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Thursday
Apr242014

Retail Health: What Amazon and Nordstrom Can Teach the "Saints" about Customer Service

Image © Gensler

Whether you're St. John’s, St. Catherine's, St. David's or everyman's medical center, your "patient centric" focus has just flipped to a more robust “consumer care” delivery model—the same consumer care iconic retailers like Amazon and Nordstrom strive to perfect.

As a result, the rules of health delivery are changing. Providers are being challenged to respond to the choices that consumer-directed spending has placed in the hands of patients. The new patient or health consumer wants access, value, dedicated outcomes, information and a good experience. Sound familiar? That’s pretty much what every woman wants when hunting for a great pair of shoes. Welcome to the new retail health model. The consumer is in charge, and they want what they want NOW.

Retail health care (health care delivered in a retail setting) isn’t new. It’s existed since the early 2000s. That’s when we began to see clinics in grocery stores, drug stores, big-box retail chains, retail strip-centers and other convenient settings. These clinics deliver low-cost care for a few given conditions at equivalent quality of other settings.

Most of these centers, 73% according to California-based think tank Rand Corporation, are owned by three major retail companies: CVS, Walgreens and Target. The balance of centers is independent or owned by hospital systems (11%). All have experienced a dramatic increase in use among consumers in the 18-24 age bracket. This growth is largely due to that age group's tendency to be without a regular health care provider. Retail health care’s appeal is, however, growing in the over 65 age group, a group that appreciates convenience.

When a retailer sees this type of behavior and an emerging trust trending in a product or service, they adjust to capture the new customer and revenue stream. They refine their focus on customer service, evaluate their price point, and document expectations of outcomes or satisfaction. So, what can retail health centers learn from retailers like Nordstom and Amazon?

Nordstrom is legendary for its delivery of superior customer service. It places the responsibility for shopper satisfaction and resolution at the register; its associates are the key point of customer contact. Every associate is taught that the customer is king—they will go to extraordinary lengths to please. And they even send customer’s personal notes when the transaction is complete. The Nordstrom outlet "the Rack" sells at a lower price point, yet still empowers the associates and consumers alike. And its online experience is as easy and friendly as the in-store experience.

Amazon.com is an everyman's store. This online retailer offers customers a resource to shop price, accessibility, and speed of service. It delivers exactly what is promised, and sometimes offers a little extra speed in delivery of goods. And if you don't want your purchase, you can return it without a fight. By engaging customers in the electronic network, Amazon can track your every move, but it never invades your privacy. It knows your preferences and your friends, but only talks to you, their customer. And it consistently checks in with you to find out how they can improve.

Providers need to take cues from Nordstrom and Amazon. The titans of retail have groomed the American consumer to expect standards of service, value and cost transparency. The customer knows upfront what his or her options are and can decide whether location needs to be taken into consideration or if experience is a driver. We are watching the success of Nordstrom’s new partnership with NorthShore. The Nordstrom Mammography Suite in a Chicago suburb offers convenience and a desired experience to the sophisticated consumer. This retailer may be expanding the definition of “Retail Health” while addressing the race for the triple aim in health services: better service, better outcomes, reduced costs.

Kathleen Margolis
Kathleen Margolis is the Health & Wellness Practice Area Leader in the South Central Region. She has worked in the healthcare industry over the past 25 years primarily focused on management of community hospital systems and in converting general hospitals into specialty hospitals and clinics. At Gensler, she is working closely with clients and project teams to provide healthier work environments and to reposition health facilities for the new model of care delivery. Contact her at kathleen_Margolis@gensler.com.

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