Happy New Year! I hope healthcare leaders are paying attention to what is going on outside of healthcare. With the potential repeal of Obamacare grasping most of the recent healthcare headlines, it’s easy to miss other business-worthy stories. In case you’ve missed the following, let me get you up to speed: 1) Sears, a 123 year old retailing giant, recently announced the closing of 150 stores, including 108 Kmart stores. In addition, management is attempting to raise $1.5 billion to stay in business through 2017 by selling the Craftsman, Kenmore and DieHard brands. 2) The Limited, a women’s apparel chain, founded in 1963 announced it’s done and the closure of 250 stores and elimination of 4,000 jobs. 3) Macy’s, a major retailing organization, announced the closure of 68 stores and elimination of 10,000 positions.
On a personal note, the Macy’s announcement specifically caught my attention as one of the locations being considered for closure is the former Dayton Hudson building in downtown Minneapolis. For as long as I can remember during my youth, my mother would take me to this Minnesota retailing landmark to see the elaborate window Christmas decorations.
As we’re now living in the world of behavioral economics, we all realize our subconscious will have a way to discount the aforementioned events as they are largely out of sight and therefore out of mind. I’m certain someone with expertise in retailing could provide a much more elaborate rational for these business decisions, however, I’m sure somewhere in the explanation would be the rise of on-line retailing. Whether or not you’ve become an on-line shopper, it’s hard to dispute the Amazon impact on brick-and-mortar retailers. While Amazon doesn’t report Christmas sales, the company reported 2016 was the best ever.
The above examples are reflective of the boiling pot of water and the frog. As long as the temperature of the water is increased slowly the frog will sit still, increase it rapidly and the frog hops out of the pot. My assumption is traditional retailers are gradually feeling the heat of on-line shoppers. For The Limited it’s too late. For Sears and Macy’s, we’ll have to wait and see. What’s this have to do with healthcare.
Recently, I’ve seen several articles regarding attempts to slow the progression of tele-health around the U.S. An example in Texas was Teladoc, Inc., a relatively new tele-health company, that went public in July 2015. Going back to 2011, Teladoc and the Texas Medical Board were entangled in litigation over Teladoc’s business model. In May 2015, a Federal Court ruled in favor of Teladoc. On-line retailing/tele-health get the similarity?
Several years ago I became familiar with the organization, Startup Health. Organized in 2011 with the mission: “to transform health by organizing and investing in a global army of thousands of entrepreneurs passionate about reinventing the future of health.” Each quarter a report summarizing funding in the digital health environment reflects where and what bets investors are placing in the health/healthcare world. These are the potential disrupters of the future. I hope I got your attention.