“bottom of the pyramid” Economics and Medical Tourism

…and a note on “Bottom Feeders” and “race to the bottom”

This is an “ever-evolving” EMVIO document

See: EMVIO Entities - in Health Tourism - https://www.dhirubhai.net/pulse/emvio-entities-health-tourism-constantinides-m-d-ph-d-/ .

NOTE

For the “definition and scope” of Contemporary Health Tourism (a.k.a. Internet Century Health Tourism – with both terms now, represented by ht8) - in bullet point form - see: https://www.dhirubhai.net/pulse/health-tourism-few-bullet-points-constantinides-m-d-ph-d-/ .

Also included is a short reference to the “then” and “now”.

about the bottom of the pyramid

…and the bottom feeders

“fortune at the bottom of the pyramid” means that there is money to be made by serving those in the low-income bracket.

A cruder – more cynical - way of putting it is: there is a fortune to be made by exploiting the poor.

I refer to those intent of exploiting those at the bottom of the pyramid as “bottom feeders”.

bottom feeder:

• one that is of the lowest status or rank (Merriam-Webster Dictionary)
• an opportunist who seeks quick profit usually at the expense of others or from their misfortune (Merriam-Webster Dictionary)
• a person who operates amidst or thrives on the unwholesome things in a society; one who takes advantage of the misfortune of others (Wiktionary)
• someone who uses other people's troubles, weakness, etc., as an opportunity to make money (The Britannica Dictionary)
• someone or something that has a very low status or rank (The Britannica Dictionary)
• an objectionable and unimpressive person or thing (Collins English Dictionary)
• a low or despicable person (Your Dictionary)
• an opportunist who profits from the misfortunes of others (vocabulary.com)

Way back (in June 23rd 2011), we read in the Economist that: Management gurus have rhapsodized about “the fortune at the bottom of the pyramid” ever since C.K. Prahalad popularized the idea in 2006.

The Economist article tells us that these gurus have filled books with stories of cut-price Indian hospitals (and Chinese firms that make $100 computers).

The “stories” are about exploiting cheap labor to sell cheaply to those who are not “affluent” (i.e., those at the bottom of the pyramid).

a rat race to the Bottom

…and the motivation to compromise with standards and principles

A lot of Medical Tourism belongs to the “Economy Class” – which in my view, is not a market which providers based in the “rich world” should be pursuing.

Nevertheless, and to my dismay, I continue to come across Medical Services Providers based in “rich world” countries who insist on basing their competitive advantage strategy on “low or lower prices”.

Of course, I sympathize with countries which cannot decide if they are “rich world” (first) or “poor world” (third) countries.

Regardless, cut price Medical Tourism is not an unqualified “bargain” for the consumer.

Some will tell you that “cheap is expensive”.

And, again in my view, the Bottom of the Pyramid Medical Tourism Market is not worth “wooing”.

The way I see it, addressing the Bottom of the Pyramid Market may make perfect sense when you are addressing a mass market of repeat buyers.

But Medical Tourism is neither a mass market – nor are the Medical Tourists “repeaters”.

Besides, Economy Class Tourism – which can be regarded as synonymous with Mass Tourism – is now shunned by the Tourism Industry (after learning a lesson – the hard way).

A “race to the bottom” is a socio-economic phenomenon that occurs between competing countries and businesses.

When competition becomes fierce (i.e., “cutthroat”) between nations and businesses, they are motivated to compromise with standards and principles in order to be able to lower costs and prices – to achieve a competitive edge.

But as Alan Tonelson in his book “The Race to the Bottom” (published in 2002) makes us realize, this type of rat race (like every rat race) is shortsighted, ill-advised, futile and “no-win”. And it is certainly not sustainable.

the Stratification of Medical Tourism

…for the “more affluent” and “less affluent”

In a related article, I wrote about the Stratification of Medical Travel – and pointed out that the “reality and truth” is that Medical Tourism is not egalitarian (i.e., classless).

There is Medical Tourism for the “more affluent” and “less affluent”.

See: Industry and Market Segmentation & Stratification in Medical Tourism - "from where to where" - and "who goes where" ?https://www.dhirubhai.net/pulse/medical-tourism-industry-market-segmentation-constantine/?.

I also wrote that it is unrealistic to expect all destinations and providers to be able to (or want to) satisfy all consumer strata.

Thailand, for example, realized this early on and ceded the lower end of the market to India.

This means that like the Market (the demand side), the Industry (the supply side) is also stratified.

If you are part of the Industry, which end of the pyramid would you go for?

And would you continue to base your competitive advantage strategy on “bottom prices”?

These are questions I will not answer for you.

But of course, I do understand, appreciate and concede that someone needs to – and will – serve those looking for “bottom prices”.

The question is: can “70% lower” prices be offered without compromising on standards and principles? Never mind about transparency and full disclosure.