Evolving Distribution Channels: How CHCs Can Continue Using the Brick-and-mortar Pharmacy Channel Effectively and Efficiently

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brick and mortar pharmacy

The way consumers buy medicines has changed significantly in recent years. While brick-and-mortar pharmacies are still by far the most important sales channel, more and more consumers in most countries worldwide seek information online and also buy OTC products in the digital sphere. As a result, the relevance of brick-and-mortar pharmacies is declining, and consumer healthcare providers must ask themselves how they can continue to use this channel effectively and efficiently.

Consumers used to find out about and buy medicines in store, but today, more and more of them are doing this online. For example: According to recent studies, 62 percent of Germans now order medicines from online pharmacies. Among 16- to 49-year-olds, the figure is as high as around 80 percent, indicating that the framework conditions for selling consumer healthcare (CHC) products have changed. What is happening to the traditional brick-and-mortar pharmacy, which used to be a central component of the patient journey? Targeting them no longer with their sales strategies would not make sense for CHC companies, as it is still the most important sales channel. However, it would also be unwise for companies to not adapt their sales model to the new reality, even though it has been successful for decades.

The brick-and-mortar pharmacy channel is evolving

In most countries, the number of brick-and-mortar pharmacies has been declining for years, and all forecasts indicate that this trend will continue. The remaining pharmacies will likely become larger and operate more professionally. In addition, the way consumers buy CHC products has changed, and not just since the COVID-19 crisis. Pharmacies’ “information sovereignty” and their influence on patients’ purchasing decisions has waned, as consumers increasingly obtain information online. Current trends, such as health platforms (,,, last mile delivery, and digital prescriptions, suggest that a growing number of consumers will make their purchasing decisions outside pharmacies. Consequently, pharmacies’ influence on these purchasing decisions will continue to diminish.

Over time, consumer healthcare companies will have to serve fewer but likely larger pharmacies due to ongoing market consolidation. At the same time, pharmacies’ falling influence on purchasing decisions indicates that the ROI of sales activities is declining.

Technological trends create new opportunities

The other side of the coin is that CHC providers can digitize processes and perform them more cost-effectively or supplement them with digital activities to make them more effective (e.g., self-service portals or video calls instead of visits and product presentations). However, these types of digitalization measures must be weighed carefully because pharmacies have varying degrees of openness to digital, and even things as simple as video calls can fail due to very mundane hurdles, such as limited staff availability or poor network coverage.

Five starting points for successful pharmacy sales

In light of the evolving brick-and-mortar channel and the impact of tech trends, here are five fields of action companies should take:

1. Review the sales strategy and investments based on it:

Companies should determine whether their current investments in sales measures at the respective pharmacies are worthwhile. They need to fully understand how the patient journey has changed and find out how great of an impact pharmacies’ influence and investments have on customers’ purchasing decisions. Figuring out whether their investments generate quantifiable added value is key and ultimately determines where consumer healthcare providers should invest in the future, how much, and in what form.

2. Optimize customer care:

Thorough customer segmentation is recommended to effectively tailor sales measures, and segmentation should be based on several factors. On the one hand, a pharmacy’s sales and potential continue to be important. On the other hand, CHC manufacturers should also pay attention to behavior-based criteria, such as how open a pharmacy is to digital measures and what preferences it has regarding contact type and frequency. In other words, segmentation should be tailored, and the intensity and type of interaction with a pharmacy should not only be based on its size. Companies need to consider all important factors in order to offer the best solution for each case. Furthermore, as pharmacies continue to grow in size, CHC companies need to consider to which extent they should expand their key account teams more to serve the increasing number of large and highly professional pharmacies. Aspects, such as sales efficiency due to increasing travel time for these teams must be weighed against the advantages of more professional support for this customer group.

3. Increase the efficiency of pharmacy care:

CHC manufacturers need to be more efficient, not just better. Digital tools offer great savings potential; for example, orders can be placed via online tools instead of on site by sales staff with telephone support. Providers should also regularly check whether training, product information, and point-of-sale activities really need to be carried out in person or whether digital channels can be used. It’s important to continuously balance efficiency considerations with the effectiveness of the chosen channel.

4. Strengthen the sales force:

If more and more pharmacies are being served digitally, consumer healthcare companies must also empower their sales teams to do the same. Sales reps will only be able to optimally serve their customers if they are able to effectively work with and communicate via digital solutions. For example, in addition to offering training, companies may want to invest in building new teams with specialized skills focused on key account management or remote sales.

5. Measure impact and success:

All the above mentioned measures and developments must be undertaken more than just once. CHC providers must take an agile approach, ensuring and optimizing effectiveness by conducting pilot projects, running constant testing, and regularly making improvements. The basis for this is monitoring all relevant KPIs.

The brick-and-mortar pharmacy channel is in a state of flux, and CHC companies must reevaluate their sales strategy. As a starting point, companies need to get a detailed understanding of the patient journey and the role pharmacies are playing in the buying process.

Next up:

Evolving Distribution Channels: Why the Importance of Retail is Growing as CHC is Moving in the FMCG Direction





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