Walmart and Amazon have both unveiled new pharmacy-oriented programs that seem designed to generate growth for the two retailers, though there is a divergence in their approaches - Walmart seems to be using pharmacy as a way to generate greater enthusiasm for its Walmart+ offering, while the Amazon program seems designed to further its healthcare ambitions.
Here are the stories:
•. Fox Business reports that "effective immediately, any Walmart+ member will receive discounts up to 85% off for select medications or, in some cases, entirely for free as part of the members-only prescription savings program Walmart+ Rx for less … To receive the savings at any Walmart pharmacy, members will need a pharmacy savings card and a valid prescription. Members can also get discounts applied to e-prescriptions provided by a prescriber and transferred to the pharmacy, according to Walmart."
In a message to customers this week, Walmart said that savings are available to members for "a variety of health needs, including heart health, mental health, antibiotics, allergies and diabetes management," though it did not detail the prescriptions covered and the ones that are not.
Fox Business offers some context: "Last year, the Arkansas-based retailer launched Walmart+, charging subscribers either $98 a year, or $12.95 a month, in its latest effort to compete with e-commerce giant Amazon which launched its Prime subscription service in 2005. Walmart+ offers same-day delivery on 160,000 items, a fuel discount at certain gas stations and a chance to check out at Walmart stores without having to wait at a register."
•. Amazon said yesterday that it now is "offering six-month prescriptions starting at $6 for medications of common health issues" through its Amazon Pharmacy program, Reuters reports.
According to the story, Amazon said that "under the new offering, customers can search for their medication by name and find out if it’s eligible for a six-month supply and what the price it will be when using the Prime prescription savings benefit … The company said Prime members would get additional savings when paying without insurance. Customers can pay as low as $1 per month for select medications, including drugs to treat diabetes and blood pressure, and will get free two-day delivery."
Bloomberg writes that "the new offering from Amazon Pharmacy is aimed at consumers who take just one or two daily pills to manage common ailments such as high-blood pressure and diabetes. Amazon Prime subscribers, who pay for delivery discounts and other perks, will be able to get six-month prescriptions for $6 on such medications as amlodipine for high blood pressure and simvastatin for high cholesterol.
"Amazon can buy the medication in bulk at a discount and make two annual deliveries to the customer, using the savings to reduce costs, said Amazon Pharmacy Vice President TJ Parker. 'We want to make filling a prescription just as easy as shopping on Amazon,' he said."
Reuters writes that "the e-commerce giant launched an online pharmacy in November for delivering prescription medications in the United States and stirring up competition with drug retailers such as Walgreens Boots Alliance, CVS Health and Walmart … Amazon is also looking at launching physical pharmacies in the United States, the Insider reported last month."
- KC's View:
Health care-centric strategies remain an enormously fertile ground for retailers looking to establish enduring points of connection with shoppers, which is why we see Amazon and Walmart making these moves. They also threaten the status quo - which is why CVS and Walgreen stocks dropped in value when these programs were announced.