{"id":6888,"date":"2018-03-05T00:45:59","date_gmt":"2018-03-05T05:45:59","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-digit\/submission\/zocdoc-finding-a-doctor-when-you-need-one\/"},"modified":"2018-03-05T00:51:53","modified_gmt":"2018-03-05T05:51:53","slug":"zocdoc-finding-a-doctor-when-you-need-one","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-digit\/submission\/zocdoc-finding-a-doctor-when-you-need-one\/","title":{"rendered":"ZocDoc: Finding a doctor when you need one!"},"content":{"rendered":"<p>Patients wait an average of 24 days to schedule an appointment with a doctor in U.S. cities.\u00a0 This is a 30% jump from 2014 and has been driven by doctor shortages, aging baby boomers, and greater insurance penetration (thanks to the Affordable Care Act).\u00a0 In Boston, the average wait time was 52 days to schedule an appointment with specialists like cardiologists, orthopedic surgeons, or gynecologists.<a href=\"#_ftn1\" name=\"_ftnref1\">[1]<\/a>\u00a0 In 2007, ZocDoc was born to improve access to healthcare.<\/p>\n<p><strong>How does ZocDoc create value?<\/strong><\/p>\n<p>ZocDoc is a two-sided digital platform that allows patients to search and view the available appointment times of doctors online and book them instantly.\u00a0 The ZocDoc platform allows patients to search based on the doctor\u2019s specialty, location, insurance coverage, and profile reviews.\u00a0 Appointment booking is not just online but also via iOS and Android apps.\u00a0 Doctors, in turn, can choose to be listed on ZocDoc and allow the platform to access and integrate with their digital calendars so that their updated calendars can be viewed by patients in real-time.\u00a0 ZocDoc is essentially a Yelp for doctors with the features of OpenTable.<\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/unnamed.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-6884 aligncenter\" src=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/unnamed-300x165.jpg\" alt=\"\" width=\"416\" height=\"229\" srcset=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/unnamed-300x165.jpg 300w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/unnamed.jpg 565w\" sizes=\"auto, (max-width: 416px) 100vw, 416px\" \/><\/a><\/p>\n<p>Therefore, ZocDoc has created value for both patients and doctors:<\/p>\n<ul>\n<li>Enabling patients to book doctor appointments within 24 hours: wasting less time in visiting a doctor could mean early detection and cure for patients and lower healthcare expenses.<\/li>\n<li>Increasing doctor utilization: while doctors are often booked for weeks, their utilization is 60-70% because of last-minute cancellations and no-shows<a href=\"#_ftn2\" name=\"_ftnref2\">[2]<\/a>. By helping doctors see patients whenever they\u2019re available, ZocDoc allows them to distribute their fixed costs over more patients.<\/li>\n<li>Reducing administrative costs for doctors: ZocDoc\u2019s insurance checker helps doctors pre-verify a patient\u2019s health insurance. Because administrative processes such as getting insurance information from patients are time-consuming and constitute ~15% of healthcare expenses, ZocDoc improves profitability for doctors.<a href=\"#_ftn3\" name=\"_ftnref3\">[3]<\/a><\/li>\n<\/ul>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker.png\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-6885 aligncenter\" src=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker-300x204.png\" alt=\"\" width=\"558\" height=\"379\" srcset=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker-300x204.png 300w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker-768x523.png 768w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker-1024x697.png 1024w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker-600x409.png 600w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2018\/03\/Zocdoc_InsuranceChecker.png 1652w\" sizes=\"auto, (max-width: 558px) 100vw, 558px\" \/><\/a><\/p>\n<p><strong>How does ZocDoc capture value?<\/strong><\/p>\n<p>ZocDoc is valued at over $2B<a href=\"#_ftn4\" name=\"_ftnref4\">[4]<\/a>.\u00a0 It does not charge any fee from the patients. \u00a0Instead, it charges $3,000 annually from listed doctors. As of August 2015, ZocDoc had over 49,000 listed doctors. That translates to revenues of $147M in 2015. \u00a0ZocDoc offers its services across the U.S., covering 60% of the U.S. population<a href=\"#_ftn5\" name=\"_ftnref5\">[5]<\/a>.\u00a0 Analysts estimate that the company has been profitable in all markets it has been operating in since 2013<a href=\"#_ftn6\" name=\"_ftnref6\">[6]<\/a>.<\/p>\n<p>Apart from charging listing fees from doctors, ZocDoc captures value in two other ways:<\/p>\n<ol>\n<li>B2B vertical: In June 2014, ZocDoc launched a premium service that employers can offer their employees, called ZocDoc for Business. This was ZocDoc\u2019s first offering for employers, whose names include Foursquare, Gilt, IAC, Jefferies, NASDAQ OMX, and Quirky.<a href=\"#_ftn7\" name=\"_ftnref7\">[7]<\/a><\/li>\n<li>Advertising by doctors: In November 2017, ZocDoc introduced sponsored results, a feature that allows doctors to increase their visibility to patients \u2013 similar to sponsored results on Google.<a href=\"#_ftn8\" name=\"_ftnref8\">[8]<\/a><\/li>\n<\/ol>\n<p><strong>How did ZocDoc scale?<\/strong><\/p>\n<p>ZocDoc was able to overcome the \u201cchicken-and-egg problem\u201d of multi-sided platforms through a strategy that many of us followed in the class simulation \u2013 it gave the platform free to patients and charged doctors (more over time) as patients on the platform increased.\u00a0 Today, ZocDoc\u2019s platform has reached over 6M patients.<a href=\"#_ftn9\" name=\"_ftnref9\">[9]<\/a>\u00a0 ZocDoc\u2019s strategy succeeded and it was able to scale because it took advantage of the high indirect \/ cross-side network effects in this market.<\/p>\n<p>More doctors on the platform will attract more patients because they can then find a doctor of their choice \/ in their insurance network \/ close by easily.\u00a0 More patients on the platform will attract more doctors because they can then improve utilization and reach more patients.\u00a0 Therefore, by offering the platform free to patients, ZocDoc attracted them and once the platform had patients, the doctors came aboard with a willingness to pay, and so on the cycle continues.<\/p>\n<p><strong>How does ZocDoc build a defensible platform?<\/strong><\/p>\n<p>When ZocDoc launched, it was one of select few multi-sided platforms for patients and doctors.\u00a0 Today, ZocDoc\u2019s competitors include DocASAP, One Medical, DocPlannr, Doctoralia, Kyruus etc., each of which has tried to differentiate its product through unique platform features.\u00a0 For example, Kyruus allows patients to book appointments on the doctor\u2019s own website as well if the patient wants.<a href=\"#_ftn10\" name=\"_ftnref10\">[10]<\/a>\u00a0 Therefore, ZocDoc will face increased competition in the future and because of the nature of the service, there be high-multi homing as well \u2013 doctors will cross-list on multiple platforms and patients will also book through whichever platform they prefer.<\/p>\n<p>To protect its user base, ZocDoc must try to incentivize doctors (especially the highly rated ones) to exclusively list on its platform.\u00a0 Building the strongest doctor coverage in specific geographies could also serve as a defensible barrier in those geographies.\u00a0 Additionally, ZocDoc will need to build more value-added services, such as the insurance checker, to raise the switching costs for both doctors and patients.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>References:<\/strong><\/p>\n<p><a name=\"_ftn1\"><\/a><a href=\"#_ftnref1\">[1]<\/a> Doctor Wait Times Soar 30% In Major U.S. Cities, Bruce Jaspen, Forbes, March 19 2017, accessed 5 March 2018, https:\/\/www.forbes.com\/sites\/brucejapsen\/2017\/03\/19\/doctor-wait-times-soar-amid-trumpcare-debate\/#6f03ceb92e74<\/p>\n<p><a name=\"_ftn2\"><\/a><a href=\"#_ftnref2\">[2]<\/a> Zocdoc&#8217;s CEO thinks you should be able to see a doctor within 24 hours, Jonathan LaMantia, Crains New York, April 11 2017, accessed 5 March 2018, http:\/\/www.crainsnewyork.com\/article\/20170411\/HEALTH_CARE\/170419980\/zocdocs-ceo-speaks-with-crains-about-appointment-scheduling-a-nightmare-for-patients-in-the-health-system<\/p>\n<p><a name=\"_ftn3\"><\/a><a href=\"#_ftnref3\">[3]<\/a> Zocdoc appointment booking app now verifies insurance with AI, Bill Siwicki, Health care IT News, October 25 2017, accessed 5 March 2018, http:\/\/www.healthcareitnews.com\/news\/zocdoc-appointment-booking-app-now-verifies-insurance-ai<\/p>\n<p><a name=\"_ftn4\"><\/a><a href=\"#_ftnref4\">[4]<\/a> <a name=\"_ftn5\"><\/a>THESE STARTUPS ARE MAKING PEOPLE ACTUALLY WANT TO GO TO THE DOCTOR, Joe McGauley, Thrillist, 2 June 2017, accessed 5 March 2018, https:\/\/www.thrillist.com\/tech\/nation\/zocdoc-forward-one-medical-group-doctors-appointment-startups<\/p>\n<p><a href=\"#_ftnref5\">[5]<\/a> ZocDoc Joins The Unicorn Club (Officially), Connie Loizos, Tech Crunch, August 20 2015, accessed 5 March 2018, https:\/\/techcrunch.com\/2015\/08\/20\/zocdoc-joins-the-unicorn-club-officially\/<\/p>\n<p><a name=\"_ftn6\"><\/a><a href=\"#_ftnref6\">[6]<\/a> Billion Dollar Unicorns: ZocDoc Should Be Able To Withstand Public Market Scrutiny, Sramana Mitra, December 1 2015, accessed 5 March 2018, http:\/\/www.sramanamitra.com\/2015\/12\/01\/billion-dollar-unicorns-zocdoc-should-be-able-to-withstand-public-market-scrutiny\/<\/p>\n<p><a name=\"_ftn7\"><\/a><a href=\"#_ftnref7\">[7]<\/a> ZocDoc gets $130 million to go beyond doctor appointment booking, Jonah Comstock, Mobi Health News, August 21 2015, accessed 5 March 2018, http:\/\/www.mobihealthnews.com\/46245\/zocdoc-gets-130-million-to-go-beyond-doctor-appointment-booking<\/p>\n<p><a name=\"_ftn8\"><\/a><a href=\"#_ftnref8\">[8]<\/a> Introducing Zocdoc Sponsored Results, Liz Bedor, ZocDoc, 3 November 2017, accessed 5 March 2018, https:\/\/www.zocdoc.com\/about\/blog\/for-doctors\/zocdoc-sponsored-results\/<\/p>\n<p><a name=\"_ftn9\"><\/a><a href=\"#_ftnref9\">[9]<\/a> Doctors will have to be more like actors as A.I. gains momentum: Zocdoc CEO, Christina Farr, CNBC, 11 Jan 2018, accessed 5 March 2018, https:\/\/www.cnbc.com\/2018\/01\/11\/zocdoc-ceo-doctors-of-the-future-will-have-a-higher-eq.html<\/p>\n<p><a name=\"_ftn10\"><\/a><a href=\"#_ftnref10\">[10]<\/a> Need a doctor&#8217;s appointment? Click it, Rachel Arndt, Modern Healthcare, May 17 2017, accessed 5 March 2018, http:\/\/www.modernhealthcare.com\/article\/20170517\/TRANSFORMATION01\/170519859<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Patients wait an average of 24 days to schedule an appointment with a doctor in U.S. cities.\u00a0 This is a 30% jump from 2014 and has been driven by doctor shortages, aging baby boomers, and greater insurance penetration (thanks to [&hellip;]<\/p>\n","protected":false},"author":2568,"featured_media":6889,"comment_status":"open","ping_status":"closed","template":"","categories":[2046,1361,1885,852,24,2045],"class_list":["post-6888","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-access","category-digital-health","category-digital-platform","category-doctor","category-healthcare","category-patient","hck-taxonomy-organization-zocdoc","hck-taxonomy-industry-health","hck-taxonomy-country-united-states"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-digit\/assignment\/growing-businesses-in-the-age-of-platforms-2018\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>ZocDoc: Finding a doctor when you need one! 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