E-Commerce Among the Elderly Clientele in Taiwan

Abstract

Tourism has been the backbone of many economies for along time. However, this sector has been affected by economic slump around the world. Governments have diversified tourism industry from the tradition leisure and traveling to a more sustainable of educational and medical tourism. Taiwan has specialized in providing treatment for elderly clientele from across the world through marketing and subsidized medical care.

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Specialized treatment for patients offered by many countries, target aging population in search of health care. However, just like any other service in the market, when supply goes up, the cost is lowered to attract more clients. Taiwan has endeavored not only to provide competitive services but also to provide them at low cost. This makes it preferred country to seek medical care as opposed to other Western countries like UK and US that offer the same services but at a higher expense.

The Taiwanese government has declared to make the country a choice destination of medical tourism not only for the Asia continent but also for the entire world especially in its specialized fields including liver and bone marrow transplanting, as well as joint replacement surgery. These diseases are more common with elderly people than with young generation. Owing to the demographic data of the Asian countries, Taiwan is likely to receive more visitors due to her specialized treatment of ailments that affect old people. As people become older, their bones become porous and therefore suffer from diseases like arthritis and osteoporosis.

Introduction

Tourism has been a major economic activity of many countries in boosting their revenues especially during this period of global economic slump. However, economic downturn has affected leisure and traveling as more people seek to cut down on their expenses (Laws et al., 2007). In a competitive global economy, many countries are opting to attract visitors to their countries in other sectors through marketing on the Internet. Many countries have shifted to other areas of tourism industry beside the traditional leisure and traveling. Among these is education and medical tourism. It has become cost effective to market these services through the Internet.

Traditionally, tourists’ services offered by many countries have been watching of wildlife and geographical scenery. However, as people continue to meet hard economic times, they are cutting down on unnecessary expenses like traveling and leisure. Due to its importance, medical tourism has no choice. Even when the economy is on a depression, patients must seek medical services. In making medical tourism more attractive to foreigners, countries have chosen to lower costs and highly subsidize the cost of medical services. Internet has made it possible to have cost-effective marketing strategizes without committing large budgetary expenditures (Kelly and Brown, 2007). One of these countries that have become choice destination in provision of medical services is Taiwan. Economic hardships and changing lifestyles have necessitated many people to turn to smaller families as opposed to earlier days when people preferred slightly larger families. Demographic analysis shows that many countries in Asia are having larger aged population as opposed to comparatively younger population (McBeath and Leng, 2006). This has strained the specialized medical services. In addressing the emerging medical market, many countries are promoting their medical services as a destination to take care of elderly people. This has allowed growth of medical tourism where patients from a particular country seek medical attention in another country (Connell, 2011).

Taiwanese government has invested in modern, sophisticated and specialized equipments to deal with myriad of diseases (Zhou, 2004). Medical expenses become higher with age. In marketing its services, Taiwan has lower cost of specialized treatment like liver transplant as opposed to other countries offering the same services (McBeath and Leng, 2006). Comparing the cost of surgery with other competing countries such as the US and UK, Taiwan offers less than a quarter of the cost in these other countries. According to information on Taiwan Medical Tourism website, liver transplant, for instance, would cost $88,000 in Taiwan as compared to $270,000 in the US and $170,000 in Singapore.

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Low cost and expertise is attracting more people from outside Taiwan to seek medical services in the country (Zhou, 2004). Taiwan’s medical sector does not only give preventative and curative measures for its patients but also affordable health examination like cancer screening, coronary heart health examination, anti-aging cosmetic surgery and other physical examinations like panendoscopy and colonfiberscopy. According to Taiwan Task Force on Medical Travel, 2009, there are 38 Positron Emission Tomography (PET), 331 Computerized Tomography (CT) and 156 Magnetic Resonance Imaging (MRI) (Kelly and Brown, 2007). These techniques are necessary in diagnostic of diseases at their early stages. These instruments are necessary in diagnostic of diseases among the elderly people.

Literature Review

Many economists have grappled with the problem of recession for many years now since it started in US in 2008. As expected people have shifted their spending trends through cutting down on unnecessary spending like traveling and leisure. However, people cannot cut down on education and medical services and therefore they have to incur the cost even if it means that is the only thing they can afford. In trying to counter reduced foreign exchange earning from lower tourists numbers, economists and government policy makers have changed the way they deal with economic stress occasioned by economic hardships (Ewing, 2009). It has become necessary to reduce costs of operation while maximizing profits accruing. Taiwan is a country of many mountains and forests. It prides itself of having scenic tourists’ attractions. However, due to reduced tourist numbers, the country has shifted to a more potent area of medical tourism.

Among the services the country offers is specialized diagnostic treatment at an affordable cost. Many countries in the eastern Asia are grappling with problem of aging population. This has strained their medical sectors. Elderly people rely on social securities because most of them are retired and are not in the working bracket. Moreover, this group stands at high risk of chronic diseases that require specialized and frequent treatment. Money to finance these medical costs originate from the government confers (Laws et al., 2007). Due to the prevailing hard economic times, governments seek cost effective ways of managing their sick aging population.

Demographic survey of Eastern Asia

More than a quarter of the world population is found in Asia with China, India and Japan having the largest percentage. In China, for instance, one-child-per-couple policy was initiated by the government to control rising population (McBeath and Leng, 2006). However, the policy has now become a problem with more people falling in the elderly bracket. This group requires medical attention on regular basis. Medical expenses on elderly people have put a lot of strain on the government revenues. Due to her proximity and her strategic position, Taiwan has moved to exploit provision of medical services to this aging population at a low cost.

Definition of Medical Tourism

Medical tourism is a term that describes movement of people from one country to another to seek health care. Services sought by foreigners include specialized treatment in joint replacement, cardiac surgery, cosmetic surgery and treatment of chronic diseases (Connell, 2011). Many countries have strengthened their medical sector so as attract more people in their countries. However, the economic situation in the world has necessitated people to seek areas that provide good health care service at low cost.

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Provision of services is just one of the areas of the government. Marketing these services must also be in tandem with services rendered to inform the public outside their countries of the services they are offering. Marketing strategies will also make it possible to avail data to the larger world population when they need it. According to Medical Tourism Report, Internet has become pivotal in enhancing marketing of services rendered by Taiwan Medical Sector.

Role of E-commerce in medical tourism

Traditionally, marketing was carried out through electronic media and print media. With the exponential growth of Internet services and the integration of services, it has become cost effective to market products on the web. More people are turning to Internet in search of services as opposed to traveling to different places without being sure of the availability of those services. More important is the comparison of cost. Many countries are offering medical services but patients must be aware of which country gives them the best service coupled with low cost. Provision of information that clients require to make a decision is posted through the Internet. Marketing of such services therefore will be possible and available to the target group at the click of a computer button. Though there are inherent risks of exposing the marketing strategies to the competing markets, it is becoming necessary to have the information when required.

The relationship between government subsidies and increase in medical tourists
Figure 1: The relationship between government subsidies and increase in medical tourists

The figure above shows how medical tourism is improved through government subsidies and Internet marketing. This will enable patients to have information which they require without having to travel. Being aware of these advancements, Taiwan has subsidized its medical services to offer comparatively low costs and therefore become preferred destination. This is how the country has managed to boost its medical tourism.

Research Model

A research model is a general overview of interrelated issues under investigation. These interrelated issues are referred to as the problem domain. This case study will explain the relationship between Taiwan medical sector and how it has managed to attract more visitors through medical tourism (Lincoln and Guba, 2000). The study will also seek to explain the role of e-commerce in enhancing marketing strategizes that the government of Taiwan is using to make the country a choice destination in medical sector.

The study focuses on a specific group of elderly people. The study was apt in observing that many countries in Eastern Asia have aging population (Macdonald, et al., 2002). This group of people requires more attention in terms of medical care than comparatively younger population. The use of this group was necessary has elderly people spend most of their savings on medical care. Due to the global recession, tourism industry has been affected with people cutting expenses on unnecessary things among them leisure and traveling (Singh, 2009). However, the government must still commit a lot of its expenditure to provide health care for its people – especially to elderly people.

This research is aimed at explaining the relationship between hard economic times, use of e-commerce in reducing cost of marketing and provision of medical care for the elderly people (Patton, 1990). The research is conceptualized under the assumption that people will seek medical care whether they have money or not. However, people will prefer to visit countries that give them lower costs and higher diagnostic services from the state-of-the-art equipments besides well-trained medical professionals. Availability of this information will make it possible for patients to choose countries that offer medical services at low cost.

In this study, research models will identify concepts like ages of patients, options of different countries and charges offered in individual countries (Patton, 1990). It will also endeavor to show the relationship between these three major factors.

The study defines a worldview and technological advancement in e-commerce that reduces the costs of acquiring medical care from around the globe (Macdonald, et al., 2002). Medical tourism comes to alleviate the problem of expensive treatment of specific diseases affecting elderly people. The study seeks to explain how the government of Taiwan has endeavored to enhance policy strategies that make it a choice destination for elderly people seeking medical care from across the globe. Targeted marketing of the country has been achieved through subsidizing medical treatment in the country. By reducing the overall cost while maintaining world class treatment options, the Taiwan government has managed to attract more people in visiting the country for medical care.

For patients who are seeking medical care they would prefer to visit Taiwan than to have the same services in other western countries. More important is the provision of these services to the elderly people who rely on other people or their savings in seeking medical care.

This study seeks to draw a comparison between the campaign by Taiwanese government and improvement of medical tourism industry (Lincoln and Guba, 2000). It also seeks to show how the low cost of medical treatment from Taiwan has affected the industry as more people choose to visit the country for specialized treatment.

Methodology

Research paradigm is defined as a set of theories on which the study is based and has been formulated. Research paradigm is the worldview of the problem being investigated: in this case the effect of medical subsidies in boosting medical tourism in Taiwan. A paradigm therefore gives a view through which the researcher sees and understands the problem under investigation (Smith and Pagan, 1999).

Research methodology entails therefore how research designs were formulated, how the data was collected and how the results were interpreted and presented. According to Creswell, 2003, there are many research paradigms that can be used. This study employs ontological approach (study of reality and how elderly people spend their incomes on medical expenses) and methodological approach (explaining how e-commerce affects the improvement of services in the medical sector) (Lincoln and Guba, 2000). Based on information of increasing chronic diseases, more money is being committed to medical expenses. Countries that have the expertise have focused on marketing their services to the world through the Internet. Besides marketing, they have endeavored to subsidize the services to make them more attractive to foreign and hence increase exchange.

The research also seeks to explain the strategic position that the country of Taiwan has occupied in providing medical services to the people of eastern Asia (Smith and Pagan, 1999). This has come with the reality that larger population of these countries is aged due to government policies meant to control ballooning population.

The research seeks to use both qualitative and quantitive approaches to paint a picture of the impact of online marketing strategies, subsidized medical care and increase in medical tourists in Taiwan.

In qualitative approach, analysis will be based on how data available proves theories that have been formulated. This method gives the relation between observations and the mathematical data collected. In qualitative methods, general conclusions are drawn after general trends are established (Creswell, 2003).

In quantitive approaches, analysis will be based on the data collected from the number of elderly people from different countries especially in the eastern Asia. Quantitive approach will endeavor to prove the hypothesis that government subsidies on medical care attract more visitors into medical tourism (Creswell, 2003). The method will show the correlation between increases in numbers of visitors and lower medical cost.

Result and Discussion

Economic recession has forced people to reduce expenditure to only necessary expenses. Spending on leisure and traveling has been reduced. This reduction has definitely reduced foreign exchange earned from tourism industry. Taiwan being an island, its government has shifted the focus in their economy to other types of tourism like medical tourism.

Being in a region, which has more elderly people than young population, Taiwanese government is aware that many of its Asian neighbors will be spending more on health care of their people. For instance, China does give its 1.5 billion people any socialized medical cover. This provides a good market for the Taiwanese government (Connell, 2011). According to the information available on Taiwan’s Medical Tourism Boom in 2008, about 5000 visitors came to the island for medical care, health checkups and cosmetic surgery. One year later, this number had increased to 40,000 visitors. This was 800 percent increase within one year. This increase was attributed to meticulous marketing and proximity of the China population. Otherwise, their services played a key role in attracting more people from other countries. It was projected that this figure will rise to 100,000 people visiting for medical check ups by the end of this year.

The graph shows the trend of increasing number of medical tourists visiting Taiwan between 2008 and 2011
Graph 1: The graph shows the trend of increasing number of medical tourists visiting Taiwan between 2008 and 2011

This increase in number of medical tourists shown in the graph above, is attributed to both good medical services and good marketing strategies using Internet by the government of Taiwan. Through the Internet, a patient from one corner of the global will be able to compare services offered in another corner of the globe. To make the country a choice destination, the government has offered to subsidize the medical sector and hence lower the cost of provision of health care.

The government also ensures that there is excellent health care. This has been enhanced through periodical assessment of the facilities and services offered by different hospitals.

Chronic and lifestyle diseases are more prevalent with the aging population than they are with much younger group. Taiwanese medical industry has specialized in early detection of cancer and cardiovascular diseases using Positrion Emission and Computerized Tomography as well as Magnetic Resonance Imaging (Rouibah et al., 2009). This advanced technology has made China to be preferred destination for many of its neighbors patients. Coupled with problems in the Chinese health sector and cost in Thailand and Japan, Taiwan has struck a large market hence improving medical tourism. However, the services have not been embraced in US and other Western countries. Marketing of its services will make the countries become a choice of many western countries. The use of Internet will be necessary in pursuing this objective.

Having low cost and excellent screening services has converted the country into a choice destination for people seeking medical attention. This is how the country has become a preferred destination for elderly people seeking specialized treatment. Among the countries that Taiwan is, targeting in her campaign is China. After Chinese government lifted restriction of its citizens from visiting Taiwan in 2008, more people from China are seeking medical services in Taiwan (Rouibah et al., 2009). The Taiwan government seeks to promote individual services from hospitals as they market the medical opportunities offered in their country.

During the marketing of these services corporations and the government is using the Internet in launching a campaign that is likely to make the country a choice destination for services in specialized treatment. Though there is Internet service restriction in China the government and other stakeholders in the medical sector seeks to have improve their marketing through the network. Low cost medical services coupled with specialized treatment with minimum cost of marketing have enabled the country to become a choice destination for people who are seeking medical attention.

Taiwanese Bureau of National Insurance subsidizes the hospitals according to their accreditation offered by Taiwan Joint Commission on Medical Accreditation. This enables the hospitals to lower cost of treatment and hence attract more people into their country. With well-trained medical professionals and latest devices, Taiwan healthcare providers assure patients excellent services at low costs. Taiwan has 87 teaching hospitals in the country with quality personnel, medical instruments, services, and patient safety protection. These factors are reviewed every three year, to ensure that the hospitals are up to international standards.

Another neighbor that is likely to benefit from Taiwan’s medical tourism is Japan (Singh, 2009). Due to the convenience of air travel, proximity and good marketing strategies, the government of Taipei (the capital city of Taiwan) plans to attract more people from its neighboring countries who would be seeking medical care. These countries like Japan, China and Philippines have high aging population. Aging population of these neighboring countries has benefited Taiwan.

Conclusion

Medical tourism has remained lucrative even during the time when global economic slump seems to be hitting many western countries. However, thorough marketing needs to be undertaken to ensure that Taiwan secures a larger market outside eastern Asia. Due to higher economies of scale, the country would be able to rake in more profits if it can increase patient population from other western countries. For instance in the US, the cost of offering medical services is higher compared to the services offered in Taiwan.

Global economic slump will affect many sectors but medical sector will enjoy some reprieve because of its necessity (Ewing, 2009). The only thing a patient will do is to compare services offered in different countries and the cost that come with them. Apart from revenues from the medical area, Taiwanese government will improve her foreign exchange earning through, higher hotel booking and increased activity in the transport sector. These are areas that will boost the employment levels of her local people. However, to achieve this noble goal the government must improve her spending in marketing the country as medical destination on both the Internet and other media.

Unlike other areas of the tourism sector that can be affected by economic slowdown, medical tourism for the elderly people will remain lucrative as more governments continue to invest more in the health care of its citizenry.

References

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