Medical tourism is characterized worldwide by many individual companies that are not organized in big chains or other types of conglomerates. Nonetheless, one can observe that medical tourist companies start to develop growth strategies assuming that the post-covid era begins soon. There are, as in many other businesses, different types of diversification.
Firstly, the “therapeutic diversification” way to expand business means a diversification of medical treatments. For example: until now, the company offered only traditional Western treatments; now, it also offers traditional Chinese treatments.
Secondly, geographical diversification: The same service at another place, so you can have a second medical hotel of the same kind as the first one in another country.
Thirdly, horizontal diversification. Example: offering eyelid surgery, later also ear correction (otoplasty). Both services approach the same target group with services that both care for the ear and connected diseases.
Fourthly, lateral diversification: start selling products that do not have anything to do with what was sold before. Example: Selling health-related services, later beginning to add gardening tools in your assortment. It makes sense, especially if you can create a link between previous services and the new ones. For example: in a setting where relaxation plays a major role, you can start selling these gardening tools if you can convince guests that gardening at home is relaxing.
Fifthly, vertical diversification. Within this category, you can differentiate between an upstream and a downstream diversification. For example: now offering hip replacement surgery, later producing artificial hips that belong to an earlier production stage (downstream).
Written by Dr Kai Illing, professor at universities in Graz and Bremen, and CEO of TDC Consulting, Austria