PwC Global Health Industry Trends Report: Wellness and Fitness Sector Offers Prime Opportunities for New Entrants to Seize Market Leadership
Not long ago, the PwC Health Research Institute released a report on the global health market. The report outlines the challenges facing the traditional healthcare industry, as well as the advantages and challenges of the emerging healthcare sector, and offers recommendations based on its findings. So, as an emerging force in the healthcare industry, how can one seize the trends in the global health market and rapidly establish a market position? This report provides detailed insights. (The term “emerging force” refers to entrepreneurs who are entirely new to an industry, or companies engaging in cross-industry entrepreneurship that is completely unrelated to their previous business activities.) VCBeat has compiled the main contents of the report for our readers; please see below.For more exchanges and sharing, join the VB Entrepreneurship Circle）
According to statistics, in emerging markets, 54% of people expect mobile health applications and services to improve the quality of healthcare over the next three years. New market entrants can cross borders and establish landmark partnerships with traditional players. Opportunities await companies with keen insight, regardless of their size or target market, as long as they can bring new ideas and wisdom to consumers in the realm of health, given that healthcare costs in many countries are growing faster than GDP.
Serving the global market inevitably presents significant challenges. Industries such as retail, technology, telecommunications, and consumer goods are all seeking ways to penetrate markets across different cultures, yet they often encounter difficulties in adapting to local conditions. Countries vary in their healthcare systems, privacy concerns, cultural shocks, and geographical barriers that must be overcome. Global healthcare protocols are widely recognized even in most remote areas, which means that the $9.59 trillion healthcare market will be more open to innovations capable of replacing traditional face-to-face clinical experiences.
In both developed and developing countries, telemedicine entrepreneurs have become market pioneers, offering more convenient and affordable healthcare solutions that enable flexible clinics to replace immobile public hospitals.Surveys by PwC and EI indicate that consumers are willing to adopt new healthcare models if they are reasonably priced, offer comparable efficacy, and save time.
PwC also identified several key trends:
The global healthcare market is projected to reach $9.56 trillion, with $8.1 trillion from government expenditure and the remaining $1.49 trillion from the health and fitness industry.
Global healthcare is gradually moving toward virtualization. The integration of mobile, digital, and wireless technologies has broken down the boundaries of healthcare, making medical services accessible from anywhere.
Innovative breakthroughs will emerge more rapidly in emerging markets than in developed ones. A more open policy environment is essential to accelerate the growth of disruptors.
Consumers expect healthcare to offer the same level of convenience as banking, retail, and transportation. New companies are bridging the gap between these expectations and the current state of medical infrastructure by introducing innovative ideas and skills to the global healthcare industry.
Entrepreneurs can collaborate with healthcare professionals and government entities to build trust with consumers, ensure the continuity of services, and improve efficiency based on existing knowledge.
Emerging Forces Driving Future Change
As emerging players carve out their niche markets in medical processes and services, healthcare will undergo profound transformations.
The challenges facing the entire healthcare industry include affordability, quality of care, and continuous, borderless access. In developed countries, population aging and the rising incidence of chronic diseases are two major issues; meanwhile, developing countries face the dual challenges of higher chronic disease incidence and inadequate healthcare infrastructure. In some developed countries, hospital beds in large hospitals remain vacant, yet there is a shortage of hospitals, clinics, and healthcare professionals providing primary care services. The scarcity of medical resources is even more severe in developing countries. The entry of new forces will bring relief to the healthcare industry by leveraging the advantages of consumers, business, and technology to reduce inefficiencies and deliver higher-standard medical services.
Emerging forces are disrupting the $2.8 trillion U.S. healthcare industry and gradually transforming healthcare systems in both developed and developing countries.
Across retail, technology, telecommunications, and consumer products, emerging players can leverage consumer engagement to develop products at a faster pace and lower cost than traditional healthcare companies, while collaborating with established firms to achieve superior outcomes.
A symbiotic relationship is emerging, with regulators, specialized payment institutions, and traditional payment providers all serving as forces driving innovation.
More invasive procedures will be replaced by the expanded and deepened use of app-based devices and services, which are less invasive. Populations in remote areas will be integrated with global diagnostic and therapeutic resources.
Partnerships are taking shape. Competition will intensify. Emerging healthcare-oriented opportunities will drive an increase in cross-sector collaborations.
Virtual Democracy in Healthcare
By the end of 2014, global mobile network coverage had reached 32%, doubling from 2011 levels and connecting approximately 3 billion internet users, two-thirds of whom were from developing countries. The convergence of mobile, digital, and wireless networks will usher in an era of democratic digital healthcare, enabling borderless access to medical services anytime and anywhere.
Virtual medical services are gradually replacing traditional healthcare delivery. Both young and older individuals are increasingly willing to obtain health information through their handheld devices, opening doors to new business opportunities and collaborations. Products developed in one location can be used to detect life-threatening conditions on the other side of the world.
Global healthcare systems are moving toward sustainability, shifting from volume-based fee-for-service models to quality- and outcome-based standards. Some forward-looking organizations, particularly medical device and pharmaceutical manufacturers, are leveraging technology to focus on comprehensive patient engagement solutions—spanning disease prevention and wellness, treatment plans, post-treatment follow-up, and even patient support and education.
This approach places patients at the center of the entire service ecosystem, but it also necessitates new business models based on collaborative partnerships. Emerging players can provide essential solutions in behavioral, diagnostic, and therapeutic domains. Taking this trend into account, the global healthcare industry is prepared to embrace the integration of traditional and emerging forces, particularly in the realm of telemedicine. For instance, Sanofi established its Diabetes Division in 2010, committing itself to becoming a global leader in diabetes care by providing patients with real-time interactive solutions.
Inefficient healthcare solutions in remote areas have prompted action from local officials. For most developing countries, establishing adequate medical infrastructure is an urgent priority. In the realm of public health, developing nations face significant pressure, such as how to prevent heart disease and other chronic conditions.
The pace of innovation in developing countries will outstrip that of developed nations, where healthcare systems are more entrenched and highly regulated. However, bursts of innovation often occur in countries with more pressing needs and relatively flexible regulations. Breakthrough solutions offered by emerging enterprises are more likely to take root and flourish in developing countries.
Emerging players have found greater acceptance in some emerging markets, particularly as governments actively reform their healthcare systems. Therefore, governments bear a greater responsibility to support innovation and act as catalysts for these new markets.
Bridging the Gap in the Global Consumer Health System
Rising healthcare costs are causing economic losses in both developed and developing countries. The aging population is also increasing pressure on the entire healthcare system. Many consumers complain about long waiting times and are willing to pay for more efficient services. Public-private partnerships can streamline healthcare delivery processes, but today’s consumers expect their healthcare experience to be as convenient as those in other industries such as banking, retail, and transportation. Bridging the gap between consumer expectations and existing healthcare infrastructure presents new opportunities for entrepreneurs. Developing countries may provide more fertile ground for new ideas and technologies. Throughout the implementation of healthcare solutions, emerging players have demonstrated their ability to perform better and have already captured a certain market share.
The Path of Least Resistance - Health & Fitness
The global health and wellness market is experiencing continuous growth, with consumers increasingly spending on non-medical services to maintain their well-being. For emerging players, this sector may present the lowest barrier to entry, allowing them to disrupt the entire industry without having to navigate complex relationships with governments or traditional competitors. Many entrepreneurs have already entered the healthcare industry by offering products such as fitness solutions and weight-loss tools, leveraging strong market positioning. PwC projects that this market will reach a scale of $1.49 trillion. Although the market size for chronic disease management is even more enticing, it is important to recognize the fact that people are willing to pay to stay healthy. Healthy eating represents the first step for individuals in taking control of their health status. According to forecasts by Nutrition Business Journal, the global nutrition market is also expected to reach $391 billion.
The global weight-loss industry, valued at $595 billion, along with the $236.5 billion fitness equipment and apparel sector, underscores people’s growing interest in maintaining their health. Nestlé Health Science has strategically acquired companies specializing in digestive health, clinical nutrition, and cancer diagnostics, thereby solidifying its market position in the field of specialized nutrition. In developed countries, the trend of treating employee well-being as a corporate responsibility is becoming increasingly evident. Innovative products can encourage consumers to make healthier choices, delivering value in terms of both physical health and lifestyle. Most importantly, this approach helps reach younger consumers, encouraging them to prioritize healthy eating and exercise, which will reduce the incidence of chronic diseases in the future.
Many entrepreneurs have found the health and wellness market to be an ideal testing ground, yet it poses significant challenges for sustaining viable business models. Those who have succeeded have done so by offering diversified products to enhance profit margins. For traditional enterprises, the challenge lies in integrating data into the entire patient care continuum—healthcare, prevention, diagnosis, and monitoring—to drive appropriate behaviors and outcomes. This industry offers an opportunity to avoid higher medical costs in the future; however, players looking to enter this space must ensure that pricing remains reasonable.
What Does It Mean for All Stakeholders?
Emerging Forces
1. Building Trust with Consumers in the Digital World
Entrepreneurs need to understand how to leverage both traditional healthcare systems and emerging digital health solutions to store, transform, and share health data, while ensuring compliance with legal regulations and social obligations. The formulation of data strategies should incorporate insights from leading-edge consumers, yet also account for the specific nuances inherent in medical care. Monetization models common in social media are not necessarily applicable to the healthcare sector. Whether transmitting information globally or within a single country, personal health data must be handled with appropriate safeguards to ensure security.
2. Identify Suitable Partners
By collaborating with experienced healthcare providers, particularly those who recognize that pushing the boundaries of medical services is a pathway to social progress, entrepreneurs can deploy technologies to assist medical staff in triaging patients when hospital and clinic services are in short supply.
Consumers, policymakers, and entrepreneurs share a long-term goal of expanding access to healthcare, improving quality, and reducing costs. However, managing such collaborations requires all stakeholders to remain committed to staying aligned with ongoing technological advancements and evolving consumer preferences.
3. Seize Opportunities
Policymakers are actively gathering ideas and supporting emerging medical assets to serve a growing population and increasingly discerning consumers. Engaging in early-stage policy discussions enables governments to benefit from innovative ideas, allows consumers to reap the rewards of superior solutions, and helps emerging players sharpen their competitive advantages and capture market share.
4. Ensure the global pharmaceutical market transitions toward shared science
The addition of new partners in the healthcare sector can foster mutual relationships and ensure the fulfillment of relevant agreements. Historically, medicine has relied on practical experience and information obtained by physicians from patients. Today, the widespread adoption of mobile phones and the internet enables both patients and physicians to be equally informed when making decisions regarding diagnosis and treatment options. The establishment of licensing agreements ensures that physicians adhere to global standards of medical practice.
New technologies can also ensure that patients receive the best possible care. Entrepreneurs can help foster collaboration between physicians and consumers, provide real-time consultations when needed, and leverage trend data to safeguard long-term health.
5. Provide services at scale to reduce service costs
Essentially, whoever pays for medical expenses is making a losing proposition; the market expects large-scale, low-cost medical services and treatment plans. Governments are striving to control rising healthcare costs, so in some regions, consumers are required to pay for their own medical care. In all cases, convenience, transparency, and clearly visible outcomes will be key criteria determining consumers’ willingness to pay.
6. Understand the local market and learn to adapt to local customs.
Each country has distinct regulations, reimbursement policies, healthcare delivery models, and resource allocation systems, necessitating that business models be tailored to local markets. Multinational service providers must understand local customs, historical challenges, and the specific issues faced by each target country. Emerging players must also assess the nation’s overall healthcare landscape—encompassing health, prevention, diagnosis, treatment, and monitoring—and grasp the “rules of the game.” To align interests with all stakeholders, emerging players need a clear understanding of every aspect of the healthcare ecosystem, including payers, suppliers, patients, employers, governments, and regulatory authorities.
7. Test the Market Cautiously
If possible, strive to adopt an innovative model that is both rapid and cost-effective. Utilize simulation algorithms to finalize the product prior to pilot testing.
Collaborate with partners to clearly define and analyze products, incorporating market insights and lessons from failures. Continuously iterate on new products to rapidly achieve commercial scale and build a reputation for success.
Traditional Medical Service Institutions
1. Choose Partners Wisely
Consumers expect convenient, high-quality services within an affordable range. Policy and social objectives should be clearly defined. Entrepreneurs should be engaged in developing and launching new solutions. Partnering with reputable startups can help establish sustainable, compliant solutions that achieve business goals.
2. Embrace Innovation with an Open Mind
New companies may challenge the status quo and differ somewhat from long-established practices. It is better to scrutinize their business plans and make well-considered, evidence-based decisions than to shy away from disrupting conventional norms.
3. Conduct consumer data analysis
Work closely with the new company to assess consumer response. The introduction of a new player or product requires careful consideration, along with a flexible process that allows for timely adjustments, termination, and updates. Consumer reactions to change can inform decision-making; a well-designed innovation management framework benefits all stakeholders and delivers maximized solutions to the market.
Life Sciences / Pharmaceuticals / Medtech Companies
1. Beyond Treatment Itself
In most markets, entrepreneurs are shifting toward outcome-based reimbursement models, which will compel biopharmaceutical and medical technology manufacturers to look beyond treatment itself and understand how to sustain and define their roles in this landscape.
2. Developing Partnerships
Consumers are increasingly adopting diverse software and hardware solutions to facilitate health management. Biopharmaceutical and medical technology companies need to establish partnerships with emerging enterprises to help them create new business models that transcend geographical limitations.
3. Understand the Value of Data
Regardless of whether an individual is in a state of health or illness, basic vital signs are critical factors for understanding a user’s current physical condition and monitoring their treatment progress. Consumers expect solutions that integrate with their usage habits, encompassing mobile devices, application ecosystems, and wearable technology. The solution and its data framework must ensure that all participating parties receive economic value commensurate with their contributions to the user’s health.