Marketing plan for medical tourism patient in fv hospital master project in business and marketing management

According Deloitte Medical Tourism Update, 540,000 American traveled abroad to receive medical treatment in 2008 and estimated 1.62 million medical tourists in 2012.. The expected increa

TRƯỜNG ĐẠI HỌC MỞ TP.HCM

HO CHI MINH CITY OPEN UNIVERSITY

UNIVERSITÉ LIBRE DE BRUXELLES SOLVAY BRUSSELS SCHOOL

MBMM4 GIANG HAI KIM NGOC

Marketing Plan for Medical Tourism in FV Hospital

MASTER PROJECT MASTER IN BUSINESS & MARKETING MANAGEMENT

Tutor’s name: Dr Nguyen Duc Tri

Ho Chi Minh City (2010)

Declaration

I certify that my final project titled “Marketing Plan for Medical Tourism in FV Hospital” is my own work Material taken from other sources has been acknowledged according to requirements for reference

Acknowledge

I would like to express my appreciation for my tutor – Dr Nguyen Duc Tri for his valuable comment and assistance

I also want to thank Ms Camilla Berglund and Mr Phan Le Dung for their

supporting to finish this project

Yours sincerely,

CONTENT

EXECUTIVE SUMMARY 1

CHAPTER 1: INTRODUCTION 1.1 Project Objective and Significance 3

1.2 Methodology……… 3

1.3 Project Limitation 4

1.4 Company Overview

1.4.1 Background 4

1.4.2 Mission 4

1.4.3 Value of FV 5

CHAPTER 2: LITERATURE REVIEW 2.1 Medical Tourism……… ………

2.1.1 Definition ……… ………6

2.1.2 Brief History of Medical Tourism ……… ………7

2.1.3 Different between Health and Medical Tourism ………… ………7

2.1.4 Key Players in Medical Tourism Industry ….……… ………9

2.2 Contributing Factors in becoming Medical Tourism Destination ………

2.2.1 Pull and Push Factor ………… ……… … ……10

2.2.2 Motivation Factors in Medical Tourism ……… ……… 10

CHAPTER 3: SITUATION ANALYSIS

3.1 SWOT Analysis 12

3.2 Competitor Forces

3.2.1 Vietnam 13

3.2.2 Asia 13

3.3 Key to success 14

3.4 Technology in Medical Tourism 14

3.5 Target Market

3.5.1 Medical Tourism of U.S Market 15

3.5.2 Other influencing factors 16

3.5.3 U.S Plastic Surgery 19

3.5.4 Market Trend 19

3.6 Survey 20

CHAPTER 4: MARKETING STRATEGY

4.1 Segmentation 23

4.2 Target Segment 23

4.3 Positioning 23

4.4 Marketing Mix

4.4.1 Product 23

4.4.2 Price 25

4.4.3 Distribution 26

4.4.4 Promotion 27

4.5 Marketing Budget 29

4.6 Conclusion 29

REFERENCES ……….30

APPENDICES ……….……….32

EXECUTIVE SUMMARY

There are many tourism typologies: sport, leisure, religion, pilgrim pursuit, historical discovery and others The trend in combination of tourism and medical is called medical tourism which tourists primarily seek medical treatment and afterwards the more beneficial experience related to leisure and relaxation in tourist places

Today culture of travelling abroad for surgery becomes more common in the world, especially people from developed countries fly to Asia to absorb cosmetic surgery regard

to price connotation There are optimistic forecasts about medical tourism development in the future According Deloitte Medical Tourism Update, 540,000 American traveled abroad to receive medical treatment in 2008 and estimated 1.62 million medical tourists in

2012 The expected increase in medical tourism derives from high cost of healthcare in their home country, better customer care, the ease and affordability of international travel and improvements in both technology and standards of care in many countries

Medical Tourism has contributed remarkable to GDP of many countries such as Singapore, Thailand and India It brings benefits not only for hospital as increasing revenue, innovating infrastructure but also for its country economy as creating jobs for local people, improving life conditions… With those benefits, medical tourism plays important role for bringing more money to national budget Recognizing these potential interests, Thailand governments have pushed promotion for the development of medical tourism by reducing barriers to attract more patients to their countries As a result, the number of international patient increases quickly Besides Thailand, India, Singapore and Malaysia also put efforts

to lure the flow of oversea patient deciding their surgery procedures done in their countries

Vietnam doesn’t promote to this model currently Medical Tourism is quite new to Vietnam However, as a trend of development, it’s believed that Vietnam will be soon a tough competitor for neighbor countries in future

FV is the first hospital to take part in this model in Vietnam FV Hospital has operated since 2003 Its facilities were noticeably invested for years with foreign and Vietnamese doctor team who are trained oversea in reputation hospital in France

In order to increase the operational efficiency, FV wants to attract medical tourism patients who want to combine their traveling to Vietnam with having medical treatment such as health check up, hip replacement, dental treatment or plastic surgery Therefore, this project will help FV to become a competitive medical provider in medical tourism market

CHAPTER 1: INTRODUCTION

1.1 Project Objective and Significance

The main purpose of this project is to increase operational efficiency of FV Hospital by building an effective marketing plan to attract abroad patients to FV Hospital It could be done by analyzing external and internal factors to implement the right method in foreign countries

It is recognized that there is an expansion in demand of Plastic surgery in U.S According

to Deloitte Consulting, over hundred thousand of Americans travel abroad for medical treatment in 2008 This number will increase by million in 2015 That’s a huge potential market for FV

This project is designed to understanding the effective factors and competitive advantages

to attract medical tourists to FV hospital Besides, it helps FV to become a global medical hub The significance of this project has indicated that:

+ Accelerating hospital revenue by attracting more foreigners who can combine cosmetic surgery with holiday trip

+ Analyzing clearly proper factors the marketing mix for attracting medical tourism have created more successful opportunity and reduced risks

1.2 Methodology

Descriptive method is used to identify and obtain information on Plastic Surgery in the target market

1.2.1 Desk Research (Secondary data)

The research use data from different resources published on economic newspapers, magazines, internet… for collecting information about plastic surgery industry in U.S, Social and psychology of American for Plastic Surgery and new trend for this industry in future

1.2.2 Market Research (Primary data)

Qualitative survey is done by focus group with American visitors in Vietnam

Quantitative survey is taken by survey with 80 American in U.S by email

FV Clinic is a branch of FV hospital located in district 1 giving more convenient options for patients who live in center FV operating revenue is more than 18 million USD in 2009 serving over 200,000 patients a year including 70% Vietnamese, 20% Western and Asian expatriates, 5% Cambodia and 5% Viet Kieu and tourists

It is also the first hospital in Vietnam to be accredited by an international organization HAS and working to achieve “Joint Commission International” by 2010

1.4.2 Mission

FV is an international organization in Vietnam for over 7 years It becomes a trustful brand

in Vietnam community with different society contributed activities such as charity trip to poor village in Vietnam for free consultation and medicine delivery

It mission: “FV provide superior quality and comprehensive patient care in a continuous effort to gain patient trust”

1.4.3 Value of FV

FV is non-stopping providing high quality service to serve patient in the best condition and make them comfortable It believes in “Medical Ethics” Value of FV includes:

Being patient centered

Being Professional, caring, trustworthy, compassionate and responsible

Empathy with patients, share their thought and understand how their feeling

Striving to provide comprehensive and high quality care including good doctors and nurses, high quality facilities, customer services teams…

CHAPTER 2: LITERATURE REVIEW

The aim of this chapter is to provide relevant literature about medical tourism It includes definition of Medical Tourism, history of Medical Tourism It also discusses about motivation factors in Medical Tourism

2.1 Medical Tourism

2.1.1 Definition

Medical tourism refers to patients that are traveling overseas for affordable treatment Cabllero-Denell and Mugomba (2007) defines medical tourism as the pursuit of medical care abroad and simultaneously engage in more conventional form of tourism

Connell (2005) defines medical tourism as a niche industry “where people often travel long distances to oversea countries to obtain medical, dental and surgical care while simultaneously being holiday makers, in a more conventional sense”

According to Daub’s study (as cited in Newman, 2006), medical tourism is the attempt by many Americans to save money by traveling to other countries for their medical needs This focuses on the Americans while others define differently

Keckly and Underwood (2008) noted that medical tourism is the process of “leaving home” for treatments and care abroad or elsewhere domestically It is an emerging phenomenon in the healthcare industry

In addition, according to Horowitz and Rosensweig (2007), “medical tourists” seek modern healthcare at affordable prices in countries variable levels of development

In short, medical tourism is the attempt by patients to seek for a qualified and high quality medical healthcare at foreign countries at an affordable price or cheaper price It does not limit to traveling to modern countries to seek for better service but most important is the affordable price with the same quality of service This combination of surgery and tourism

is a new niche tourism that expects significant growth in next years

2.1.2 Brief History of Medical Tourism

Base on website www.health-tourism.com, Medical Tourism has developed since ancient times Most ancient civilizations recognized the therapeutic effects of mineral thermal springs and sacred temple baths As a result, these places become a fashionable destination for rich people flocking to recover and health retreat The “Spa” first used in Renaissance Period of the 14th to 17th century was attached with wellness resorts

The forms of medical tourism evolve variously In the 1990s to 1997, the USA and Europe were not only the commercial and industrial centers, but they were also the center of the healthcare world Medical travel was limited to the rich people who traveled to these countries to receive high-end medical services However, the cost of healthcare rising in the 1980s and 1990s, American patients started considering offshore options, like dental services in Central America

Due to the Asian economic crisis in 1997 and the collapse of Asian currencies, Asia countries decided to push medical tourism marketing their countries as premier destinations for international healthcare Thailand quickly became the salient destination with competitive price compare to Western countries

It was in 1997 that the Joint Commission International was formed to check and investigate international healthcare facilities for conformance to international standards due to the emergence of health providers around the world

In Vietnam, medical tourism is quite new market for Vietnam In November 2006, the first medical treatment as acupuncture was launched in tourism market by professor Nguyen Tai Thu In addition to, many wellness resort and spa was growing in last few years However, providing more depth medical treatment with international standard such as dental treatment or plastic surgery is not popular in Vietnam

2.1.3 Different Between Health and Medical Tourism

According to Benett et al (2004) defines health tourism as follow “Health tourism would

be any pleasure orientated tourism which involves an element of stress relief” means it is

an enjoyable and relaxing activity

William (2000) expands the definition as combination of health and tourism in leisure, recreational and educational activities which focus on the improvement of physical, mental and social well being

Health tourism is a very broad category that encompasses a wide variety of treatments and services whist medical tourism becomes a subset of health tourism Henderson (2004) views health tourism as travel where the primary purpose is treatment in pursuit of better health and medical tourism incorporates health screening, hospitalization and surgical operations In the study of Mugomba and Caballero Danell (2006), they have developed the health tourism structure

Wellness tourism inclines for people seeking a form of relaxation or stress relief at a spa or yoga retreats while a medical tourist has two components – the medical procedure and the leisure element

Similarly, Connel (2006) identify health tourism with general health and wellbeing, while medical tourism combines tourism with medical surgical or dental intervention to improve

The Health Tourism Structure

Health Care Tourism

Wellness Tourism Medical Tourism

Non Cosmetic Surgery Cosmetic Surgery

or Elective Surgery

or restore health in the long term Therefore health and medical tourism are differentiated

by the level of surgical and physical intervention on the tourist’s body

Although health and medical tourism could be separated on the consequent level of physical and surgical intervention required, there are still controversial about this

2.1.4 Key Players in Medical Tourism Industry

Medical tourism operators can be divided into two groups First, there are medical centers such as hospitals or clinics Medical centers actively attract international patient to obtain their medical procedures but in many case, also responsible for all patient logistic from arrival to departure

The second group is medical tourism facilitators or referrers who function like agents and associated service provide They are often smaller companies with just a few people dealing with hospitals and clinics in different countries These facilitators offer for international patient option accessing international healthcare with competitive price compare to his or her home country

These facilitators provide necessity information and assist patients with pre and post- travel medical issues They also provide resources for follow up care upon the patient’s return Medical tourism package often includes cost of medical care, transportation, travel arrangements, hotel accommodation during the post recovery period Hospitals being either JCI or ISO accredited or affiliated with recognized medical institutes such as Harvard and Johns Hopkins are priority opted as partners of medical tourism facilitators

2.2 Contributing Factors In Becoming Medical Tourism Destination

Motivations play a significant role in choosing medical destination Understanding these factors would help to attract customer effectively It can be classified into two forces to describe how individual is motivated in opting medical tourism place for their treatments

2.2.1 Pull and Push Factor

Push factor is classified among motivational factors and conceptualized as the motives and needs that influence his decision to take a vacation Push factor can be defined as factor

that motivate or create a desire to travel It originates from intrinsic desires of human being including desire for escape, dream fulfillment, rest, relaxation…

Pull factors consist of both tangible and intangible elements such as the features, attractions or attributes of the destination itself The pull factors include social opportunities and attractions, natural and culture, foods, infrastructure, recreation activities

2.2.2 Motivation Factors in Medical Tourism

A published article on www.hospitalimpact.org by Ph.D Maria K.Todd states when employers and their employees are pushed to the wall financially for the cost of health benefits which is increasing with time, employers has started to think about health services migration encouraging their staffs across border for medical care

Also according to Todd, push factors include the cost and access to care challenges, more people used to traveling for work, more students and recent graduates who spent time abroad in different cultures and employers who are beginning to test the waters, especially

if health plan is a self-funded trust rather than a fully insured plan, high levels of technology and high quality of care and a general perception that it’s possible to maintain more privacy abroad Otherwise, pull factors compose of rapid access to affordable care and more expatriates working further away who cannot come back home for care

In addition to, improvements in transportation infrastructure encourage health services migration Also developments in telemedicine for monitored care, physician to physician communication with pre-operative and post-discharge follow up are reasons for medical tourism or health services migration more practical

In the context of medical tourism, push factors explain the reasons and desires to travel for health services and pull factors determine the destination of choice Based on source United Nation (2007) push factors comprise of

 Non-coverage of certain procedures by insurance companies

 Accelerating the cost of medical insurance leads to an increasing number of people who are underinsured or underinsured

 Increasing popularity of cosmetic surgery in developed countries

 Waiting lines for surgical procedures in developed countries While pull factors include in

 Languages

 Culture and social environment

 Geopolitical Events

 Tourist Attraction

 High quality healthcare

 Affordable and Cost Saving Alternatives

 Value Add On and Personalized service

 Development of communication and transportation

CHAPTER 3: SITUATION ANALYSIS

* Strength

- Five-star service hospital including

experience doctor and modern facilities

- Accredited by international organization

including HAS-French Accreditation,

JCI– U.S Accreditation

- Personalized service is offered for

medical tourism patient to assist them

during their stay in Vietnam

- Competitive price due to lower labor

costs

- Political Stability

- Travel benefits

* Weakness

- New Brand in Medical Tourism market

- The number of room is limited (only 200 rooms in total)

- Small budget for marketing

- Not experience on Medical Tourism market

- Not experience on medical tourism market

- High rotate foreign doctors

* Opportunity

- More demand of cosmetic surgery

- The number of arrival tourist to Vietnam

increases over years

* Threat

- High competition

- Competitors have better technique and experiences in treatment

also offer a positive outward looking for FV including the increase of demand and the development of technology

3.2 Competition Forces

3.2.1 Vietnam

In Ho Chi Minh, at least 200 plastic surgery clinics are in operation in Vietnam but none of them is the real competitor of FV Hospital Most are operated by individual and not followed international quality such as hygiene, no guarantee for surgery they provide or even don’t well-equipped to handle with any occurring emergency case happing during surgery

According to thesaigontimes launched on 13 August 2009, Vietnam does still not have any hospital achieved International Accreditation JCI – Joint Commission International which

is one of pull factors to attract Medical Tourism patient to Vietnam’s hospitals

3.2.2 Asia

Innovative healthcare system and advance in technology have supported medical tourism among the Western countries for many years According to a report of United Nation (2007), Malaysia, Singapore, India, Thailand attracted over 1.4 million medical travelers and earned over US 1 billion in treatment costs alone In 2005, the number of international traveler will surpass 2.5 million

In website www.hotelmarketing.com, Thailand wants to attract two million foreign patients by 2010 up to 1.5 million in 2005 while Philippines hopes for 700,000 patients up

to 250,000 in 2006 India’s medical tourism business is growing at 30 per cent per year and is forecast to generate at least US$2.2 billion a year by 2012 Singapore is targeting to attract one million foreign patients annually and push the GDP contribution from this sector above US$1.6 billion, while Malaysia expects medical tourism receipts to be in the region of US$590 million in five years’ time

Country Arriving from Estimated earnings Strengths

India Middle East, United

Kingdom, Canada, developing countries

US 48 million (2005) Cardiac surgery,

joint replacements, eye surgery

Malaysia Indonesia, United

States, Japan

US 40 million (2004) Cardiology,

cardio-thoracic surgery, cosmetic surgery Singapore Malaysia, Indonesia,

Middle East, United States

US 560 million (2004) Liver transplant,

joint replacement, cardiac surgery Thailand United States, United

Kingdom, Middle East, China, Japan

US 1 billion (2006) Cosmetic surgery,

organ transplants, dental treatment, joint replacements

Source: UN, 2007

3.3 Key to success

For FV hospital, these are key elements to success

 World class hospital: experience doctors and modern facility, especially hygiene condition

 Personalized service: assisting during treatment in Vietnam, outstanding customer service

 Travel benefits: many beautiful sightseeing and landscapes meeting different recreational purpose including leisure, culture or historical experience

3.4 Technology in Medical Tourism

Technology plays a vital role to medical tourism It helps bridge the geographical gap such

as seeking information efficiently, communicating easily in pre and op- operative phase

An emergence of technological development has contributed to simplify the medical traveler process

First, in Medical tourism, this technology is mentioned as telehealth or telemedicine which

is the remote provision of health care services enabled by technology According to Medical Tourism Association, this telehealth includes range from the transmission of digital photographs and patient histories for diagnostic consultation, to remote monitoring

of physiologic data for chronic disease management, to interactive patient physical examination using medical video endoscopes and ultrasound over high-definition videoconfereing links

In Medical Tourism Magazine, telehealth is classified into two primary operational modes: 1 real-time or synchrononous and 2 deferred or asynchronous They improve quality, efficiency and customer service in medical tourism applications by better coordination of care between patients and medical providers, optimizing patient and family member travel

Technology also subsidizes to medical tourism through proliferation of air transportation facilitating patients easily to reach to provider’s country Internet, in particular social network contributes to search information in making decision

3.5 Target Market

3.5.1 Medical Tourism (outsourcing) of U market

Although America is a developed country with advanced technology and method in medical treatment, it’s too expensive for noninsured or underinsured American According

to business-in-asia.com and www.health-tourism.com, there are reasons for them to be medical tourists

 Price

Lower price is the main advantage of medical tourism U.S health care costs are often higher than the combined fee of traveling and receiving medical abroad

 High quality healthcare abroad

There are many new and renovated private hospitals that use cutting edge technology and equipment The doctors in these facilities are trained to American and European standards, providing service that is equal or greater to what hospitals in USA offer

 Service

Most of medical tourists are escorted and cared during their visit trip Moreover, if staying overnight in the hospital, patients only have to pay cheap price compare to room facility

 No wait-list

Patient can access to immediate service In many countries, people have to wait for months

or years to receive medical treatment

 Lack of Insurance

The Miami Herald, November 2, 2008 revealed that while the USA continues to debate over their medical insurance system, 61 million people are either uninsured or under-insured In addition to, Cosmetic and Dental surgeries are not covered at all by insurance

 Tourism

Patients having minor procedures can enjoy their recovery by staying in a relaxing vacation environment in beautiful surroundings Patient accompanied by others can enjoy some quality time, relaxing on the beach or going shopping to relieve much of stress

 Receiving treatment anonymously

American patients who are traveling abroad for medical treatment can receive their treatments in privacy and recover in comfort without questions and judgment from people who know them

3.5.2 Other influencing factors

3.5.2.1 U.S Economy

Economic contributed on demand of medical tourism As the economic recession, a shift in the demand for certain types of medical procedures Many patients who are seeking elective surgeries such as plastic or cosmetic procedures wait and spend the money after they see how the economic recession will affect their personal lives However, other procedures such as orthopaedic, cardiac and transplants have accelerated due to cost saving

Base on www.businessandmedia.org, the prolonged U.S recession has had a significant impact on patient’s ability to afford medical care Increasing unemployment has likely contributed to the growing number of uninsured in the U.S Since insurance coverage for medical treatment is not widely covered, it is an option for American traveling to receive