Technological Approach Also Benefits Those Who Avoid TechnologyTue, 06/11/2019 - 13:54
E-commerce is a fast and convenient alternative for buying almost anything, but online sales of medicine have yet to catch on in Mexico. Emiliano Hernandez Laos, Co-founder of Mexican pharmacy startup Knaou, believes change is on the way thanks to technology. “Without a doubt, technology will change the Mexican pharmaceutical sector as it has changed other sectors such as retail.”
Hernandez Laos adds that new technologies can address gaps in healthcare services, starting with a subscription-based system like Knaou’s that facilitates medication delivery. “People do not want to leave their homes and they do not want to spend time traveling to pharmacies or other stores for the products they need,” he says.
Technological tools have significant potential in the healthcare sector that goes well beyond home delivery of medicines. “Technology can impact every aspect of the health value chain. For example, it allows doctors to remotely monitor their patient’s health and their adherence to the medication. It also lets clients review and analyze the characteristics of the medication they use to give better feedback to pharmaceutical companies.”
Knaou operates as an online pharmacy selling a wide variety of patented and generic medications from brands such as Eli-Lilly, Johnson & Johnson, Sanofi, Beckman, Chinoin, Novartis, Roche, Janssen and Pfizer. Its business model also aims to create lifelong links with patients. “We are using our platform to provide a better service to chronic patients with high-ticket conditions like osteoporosis, cancer and geriatric needs. Platforms like ours permit closer monitoring of the patient and allow us to offer a personalized service that caters to the patient’s preferences,” says Hernandez Laos.
Knaou’s subscription system automatically monitors and delivers medications to patients. Hernandez Laos explains that patients, or their relatives, can simply upload their prescriptions and the system will automatically calculate the amount of medication the patient needs per month and deliver it a couple of days before the previous batch runs out. Knaou began operations in January 2019 working with retirement homes. Now, it is looking to enter niche markets with few specialists, such as infectiology and hematology.
The company’s objective is to create loyalty among its client base. “Our alliances with doctors, pharmaceutical and insurance companies help convince our clients to try our solutions. After that, our customer service and smart prices convince them to stay. Loyalty is essential for online sales.” The challenge, Hernandez Laos says, is to attract patients to the platform. “The most important KPI in online sales is conversion, which measures the percentage of people that enter the page form the ones that actually buy in it. Pet stores have the highest conversion rate at 14 percent but the conversion rate for online pharmacies is only 2 percent. Higher client loyalty means higher ROI on advertisement.”
Knaou hopes to improve the platform’s conversion rate in 2019, boosting it above every other online pharmacy. To do so, the company will focus on creating a personalized experience for each chronic condition and implementing state-of-the-art technologies. He adds that platform’s simplicity is an advantage. “Patients fill in the registration form just once or load it directly from one of the online prescription software programs in the market and then receive their medication every month, which is more convenient that buying it themselves when needed. This feature has proven popular with our clients.”
The company has 1,000 products on its webpage but if patients do not find the medication they need in the catalog, the company can often find it for them since it has access to over 20,000 products. Knaou’s portfolio was created through alliances with distributors but it wants to go a step further and work directly with pharmaceutical companies and target specific conditions. Although Knaou works mainly with geriatric institutions and private firms, the company has ambitious expansion plans. The startup wants to continue investing in technology and in software development. “Although we do have great prices, we are not a discount pharmacy. Our value proposition is based on technology and customer care. We are collaborating with allies like Prescrypto to eventually offer a fully digital ecosystem.”