Incorporated into the new store formats currently being rolled out by both Walgreens and Rite Aid is a new store associate position with the primary function of proactively engaging customers in the OTC aisle. Walgreens calls them Health Guides; Rite Aid calls them Wellness Ambassadors.
But whatever you call them, these associates are both raising the bar in terms of the retail pharmacy shopping experience — helping to create an actual customer experience in health and wellness — and establishing a gateway to the pharmacist and the growing number of health services available through the pharmacy (e.g., medication therapy management, disease-state counseling, immunizations, weight loss and smoking cessation).
And if ever there was a time to shine a light on all that retail pharmacy can bring to bear in helping to manage health, it’s now. Retail pharmacy faces increasing margin pressure from third-party payers and narrowing PBM pharmacy networks. And that’s today. With healthcare reform expected to provide insurance coverage to an incremental 32 million patients in 2014, that pressure on dispensing margins will only grow more intense.
That’s just one pressure point. The ubiquity of smartphones and tablets — 79% of Americans currently shop using one or the other, according to a recent Nielsen survey — provides ready access to online retail, and it is taking price, convenience and choice out of the equation, leaving only shopping experience as the key point of difference across an increasingly commoditized prescription business and a generally homogenized front-end mix.
“The biggest pressure in retailing today and in the future is going to be from online,” said Todd Hale, Nielsen SVP consumer and shopper insights. “So retailers need to think about what do they do to make that experience in their stores unique and different?” It’s happening across all sectors — JCPenney is looking to leverage mobilized checkout capabilities that will liberate associates to better serve shoppers; Trader Joe’s has employees who are experts on certain culinary subjects; and Giant Eagle has deployed an in-store dietitian for shoppers to consult.
“If you think about the drug format in particular, the shopper base today is typically [made up of ] the kind of people who are more likely to have face-to-face, one-on-one conversations, certainly the older shoppers,” Hale said.
Conversely, one positive factor driving the need for more consumer healthcare touch points, especially in the self-care aisles, is healthcare economics. With the rise in healthcare costs and the transitioning of some of that cost from payers to the end user, “informed people are saying, ‘I better take responsibility for my health,’” said Michael Feuer, founder of Max-Wellness.
The fact is, these health-and-wellness “guides” or “ambassadors” are personalizing pharmacy retailing. And while they aren’t in the self-care aisles to make product recommendations, they do serve as a point of entry to the growing number of services becoming available at retail pharmacy, including vaccinations and a growing number of wellness services.
They’re walking, talking and smiling pharmacy service billboards that are not only helping to improve the patient experience, but also are helping to improve store performance. Rite Aid last month touted its new Wellness format as a promising concept around which the company can grow. The whole format offering — from the fixtures to expanded product selection, from additional clinical pharmacy services to the Rite Aid Wellness Ambassadors — “all those changes combined are really giving us a positive sales trend,” said Robert Thompson, Rite Aid EVP pharmacy. “We’re getting great feedback from our customers. ... Wellness Ambassadors have improved our overall ability to help customers get the quality information they need and receive advice or other patient services from our pharmacists.”
On top of highlighting pharmacy services, health-and-wellness ambassadors are helping drive more margin-friendly front-end sales as they provide customers with access to information on health, wellness and beauty products. And they could become a key cog in the new OTC switch model that the Food and Drug Administration is considering by serving to direct traffic toward the appropriate self-diagnostics tools or, again, a consultation with the pharmacist.