Finger on the pulse

Amrita Bhinder, a 30-year-old Gurgaon resident, discovered she had a gluten allergy a few years ago. Since gluten is found in wheat, Bhinder had to make drastic changes in her diet — she could not eat chappatis, breads and a whole host of foods that have wheat flour as an ingredient. She knew of a few shops that sold gluten-free flour and other edibles at Connaught Place in central Delhi but they were many miles from her house and she had a busy schedule.

The launch in March 2011 of Healthkart, a healthcare website, turned out to be a godsend for Bhinder. She now orders her gluten-free groceries from the Delhi-based portal. As many as 2,000 customers shop here every day from a catalogue of nearly 10,000 health, fitness and personal care products and services. Visitors to Healthkart order everything from diabetes strips, nutritional supplements and BP monitors to commode chairs, water beds and reading glasses. Bhinder, who is also diabetic, says, “I now order my monthly supply of insulin measuring strips from the site. It saves me time and it’s reliable.” 

Healthkart is only one of the many portals serving the growing market for online purchase of health and fitness-related products and services. Take a look at the quickly burgeoned line-up of portals — MyLabYogi, HealthCareMagic, MyHealthRecords, Ask4Healthcare, Medico, OnlyMyHealth and MedIndia — all of which have sprung up in the last two years. Typically, ‘health portals’ fall into three categories: selling health and personal care products and services; keeping online health records and arranging for online booking of lab tests; providing healthcare information and online consultations with doctors. 

Healthkart receives traffic of about 70,000-80,000 transactions a month, an average of 2,500 transactions a day. People between the ages of 17 and 30 typically check the websites for their services but they often do it for their younger and older family members. “We are growing at 30-40% every month in revenues,” says Prashant Tandon, joint MD, Healthkart, who started the medical portal along with his batchmate from IIT, Sameer Maheshwari in March 2011.

Nutrition products account for nearly half of Healthkart’s sales while diabetes-related products clock another 10-20%. “We are seeing very good rise in [sales of] home devices while fitness, too, is picking up,” adds the former consultant with McKinsey in the US. Tandon estimates the total fitness market in the country is worth $15-20 billion, home devices figure at $6-7 billion and personal care is pegged at $6-7 billion. “We have 5-8% of our population online, and that’s growing fast,” he says. “We can only imagine the scope for this business now.” 

Health is wealth

Other portals are also reporting healthy numbers. Ask4Healthcare uploads and manages health records online and offers discounts on treatments and second opinions from doctors. The company, which charges a one-time fee of Rs.600 for a family and Rs.450 for individuals, has gained 200,000 registered members in its two years of operations. “The number of members has been growing steadily at 12-15% a year,” says Rahul Kasliwal, director, Ask4Healthcare. 

MyHealthRecords, another outfit that began operations last year, now has 40,000 registered users. Online archiving of medical reports keeps them safe and accessible from anywhere, and it’s easier to analyse and compare records once they are stored. Users also get SMSs and alerts to remind them of doctor appointments and tests. MyHealthRecords’ revenues come from digitising health records such as medical papers and scans (X-Rays, MRIs, ECGs), which are  available to the patient at all times. The portal charges Rs.2,000-2,500 as a one-time fee; subsequent digitisation is billed at Rs.40-100 per record.

Portals like MedIndia and PinkWhaleHealthcare provide online consultations for a fee, whereas sites like Medico charge Rs.600 for ‘non-urgent’ consultations (processed within three days) and Rs.1,100 for a response within 24 hours. Generic advice comes with the caveat ‘please consult your doctor first’ and formal consultations are backed by a certified medical practitioner. Either way, there are no legal quandaries or government bylaws stepped on. 

Why the web?

But why would patients seek online succour over personal care from a doctor? There are several reasons. Not only do online health portals enable consultation with international doctors, they are especially useful for busy professionals and people living in remote areas. Ask4Healthcare, for example, has tie-ups with the Apollo and Fortis groups.  Sites offering free consultations may be low on details but paid sites offer upfront credentials (degrees and experience) of doctors, who range from dieticians to neurosurgeons.

Usually, people come to health-related sites for a second opinion after visiting the “Hinduja [Hospital]-type place,” Kasliwal says, adding, “12% of all internet traffic out of India is related to health, and it’s also the fastest growing segment, with over 50 million Indians suffering from chronic ailments like diabetes and hypertension. India is already the disease capital of the world.” Entrepreneurs like him believe that since the country has only about 600,000 doctors catering to the huge — and growing — demand for health-related services in India, online health services only offer a scalable model that can address it.

Moreover, “there is very little organised retail when it comes to health-related products,” says Sameer Maheshwari, joint MD, Healthkart. “Often, good quality products are not available or are sold at outrageously high margins of 60-100%. There are a lot of fakes. The need for authenticity is a big pain area.” He says that the problem of access grows even more acute in the non-metros and, not surprisingly, he finds his non-metro customers are growing at a furious pace — they already contribute over 50% of his business and he expects that proportion to increase. 

Medical professionals find health portals a good way to treat more patients across geographies, especially in far-flung areas. “We want to connect all stakeholders — consumers, doctors, patients and digital information providers — via a cloud,” says Anil Joshi, CEO, MyHealthRecords. “We give doctors and patients a platform to access healthcare information anytime, anywhere, through devices like smartphones.” 

Still some way to go

The business models, though, are still evolving. MyLabYogi charges a monthly fee of Rs.99 to maintain health records but uploads them for free, unlike MyHealthRecords. Info websites like OnlyMyHealth and MedIndia have to rely on digital advertising, still an evolving source of revenue in India. But, “when we studied the market, it was our understanding that revenues from advertising alone may not be enough to sustain a business model,” says Tandon. 

The biggest challenges, of course, are the low levels of internet penetration in India and the difficulty in building a customer base. Back-end execution is especially crucial for services like lab tests and digitisation of records. Till now, e-commerce portals have relied only on SEO-based (search engine optimisation) marketing and word-of-mouth publicity. Recruiting and retaining quality manpower, and convincing healthcare providers and consumers to come online, are other bugbears. 

Investments have also varied with the business models. Healthkart started with an initial investment of Rs.15-20 lakh between the two partners. They also raised seed capital of $1 million from venture capitalist Sequoia and, in December 2011, got a further $7.5 million from Sequoia. Healthkart’s margins are currently hovering around 30-40%. They are projecting 20% annual growth, and a breakeven in 2-3 years.

On the other hand, Ask4Healthcare, which started in 2010 and now gets 300,000 visitors every month, has its revenues growing at 30%, and expects to breakeven this year. MyLabYogi, which has an initial investment of Rs.25 lakh, runs with 12 employees and spends Rs.1.2 lakh in month by overheads. HealthCareMagic, which charges Rs.599-799 per doctor consultation, has funding of $2.5 million from Accel Partners and a registered user base of 6.7 million (about 1,900 new users are getting added every day to the registered list) — its corporate clients help HealthCareMagic garner Rs.20-25 lakh in revenues every year. Most companies are expected to breakeven in 1-3 years with growth rates ranging between 20% and 30% on an average. 

Healthkart’s Tandon expects smartphones to be among the biggest enablers of growth. Moreover, as consumers become more aware of health-related issues, they are willing to spend more on healthcare products and services.  All players are expecting their businesses to grow as the level of internet penetration in the country increases.

“To make a comparison, the e-commerce industry in China is worth $170 billion at present while that in India is only $10 billion,” says Tandon. “There is big scope in Indian markets.” Also, with a market that is expected to grow at approximately 25-30% every year, the race for page views and bounce rates is going to heat up quickly, and this time it is just what the doctor ordered.