WESTLAKE VILLAGE, Calif. —U.S. consumers are paying more heed to the cost of medicines, health-and-beauty aids and other drug store products in an era of economic uncertainty and joblessness. But in the perennial battle for customer loyalty, service still is king, and independent, owner-operated community pharmacies still rule.
That’s the fundamental lesson retailers can take from the latest customer satisfaction survey from J.D. Power and Associates. The big research and consulting firm unveiled the results of its 2010 U.S. National Pharmacy Study Sept. 21.
The study includes chain drug stores, supermarkets and mass merchandisers. Researchers polled customers about five key factors that contribute to customer satisfaction with brick-and-mortar pharmacies: prescription ordering and pickup process, the store shopping experience, cost competitiveness, nonpharmacist staff and pharmacists.
The study, based on a poll of more than 12,300 pharmacy customers in May and June, underscored the growing concerns Americans have with the cost of their pharmaceuticals and other health products. “As consumers shoulder more healthcare expenses, cost increasingly drives overall customer satisfaction with pharmacies,” noted the company in its report.
Nevertheless, added the report, personalized, above-and-beyond service still outweighs price for a majority of consumers. “Customer service still trumps price, even in an environment where cost has become increasingly important,” said Jim Dougherty, J.D. Power’s director of the healthcare practice. “Pharmacies that are focused on service garner the highest levels of satisfaction.”
That’s good news for small-scale, owner-operated independent pharmacies. It’s also good news for the Big Three drug wholesale giants that operate the three major networks of independents, franchised and otherwise, that scored top rankings in the poll.
Again this year, survey respondents ranked independents tops in overall satisfaction. “The independents and those companies that are focused on service are considerably higher [in customer satisfaction rates] than the larger stores,” Dougherty said.
Customers gave their highest scores to Good Neighbor Pharmacy, the 3,700-store group of independents that operate under the buying, merchandising and store-support umbrella provided by distribution and health services giant AmerisourceBergen. “That’s the first year that they have been a ranked brand in the study,” Dougherty said in a conference call with reporters.
The two largest groups of independent-owned franchises, McKesson Corp.’s Health Mart and Cardinal Health’s Medicine Shoppe Pharmacy, ranked second and third, respectively, in overall satisfaction rankings. But Walgreens rated a strong fourth, making it tops among corporate-owned drug store chains in customer rankings.
“One of the things that jumps out at us this year is we see a 31-point increase in Walgreens, and a drop of 8 points in Duane Reade,” Dougherty said, referring to the New York-based regional drug store chain purchased earlier this year by Walgreens. “It is not uncommon when there is a merger or acquisition in place that there would be some negative impact in customer satisfaction, even with the acquiring company. So this is unusual and a positive that Walgreens is seeing that increase.”
Among mass merchants, Target’s pharmacy operation got highest satisfcation marks for the fourth year in a row, while Publix rated tops among supermarket pharmacies. Supermarkets in general have seen steady improvements in satisfaction scores, Dougherty said.
Efforts to give the best possible service pay off, both in additional revenues and in measurable customer loyalty. Highly satisfied customers can bring in an additional $227 each year in prescription business, researchers found. What’s more, J.D. Powers reported, “brick-and-mortar pharmacy customers who are highly satisfied…are more than three times more likely to say they ‘definitely will’ return to their pharmacy, and 10 times more likely to say they ‘definitely will’ recommend their pharmacy to others, compared [with] customers with low satisfaction levels.”