Market Analysis Summary

The Royal Pharmacy's target market consists of two different groups, local customers or walk-ins, and
mail order customers.

The Royal Pharmacy will employ two different strategies to reach these two diverse market segments.

Market Segmentation
The Royal Pharmacy's customers can be broken down into two different groups, mail order customers
and walk-in customers:

 Mail order customers. This group of customers orders their medication through the mail in an
effort to save money. Generally, the mail order customers are older in age, typically over 50. In
general, elderly customers consume more medication relative to younger people. The mail order
customer will typically purchase maintenance medications - prescriptions for an ongoing ailment
that requires regular treatment. This group of customers will also be more likely to purchase
several months of medication at once.
 Walk-in customers. This group of customers are also looking for the lowest prices for their
medication. However, they tend to purchase medications monthly at their local pharmacy, often at
a higher price. There is not a common demographic for this group of people. Some of these
customers will pay for the medications out of pocket and some will submit a claim to their
insurance company for reimbursement at a later date.
Target Markets
The Discount Pharmacy will have different strategies for the two different groups.

The walk-in customers will be targeted through advertisements in the local paper, "The
Oregonian." The advertisements will raise visibility for The Discount Pharmacy and their
discounted prices. As the price of medication continues to skyrocket, The Discount Pharmacy
will appeal to local people as a way to try to contain these rising costs.

The mail order customers will be targeted through an advertising campaign in magazines and
newsletters that have an older (over 55) crowd that regularly needs medication and knows in
advance what their needs are. One of the main newsletters that The Discount Pharmacy will be
visible in is the A.A.R.P monthly newsletter.

Positioning
The Discount Pharmacy will position themselves as the premier, customer-service-orientated
mail order pharmacy in the U.S. The Discount Pharmacy will offer a good selection, great
service, and better prices than traditional pharmacies. The Discount Pharmacy will leverage their
competitive edge to achieve this positioning.

The Discount Pharmacy's competitive edge is superior pricing. Generally, it is not a sustainable
practice to compete on price. This is the case because it is based on the assumption that the
competition has the same cost structure, so in order to compete on price you have to accept
smaller margins which over time will erode the business model and profitability.

This reasoning does not apply to The Discount Pharmacy's situation because they are able to
maintain similar margins through cost-cutting measures and operating efficiencies.

The Discount Pharmacy is able to decrease operating costs by not offering all of the typical
services traditionally offered by pharmacies. The first cost measure is only employing a single
pharmacist, in compliance with Federal regulations, and using pharmaceutical technicians
 whenever possible. As long as a pharmacist is on-site during the hours of operation, The
Pharmacy can use the pharmaceutical techs in all other capacities that most pharmacies use
pharmacists for.

The Discount Pharmacy is able to maintain industry margins through the use of other operating
efficiencies. By only having a small store front and doing the bulk of business through mail
order, operating costs are significantly reduced.

Lastly, although there is a pharmacist on hand, The Discount Pharmacy is not designed to hold
the patients hands when they purchase their medications. The vast majority of The Discount
Pharmacy customers are veteran drug takers and are already aware of how to take the medication
and any side effects or drug interactions that should be avoided. Regardless, The Discount
Pharmacy will provide each patient with a print out of all the information they need for the
consumption of the drugs.

Marketing Mix
The Discount Pharmacy marketing mix is comprised of the following approaches to pricing,
distribution, advertising and promotion, and customer service.

 Pricing: The Pharmacy's prices will be better than traditional pharmacies.

 Distribution: The products will be distributed throughout the U.S.
 Advertising and Promotion: The most successful advertising campaigns will be targeted
advertisements.

 Customer Service: Obsessive customer service is the norm. All employees have been trained to

ensure that all customer's expectations are exceeded. This will occur at any short-term expense, realizing

that this is needed to build a successful business.

Marketing Strategy

1- Brand Management stratgy

Your brand defines who you are and what differentiates your pharmacy from your competitors.
Before you start working on your marketing efforts, take the time to ensure you’ve established
a strong brand.

2-Marketing communication stratgy

1. Survey your patients

What do your patients like and dislike about your pharmacy? How does your pharmacy compare to
national chain pharmacies or other independents in the area? Compile a list of questions like these
to email to patients or to ask in person. A survey can provide powerful insights into how satisfied
your patients are and what you can do to benefit them further.

2. Follow up with patients

Asking patients about their experience with your pharmacy is an easy way to learn where you can
make improvements. You can do so by making personal phone calls or simply asking them up front
during consultations.

3. Write an article
Consider writing an article for a local magazine or an opinion piece for your area newspaper. This
can serve as a free source of marketing for your independent community pharmacy. The article
should provide value to the community and be interesting to readers.
It can also double as free advertising since it mentions your name and your pharmacy. But be
careful not to simply create an advertisement disguised as an article—it won’t get published. (Here
are more tips to get your pharmacy in the news.)

5-­‐ Promotion strategy

6. Give away free samples or gifts

Let’s face it, people love free stuff. Giving something away is a great way to attract prospective
patients. Food and beverages are always a fan favorite, but items such as pens or mugs with your
pharmacy’s branding on them can also be successful.

8. Use good signage

How many times have you purchased something simply because you were attracted to the signage?
It happens all the time. A good sign will not only grab a patient’s attention, but it will also help direct
and inform them to products in your pharmacy. (Check out these tips for using shelf signs in your
pharmacy’s front end.)
25. Offer free health screenings
Offering free health screenings is a great way to attract prospective patients.
For example, offer free blood glucose screenings every so often. Not only does this service provide
value to your patients, it also opens the door for you to introduce related products and services, such
as your diabetes management program or supplementary diabetes products.

22. Participate in community events

Participating in or volunteering at community events demonstrates that your pharmacy supports your
community.
And, doing so gets your pharmacy’s name out there.
For example, sponsor a hole at a community golf tournament or set up a booth at a local 5K.

23. Partner with local businesses

Partnering with local businesses can boost awareness of your pharmacy, and your promotions can
reach more potential patients.
For example, partner with a local dentist’s office. Ask the office to include coupons to your pharmacy
in their giveaway bags and thank the business by posting a sign promoting its dental services in your
pharmacy.

4. Establish an online presence

At the very least, patients should be able to find out what your business is and how to contact you
via the Internet. That means having a website and social media accounts for your pharmacy. To make
your online presence more effective, consider advertising services that focus on reaching more of
your target audience at affordable pay-per-click rates.

6.02 Promotion strategy

The following will be Sample Pharmacy’s promotion strategy for the fiscal year 2007-08. 1. An
awareness campaign throughout the year by farming its geographic target
2. One launch event or anniversary celebration per year
3. Two health camps per store per year.
4. One charity event per year.
5. Two contests per year.
6. 22 Q&A answer ads in Frazer times, 4 profile ads per year (one every quarter), 1 sale ad per year.
7. 1 sale per store per year.
8. Direct mailers to diabetics, genecology, cardiac, pediatric and dermatology patients every quarter
i.e. 4 times a year.
9. Direct mailers of birthday cards with a gift coupon every month.
10. Market research (internal) twice a year.
11. Market research through an external agency, if required, once a year.
12. One Diwali promotion a year.
13. One Christmas and New Year promotion per year.
14. Listing on Just dial
15. Listing on the Yellow Pages
16. Implementation will be measured by filling up the pre and post promotion form.

7-Competitive advantage
7.1- Understand your competition A small amount of detective work
is all you need to do in order to understand your competition.

Follow these steps to gain valuable knowledge about your

competition:

• Identify the top three to five competitors in your immediate area.

These could include other pharmacies, grocery stores with
pharmacies, or big-box retailers with pharmacies. • List what they
do well. Consider how you might copy or improve upon it. • List
what they do not do well. Ensure that you are not making the same
mistakes. • Ask yourself “if I were going to advise this pharmacy
how to do business better, what would I suggest?” • Take your own
suggestions and put them to work in your store.
focus on what your customers want. This requires asking questions,
knowing the competition, and a willingness to adapt current
practices to become the destination retailer for a particular
population. Independent pharmacies are ideally positioned to cater
to a specific demographic or therapeutic niche. Examples of niches
include the following:

• Home health care • Diabetes care • Women’s health •

Asthma/allergy • Screening • Vaccinations • Skin care • Nutritionals
• Home diagnostics • Sports medicine • Homeopathy/alternative
medicine • Family caregiving
8-­‐ Market Development strategy

Strategies
The single objective of The Discount Pharmacy is to establish themselves as the mail order
pharmacy serving the U.S. The Discount Pharmacy will aim to achieve a 30% market penetration
within five years. The marketing strategy will seek to first create customer awareness regarding
the products/services offered, develop the customer base, and work toward building customer
loyalty and referrals.

The Pharmacy will use advertisements to communicate the message. Advertisements will be
placed in different venues depending on the target segment that is trying to reached. To reach
the walk-in customers, advertisements will be run in The Oregonian. To reach the mail order
target segment advertisements will be placed in A.A.R.P's newsletter.

Marketing Research
During the initial phases of the marketing plan completion, several focus groups were held to
gain insight into the targeted customer's mind and the processes of their decision making. These
focus groups provided the Pharmacy with a wealth of information.

Additionally, survey were handed out and completed by people that use traditional pharmacies to
purchase their medications. The surveys were developed by The Discount Pharmacy's owner
himself, leveraging his statistic skills that he mastered while pursuing his MBA. Having a
carefully designed survey is paramount to ensuring that the data collected is accurate and
applicable. The surveys provided insight into the barriers that people face when moving from
using a brick and mortar pharmacy to a mail order pharmacy.

The last source of marketing research is an in-depth analysis of the pharmacy industry, focusing
on consumer decision models within the industry. Cumulatively, all of this market research
provided the owner with the necessary "kick in the pants" to move forward with his idea.

Target Market Segment Strategy

The Royal Pharmacy will seek to attract two different groups of customers and will thus have two
strategies to attract them.

We anticipate that by far our largest group of customers will be those who order through the mail.
These customers will be targeted through an advertising campaign in magazines and newsletters that
have an older (>55) audience who regularly need medication and are aware in advance of their needs.

Walk-in customers will be targeted through advertisements in the local papers will raise awareness for
the The kalarikal Pharmacy and our low prices.
 Figure 1 – PEST analysis potentially relevant to Pharmacy

Factor Potential Impact

POLITICAL Patient Surveys. Increased emphasis on provision of

CQC & NHSLA standards. information for patients/carers.
NHS Outcomes Framework & Increased number of services delivered
Quality focus. by the private sector
Maturing Clinical Commissioning New relationships with new/different
Groups expectations and priorities
Increased support of private sector Potentially increased reporting
involvement requirements and local accountability,
Patient choice audit and monitoring
Reducing health inequality Increased competition for service
Any Qualified Provider delivery

Ongoing austerity measures and Conflicting priorities: impact on time for

ECONOMIC continued focus on sustainable safety, training, assurance etc.
efficiency Potentially less staff.
Cost improvement on medicines. Reduced income and increased
Cost improvement in pharmacy. pressure to deliver more for less
Selective service delivery by the Higher than funded level of inflation
commercial sector Potential tariff reductions in MH
Pressure on capital budgets Capital funding developments curtailed

SOCIAL Changing labour market Increased elderly population

Changing demographics Possible recruitment difficulties
A culture of litigation developing Increased demand for some services
Inadequate supply of qualified Increased litigation
pharmacy staff available. Use of locums; pressure on
More elderly, & more complex supporting/developing staff.
patients More medicines risks and less time to
resolve or patients not seen by
pharmacy.

TECHNO-
LOGICAL • More complex medicines. • More knowledge/training & information.
• More e-systems [e-prescribing, • High costs, benefits & organisational
timesheet, ordering, ESR etc] change.
Improved communication tools e.g. • Staff access to IT.
telehealth/telecare and
Decision aided technology
Pharmacy SWOT Analysis
Strengths Weaknesses
 Clinical expertise within mental health  External pharmacy report (2012)
and learning disabilities recommendations not fully implemented
 Chief pharmacist in post with clear  Staff development; alignment of rotas
vision to take pharmacy service forward with functions
 Established pharmacy teams with some  Pharmacy accommodation needs
highly committed staff upgrading
 dedicated experienced staff with a  Quality and performance metrics need to
strong background in mental health; be developed in some pharmacy areas
Positive, productive relationships with  Management and review of SLAs
primary care  Technology not fully exploited, eg e-
 Service user / carer support via the prescribing, use of pharmacy robot
'choice and medication' resource  Need to develop link between savings on
 Participation in national POMH audit drug expenditure and (re)investment with
programme pharmacy
 Use of ISIS at Rampton to support
clinical decision-making etc.

Opportunities Threats
 Collaboration with pharmacy  Profile of pharmacy in the Trust
organisations within primary care /  CIP pressures on Pharmacy
Competition and Buying Patterns
Competition takes many different forms in the pharmacy industry.

 Chain pharmacies. These are state or national chains. The advantage to these chains are better
prices through economies of scale, as well as personalized service. The personalized service takes
the form of the chain having a record of your medication purchases as well as any allergies that
you have disclosed to them.

 Local pharmacies. These are the pharmacies where you typically know the pharmacist and they
know your medical history. This option is high in personalized service and convenience, and high in
price.
 Mail order and Internet pharmacies. These are similar to The kalarikal Pharmacy.