Pearmill is a growth marketing agency that uses art and technology to help companies with paid growth. We spend $100M+ on advertising each year, but we only work with 10-15 brands at a time.

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Given our limited scope, we’ve started making requests for clients for whom we think we could do impactful work. In this edition of “Request For Clients”, I’m going to address a unique opportunity in the market right now: direct-to-consumer care providers.

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Our Experience

We’ve been working hard over the past few years to help a specific set of clients that were very crucial in the early stages of the pandemic: healthcare companies providing support to those who weren’t able to use their health providers without risking their lives or those of their loved ones.

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Over the past two years, we’ve helped scale companies like Ophelia, K Health, Mindbloom, and Vivian Health. They’re all on their way to becoming foundational companies in the U.S. healthcare ecosystem.

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As part of our experience, we’ve learned quite a bit about how to get these businesses to thrive:

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• Balancing growth with customer experience when it comes to wait times.
• Scaling spend and managing marketplace liquidity in different states, jurisdictions, and healthcare providers on the supply side. Effectively creating different vectors in how to judge marketplace liquidity.
• How to produce creative that speaks to illnesses without being alarmist, by being kind, and by ensuring that we cover many different patient paths.
• Learning how to compete against pharma giants who overspend on keywords and auctions on different channels.
• Learning how to operate within HIPAA and designing a world-class marketing data stack without compromising on efficiency of ad spend.

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Why we believe in this business model

There are two reasons why we think these new business models are interesting:

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U.S. Law

It’s no secret that healthcare in the United States has its issues. It’s a complex machine accounting for ~19% of the country’s GDP. There has been poor price transparency for years (recent legislation is taking effect to help with this), and it’s got a clear incentive problem: the customer is rarely the patient.

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Given the private insurance model of the U.S., long-term thinking about patient care has been eroded. But fortunately, there are plenty of new companies turning that on its head.

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Due to the COVID-19 pandemic, there’s been a new opening in the U.S. law allowing for telemedicine to prescribe medication and treat patients online. There are plenty of signs pointing to these changes becoming permanent in U.S. law over the next few months and years to come.

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By building direct relationships with consumers and excelling at (usually) one vertical at a time, there’s massive potential for the decoupling of healthcare in the U.S. by putting the customer first.

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Growth Dynamics

There is an immense amount of complexity in how doctors are allowed to prescribe medications to patients. There are different licenses involved, limitations on volume of prescriptions, limitations to geographic boundaries, and plenty more that we have yet to learn about.

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These are all limitations that the customer doesn’t need to know or, frankly, even care about! The growth problem then becomes one of respecting regulatory responsibilities and balancing them with effectively spending acquisition efforts in the right areas (geo limitations) for the right subset of potential patients (volume or license limitations).

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Recently, there have been leaps in ad auctions on Facebook and Google which make all of this possible without violating any data privacy issues:

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1. Advertising auctions are more machine learning based – by sending them more nuanced and granular information about your marketplace liquidity (e.g. different types of licenses doctors need to have, paired with the type of audience), you can get a lot of gains in CAC. 
2. By clustering your spend across geos, you can get gains in CAC (similar to geo-constrained marketplaces) as you scale (instead of losing out on CAC!)

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It’s probably worth mentioning that while we find the growth dynamics interesting and think there are moats to build on advertising channels, they’re immensely hard to achieve! But there are a plethora of experiments to run to achieve scale, and that gets us excited!