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Study finds double-digit growth in drug store loyalty programs

BY Alaric DeArment

CINCINNATI — Memberships in drug store loyalty programs have grown by 45% over the past couple years to total more than 140 million, according to a new report.

The 2013 Colloquy Loyalty Census, released Tuesday, found a total of 142.4 million members of drug store loyalty programs, compared with 193.9 members of department store memberships and 360.5 million specialty retail memberships. Department store programs showed the strongest growth at 70%, while specialty retailers’ programs grew by 26%. Supermarket loyalty programs have contracted by 1% to 172.4 million members.

The latest Colloquy Loyalty Census is the fifth, with the most recent being published in 2011. Colloquy is the research arm of LoyaltyOne, a company that designs loyalty programs and performs customer analytics.

"As the economy slowly breathes new life, loyalty programs have gained increased awareness," report author and Colloquy research director Jeff Berry said. "We expect continued growth as increasingly sophisticated programs revitalize engagement with existing members and attract new participants."

 

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Avella joins limited-distribution network for orally administered cancer drug

BY Alaric DeArment

PHOENIX — Avella Specialty Pharmacy will be included in the limited-distribution network for a cancer drug made by Genentech, Avella said Tuesday.

The specially pharmacy company said it would be included in the network to sell Tarceva (erlotinib), an orally administered drug used to treat non-small cell lung cancer and pancreatic cancer. Genentech will shift distribution of Tarceva to a select group of pharmacies starting July 1 to align its distribution with that of similar cancer drugs.

"Being included in such an elite group of suppliers is a testament to our business model in the oral oncology market," Avella VP of business development Leslie Yendro said. "Manufacturers like Genentech recognize Avella’s ability to serve patients in all 50 states and to provide high-touch patient services and reliable product data to ensure maximum drug effectiveness."

 

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More companies focus on innovation, marketing, report finds

BY Alaric DeArment

WASHINGTON — Consumer packaged goods companies and retailers that sell their products have managed to stay strong despite economic difficulty, according to a new report.

The 2013 financial performance report, "Growth Strategies: Unlocking the Power of the Consumer," conducted by the Grocery Manufacturers Association and PwC, found that despite overall slowing net sales growth rates in 2012, food, beverage and household product companies had respective sales growth of 7%, 5.5% and 3.2%.

"This report shows that in the midst of a challenging economy, the food, beverage and consumer products industry continues to show great resiliency," GMA president and CEO Pamela Bailey said. "By providing consumers with innovative products and convenient, cutting-edge shopping experiences, CPG companies are well-positioned to enhance consumer loyalty and profitability."

The report found that the companies performing best identify consumers, engage with them and focus on innovation to reach them directly, showing how digital channels, adoption of mobile technology and marketing directly to consumers are rewriting the rules of retailing and CPG manufacturing.

Findings in the report, the 17th of its kind, included $1.1 trillion in retail sales last year, including $568 billion at grocery stores. Many companies are embracing the need for product innovation and understanding consumer and market needs as part of their research and development activities. Meanwhile, bottom performers are starting to hold onto their cash, meaning they could be ready to start making more investments in research and development and marketing to launch new products.

"CPG companies that engage with consumers directly through digital channels and build out their direct-to-consumer processes will have the best advantage for creating new growth," PwC U.S. leader for retail and consumer industry Steven Barr said. "Fifty-two percent of U.S. consumers are already buying directly online from brands they trust, proving that CPG companies now have far greater opportunities to walk alongside their shoppers in real time while driving sales of existing and new products."

More than 40% of CPG companies plan to sell products directly to consumers this year, compared with 24% last year, finding direct-to-consumer as an effective means for testing new products and reaching out to new consumers faster and more effectively.

 

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