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- The Drug Store Shopper - US - January 2012
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Retail sales at drug stores grew by 3.6% in 2011, reaching $230 billion, and are expected to increase by a further 5% in 2012. Growth is driven by the aging population, rising levels of obesity and obesity-related illnesses and conditions such as diabetes and heart disease. As these groups seek treatment for their conditions, they turn to drug stores for health-related needs. Additionally, rising costs of health care are causing many to limit or avoid visits to their doctors, rather preferring self-diagnosis or assistance from a pharmacist or in-store clinic when seeking medical advice and treatment. Though competition exists from other channels, Walgreens and CVS remain the leaders among drug stores visited in general, as well as the top two destinations for prescription refills. Online retailing is slower to take off in this space, but it is expected to grow as consumers continue to adopt mobile devices such as smartphones and tablets. This report closely examines these themes as well as a variety of other factors impacting the drug store shopper.
Some of the key issues covered in this report include:
- How the growing aging population will drive drug store visits
- How levels of obesity and diabetes are on the rise and will result in more adults seeking care and treatment
- How rising health care costs cause people to self-diagnose and self-medicate
- The impact of other retail channels for health and wellness needs
- Total retail sales at drug stores in the U.S.
- Segment performance across key CPG segments sold through drug stores
- The impact of and interest in retail health clinics
- Social media presence and other marketing activity among leading drug store retailers
- Reasons for not shopping at drug stores
- Type and frequency of items purchased at drug stores
- Shopping behavior at online drug stores
- Retailers shopped for prescriptions and shopping behavior around prescriptions
- Attitudes toward drug store shopping
- Attitudes toward health clinics and treatment received at clinics
- How race and Hispanic origin impact shopping behavior and attitudes toward drug store shopping
Scope and Themes
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Advertising creative
Abbreviations and terms
Abbreviations
Terms
Executive Summary
The market
Figure 1: Fan chart forecast of total U.S. drug store sales and expected forecast, with best and worst cases, 2006-16
Market factors
The aging population drives drug store visits
Figure 2: population, by age, 2006-16
Levels of obesity and diabetes on the rise
Figure 3: Age-adjusted prevalence of being overweight, obese, or extremely obese, among adults aged 20 or older, 1988-2006
Rising healthcare costs cause people to self-diagnose, self-medicate
Retailer overview
Other retail channels compete for health and wellness needs
The consumer
Physical stores preferred, Walgreens most visited drug store
Figure 4: Drug store retailers shopped (physical store), October 2011
Drug store needs bought from other retailers limits visits to drug stores
Figure 5: Reasons for not shopping at drug stores, October 2011
Most shoppers prefer to leave the store or browse and shop while they wait for prescriptions
Figure 6: Prescription refills at drug stores – shopping behavior, October 2011
Price most important factor among drug store shoppers, convenience also a priority
Figure 7: Attitudes toward drug stores, October 2011
Insights and Opportunities
Offering faster home delivery can appeal to busy, incapacitated shoppers
Support local business to drive affinity
Help combat obesity through initiatives and incentives
Expand photo and gift offerings
Offer savings on prescriptions, healthcare
Inspire Insights
Inspire Trend: Experience is All
Inspire Trend: Creature Comforts
Market Drivers
Key points
The aging population drives drug store visits
Figure 8: Population, by age, 2006-16
Levels of obesity and diabetes on the rise
Figure 9: Age-adjusted prevalence of being overweight, obese, or extremely obese, among adults aged 20 or older, 1988-2006
Rising healthcare costs cause people to self-diagnose, self-medicate
Other retail channels visited for health and wellness needs
Market Size and Forecast
Key points
Positive outlook for drug store industry
Figure 10: Total U.S. drug store sales and forecast, at current prices, 2006-16
Figure 11: Total U.S. drug store sales and forecast, at inflation-adjusted prices, 2006-16
Fan chart forecast
Figure 12: Fan chart forecast of total U.S. drug store sales and expected forecast, with best and worst cases, 2006-16
Competitive Context
Competition heats up from other retail channels
Mass merchandisers and warehouse clubs
Traditional grocery
Online and mail order
Segment Overview
Drug stores invest in private label
Figure 13: Drug store sales and forecast, by key segments, 2006-16
Figure 14: Share of drug store sales and forecast, by key segments, 2006-16
Figure 15: Drug store private label sales and share, by key segments, 2010 and 2011
Segment Performance—Dairy
Key points
Positive outlook for dairy at drug stores
Figure 16: Drug store sales and forecast of dairy products, 2006-16
Private label accounts for more than one third of dairy segment sales
Figure 17: Drug store sales of dairy products, total vs. private label, 2006-11
Figure 18: Walgreens private label “Nice” sweet cream butter, 2011
Segment Performance—HBC
Key points
HBC segment sees strong growth, favorable outlook
Figure 19: Drug store sales and forecast of HBC products, 2006-16
Drug store retailers offer considerable amount of private label HBC items
Figure 20: Drug store sales of HBC products, total vs. private label, 2006-11
Figure 21: CVS pharmacy daily moisture lotion for sensitive skin, 2011
Figure 22: CVS pharmacy homeopathic cold relief lozenges, 2012
Figure 23: Rite Aid pure spring bath and shower gel, 2011
Figure 24: Rite Aid pharmacy nighttime sleep aid, 2011
Segment Performance—General
Key points
General segment sales will rebound
Figure 25: Drug store sales and forecast of general products, 2006-16
Private label share has increased in the general segment
Figure 26: Drug store sales of general products, total vs. private label, 2006-11
Figure 27: CVS private label just the basics baby diapers, 2011
Figure 28: CVS private label just the basics paper plates, 2011
Segment Performance—Frozen
Key points
Frozen segment sales lag behind other sectors at drug stores
Figure 29: Drug store sales and forecast of frozen products, 2006-16
Expansion of private label brands into frozen will drive growth
Figure 30: Drug store sales of frozen products, total vs. private label, 2006-11
Figure 31: Duane Reade’s “good & delish” lemon sorbet, 2012
Retailer Overview
Walgreens
Duane Reade
CVS Caremark
Rite Aid
Drugstore.com
Target
Walmart
Supervalu (Osco/Sav-on)
Other regional drug stores
Bartell Drugs
Kerr Drugs
Navarro Discount Pharmacy (Hispanic owned)
Discount Drug Mart
Marketing Strategies
Key points
In-store merchandising and displays
TV advertising
CVS
Figure 32: CVS TV ad “I’m Laura and this is my CVS,” may 2011
Kroger
Figure 33: Kroger TV ad “pet meds, prescriptions,” March 2011
Rite Aid
Figure 34: Rite Aid TV ad “Prescription delivery,” February 2011
Target
Figure 35: Target TV ad “Throat untickler,” September 2011
Walmart
Figure 36: Walmart TV ad “Cheap Co-pay,” August 2011
Walgreens
Figure 37: Walgreens TV ad “Staying on top,” April 2011
Online and mobile initiatives
Social media presence
Figure 38: Profiled companies retail stores and social media reach, Dec. 13, 2011
Innovations and Innovators
Rethinking the traditional drug store
A new “Look” for Walgreens
Rite Aid’s virtual health clinics
Drug Store Retailers Shopped
Key points
Physical stores preferred over online drug stores, Walgreens most visited
Figure 39: Drug store retailers shopped (in-store vs. online), October 2011
Women more likely than men to shop at Walgreens, CVS
Figure 40: Drug store retailers shopped (physical store), by gender, October 2011
Younger shoppers least likely to shop at drug stores
Figure 41: Drug store retailers shopped (physical store), by age, October 2011
Shoppers with highest household incomes shop at top two chains
Figure 42: Drug store retailers shopped (physical store), by household income, October 2011
Shoppers with children likely to shop at Walgreens, CVS
Figure 43: Drug store retailers shopped (physical store), by presence of children in household, October 2011
Reasons For Not Shopping at Drug Stores
Key points
Consumers buy drug store needs at other retailers, avoid shopping at drug stores
Figure 44: Reasons for not shopping at drug stores, by gender, October 2011
Younger shoppers more likely to visit drug stores only when filling prescriptions
Figure 45: Reasons for not shopping at drug stores, by age, October 2011
Little differences in reasons for not shopping at drug stores across household income groups
Figure 46: Reasons for not shopping at drug stores, by household income, October 2011
Type and Frequency of Items Purchased at Drug Stores
Key point
Prescription medication most likely to be purchased every time shoppers visit drug stores
Figure 47: Frequency of purchasing select products at drug stores, October 2011
Online Drug Store Shopping
Key points
Men more likely than women to purchase a variety of drug store items online
Figure 48: Items purchased at online drug store in last 12 months, by gender, October 2011
Items purchased online varies with age
Figure 49: Items purchased at online drug store in last 12 months, by age, October 2011
Household income plays little role in online shopping
Figure 50: Items purchased at online drug store in last 12 months, by household income, October 2011
Retailers Shopped for Prescriptions
Key points
Walgreens is most common destination for prescription refills, CVS not far behind
Figure 51: Retailers visited for prescription refills in last 12 months (online vs. in-store), October 2011
Walgreens leads, CVS and big box stores compete
Figure 52: Retailers visited for prescription refills in last 12 months (in-store), by gender, October 2011
Younger shoppers more likely to fill prescriptions at Walmart, Target
Figure 53: Retailers visited for prescription refills in last 12 months (in-store), by age, October 2011
Lower household income shoppers prefer Walgreens, Walmart
Figure 54: Retailers visited for prescription refills in past 12 months (in-store), by household income, October 2011
Prescription Shopping Behavior
Key points
Women more likely than men to browse, shop while waiting for prescriptions
Figure 55: Shopping behavior when refilling prescriptions, by gender, October 2011
Younger shoppers less likely to shop for other items while they wait for prescriptions
Figure 56: Shopping behavior when refilling prescriptions, by age, October 2011
Little differences in behavior across household-income groups
Figure 57: Shopping behavior when refilling prescriptions, by household income, October 2011
Attitudes Toward Drug Store Shopping
Key points
Price sensitivity among drug store shoppers
Figure 58: Attitudes toward drug stores, October 2011
Women more discerning shoppers compared to men
Figure 59: Attitudes toward drug stores, by gender, October 2011
Older consumers partial to particular drug store retailers
Figure 60: Attitudes toward drug stores, by age, October 2011
Consumers with lower household incomes aim to stretch their dollars at drug stores
Figure 61: Attitudes toward drug stores, by household income, October 2011
Visits to Retail Health Clinics
Key points
Most don’t use retail health clinics, among those visited Walgreens, CVS are tops
Figure 62: Visits to retail clinics (for self or others), October 2011
Men more likely than women to visit retail health clinics
Figure 63: Visits to retail clinics for self, by gender, October 2011
Younger shoppers more likely to visit retail health clinics
Figure 64: Visits to retail clinics for self, by age, October 2011
Few differences in clinic visits among household income groups
Figure 65: Visits to retail clinics for self, by household income, October 2011
Attitudes toward Retail Health Clinics
Key points
Immunizations primary reason for visiting retail health clinics
Figure 66: Reasons for visiting a retail health clinic, by gender, October 2011
Younger shoppers more likely to visit retail health clinics for a variety of reasons
Figure 67: Reasons for visiting a retail health clinic, by age, October 2011
Consumers with low household incomes visit clinics due to lack of health insurance
Figure 68: Reasons for visiting a retail health clinic, by household income, October 2011
Attitudes toward Treatment at Retail Health Clinics
Key points
Half of visitors to retail clinics received treatment in timely manner
Figure 69: Success of treatment at a retail health clinic, by gender, October 2011
Older consumers most satisfied with efficiency, treatment at retail clinics
Figure 70: Success of treatment at a retail health clinic, by age, October 2011
Lower-income households least satisfied with health clinics
Figure 71: Success of treatment at a retail health clinic, by household income, October 2011
High incidence of repeat visits among consumers
Figure 72: Likelihood of repeat visit to a drug store retail health clinic, October 2011
Men likely to accompany spouses, women likely to accompany children to retail health clinics
Figure 73: Who received treatment at retail health clinic, by gender, October 2011
Grown children accompany older parents to health clinics
Figure 74: Who received treatment at retail health clinic, by age, October 2011
Highest earners likely to visit health clinics for spouse/partner’s treatment
Figure 75: Who received treatment at retail health clinic, by household income, October 2011
Nonusers likely to recommend health clinics to friends and family
Figure 76: Likelihood of recommending a health clinic to friend or family member, October 2011
Impact of Race and Hispanic Origin
Key points
Hispanics, blacks most likely to shop at Walgreens
Figure 77: Drug store retailers shopped (physical store), by race/Hispanic origin, October 2011
Hispanics likely to purchase vitamins/supplements, OTC online
Figure 78: Items purchased at online drug store in last 12 months, by race/Hispanic origin, October 2011
Hispanics prefer Walgreens for prescriptions
Figure 79: Retailers visited for prescription refills in last 12 months (In-store), by race/Hispanic origin, October 2011
Across all race/ethnic groups consumers don’t like to wait for prescriptions
Figure 80: Prescription refills at drug stores—shopping behavior, by race/Hispanic origin, October 2011
Price, convenience most important when shopping at drug stores
Figure 81: Attitudes toward drug stores, by race/Hispanic origin, October 2011
Hispanics prefer Walgreens, Asian/Pacific Islanders choose CVS among health clinics
Figure 82: Visits to retail clinics for self, by race/Hispanic origin, October 2011
Blacks choose clinics for convenience, affordability
Figure 83: Reasons for visiting a retail health clinic, by race/Hispanic origin, October 2011
Blacks least satisfied with treatment at health clinics
Figure 84: Treatment at a retail health clinic, by race/Hispanic origin, October 2011
Two thirds of consumers are likely to repeat visits to retail clinics, whites most likely
Figure 85: Likelihood of repeat visit, by race/Hispanic origin, October 2011
Hispanics likely to accompany older family member to health clinics
Figure 86: Who received treatment at retail health clinic, by race/Hispanic origin, October 2011
All groups likely to recommend clinic
Figure 87: Likelihood of repeat visit, by race/Hispanic origin, October 2011
Custom Consumer Tables—Boomers vs. non-Boomers
Boomers slightly more likely to visit Walgreens, non-Boomers more likely to avoid drug stores
Figure 88: Drug store retailers shopped (physical store), by boomers/non-boomers, October 2011
Non-Boomers more likely to purchase most categories online
Figure 89: Items purchased at online drug store in last 12 months, by boomers/non-boomers, October 2011
Non-Boomers shopping at a variety of retailers for prescriptions
Figure 90: Retailers visited for prescription refills in past 12 months (In-store), by boomers/non-boomers, October 2011
Boomers and non-Boomers prefer to drop off prescriptions, return later for pickup
Figure 91: Prescription refills at drug stores—shopping behavior, by boomers/non-boomers, October 2011
Price, convenience important to Boomers and non-Boomers
Figure 92: Attitudes toward drug stores, by boomers/non-boomers, October 2011
Non-Boomers more likely than Boomers to visit retail health clinics
Figure 93: Visits to retail clinics for self, by boomers/non-boomers, October 2011
Regardless of generation, consumers visit clinics primarily for immunizations
Figure 94: Reasons for visiting a retail health clinic, by boomers/non-boomers, October 2011
Both groups mostly remedied by treatment at retail clinics
Figure 95: Treatment at a retail health clinic, by boomers/non-boomers, October 2011
Appendix: Other Useful Consumer Tables
Drug store retailers shopped
Figure 96: Drug store retailers shopped (physical store), by gender and age, October 2011
Figure 97: Drug store retailers shopped (physical store), by gender and household income, October 2011
Figure 98: Drug store retailers shopped (physical store), by marital/relationship status, October 2011
Figure 99: Drug store retailers shopped (physical store), by household size, October 2011
Figure 100: Drug store retailers shopped (physical store), by education, October 2011
Figure 101: Drug store retailers shopped (physical store), by employment, October 2011
Reasons for not shopping at drug stores
Figure 102: Reasons for not shopping at drug stores, by marital status, October 2011
Figure 103: Reasons for not shopping at drug stores, by household size, October 2011
Figure 104: Reasons for not shopping at drug stores, by employment, October 2011
Online drug store shopping
Figure 105: Items purchased at online drug store in past 12 months, by gender and age, October 2011
Figure 106: Items purchased at online drug store in last 12 months, by gender and household income, October 2011
Figure 107: Items purchased at online drug store in last 12 months, by household size, October 2011
Figure 108: Items purchased at online drug store in last 12 months, by presence of children in household, October 2011
Retailers shopped for prescriptions
Figure 109: Retailers visited for prescription refills in past 12 months (in-store), by gender and age, October 2011
Figure 110: Retailers visited for prescription refills in last 12 months (in-store), by gender and household income, October 2011
Figure 111: Retailers visited for prescription refills in past 12 months (in-store), by presence of children in household, October 2011
Figure 112: Retailers visited for prescription refills in last 12 months (in-store), by region, October 2011
Prescription shopping behavior
Figure 113: Prescription refills at drug stores—shopping behavior, by gender and age, October 2011
Figure 114: Prescription refills at drug stores—shopping behavior, by gender and household income, October 2011
Figure 115: Prescription refills at drug stores—shopping behavior, by presence of children in household, October 2011
Attitudes toward drug store shopping
Figure 116: Attitudes toward drug stores, by gender and age, October 2011
Figure 117: Attitudes toward drug stores, by gender and household income, October 2011
Figure 118: Attitudes toward drug stores, by presence of children in household, October 2011
Visits to retail health clinics
Figure 119: Visits to retail clinics for self, by gender and age, October 2011
Figure 120: Visits to retail clinics for self, by gender and household income, October 2011
Figure 121: Visits to retail clinics for self, by marital/relationship status, October 2011
Figure 122: Visits to retail clinics for self, by presence of children in household, October 2011
Attitudes toward retail health clinics
Figure 123: Reasons for visiting a retail health clinic, by gender and age, October 2011
Figure 124: Reasons for visiting a retail health clinic, by gender and household income, October 2011
Figure 125: Reasons for visiting a retail health clinic, by household size, October 2011
Attitudes toward treatment at retail health clinics
Figure 126: Treatment at a retail health clinic, by marital status, October 2011
Figure 127: Treatment at a retail health clinic, by presence of children in household, October 2011
Appendix: Trade Associations
- Albertsons Inc.
- American Medical Association (AMA)
- American Pharmacists Association (APhA)
- Chain Drug Marketing Association
- Coca-Cola Company (The) (USA)
- Consumer Healthcare Products Association (CHPA)
- Duane Reade, Inc
- Food and Drug Administration
- Giant Eagle
- L'Oréal SA
- National Retail Federation (NRF)
- Private Label Manufacturers Association (PLMA)
- Rite Aid Corporation
- Safeway Inc
- Supervalu Inc
- The Kroger Co.
- U.S. Bureau of Labor Statistics
- Walgreen Co
- Walmart Stores (USA)
- World Health Organization
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