But when it comes to cosmetic surgery clinics here, that’s a different story. Few people – perhaps none – openly advertise the price of their services or procedures, let alone the specifications of the medical equipment they use.
“Say I want to receive laser treatment to tone the skin and there are two hospitals. One uses equipment that costs 200 million won (about $ 180,000), and the other uses obsolete equipment. worth 30 million won. But they charge the same price. I think it’s not fair for patient accounts, “said Hong Seung-il, co-founder and CEO of Healing Paper, the company behind Gangnam Unni cosmetic surgery review app.
Seeing such a gap, he and his medical school classmate saw a promising business opportunity.
In 2015, doctors turned entrepreneurs launched the app, borrowing the name of Gangnam neighborhood, Seoul’s Beverly Hills, and a hotspot for plastic surgery. It was years after the duo attempted to launch yet another unsuccessful medical service app, Healing Paper, which targeted chronically ill patients.
Roughly translated as “Gangnam’s sister,” the name of their new company reflected their ambition to make it the go-to app for those interested in going under the knife.
“Interested in a little pinch? Ask this (older) sister from Gangnam. That was the idea, ”Hong said in an interview with The Korea Herald.
It was a change in the right direction. South Korea, often described in foreign media as “the cosmetic surgery capital of the world,” has a happy combination of a high smartphone penetration rate, a strong e-commerce environment, a huge base. potential clients for cosmetic surgery and, above all, the lack of similar services.
It took approximately two years for Gangnam Unni to establish itself with the local cosmetic surgery clientele. Gangnam Unni was able to make a profit in 2017.
“The platform has shown double growth every year before the outbreak of the COVID-19 pandemic last year,” he said. The company’s annual sales, which were 160 million won in 2017, soared to 8.5 billion won in 2019.
By 2020, however, growth had started to slow down a bit. Sales grew only 30 percent year-on-year to 12 billion won, due to the COVID-19 pandemic.
To date, it has obtained around 2.8 million users in South Korea and around 400,000 reviews and ratings from local cosmetic surgery hospitals. About 750 clinics are present on the application.
Hong says his goal is to make the app a relaxed online space for all age groups.
At a young age in Korea, people consider major businesses like double eyelids, nose jobs, and liposuction, but as they get older – usually over 30 – they prefer to visit clinics regularly for regular exams. less invasive procedures, he said.
Hong, citing industry data, said about 20 to 30 percent of patients at clinics specializing in cosmetic procedures are regulars who visit at least once a month.
“Our goal is to make Gangnam Unni a platform that every age group uses at least once or twice a month,” he said.
Gangnam Unni has so far attracted a total investment of 23 billion won, including 18.5 billion won in funds raised in April last year from Legend Capital, KB Investment and Hana Ventures.
Gangnam Unni only makes money by displaying advertisements from registered hospitals. For each click of the consultation reservation button in the app, these clinics earn credits which can be used towards the payment of advertising costs.
The company had tried a different monetization model, but then dropped out due to regulatory restrictions.
In many other countries, including China and Japan, platforms like Gangnam Unni could charge commissions to hospitals based on the costs patients pay for medical services booked through the platform.
But Korea’s medical services law prohibits such funding, Hong said.
“In the past, hospitals would invest their resources in luring patients. The (current) medical law was introduced in response to this, with the aim of preventing hospitals from overspending, ”he said.
It’s not just the monetization model that’s driven by strict regulations here. The company’s other attempts to reinvent the way medical services are delivered have also suffered regulatory setbacks.
In 2019, Healing Paper introduced a video viewing feature on Gangnam Unni, allowing users to ask doctors what can be done on specific areas of their face or certain parts of the body. The service was cut off, however, as doctors feared it could be seen as a violation of a law banning telemedicine.
“It’s a shame that the law does not allow doctor-patient pairing on online platforms. Without the law, we would have already been able to advance our WebRTC-based telediagnosis model, ”said Hong.
Although he believes deregulation would help advance the local healthcare industry, the businessman said the company was “OK” with the current market environment.
There is already a lot of growth potential, Hong continued, as long as he maintains the No. 1 position in South Korea, home of the ever-growing beauty trend K.
“South Korea and Gangnam have symbolic importance” in medical tourism as well as in the regional cosmetic surgery industry, Hong said.
As the new coronavirus has decimated medical tourism, Healing Paper has changed its strategy to directly launch its services in overseas countries, namely Japan and China.
Last year, the company acquired Lucmo, which was the second largest cosmetic surgery platform in Japan with 150,000 users and 100,000 beauty clinic reviews. It has stepped up its efforts to secure Japan’s largest medical and aesthetic clinic operators, including Shonan Beauty Clinic, Shinagawa Cosmetic Surgery Group, and Takasu Clinic. The number of cosmetic clinics registered on Gangnam Unni in Japan stands at around 330, the company said.
In the future, Japan could generate larger profits for Healing Paper, more than Korea, Hong said, as Japanese laws allow platforms to earn commissions on surgeries or procedures performed through the app.
Costs for beauty treatments in Japan are two or three times higher than in South Korea. For these reasons, Hong expects many Japanese app users to be interested in visiting South Korea for a break after the pandemic is over.
Of the Japanese who had plastic surgery, 32% traveled to South Korea to perform procedures, Healing Paper said, citing data from the Japanese market.
In China, things are not moving so quickly.
Healing Paper was scheduled to hold talks with China’s largest cosmetic surgery social networking apps, like GengMei or So-Young, for potential business partnerships last year. The Korean firm had sought to attract Chinese visitors to South Korean hospitals by providing information about local hospitals to Chinese platforms, like other white label and API solutions such as Expedia Travel. The plan will have to wait until international travel returns to normal, Hong said.
As part of another investment, the company acquired technologies that could help it expand its business portfolio in the future.
Healing Paper acquired Syscode in 2019, a Korean company that develops healthcare customer relationship management software. Hong said the company will develop its healthcare CRM software so that it can be sold to local and overseas hospitals.
By Shim Woo-hyun ([email protected])