2. More Competition to Improve In-Store Experience

According to one research report, 83% of all new pharmacies go out of business within an average of 2.5 years. It can be difficult for smaller pharmacies to find a market and garner enough name-brand recognition to compete with chain pharmacies. Even if they do, it’s hard to continuously evolve with a changing retail pharmacy landscape. Established brands like Walgreens are also having to diversify their in-store product offerings in order to compete with other large pharmacy chains. CVS Health, for example, appears to be making big changes that will allow it to be more competitive. It has rolled out a proprietary tool called RX Savings Finder to help customers save up to $75 on some prescriptions. CVS also now offers CBD products in eight states. The company will be opening 1,500 HealthHUBs by the end of 2021. These stores will host group events, including health classes, nutritional seminars, and benefits education.

CVS HealthHUB concept store

3. Amazon and CVS Launch Pharmacy Delivery Services

Amazon acquired PillPack, an at-home prescription drug delivery service, in September 2018 for $753 million. The service now includes free shipping of prescription medicine for Amazon Prime members in every US state, except Hawaii. On August 5, 2019, CVS announced its plans to launch its own delivery service as part of an expanded CVS CarePass membership program. It will also be available nationwide in the US and let customers receive pharmacy product deliveries for free.

Walgreens now must take on market challengers that are introducing services that cater more to millennials and younger generations of customers who have grown up in a world of e-commerce. Will Walgreens add a similar delivery service, or will it focus on revamping other parts of its business model instead? The reality is that tech giants are continuing to not only create new markets but also reshape markets in established industries that hadn’t seen major changes for decades.