Online pharmacy 1mg to start subscription model soon

Online healthcare startup 1mg Technologies Pvt Ltd to start subscription model for its customers in an effort to reduce cancellation rate which currently is upwards of 40 percent on e-pharmacy platforms, according to a top executive of the company.

"We are expecting and hopefully should have subscription in the next 2-3 months," said Prashant Tandon, chief executive at 1mg.

The high cancellation rate in the e-pharmacy sector comes due to lack of proper prescription in the Indian ecosystem.

"The only problem with subscription model in India is taking credit card on file and auto deduct... We always run into that complexity," he said, adding that the company is considering other models of payments including cash on delivery.

With subscription services, customers will be able to register themselves and keep getting medicines without having to order them every month. The data of the medicines to be delivered will be stored in the system. The customers can however make addition or reduce the numbers, as per demand.

Subscription model is expected to go a long way in improving the order predictability of e-commerce companies, especially e-pharmacy segment, which specially is, marred with high cancellation rates.

Other companies such as cab aggregator Ola is also emphasising upon the subscription model. In July, it renewed its subscription based privilege programs to ensure customer loyalty and prevent them from moving on to rival Uber.

The online pharmacy sector is also deeply affected by regulatory uncertainties. The companies thus maintain a strict decorum of cancelling every order that comes without a valid prescription to save themselves from any unwanted allegations. 

1mg thus is targeting chronic patients from where they can get regular supply of orders. Patients of chronic diseases such as diabetes, asthma need to take medicines on a daily basis and need monthly or weekly supply of the same.

Almost 80 percent of the company's current business is coming from chronic medicines. 1mg has also de-prioritised segments such as anti-biotics and anti-allergics because these are the categories where mostly self-medication happens in India.

1mg claims to have average order size of Rs 1,000-1,500.

Also read: Online pharmacy licenses will ease business, say startups