Amazon move should prompt strategy changes, analyst warns
By Neil Saunders
Amazon’s acquisition of PillPack is a warning shot in what is about to become a major battle within the pharmacy space. Not only has Amazon finally made a solid move into pharmacy, it has done so via an innovative supplier that helps patients manage and organize their prescription drugs.
Drugstores need to rethink their futures. The addition of more services and positioning themselves as a destination for health advice and simple medical treatments are more critical than ever.
Firstly, the most loyal part of their pharmacy customer base is the older consumer. Over the next 10 years, this cohort will become a less significant part of the market. This will leave drugstores exposed to younger shoppers, who are more likely to use both Amazon and remote pharmacy services. There is a significant risk that drugstores will see a real erosion in pharmacy customer share, especially in urban and suburban areas where Amazon can quickly deliver.
Neil Saunders is managing director of research firm GlobalData Retail.