During the pandemic, the shopping behaviors of people changed all over the world and more people took to spending more time making online purchases. We have become accustomed to convenience and making our buyer decisions without leaving the comfort of our couch. We buy our clothes, shoes, groceries and dog toys online now. So, why wouldn't we buy our pharmacy goods too?
Due to the rapid increase of online ordering, pharmacies have been forced to keep up with the times with most offering basic online shopping, click & collect and delivery options for their stores.
Fortune Business Insights stated that in 2018 the global e-pharmacy market size was valued at $49,727 million and is set to reach $177,795 million by 2026. Overseas there are already large companies such as Amazon dominating this market. In Australia the online pharmacy retail market is estimated to grow by approximately 4% by 2025. During the pandemic we have seen similar trends with new online pharmacies popping up as well as delivery service platforms making it easier for community pharmacies to be in the game. Overall, the data indicates that it is a case of jumping onboard or getting left behind in terms of e-commerce for community pharmacy. If you are thinking, how am I supposed to navigate this new world of e-pharmacy; keep reading.
Everything we look at in pharmacy marketing we relate back to our Four Pharmacy KPI’s.
Increase Customer Numbers
Increase Customer Spend
Increase Customer Loyalty
Increase Customer Frequency
When we look at implementing anything new to our pharmacy business, we need to make sure that at least one or more of these KPIs are being achieved. If you look at it from this perspective, e-commerce provides a huge opportunity for growth.
When we look at implementing anything new to our pharmacy business, we need to make sure that at least one or more of these KPIs are being achieved. If you look at it from this perspective, e-commerce provides a huge opportunity for growth.
Larger Demographic Target Market = Increase Customer Numbers
One of the limitations of a brick-and-mortar business is its location. When you take your business online you are able to reach customers much further than the usual radius of your store. Particularly if you offer niche products your opportunities are limitless! This means you have a much greater ability to increase your customer number and consequently your revenue. This is particularly useful if you have a product that does not align with your store's location demographic but is a strong match for another demographic which can be targeted online. Think about who is online and how you can solve their problems; it sometimes isn’t the same people that come into your store.
24hr Customer Convenience = Increase Customer Frequency
Think of the cost and logistics to open your pharmacy 24hrs a day. It just simply would not be possible for most community pharmacies. Especially in times of severe pharmacist shortages and high wage rates. By bringing your business online you are able to answer your customers' questions 24/7. How? Let your website speak for itself. Through clever navigation your website should be able to show customers exactly what products they need and provide convenient access to these products for a good price. Instead of your pharmacy team having to relay information to the customer your website does the work for you with detailed product information.
We also recommend keeping updated blogs about popular customer questions and topics. This not only helps your customer it also sets your pharmacy apart as an industry leader. Your content may be shared across the internet bringing you more trust and traffic. Not to mention it is great for SEO or searchability!
Cut Costs = Increase Customer Spend
As we mentioned earlier wages are on the rise and that is if you are lucky enough to have the team to begin with. By providing more services and products online you can be cost effective with your resources. It is much more efficient to have your customer choose and checkout themselves online than it is to have a team member in store check them out. It is a win-win situation.
By offering more products online you can avoid the need for merchandising and floorspace. A warehouse has a lot less maintenance costs than your typical storefront. Overall, this should mean pharmacies are able to sell products at a better price and encourage customers to spend more.
Another way that we can encourage customer spend online is with carefully articulated free shipping limits. Most shoppers will spend that extra few dollars to receive free shipping. Part of your online marketing strategy should include upsells or add on products which are displayed at checkout.
Have you ever been ready to check out your basket and there's suddenly a list of irresistible products which perfectly align with what's in your cart? Utilise this type of technology to your advantage. This is functionality which can be costly but is definitely beneficial for increasing your customer spend.
Online Community = Increase Customer Loyalty
Community pharmacy’s secret weapon is its customer’s loyalty. Pharmacists are among the most trusted professions which means (similar to your accountant) once you have a good one you don't want to leave them. So, make sure you keep those customers even if they move away or another pharmacy pops up closer to them. If you can offer your advice and services remotely it means you can keep your loyal customers.
This is where your online community comes into play. If your customers aren’t visiting your store, they aren’t seeing your latest catalogue, your new signage and the discounted products at the front. All of this needs to be shared online too. Having a database of your customers email addresses and phone numbers is one of the most direct and effective ways to communicate to your customers. To keep customer loyalty to your store (especially in an online world) you must be giving them something in return for their loyalty. Most pharmacies have a loyalty program, but what makes yours better? And how effectively are you communicating these benefits with your customers?
Yes, we want our social media to help us make sales. But it’s called social media for a reason, be social! The best social media marketing strategies use personal stories to tug on the heart strings of their customers and build relationships. I don’t know about you, but I will always choose the product that I know where my money is going rather than the faceless business. If your customers aren’t visiting your team instore and getting advice, share your most commonly asked questions on your social media. This is building that customer loyalty outside the four walls of your pharmacy. Social media can be seen by a much larger audience too, so one post can help many more customers than you ever could in store.
Please keep in mind here, customer decisions are made at the home front. That is where the brand awareness builds. That is where they do their due diligence on you and on your offering. And remember your offering comprises three elements. Sell (the products you sell), Serve (the services you offer) and Show (how you educate them).
I still believe there is a strong need for brick-and-mortar pharmacies in Australia but I have seen more and more pharmacy owners move towards e-commerce and they are reaping the rewards and endless opportunities. This is still a relatively new space for Australia, and it will be interesting to see how the trends evolve.
A piece of advice I would give is niche down if you want to go online. Retailers like Chemist Warehouse are always going to be the one stop shop for cheapest pharmacy products. What they don't offer is tailored services and products to a smaller targeted audience. Sometimes the art of selling is about giving your customer one option and not overwhelming them with too much. This is also a great way to ease into e-commerce and see what products do the best. Listen to your customers and they will let you know what they want.
If this is a conversation you are interested in having, book a consultation below to see how we can help your pharmacy expand beyond its four walls.