Can Philips’ Interweaving of Consumer and Professional Healthcare Provide Lessons for Smart Home?

Royal Philips is a global business in the process of reinventing itself. The company’s business ranges from precision large-scale healthcare imaging and diagnostics machines to electric toothbrushes and shavers. Increasingly, Philips is leveraging embedded connectivity and a single cloud platform architecture to bring these historically disparate markets together with the  goal of putting the company at the heart of a wider cycle of healthcare management. That means bridging its consumer and professional healthcare domains, and some of the company’s approaches highlight how the connected consumer market can extend technologies and services well beyond their traditional domains.

Healthcare has lagged behind many industries in adapting to the potential of embedded connectivity and cloud-centric network architecture. Established practices, regulatory demands, patient privacy concerns, a risk averse approach to new technology, ingrained workflow practices, a distributed value chain, and more have all held adoption back. However, there are signs that connectivity in healthcare provision, from in hospital to remote patient monitoring, is gaining greater support and acceptance.

Key to Philips’ strategy to derive value from that connectivity in its consumer offerings is integrating consumer devices and services with the professional healthcare market. With a presence in both markets, Philips believes patient care and service provision can flow between professional healthcare and consumer services and that each can strengthen its role in the other.

For example, Philips’ Pregnancy+ app has been downloaded more than 25 million times. It has 4 million active users and each day more than 1 million users spend 4 minutes or more in the app. App users see information relating to the progress of their pregnancies and the care of their babies until they reach age of two. In addition, there is optimized content personalized according to previous interactions. As might be expected, Philips uses the app to introduce users to its connected and unconnected pregnancy and baby care offerings. However, increasingly the goal is to integrate with Obstetrics and Gynecology (OBGYN) practices and the wider healthcare provider networks they reside in, making the app a key patient acquisition tool.

Supporting its goals, Philips maintains that use of its app drives up OBGYN appointments during the first trimester of a user’s pregnancy. Typically, 75% of pregnant women see an OBGYN in the first trimester; according to Philips, among those using the app, this rises to 92%. That rise is significant. It is also key because some 25% of US women change their healthcare provider during pregnancy. To the OBGYN, and the healthcare network it belongs to, gaining a patient during a pregnancy offers the potential for long-term service provision to that patient and their family. In addition, Philips already has a strong customer base in OBGYN in the United States to leverage given the company’s longstanding ultrasound business.

But the impact of the app can be more wide reaching. Crucially, despite increasing amounts of money being spent on healthcare in general and approximately US$50 billion each year on pregnancy care, infant mortality rates in the United States are rising. Maternal mortality grew 26.6% in the United States between 2000 and 2014, according to the Centers for Disease Control and Prevention (CDC). It is estimated that 20-50% of these deaths are due to preventable causes, such as hemorrhage, severely high blood pressure, and infection. In addition, near-fatal complication rates have also grown significantly. Access to healthcare is a key determinant. Philips Pregnancy+ is not just looking to drive up healthcare engagement; the app is also intended to provide a way to extend pregnancy beyond the confines of the OBGYN clinic.

In January 2019, Philips invested and took a minority stake in Babyscripts, a pregnancy healthcare startup. Babyscripts’ platform offers OBGYN providers a remote patient management platform that connects via end user smartphone app to Bluetooth-connected medical devices including weight scales and blood pressure cuffs delivered to pregnant patients. This kit is paid for not by the end user, but by the medical insurance provider driven by the potential to improve patient outcomes and lower the cost of delivering pregnancy care. Babyscripts has covered more than 200,000 pregnancies in the United States, and its offerings are supported by major insurance provider Aetna and across 22 states and 47 health systems. Most crucially, 15% of maternal deaths are blood pressure related, so the ability to monitor blood pressure remotely can help raise alarms and deliver treatment ahead of any potentially fatal emergency.

Pregnancy care isn’t the only market where Philips aims to bridge the disconnect between consumer engagement and professional healthcare services. The company is also extending ways to bring data from its Sonicare connected toothbrush. The company ships 20 million Sonicare devices a year. Currently only a small minority of these have embedded connectivity, and those devices are restricted to its high-end options. Even so, Philips believes it can draw providers and payers into leveraging Sonicare collected data to extend the care they provide those patients. Philips is looking to integrate with dental practice Customer Relationship Management (CRM) systems to support extend care service. For example, tracking brushing frequency, technique, and effectiveness can support greater efficiency in after care for procedures such as implants. In addition, Philips is also trialing a feature in its Sonicare app that will support teledentristry. Patients can pay US$10 for a diagnosis after following steps to record details of any pain or concern. Again, there is a preventative aspect to the integration of the connected brush into dentist practices. Oral health can be determinate of wider patient health issues such as diabetes, and early detection and treatment of gingivitis can prevent the more serious and irreversible effects of periodontal disease. Again, Philips is pulling both providers and payer organizations into a consumer environment.

Philips’ approach to pulling together disparate players in healthcare to support a more customer-engaged and driven framework for service provision has many aspects that are specific to the complex healthcare environment. However, there are also parallels and precursors for the smart home market, both within Philips and in the wider market.

Philips is already a leading player in the Chinese air purifier market. While air quality is a consumer health issue, these appliances are increasingly being drawn into the smart home environment. Ambient assisted living is another major consumer market for Philips with its Lifeline offering, but again these systems are also increasingly embraced as an adjunct to smart home services. In addition, remote patient management will increasingly be pushed into the home environment as healthcare providers improve efficiency and reduce costs and patients continue to prefer homecare over hospital stays and traveling for healthcare appointments.

Key to Philips consumer and healthcare integration is its HealthSuite cloud architecture, which is leveraged by around 20 Philips internal businesses and will be integrated into all of the company’s offerings. That single platform architecture enables Philips to not just integrate its consumer and healthcare offerings and extend the benefits of one to the other, but also provide an application marketplace for third-parties to integrate their offerings to leverage the reach and capabilities of the wider platform.

As the smart home market has expanded, it has moved more and more toward consumer-driven smart home device selection and integration. The rise of voice control-centric, vendor-owned smart home management platforms such as those from Apple, Google, and Amazon as well as platforms from smart home specialists have had a primary goal of supporting smart home interoperability.

Smart home devices are increasingly simple consumer purchases similar to that of an electronic toothbrush. In addition, both types of devices have smartphone app engagement as a key element in building the customer relationship. The same brand recognition and ability to provide richer services are as key in smart home as they are in consumer health related products. So too is the potential to leverage and monetize that smart home installed base by providing connectivity to related service providers.

It will increasingly be the role of the major smart home providers to support and integrate a range of services and their providers. Not only for in-home healthcare provision, but also to bring smart home users to new communications and energy providers and integrate new home insurance, transportation, security, entertainment, maintenance, and other services.

For smart home vendors, Philips’ ongoing strategy that looks to draw together its consumer and businesses with a single cloud-architecture may well provide key learnings that can be leveraged and addressed.