By Aman Jain. Originally published at ValueWalk.
The outbreak of the COVID-19 pandemic has created a lasting effect on health care systems around the world. Not only are we now witnessing an ever-changing environment in the field of medicine, but the acceleration of consumer trends and habits has shifted our perspective towards constant innovation and drivers of change.
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While the pandemic may have strained national healthcare systems, the industry revealed its resilience when faced with a global threat.
According to data provided by the World Economic Forum, we see how companies that manage to invest in innovation, adaptation, and rapid response can outlive and outperform their peers during a crisis and the recovery process that follows afterward.
As technology and software become more integrated with our everyday lives, market analysts are looking towards new ways in which various industries can grow resilience, and the modernization of services, products, medical procedures, and delivery models.
While not directly associated with the ongoing pandemic, medical alert systems, and personal emergency response systems, also known as PERS, can play a vital role in the health and safety of older generations, and those retiring in place.
The American Association of Retired Persons predicts that around 90% of people aged 65-years and older will retire in place, either in their home or in a care facility.
Although medical alert devices can offer a sense of comfort, we need to understand how the industry can look to innovate and provide improved devices to meet growing demand, diversify product offerings, and play a key role in the advancement of telehealth.
The Current State Of The Medical Alert Systems Market
A report published by Research and Markets, analyzing leading geographical areas such as North America, Europe, and Asia-Pacific indicates that between 2021and 2027, the medical alert system industry will grow at a CAGR of 14.82%.
When looking at it from a different angle, other than percentage growth, we can see how annual revenue in the industry will grow from $6.96 billion in 2021 to more than $15.95 billion by 2027.
Medical alert devices, portable or in-place systems, and PERS devices are seeing an increasing number of users, with changing consumer habits; a need for improved devices and systems are pushing the industry and researchers to find tools and new resources that will help drive innovation.
With an increased consumer demand, how can the medical alert systems improve their influence and reach on a global scale, while at the same time facing labor shortages, supply chain issues, and trade restrictions caused by not only the pandemic by also geopolitical issues?
Four Main Types of Growth Factors to Consider
Considering the burdens which the industry is currently faced with, we can use the Ansoff Model. This model is used as a strategic tool, which enables business owners, designers, researchers and market specialists to develop a growth strategy for a company, service, or specific product.
The following four factors of growth are considered to be the basis on which the Ansoff Model assists the development of business processes and products.
Market Penetration
The first factor of the Ansoff Model is market penetration, which seeks to explore ways in which companies that manufacture and design medical alert devices can grow their existing market.
While the need for better medical alert devices is growing, companies are looking for ways to draw in new customers and establish their reputation as superior. Through market penetration, these companies will need to look at how they can adjust their current product offering, subscription programs, and drive change to help win over their competitors.
It may be a challenge many companies are faced with, but it can help eliminate competitors that slow the development and credibility of the industry.
Market Development
The World Health Organization estimates that by 2050, more than 16% of the global population will be over the age of 65-years old.
With this estimation, we need to consider how companies that manufacture, design, and distribute medical alert systems and PERS devices are improving their marketing efforts to develop better market penetration, and also offer better accessibility.
In the United States alone, more than 3.3 million people currently make use of some sort of medical alert device. But how are manufacturers and distributors focusing their attention on developing nations, where this technology may only still be in its infancy, if not completely non-existent?
The major challenge for these companies lies within their ability to not only offer better and improved devices but also seek new ways in which it can help grow its market influence, not only to its existing consumers but those who have yet come across this technology.
Product Development
We may think that medical alert devices and wearable technology such as PERS systems were always accessible via a mobile app. It wasn’t until 2016 that the PERS systems only went mobile for the very first time.
As a way to ensure popularity, and increase market influence, constant product development, and enhancement of existing models within the current market will be needed.
Deeper analysis on product development, specifically for medical alert devices has been regarded as the biggest restraint for the industry overall.
Factors that play a role include:
- A lack of innovation from manufacturers.
- Minimal financial support from government entities.
- Growing share of market competitors using advanced technology such as AI and IoT.
- Unequal access to products and services.
- The rising cost of labor, material, and other resources.
- Demanding government regulation.
A growing number of factors and those mentioned above have left the industry, and researchers perplexed to find viable, yet attainable solutions. Product development plays a vital role in the overall success and well-being of any industry, as this helps keep consumers engaged, interested, and grow the number of supporters.
Diversification
Diversification is known as one of the most challenging steps when establishing a new model that will help explore previously non-existing and existing markets. With product diversification, through the means of AI and IoT (Internet of Things), medical alert systems are no longer just considered a luxury but can help become a necessity.
Wireless technology of any kind has seen rapid improvement in the last decade or so. While other markets may explore how the internet can assist their diversification, some companies have been left to their demise.
This has caused a snowball effect, where companies are now simply copying the ideas of competitors, instead of finding new ways to attract and retain consumers.
With product diversification comes the basis on which companies should look at how they can create more affordable devices and systems for consumers in lower-income economies. Additionally, they can look at ways to modernize or improve existing systems by using consumer reviews and market insight.
Final Thoughts
While the future of the medical alert system industry is set to grow at an exponential rate, researchers, developers, and manufacturers should consider the growth factors which can either improve or hinder their business practices.
Using existing models companies can look at how they can improve their current product offering in markets where they are well-established. With this in mind, it should also be considered how innovation and development can help reach untapped markets and how diversification plays a significant role in all of it.
The effects left by the global pandemic have given most industries a different perspective of how they can adapt in times of crisis, but also make use of technology and software as a way to be more resilient, yet offer a product and service that can help establish market dominance.
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