November 2004 Times & Trends Executive Summary:
RX-SHOPPER CENTRIC RETAILING - Leveraging
The Connection Between
Pharmacy And The Whole Store

Times&Trends reviews new developments and critical events across all major CPG categories, key channels and all consumer groups, providing powerful benchmarking insights to help guide strategic decisions.

This month’s subject is part of Times & Trends series on Shopping & Wellness Trends, specifically Rx-shopper centric merchandising that prompts consumers who pick up a prescription to shop the entire store, increasing spending per trip, and enhancing the grocer’s image as a destination for health-management and healthy-living CPG products.

This free summary is also accessible via the GMA Web site  at http://www.gmabrands.com/publications/gmairi.cfm

Here’s a summary from the brief:

Pursuing An Rx-Shopper Centric Approach
It’s all about how consumers connect their ailments and prescriptions to healthy-support solutions – connector products – throughout the store.

■ The pharmacist/shopper relationship holds the potential. Rx-shoppers have positive attitudes and relationships with their pharmacies. The potential is there to leverage this connection into positive behavior throughout the store – not just OTC drugs, but CPG food and beverages that help consumers manage their conditions. However, typically 44% of Rx-shoppers fill their prescriptions and leave the store without any additional purchases.

■ Retailer leadership sees the importance of prompting Rx-shoppers, but needs to rethink barriers. The pharmacy typically is not linked to merchandising throughout the store. This needs to change to effectively stimulate Rx-shoppers into connecting with the whole store. Traditional Grocery is losing shopper trips to the value channels, particularly Wal-Mart supercenters, and cannot afford to lose Rx-shopper sales opportunities. Prompting consumers who pick up a prescription to shop the entire store will not only increase spending per trip, but will strengthen the grocer’s image as a destination for healthier-living and health-management CPG food and beverages.

■  “High-value” conditions are linked to connector product solutions. Ailments – allergies, asthma, heart conditions, flu's/respiratory infections, etc. – dictate healthy living changes and use of different products in many CPG aisles of the store – connector product solutions. Eight of 10 supermarket shoppers say they want one-stop Rx/health care shopping. And, many manufacturers today are retooling brands with healthier options, looking to connect with consumers’ more holistic management of their health situations.

■ The Rx-shopper centric merchandising approach works. An eleven-week controlled store test of a heart-healthy merchandising program resulted in stronger unit growth of two-thirds of monitored connector-CPG products – including low calorie soft drinks (to lower sugar intake) and ready-to-eat cereals (many offering “heart-healthy” benefits). Test findings also include positive attitude feedback from heart-ailment shoppers. Seven of ten heart-condition shoppers felt the program improved their local store’s image; 4 of 10 said they will buy more in the store because of the program.
 

■ Manufacturers and retailers need to work together. In Rx-Shopper Centric retailing, consumers lead the way – not retailers or manufacturers. But retailer and manufacturer partners need to develop practical, realistic and effective merchandising programs to leverage shoppers’ positive attitudes toward their pharmacy, resulting in increased sales and traffic throughout the whole store in many “connector” CPG categories and aisles.

The approach is one of connectivity – the connection of the consumer’s personal management of his or her condition, the prescriptions they fill for the condition and the store merchandised connector CPG products around the whole store.

In place of traditional merchandising approaches, an Rx-shopper centric approach will reflect the consumers’ thinking and behavior when managing their health conditions, and be relevant to how these consumers choose to live their lives with their condition.
 

Source: IRI's Times & Trends Reports
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