SAN ANTONIO — Retail pharmacists will be missing out on as much as a $20 billion opportunity if they don't identify how to consistently and efficiently engage their patients, suggested Jeff Rehling, principal at Edgewood Consulting Group, during a business session Sunday at the recent 2013 GMDC Health & Wellness @Retail Conference.
There will be plenty of organic growth in the sale of prescription medicines and front-end health solutions, Rehling acknowledged, but convenience and price are no longer destination differentiators — all pharmacy retailers trade on those factors. And mobile technology is quickly changing the patient's decision-making tree as it becomes easier to access credible health information at the swipe of a tablet screen as opposed to asking a pharmacist.
The opportunities to build relationships between pharmacist and patient are dwindling. According to Rehling's research, 52% of patients report they don't have a relationship with their pharmacist and only 10% proactively sought after their pharmacist for health advice in the three months prior to the consumer survey.
The absence of that kind of relationship building may be one factor behind a lack of loyalty. “Four-out-of-10 consumers will easily switch stores," Rehling said. "Those are the people you want to protect if you have them and the people you want to go out and get if you don't," Rehling told session attendees. Converting those consumers from pharmacy agnostics to pharmacy loyalists means incremental growth. "Pharmacy shoppers have a 25% higher non-pharmacy basket of product than the average shopper," Rehling said. "If every shopper bought one or more items when picking up their prescription, it would mean $4.8 billion more in sales across the country.”
"Customer satisfaction is worthless; it's customer loyalty that's important," Rehling noted, quoting business author Jeffrey Gitomer.
Rehling outlined a four-prong strategy to help retailers and supplier partners better link store merchandising and marketing to patient-oriented decision making called, incidentally, LINC (Loyalty, Information and Incentives, Nutrition and Connections). The strategy helps define what patients are looking for in a retail pharmacy, and by that helps retailers develop and incentivize services and products that match patient needs.
Communicating nutritional needs may be one way to connect with the consumer, Rehling suggested. Almost two-out-of-three pharmacy shoppers buy VMS products, for example, he said. Even so, 55% of pharmacy trips result in no front-end purchase. There lies the opportunity, Rehling noted — improving the lives of these patients may help capture incremental sales.
It's all about disruptive innovation, Rehling said.
“If we look at what Starbuck’s experienced back in 2002, we find that there are parallels in their strategies that pharmacies could embrace today. One of the most successful coffee retailers of all time figured out that they needed to please two different audiences, one looking for service and experience and the other looking for speed," Rehling said. "They realized that the experience and expectations between the two are very different but instead of picking one target they embraced the opportunity to meet multiple needs in their total store experience.”