Reinventing the Drugstore

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Reinventing the Drugstore

By Don Longo, Convenience Store News - 07/14/2003
Demographic and behavioral trends — specifically the aging of the baby-boomer generation and consumers' demand for convenience — favor the future growth of the chain drug store channel. However, to take full advantage of these trends, many drugstore retailers will need to transform their businesses from simple, cost-efficient, generic retail boxes to interactive information and retail centers that cater to the whole health and well-being of their customers.

The $164-billion drugstore industry is seeing 15 percent to 17 percent per year growth, but it's also under siege from federal regulators, margin erosion, a shortage of pharmacists, competitive pressure from other retail formats and lack of differentiation among the major individual drugstore chains. Experts report that chain drugstores are positioning themselves to meet the future needs of shoppers.

"Drugstores need a prescription for change," said Sandy Skrovan, vice president of Retail Forward, an international consulting firm. "Several years of sales gains have masked problems under the surface," she said. "And, unless drugstores can cure front-end ills, strategically retrench and redeploy to optimize market coverage, and stretch the pharmacist's reach, a tougher outlook is in the offing."

Perhaps part of the formula for helping drugstores capitalize on their vast potential lies in an innovative dose of store design. At least, that's the prescription recommended by four retail design firms that were invited by CSNews' sister magazine, Display & Design Ideas, to rethink and redesign the drugstore. Given two months and no budget limitations, each firm was free to be as imaginative and creative as it wished. The result, according to DDI editor Roxanna Sway, was four brand-new drugstore concepts that point the way to the future.

According to Sway, the four designs focused on three common ideas:

Rounder is friendlier. Curves prevail and space frees up and flows generously, leaving the banality of the "box" far behind.

Emphasis is placed on a holistic approach to health and well-being, including

sensory and therapeutic experiences — in some cases moving closer to a spa-like environment where customers can relax and rejuvenate.

The "high-touch," personal approach is imperative — with confidential, qualified advice from well-trained professionals on hand.

The store design from Columbus, Ohio-based Chute Gerdeman is focused on being a woman's "lifetime" drugstore. The firm envisions a warm and inviting, information-rich environment with an edited merchandise assortment focused on three solutions- based zones that women say are most important to them: beauty, health and family. An "express zone," designed to capture some of the convenience store market, is conveniently located near the entrance. However, all merchandise, even in this area, is beauty/ health/family-related.

The exterior of the store, which the firm calls "Lifespring," has flower boxes under windows accented with fabric awnings and an entrance garden. Parking spaces are grouped around the perimeter of the store for convenience and security.

Inside, the store features a fashionable color palette and a variety of materials and finishes. Wide aisles provide an open feeling and allow easy maneuverability for strollers and carts. Upbeat music and refreshing herbal and citrus scent waft through the store. Lifestyle graphics feature healthy, attractive women, but signage is kept to a minimum, with the emphasis on information, not price or manufacturers' brands.

Design Matters

With no end in sight to the nationwide pharmacist shortage, Canadian design firm Aedifica's drugstore of the future uses technology to free the pharmacist from counting pills and managing orders and allows him or her to spend more time with patients and customers. Key features: a pharmacist-centric environment where circulation and visual perspectives converge on a counseling area equipped with semi-private cubicles; digital displays and Internet-based stations providing a wealth of health and wellness information; and a soothing environment using translucent glass partitions with graphics, indirect lighting, comfort areas and privacy stations.

Seattle-based The Retail Group proposes a drugstore that leverages the only true points of differentiation for the category — the legal ability to dispense prescribed medications and the medical expertise to counsel customers on health-care issues.

The design firm sees medical brands, like the Mayo Clinic, extending into retail and opening a store like its proposed "Pharmalogica" design. Its merchandise mix would be chosen for its therapeutic benefits. Mass-market cosmetics would be out and higher-margin "cosmeceuticals" would be in. Homeopathic remedies, health-care aids and aromatherapy products would sit alongside Advil and Flintstone chewables. Customers would schedule appointments for massage, chiropractic care or reflexology, all performed by accredited professionals in spa-like surroundings. There would be classes for well-baby care, nutrition and stress management.

"Good Life," designed by Robert Young Associates of Dallas, is another circular store design. It offers a collection of products and services for maintaining a healthy lifestyle. There is a tranquil, Zen-like quality to the interior and also a therapeutic feeling.

Flowers and scents provide a welcoming sensory experience. In place of the soda fountain of yesteryear, the Good Life features a health beverage bar with an adjacent garden-like seating zone with books, periodicals and music. A circular path leads to the rear of the store, which is anchored by the pharmacy.

The rest of the store is divided into two parts. Remedies and therapy-related products are on one side, with traditional and natural/herbal over-the-counter medicines equally represented. Sports therapy products and equipment sales and rentals are adjacent to the prescription medicine counter. The other side of the store features well-being products and treatments.

"Most drugstores have already increased their focus on general merchandise to create more of a convenience store format in order to increase consumers' baskets, which is forward thinking," said John DeBatista, director of national accounts for Alberto-Culver. "Drugstores have to focus on the aging baby-boomer population. The ones that will be successful are those who take a broad approach to focusing on this group, that is, anything health care and nutrition-oriented."

DeBatista says retailers need to take advantage of natural tie-ins with special consumer needs, such as diabetes control. "We're already starting to see more wellness types of products, compared to curative ones. But drugstore retailers must increase that focus. The population is living longer and people are struggling with health needs that they never had to deal with in the past."

The executive notes that convenience is more than just having lots of corner stores. "The shopping experience needs to be conducive to aging consumers," said DeBatista.

Don Longo is Editor of Retail Merchandiser magazine.