Flux Fertility: At-home Fertility Testing Services to Empower Women
Infertility is a major concern among women thinking of starting a family and diagnosis is often delayed. 40% of infertility cases can be treated when diagnosed — but on average, women spend 6+ months before receiving a diagnosis.
Flux Fertility is a startup diagnostic testing kit company that developed an at-home urine testing kit to predict ovulation, detect healthy pregnancies, and treat common causes of infertility. The at home test and subscription service offers women more insight, autonomy, and confidence during their fertility journeys.
Flux Fertility was planning a direct-to-consumer go-to-market strategy but was aware of a few realities: the fertility testing market is crowded, misinformation is common, and it was unclear whether consumers will value Flux Fertility’s features. In order to determine the most optimal business model, I helped them think through positioning experiments and built profit and loss (P+L) projections to validate their business model.
“The cruel irony in today’s system is that you can’t test your fertility until you’ve proven that you can’t have a child. Which you can’t find out until you start trying to have a child to begin with.”
— New York Times (Feb. 20, 2019)
Pictured above are the three dominant customer segments that emerged from our research. Wonderers are thinking ahead and curious about difficulties she may experience during pregnancy; Planners have a firm timeline in mind of when they’d like to conceive and are likely already familiar — or experimenting with — cycle tracking tools; Troubleshooters have been unsuccessful conceiving for several months are are looking for answers.
Segmentation
Empathizing with End Users:
Our team interviewed over 30 women and couples. By integrating our qualitative interview data with survey data that we conducted, we uncovered 3 distinct segments.
Actionable Analysis:
Participants articulated that becoming pregnant is more stressful than it needs to be because current at-home testing does not do enough to develop insight, autonomy, reassurance during the fertility journey.
This knowledge was pivotal because it gave our team a better sense of the market, the revenue potential of each segment, and allowed me to paint a clearer image of how customers will engage with the business.
Pictured above is a journey map depicting the user journey and experiences of three distinct segments which can be grouped into two different journeys. One journey is ‘pregnancy-led’ and the other journey is ‘fertility-led.’ Journey stages are are found along the horizontal axis on the top, and each segment is plotted along along that axis based on where they would start their journey. Below are the different barriers users face during each journey stage.
Journey Map
Visualizing the User Experience:
After developing our customer segments, I dove further into our interview and qualitative data. Although the segments were different, they all experienced similar stages during their respective pregnancy journeys.
One Journey, Two Starting Points:
The three segments can be divided into two distinct journeys: one that is ‘pregnancy-led’ and one that is ‘fertility-led.’
The pregnancy-led journey is centered around the idea of pregnancy, and the hyper-focus on pregnancy causes this segment to overlook intermediary milestones like ovulation cycle tracking and fertility indicators — instead thinking only of the end goal: pregnancy. As a result of less monitoring, it will take more time to understand the cause and finding the right therapy.
Validating Sales Channels
Developing Models:
Because this was a direct-to-consumer model I explored digital marketing and sales channels.
I modeled the customer acquisition costs (CACs) by integrating click through and conversion rates, and costs of search and display ads on google and Facebook, along with the cost of influencer campaigns and word of mouth. Next, I calculated the lifetime value (CLV) that each customer generates based on their respective segment sizes, services needed, and duration of services use.
Actionable Analysis:
While acquisition costs are significant, customer lifetime value is still attractive. As a general rule, a CLV/ CAC ratio of 3:1 is a good minimum threshold to keep in mind. Our analysis shows 10 to 1 and 7 to 1 among are segments which is probably on the higher side but still a good indication of the opportunity that exists
Business Viability: Wands
Refining Gwener’s Business Model:
Despite the founders originally strongly considered a pure direct to consumer model, I recommended that they consider strategic partnerships. I developed a financial model to investigate.
After building Profit +Loss (P+L) projections I ran sensitivity analysis using a tornado chart, which is tool that is extremely helpful in comparing the relative importance of different variables. This tornado chart revealed two critical aspect about Gwener’s business model.
Recommendations:
Sensitivity analysis of revenue drivers revealed that profitability is most influenced by 'wand purchases and wand pricing. This was great news because it confirmed that Flux Fertility is a razor-and-blades business (one item is sold at a low price in order to increase sales of a complementary good).,
This should encourage Flux as a company to consider ways to support wand use even after pregnancy and delivery. I suggested was iron testing as a post-pregnancy test that — remembering back to my time in India and how iron and folic acid supplements were very critical indictor during pregnancy.
Business Viability: Tele-medicine Services
…on the other hand, telemed services have the least influence on profit.
The bottom two dimensions of this chart reveal that ‘prescription price’ and ‘average months of prescription therapy’ have the least influence on Flux’s net present value (NPV). This is because the size of the troubleshooters segment —those who would be using this service — is so much smaller the other segments.
Recommendations:
These outputs gave our team pause as to whether telemed is a viable revenue stream. The results suggest that Flux needs to think about partnering with another company that already offers telemedicine services, or consider dropping the service entirely
Strategic Partnerships
Diagnostic Testing:
Even before Covid-19 swept the globe, medical device companies, diagnostic testing companies, and medical care providers were trying to figure out how to best leverage Telehealth to access patient medical data and deliver services. Now during Covid-19, its more important than ever for healthcare service providers to find innovative ways to get closer to patients.
Over the past few months Flux Fertility has explored partnership opportunities with hospital systems that require tools for regular and frequent patient monitoring, but do not currently have capacity and technology to do so.
Flux has also sought partnership opportunities with tele-medicine providers. These companies already have an established consumer base and a profitable business model, which would complement Flux Fertility’s current value proposition.
Expanding the Pregnancy Market:
After conducting market research and financial analysis, I felt strongly that Flux had an opportunity to craft a unique value proposition that included couples in addition to women.
The reality is that 40-50% of infertility among couples is a result of male infertility. By partnering with an at-home male fertility testing company, Flux could tap into an entirely new market and transform itself into a ‘one-stop’ shop for all couples looking to conceive.