The mHealth Move from Direct to Consumer to Employer Health
I’m starting to see a trend that’s happening over and over again in the mobile health space. Many mHealth companies focus initially on direct to consumer. They put their app on the app store and wait for the patients to come rolling in. Unfortunately, Field of Dreams was wrong when it said, “If you build it, they will come.” Mobile health companies quickly realize that marketing a mobile health app direct to consumers is a really tough business. Plus, consumers can be really fickle and so it’s hard to make money even if you do get some traction and following.
In the startup world when something like this happens, they do what they call a “pivot.” Essentially they pivot their product from one business model to a new one. Sometimes that means basically scrapping their product and starting a new one. Other times it’s applying their technology to a new space.
The pivot I’ve seen most often with mHealth companies is the pivot away from a consumer health application to an employer health application. Many employers are looking for ways to improve the health of their employees since their healthcare costs are huge and real. So, a mobile health company can make an ROI case for why the employer should buy their product. I won’t dig into the ROI of employer health here, but I should in a future post.
I had one guy I talked to recently basically say that healthcare startups should focus on the employer health space. He saw that as the real opportunity for a healthcare startup to be successful. While I certainly find the employer health space intriguing, I’m not sure it’s the best space for healthcare startup companies. A lot of it depends on the company and the DNA of the people at that company.
What I do see is a trend of mobile health companies interested in employer health. I’ll be interested to see how many of them give it a go and then pivot back to being consumer health focused companies.
