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US Drug Store Retailing market report

The effects of an aging population focused on health management are positive for the drug channel, which is projected to continue on its path of upward sales growth over the next five years.

This report examines the following:

  • Many drug store trips occur outside the channel
  • Most consumers have issues with price
  • Many shoppers aren’t using all that drug stores provide

For the purposes of this Report, Mintel has defined a drug store as a retail store where a primary component of the store is a pharmacy, selling prescription medicine and staffed with a pharmacist. Other categories commonly found at drug stores include OTC (over-the-counter) medicine, beauty and personal care, household needs, and a limited selection of food. When referring to “drug stores,” this Report considers those that are traditional drug stores, not including other retailers with pharmacies such as grocery stores, warehouse clubs, or mass merchandisers. These other retailers are also discussed in the Report as locations consumers may shop for drug store needs, yet are not referred to as “drug stores.”

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Many drug store trips occur outside the channel
            • Figure 1: Retailers shopped, February 2017
          • Most consumers have issues with price
            • Figure 2: Attitudes toward drug store shopping, by age and gender, February 2017
          • Many shoppers aren’t using all that drug stores provide
            • Figure 3: Attitudes toward drug store shopping, February 2017
          • The opportunities
            • Unlock private label/store brand potential
              • Figure 4: Attitudes toward drug store shopping, by generation, February 2017
            • Tailored healthy assortments could appeal to more shoppers
              • Figure 5: Influencers to encourage more shopping, February 2017
            • Upgrade digital services
              • Figure 6: Influencers to encourage more shopping, February 2017
            • What it means
            • The Market – What You Need to Know

              • Positive growth expected to continue
                • Medicine and BPC drive segment sales
                  • Growth among those 55+
                    • Online will play a key role
                    • Market Size and Forecast

                      • Positive growth expected to continue
                        • Figure 7: Total US sales and fan chart forecast of market, at current prices, 2011-21
                        • Figure 8: Total US sales and forecast of market, at current prices, 2011-21
                    • Market Breakdown

                      • Positive sales forecasted for all segments, driven by prescription medicine
                        • Figure 9: Total US drug store revenues and forecast, by segment, at current prices, 2011-21
                        • Figure 10: Total US retail sales of Drug Store Retailing, by segment, at current prices, 2014 and 2016
                    • Market Factors

                      • 55+ consumer group continues to grow
                        • Figure 11: Number of households, by age of householder, 2006 and 2016
                      • Healthcare changes are a concern for many consumers
                        • Figure 12: Election impact, by gender, February 2017
                        • Figure 13: Median household income, by age of householder, 2015
                      • Obesity is still an issue
                        • Figure 14: Prevalence of obesity among adults aged 20 and over, by sex and age: United States, 2011-14
                      • Rural areas represent opportunity
                        • Figure 15: Image of Walgreens community pharmacy in Iowa, April 2017
                        • Figure 16: Rural vs urban population, December 2016
                      • Connectivity changes shopping
                        • Walgreens, Rite Aid merger could influence the market
                        • Key Players – What You Need to Know

                          • Drug stores winning with certain consumers, but others shifting elsewhere
                            • Health and wellness items remain products of interest
                              • Walmart is the most shopped retailer for drug
                                • Online shopping is growing in the channel
                                • What’s Working?

                                  • Health, wellness, and personal care most purchased items
                                    • Figure 17: Items purchased – Any in-store or online purchase, by repertoire any in-store or online purchase, February 2017
                                  • Other categories capturing consumer interest
                                    • Figure 18: Items purchased, by gender and age, February 2017
                                  • An opportunity to grow store brands
                                    • Figure 19: Walgreens E-mail, March 2017
                                • What’s Struggling?

                                  • Other channels are winning drug store related trips
                                    • Figure 20: Retailers shopped, by parental status, February 2017
                                  • Customers have trust and price issues with drug stores
                                    • Figure 21: Attitudes toward drug store shopping, by age, February 2017
                                  • Most consumers not using provided services
                                  • What’s Next?

                                    • Tailored assortments for healthy living
                                      • Expanded digital offerings and services
                                      • The Consumer – What You Need to Know

                                        • Channel shifting is occurring
                                          • Destinations for BPC, healthcare, and private brand
                                            • A need for better prices and products
                                              • Promote transparency and awareness of provided healthcare services
                                                • Enhance shopping options to win online and in-store
                                                • Retailers Shopped

                                                    • Drug stores face increased competition
                                                        • Figure 22: Retailers shopped, by gender and age, February 2017
                                                      • Mass merchandisers winning over customers
                                                        • Figure 23: Retailers shopped, by Hispanic origin, February 2017
                                                      • Online is a key channel
                                                          • Figure 24: Retailers shopped online, by age, February 2017
                                                        • Warehouse club stores and supermarkets see slippage
                                                          • Figure 25: Retailers shopped, by parental status, February 2017
                                                      • Items Purchased

                                                        • Medicine, beauty, and healthcare items most purchased
                                                          • Figure 26: Items purchased, part 1, February 2017
                                                          • Figure 27: Items purchased, part 2, February 2017
                                                        • Drug stores destinations for health and wellness, BPC
                                                          • Figure 28: Select items purchased, February 2017
                                                        • Food and household items are fill-in trip purchases
                                                          • Figure 29: Items purchased, by age, February 2017
                                                        • Online purchases are growing
                                                          • Figure 30: Select items purchased, by age, February 2017
                                                      • Attitudes toward Drug Store Shopping

                                                        • An opportunity for private brand products
                                                          • Figure 31: Attitudes toward drug store shopping, by age, February 2017
                                                        • Services are underutilized
                                                          • Figure 32: Attitudes toward drug store shopping, by parental status and number of children in household, February 2017
                                                        • Price versus convenience
                                                          • Figure 33: Attitudes toward drug store shopping, by parental status, February 2017
                                                      • Influencers to Encourage More Shopping

                                                        • Better prices, products and services can boost shopping
                                                            • Figure 34: Influencers to encourage more shopping, February 2017
                                                          • Shoppers seek improved prices and products
                                                            • Figure 35: Influencers to encourage more shopping, by age and gender, February 2017
                                                          • Shoppers want more
                                                            • Figure 36: Influencers to encourage more shopping, by age and Hispanic generation, February 2017
                                                        • Retail Clinics

                                                          • Overall usage is low, but those who visit are mostly pleased
                                                            • Figure 37: Retail clinics visited, February 2017
                                                          • Reasons for not visiting clinics range from no identified needs to skepticism
                                                            • Figure 38: Reasons for not visiting clinics, February 2017
                                                          • Young men visit retail clinics the most
                                                            • Figure 39: Retail clinics visited, by gender and age, February 2017
                                                          • Thoughts on retail clinics visited
                                                            • Figure 40: Perception of retail clinics visited, February 2017
                                                        • Appendix – Data Sources and Abbreviations

                                                          • Data sources
                                                            • Sales data
                                                              • Fan chart forecast
                                                                • Consumer survey data
                                                                  • Direct marketing creative
                                                                    • Abbreviations and terms
                                                                      • Abbreviations
                                                                      • Appendix – Market

                                                                          • Figure 41: Total US drug store revenues and forecast, at inflation-adjusted prices, 2011-21
                                                                          • Figure 42: Households by number of members, 2016
                                                                        • Mintel post-election survey methodology
                                                                        • Appendix – Consumer

                                                                          • Repertoire analysis description
                                                                            • Other supporting data
                                                                              • Figure 43: Retailers shopped - any visitation, by repertoire any in-store or online purchase, February 2017

                                                                          Companies Covered

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