Study: Most consumers welcome Amazon’s move into pharmacy
There is good news for Amazon in a research report from Global DataRetail regarding the online giant’s acquisition of online pharmacy PillPack.
Fifty-four percent of Americans approve of Amazon’s decision to enter the pharmacy market — most likely because they think it will increase competition and reduce prices, the data showed. Only 24% think that the move is a bad thing, with the remaining consumers taking a neutral position. Approval is fairly even across the various demographic groups.
However, it will not all be smooth sailing. Consumers have concerns about sharing sensitive medical and health information, which Amazon will need to overcome, according to GlobalData Retail. Insurance network restrictions may also prevent some consumers from using Amazon — even if they want to.
The data also suggests that many consumers like having a physical store where they can get advice or pick up prescriptions. While this could limit Amazon’s growth if it sticks to the PillPack mail order model, it also gives the company an opportunity to develop a physical presence, perhaps using its Whole Foods Markets stores, noted Neil Saunders, managing director, GlobalData Retail.
“In any case, there are sufficient numbers [of consumers] who seem willing and able to use Amazon’s pharmacy services to allow the online giant to build a credible business and cause some disruption to established players,” Saunders said.
Here is a summary of findings from the GlobalData report:
• About 36% of consumers say they would either be very likely or likely to go to Amazon to fulfil their prescription needs. Almost 41% are not sure if they would use Amazon — most likely because it would depend on the networks permitted in their insurance or health plans.
• When it comes to where consumers would like Amazon to offer its pharmacy services, 61% are happy with mail order. But a sizeable number would like to see Amazon develop a physical presence, either at its Whole Food stores or via stand-alone pharmacies. Within ‘somewhere else’, respondents noted Amazon’s bookstores, kiosks in malls and a few mentioned Amazon’s Go convenience concept. These numbers suggest that for Amazon to really penetrate pharmacy, some sort of physical presence is needed, even if not on the scale of the traditional drugstore chains.
• Sharing data could be a barrier for Amazon with almost 58% of consumers saying they’d have at least a minor concern about sharing medical and health information with the company. On the flipside, almost 38% say they would have no problem at all (these consumers tend to be younger).
• Other barriers to using Amazon in pharmacy include a perceived lack of customer service, a desire to visit a physical pharmacy store, potential insurance restrictions, and safety concerns about mail order dispensing.
• When it comes to what Amazon could bring to the pharmacy market, the vast majority of consumers (79%) would like Amazon to lower prices. The ability to pick up prescriptions from Whole Foods stores and have same day delivery were also popular. Just under 60% of consumers would like to be able to reorder drugs via Alexa, and 48% would like a discount for Prime members.
NRF warns of ‘full effects of a trade war’
Retailers continue to register their opposition to the proposed tariffs on Chinese goods, with the first round ($34 billion) set to take effect beginning 12:01 a.m. Eastern Time, on Friday, July 6.
“With tariffs against China taking effect, American consumers are one step closer to feeling the full effects of a trade war,” said Matthew Shay, president and CEO, National Retail Federation. “These tariffs will do nothing to protect U.S. jobs, but they will undermine the benefits of tax reform and drive up prices for a wide range of products as diverse as tool sets, batteries, remote controls, flash drives and thermostats. We strongly urge the administration to abandon its plans for tariffs on another $200 billion in Chinese imports, which would destroy thousands of American jobs and raise prices on virtually everything sold in our stores.”
A study conducted earlier this year for NRF and the Consumer Technology Association found that tariffs on $50 billion of Chinese imports would reduce U.S. gross domestic product by nearly $3 billion and lead to the loss of 134,000 American jobs, with four jobs lost for every job gained. Imposing tariffs on an additional $100 billion of Chinese imports would bring the total impact to a $49 billion reduction in GDP and the loss of 455,000 jobs.
Done Deal: Nine West has new owner
Authentic Brands Group has expanded its brand portfolio.
The brand management company announced it has completed its acquisition of Nine West and Bandolino from Nine West Holdings. The acquisition increases ABG’s footwear and accessories business to more than $2 billion in global retail sales, and brings the company’s total brand portfolio to nearly $8 billion in global retail sales.
As part of the acquisition, ABG assumes all licensing partnerships and marketing activities for the Nine West and Bandolino brands. It has appointed Marc Fisher Footwear to operate the footwear businesses and Signal Products to operate the handbag and small leather goods businesses.
The company said its initial focus for Nine West and Bandolino will be on developing near-term and long-term strategies that reinforce the brands’ fashion positioning in key markets around the world. It will also accelerate the acquired brands’ ongoing expansion into new territories and categories including sportswear, outerwear, swimwear, intimates, fragrance, sleepwear, and home.
ABG has some 33 brands in its portfolio, including Nautica, Judith Lieber, Aéropostale, Juicy Couture, Jones New York, Frederick’s of Hollywood, Frye, Hickey Freeman, Hart Schaffner Marx and Tretorn. Its global footprint includes more than 50,000 points of sale and more than 4,381 branded freestanding stores and shop-in-shops.
“From the moment ABG won the bid for Nine West and Bandolino we received an outpouring of interest from retailers, distributors, and new licensing partners,” said Jamie Salter, chairman & CEO of ABG. “Now that the acquisition has been formalized, we are kicking the brands’ growth strategies into high gear.”