There's been plenty of talk about companies being disruptive in the health care industry, from Amazon to Walmart, but a company you might not be thinking about is also making moves into the health care world—Best Buy.
Radio Advisory's Rachel Woods sat down with Advisory Board's Miriam Sznycer-Taub to talk about how Best Buy is moving its way into the health care world and what that might mean for the health care industry.
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Read a lightly edited excerpt from the interview below, and download the episode for the full conversation.
Rachel Woods: Best Buy is actually making moves in the health care arena. I sort of can't believe that I just said that sentence, but I think it actually makes sense when we dig into some of their plays over the last couple of years. When did you start noticing though that Best Buy was starting to pretty seriously get into the health care arena?
Miriam Sznycer-Taub: Yeah, so Best Buy made their first, I would say real move in 2018 actually. They bought a company called GreatCall—they've renamed it to Lively now—and GreatCall was a connected health company. So it basically sort of brought together this idea of tech and health kind of all in one place.
And that was sort of Best Buy's first move in their health care ambition and then they've slowly but surely made a couple of other smaller moves over the years, kind of placing themselves in the health conversation.
Woods: And Best Buy obviously sells technology directly to consumers, but what's different about what Best Buy is doing compared to maybe other health care tech firms or other kind of retail companies?
Sznycer-Taub: Yeah, I think a couple of things. So for one, they sell to consumers, right? They sold me my microwave. I've bought a bunch of other things from them too. And what they've been selling is health technology to consumers, right? So when they bought GreatCall now Lively, they are selling technology that people can use to keep them healthy in their homes. Right. And a lot of it is aimed at seniors.
So it might be something that can help connect them to a doctor, get them a visit if they need one, connect to their loved ones, let someone know if they're experiencing a medical emergency, kind of all wrapped together in one phone or one device.
Woods: And I think that's, what you just said is really, really important. It's all wrapped together in one device because they're clearly targeting seniors. And my understanding is instead of selling this elderly person the classic Life Alert bracelet, a tablet to connect with their physician, pick your other suite of technologies, they're trying to sell one thing that serves all of the needs of that senior person. Is that correct?
Sznycer-Taub: Yeah, exactly. So they have a bunch of products, but they're two of their kind of big ones. One is actually a flip phone. So if you think back to maybe one of your first cell phones, might've been a full flip phone. They now sell a new flip phone that one of the buttons on it immediately connects you to someone if you're experiencing a medical emergency. So it's a flip phone, but upgraded to be a little bit friendlier for health purposes.
They also have a smartphone. Their smartphone has buttons that are a little bit bigger, a little bit easier to use making again, sort of aimed at seniors who at this point, many of them are very tech savvy, but also find it hard to navigate all the tiny buttons on maybe a more normal smartphone.
Woods: And that's again, because their core consumer are those baby boomers who maybe aren't as tech savvy. They are the folks who need something simple, whether it's a flip phone or a smartphone with fewer stuff and bigger buttons. And I'm guessing their basically targeting the same type of person that would maybe need Best Buy's Geek Squad.
Sznycer-Taub: Yeah, absolutely. And I think that's what makes them little bit different—they've had these years of experience in providing customer service and helping people use their technology. You could come in and you can make an appointment with the Geek Squad. If you didn't know how to use your laptop, if you didn't know how to use the thing that you just bought and they've sort of extended that idea to health.
And so this idea that you can call someone, if you have a question and the Geek Squad for health in this case will help you out. That's how they've sort of wrapped around their kind of traditional Best Buy consumer retailer into this health world. So their consumer is a senior most likely, or someone who's elderly, but the person who's actually purchasing the tech might actually be that person's adult child. It's not necessarily the same person who's using it.
Woods: What do you mean by that?
Sznycer-Taub: So right now there's this whole idea of the sandwich generation. There are people who are caring for children at the same time they're caring for elderly parents or other elderly relatives. And those people might not live in the same place as them. And so there's this immense pressure that a lot of people feel to make sure that their parents or relatives can age in place safely and without loneliness, without isolation.
So this technology kind of gives them a little bit of peace of mind because not only is it a phone, but it's got the ability for their parent to call and find someone who can help them get groceries. It allows them to be notified if their parent pushes that emergency alert button, I need immediate medical help. So it kind of gives them a little bit of peace of mind and helps them feel more comfortable with their aging parent living alone.
Woods: Because it sounds like the goal is a little bit more holistic than we would think about traditional health care. It's holistic in the sense of, we're going to try to link all of these different pieces of tech and instead make it this simple kind of singular piece of technology. But it's also holistic because you can connect to a doctor or you can connect to somebody who can, I don't know, help you find groceries.
Sznycer-Taub: Yeah, find groceries, get directions, places. I think really, again, trying to make it simple. And it's all aimed again at people in their home. This isn't for people who are going someplace else. This is for people who are living in their home and need a little bit more help and may not want to go pull up their computer to figure out directions or find out what time the supermarket closes.
Woods: As a member of the sandwich generation, I find this extremely, extremely appealing, but as somebody who studies business research, I'm curious is the business model to just keep going directly to customers, to keep not just selling TVs and microwaves to individual people, but selling this health care technology directly to the adult children of some of these elderly folks.
Sznycer-Taub: I'm not sure. And I think it's been interesting to watch Best Buy's moves. Again, this is where they started—buying these companies that were kind of about consumer technology. But I think what they've done more recently is probably a good indication of where they're going, which is starting to kind of create this home based care ecosystem and connecting both patients with providers. And this was most recent where they announced an acquisition of a company called Current Health, which is a care management platform that actually sells to health care organizations, not to consumers.
Woods: So this is a B2B move. This is a, we want to partner with the classic parts of the health care ecosystem by providing this connective tissue that they know works well for let's be honest, the most expensive group of patients that providers tend to serve.
Sznycer-Taub: Yeah, absolutely. Current Health is an interesting one, right? They are a kind of a smallish company that has seen a lot of growth and they have some big name customers. They have Mayo Clinic and Mount Sinai, Geisinger, the National Health System in the U.K. And all of them are part of this care management platform, right, that pulls together remote patient monitoring, pulls together technology and helps health systems sort of see all of that data.
And that's a really interesting move if you think about kind of the data that Best Buy is collecting with Lively. Right. Now they're able to sync up what patients are collecting and get it to their health care providers, which is one of the big challenges with remote patient monitoring and home based care.
Woods: I wonder if you think that that is the end game because we are at the same time talking about a retailer. So part of me is thinking back to the times when Advisory Board was first starting to look at some of the other big retailers that were making moves in health care and their goal kind of similar to what you're saying with Best Buy was never just purely based on selling products directly to patients or members.
But at the time we talked about this idea of the cross sell, get people into CVS, get them to get their prescriptions, do their wellness visit and also buy shampoo and toilet paper. For Best Buy, do you think that's part of the strategy, come get your kind of Life Alert, like a flip phone, but also walk away with a TV?
Sznycer-Taub: Maybe. I mean, I'm sure they'd love to get more traffic in their retail stores as well as more traffic on their websites. And of course they sell a whole range of consumer health products, everything from these phones to thermometers, to exercise equipment. I mean, they have a whole world of things that they sell, but I think what they're starting to do is a lot more partnerships, right, that are going to get their products, get their services connected to maybe more traditional health care organizations.
Woods: And I should say that even where we still started, if I think back to 2013, 2014 on what we thought that the classic retailers, the CVS's and the Walgreens were going to do, that wasn't where they ended up going when we think about now.
And obviously CVS acquired Aetna and wasn't just interested in selling shampoo. So maybe my guess like yours is that the long term ambition for Best Buy is to be much more business to business focused than just trying to sell to people like you and me.
Sznycer-Taub: Yeah, I would say that. And you already saw signs of it. They have a partnership with Kaiser. They provide their monitoring for Kaiser Permanente's Medicare population.
I imagine they'll look for more of those types of partnerships in the future, but because that's, I would imagine where more of the opportunities are more than just, again, selling to anyone who goes to their website or comes into the store.
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