce technologies.
Operational obstacles and commercial opportunities for healthcare organizations
Digital commerce in the healthcare industry faces significant challenges due to stringent regulations. For example, the checkout process can be particularly complex due to the need to determine product eligibility based on a customer’s subscription and location. Additionally, available payment methods such as FSA/HSA accounts and insurance co-payments further complicate the process. That being said, the healthcare industry is poised for digital adoption, but it needs the right technology to keep up with other sectors and meet evolving consumer expectations.
“The technology needs to be flexible to accommodate wherever the customer is – online, at the clinic or at the doctor’s office – while providing a seamless experience with a variety of fulfillment options,” Michael said.
Healthcare consumers are demanding better, simpler buying experiences across all categories, and healthcare is no exception.
“These changing expectations present a huge opportunity for healthcare organisations to embrace digital commerce and engage with patients in ways that increase consumer loyalty and drive financial outcomes,” he continues. “Just look at the influence of ‘big tech’ – it’s undeniable. Last year, Amazon expanded into the UK, signing a deal with the NHS to provide health advice via Alexa.”
This will enable technology companies to develop products using the data generated from patients’ voice inquiries, which of course will remain anonymous.
“Google and Apple have also jumped on the bandwagon, making great strides with wearable technology such as fitness trackers and wellness apps that give users real-time health information. AI is coming online in a big way, with AI-powered chatbots and virtual assistants revolutionising healthcare customer service across the UK, helping patients make appointments and get information.”
In the UK, digital commerce is clearly a major enabler of meeting these dynamic consumer expectations, and Michael expects this trend to continue.
The regulatory environment in the healthcare industry is a major obstacle. Healthcare organizations need to ensure that all stakeholders – patients, payers, and suppliers – are part of an efficient and flexible system.
“We’re talking about sensitive patient data here, which has to be handled and stored carefully, so everyone has to adhere to strict European and UK data protection standards, regulations and certifications,” he continues. “Moreover, today’s D2C market demands supporting more customers and multiple brands, channels, stores and business lines, which is no easy task for any healthcare provider. This is why digitalization is so important in healthcare today.”
Any digital commerce solution must address these obstacles by ensuring regulatory compliance and industry-leading security for sensitive data from the start.
“At the same time, greater interoperability through automation and systems integration will help create modern and unique customer experiences, improve revenue opportunities and drive efficiencies.”
How Healthcare Organizations are Using Composable Commerce to Improve Operational Efficiency and Customer Experience
Michael has worked hard to enable healthcare organizations to build these capabilities in addition to offering composable commerce.
“Just a few months ago, we introduced HIPAA compliance, enabling us to securely handle Protected Health Information (PHI) in the US market. It is the first composable commerce solution to securely handle PHI under the BAA framework, enabling healthcare and life sciences companies to sell online in the US,” Michael continues. “Similar regulations exist in other European markets, such as France, and we have integrated HDS into our solution to ensure compliance and security with local data regulations.”
One example is Vision Healthcare, a consumer healthcare platform with over 75 brands and 5,000+ SKUs across 44 different markets. The company faced significant market challenges, especially in scaling and processing order volumes across their platform.
“Using composable technology, we have been able to unify our tech stack across all our brands, scale operations across markets, reduce IT maintenance costs and resource burdens, and implement new customer experiences such as our loyalty program and 16 new websites.”
Michael advises that the days of ‘build your own’ solutions are well and truly over, and that business leaders should capitalise on the innovation gap in the UK’s healthcare market today and take advantage of the opportunity to invest in new technology.
“Yesterday’s patients are today’s customers, and they expect solutions to keep up with the industry and enable a positive experience,” he explains. “Whatever the solution, from SaaS, low-code/no-code to AI, it needs to be easy to use, integrate with other existing platforms, and work seamlessly across all infrastructures.”
However, in a highly regulated sector like healthcare, addressing these factors and adopting digital can be challenging.
“New technologies like Composable overcome these obstacles, enabling faster innovation across the value chain and allowing companies to focus on growth without the hassle of dealing with complex infrastructure.”
Clearly, the UK healthcare industry is poised for digital transformation, it’s just waiting for leaders to act.
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