Money-Minded Millennials Avoid “Spending” on Healthcare, but Invest in Wellness
For today’s millennials, there is a big difference between spending on “healthcare” and investing in “wellness.”
While they are the most wellness-focused generation, when it comes to choosing a doctor, two thirds of millennials consider that decision as risky as buying a car. In fact, buying a car is the only purchase with more perceived risk, according to the latest Commerce House Study.
But unlike the purchase of a car in which the consumer will test drive and experience prior to purchase, in our nationwide study where over 2,000 millennials were polled, they reported choosing their doctors based on two primary considerations: recommendations from personal networks and cost.
Extending millennials’ appetites for episodic wellness products and experiences to long-term relationships with physicians will be a significant challenge for the healthcare industry as this money-minded generation moves from a majority in their single, independent life stage to “married” and then “married-with-children.”
93% of millennials reported, in the recent Zocdoc Healthcare Dropout Study, that they simply do not schedule preventative doctor visits. Instead, when they get sick, they rely on urgent care facilities and retail clinics like the 900+ CVS Minute Clinics and 400+ Walgreens Healthcare Clinics popping up across the country. One could deduce that this is likely due to the invincibility factor found in younger adults, but as this generation ages further into adulthood and parenthood, how brands package their services and communicate will be critical in shifting their perspective on healthcare.
Strapped with student loan debt, a PNC Healthcare survey reports that 54% of millennials are willing to delay “healthcare” (not wellness or fitness) because of cost. In fact – unlike their parents who selected insurance plans based on whether their regular doctor was included in network – millennials select their primary care physician based on price. And almost half will switch physicians or go out of network to save money.
Lifestyle choices vs. episodic choices
Millennials smoke less, eat healthier and exercise more than previous generations. For most millennials, engaging a doctor or minute clinic is a fleeting, episodic situation that they address whenever the need arises. Wellness, on the other hand, has become an ongoing lifestyle choice, and a relatively expensive one. According to Euromonitor International, the global market for wellness offerings reached $686 billion in 2016 and is expected to grow at a 3.5% CAGR to $815 billion by 2021.
In a time when so many chronicle their lives on social media, the benefits of wellness – feeling and, especially, looking good – are affordable luxuries to post and relish. Think Fitbit, Mindbodygreen and CrossFit.
Wellness product and fitness marketers understand this. They also understand that even though a $39 SoulCycle class or a $7 Dirty Lemon nightly sleep tonic is pricey to most twenty-somethings, these products actually offer instant community. The benefit is not just physical wellness but a social activity with emotional wellness and selfie-worthy environments packaged right in.
So, while these money-minded millennials are investing in wellness, will they find the money to go to the doctor? Extending millennials’ appetites for episodic wellness products and experiences to long-term relationships with physicians will be a significant challenge for the healthcare industry as this generation moves from a majority in their single, independent life stage to “married” and then “married-with-children.”