At Research & Marketing Strategies (RMS), due to the variety of different client projects we work on, we become part-time and even full-time industry experts in a lot of sectors. One of those full-time expert sectors would be healthcare. A growing sector of research for our company has become retail from shop-alongs to behavioral surveys to focus groups with consumers. One sub-industry that I recently did some secondary research on was the pharmacy and drug store industry (NAICS Code 446110). This is of particular interest to our company because this sub-industry combines two of our research strengths – healthcare and retail.

drug store and pharmacy trends

Here are a few noteworthy trends and statistics I learned through my secondary research:

  • Competition in the industry has heated up and will continue to grow. According to MedCityNews.com the healthcare reform act will create an influx of access to care for millions of people needing healthcare services, and as a result – prescriptions. These healthcare trends at pharmacies may include clinical services being offered in-store, pushing pharmacists to be more proactive with care and promote preventative measures for more reimbursement, and also opens up the possibility of partnerships with healthcare organizations in local regions. Each drug store chain is looking to become your “one stop shop for pharmacy care”.
  • There is a growing importance on retail sales in drug stores and pharmacy. MedCityNews.com reports that although prescription and pharmacy revenue will still constitute the vast majority of sales (upwards of 70% or more), the strategic importance placed on additional retail sales in-store is growing. It also reports that pharmacies are typically located in the back of stores so shoppers must navigate through the retail space to pick up, wait for, or drop off a prescription – increasing the likelihood of impulse buys. This is similar to the trend seen many years ago in some grocery stores where convenience items such as milk and eggs were moved to the back of the store.
  • Evident growth in private label brands in the industry. According to Forbes.com, 4 out of every 5 (80%) of national consumers believe that private label brands are equal to or better than national brands in terms of quality and packaging. Drug stores and pharmacies are looking to promote private label brands within stores and increase retail margins and profits. PRWeb mentioned that over the past few years, profits for drug stores continue to increase, however growth rates have declined due to the increase competition and growth in specialty pharmacies.
  • Mail order prescriptions are being adopted by some consumers but it remains a small majority. According to the research firm Boehringer Ingelheim, only 18% of consumers stated their primary pharmacy used was mail order. This statistic compares unfavorably to the 53% that use a chain store or mass merchandiser. An additional 18% use an independent pharmacy with the remaining 12% using grocery stores to fill prescriptions.

For more insights and market research trends in the healthcare arena, click here to read past healthcare blog posts. If you have any questions or would like to work with RMS as your research consultant, contact our Director of Business Development, Sandy Baker at SandyB@RMSresults.com or call her at 315-635-9802.