Brian Lagrange (5-2 Milestone Two Final Project )
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Jan 9, 2024
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5-2 Final Project Milestone Two: Draft of Context and Market Analysis
Southern New Hampshire University HCM 325: Healthcare Marketing Brian Lagrange November 16, 2023
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Establish The Context Marketing Goals
Competition Analysis
Target Marketing- Establishing Target Customers
SWOT Analysis (Strength, Weakness, Opportunities, and Threats)
Industry Segment Walgreens open it’s first store in Chicago, IL in the year 1901 and today they continue to accomplish outstanding customer service experiences with over 8,200 locations currently
open now and its online services. The services that they are currently offering are a retail store setting, a pharmacy, and a medical facility (Walk-In Clinic). Walgreens has managed to initiate over 400 Healthcare Clinics which provide a suitable approach to a patient’s medical needs and other necessary clinical services. The Clinic locations are properly staffed with board-certified family nursing practitioners who are trained to diagnose and treat a variety of illnesses and chronic conditions. These practitioners also can order diagnostic tests and offer preventive care at the same location. Walgreens has teamed up
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with WebMD in which it provides patients with a numerous amount of digital health resources. On average one out of every five Walgreen Customer who are wanting to not only look the best and feel good at the same time, so Walgreens has decided to go substantial when it comes to beauty. They are compiling a massive range of highly-quality products for both men and women of all age’s groups, which include, hair care, fragrances, cosmetics, and a variety of other selected items. When examining the brand of products, you can notice that many locations of Walgreens are now stocking their shelves with the popular brand called “Boots No. 7 (Walgreens.com 2021).
Target Markets:
Walgreen primarily focuses on customers who are between the ages of 25-54 years old and those that who have at least two children when doing market research. The Women are usually the main caretakers for an elderly parent or a relative who needs assistant living. Some high school graduates then have an income of over $47,000 after graduating high school. Walgreens has a focus now on the store of the future and their focus is built upon their customer profile and their customer lifestyle. They also based their research on where the customer shops for themselves as well as where they shop for their family. “According to a July 2012 Pew Research study, 30% of American Adults help a loved one with their personal needs, household chores, managing their current finances, arranging for outside services, or paying weekly visits to see how they were doing. Most are caring for an adult- usually a parent or spouse” (Mintel Trend Observation, 2021). According to research the Senior Population is known to have the second largest target customer profile. Also according to research, the United States is getting older and according to the Administration
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of Aging, Customers 65 years of age and older represented 12.4% of the total population in the year 2000, and was said to believe that this number would increase by 19% by the year 2030 and 25.5% by the year 2050. There are currently over 10,000 baby-boomers that are turning the age of 65 years old each day. Walgreen should be able to benefit from this growing aging population, because older citizens require more prescriptions medications. Medication. Medications that are usually taken by older citizens are often taken to extend their lives or improve their quality of life. On average, the number of prescriptions that an elderly person takes is 800 % greater than the average adult., so with this statistic in mind collecting co pays from seniors at this rate leads to vast majority revenue potential for Walgreens. Data the was obtained from OECD shows results in 2015. 1 out of every 10 people in certain counties were over the age of 80 compared to only 4% in 2012. The cost of caring for an elderly person in this time climbed up over 300% (Mintel Trend Observations,2021)
Market Analysis SWOT Analysis Strengths:
Walgreens is being run at a very competitive pace incorporating their recent technology at the highest volume within the stores and along the supply chain
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80 % of Walgreens Stores have a digital Lab located within their facilities (Walgreens.com)
Implementation of Radio Frequency Identification monitoring would display the impacts inside its store chains.
Weakness
Walgreens number of Acquisitions is not in high demand and their expansion depends on the success of their current stores.
There is not constant implementation throughout the chain of stores.
Not enough parking Space, which sometimes deters the customers from wanting to shop there. (Walgreens.Com)
Opportunities:
Walgreens has a high belief in putting a lot of focus on their healthcare division
Considerable expansion of in-store healthcare facilities by appointing licensed doctors and medical staff. (Walgreens.com)
Threats:
Medical lines are being cut off for the generic and organic drugs
Lawsuits were filed because the company was found liable for disclosing privacy information
There is an increase in competition with pharmacy chains and supermarkets, such as Walmart, that have incorporated the pharmacy section in its stores. (Walgreens.com)
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Competitor Analysis:
CVS offers a variety of prescription drugs and has a variety of merchandise that include the
following: OTC Drugs (Over The counter Drugs), beauty supplies, One Hour Photo Services, Season Merchandise for every Holiday, A variety of Groceries through their retail
CVS Pharmacy Retail stores and online at CVS.com. They also provide similar services when it comes to healthcare just like Walgreens and have more than 1,000 Minute Clinics as well as Diabetes care Centers. Most of their Clinics are located within the stores.
Market Position
Walgreens to have an average annual gross profit of 38% compared to the 23% that CVS averages per year (2019 CVS and Walgreen Annual Report) Walgreens store locations are based on the Medical Consumer Price Index, which simply means that they follow the results of the Medical Consumer Price Index before deciding whether they will build a future location. Which means in return the higher amount of medical expenses, the greater chance that a town/city will see a Walgreen in their neighborhood. Walgreens and CVS will
continue to grow and take the current healthcare market to new heights and with their ideals
for expansion within the next ten years. The mission is to provide affordable healthcare to everyone in the United States and give everyone access to Wellness products. Walgreens opens a new location every 48 hours and 75% of the United States population live within 5 miles of a Walgreens store (2019 Walgreens Annual Report). Walgreens is accelerating new store openings while CVS is slowing down, which is creating a gap between them.
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This is how Walgreens will retain their competitive advantage. (2019 Walgreen Annual Report)
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References:
Butcher, L., (2016 March 8) Consumer Segmentation Has Hit Health Care.
Here’s How it Works.
https://www.hhnmag.com/articles/6932-consumer-segmentation-just-hit-health-
care-heres-how-it-works
Facts & FAQ (2021). Walgreens Newsroom. https://news.walgreens.com/fact-sheets/frequently-asked-quesions.htm
Fein, A.J. (2016, April 7) Walgreens Boot Alliance Talks Pharmacy Margins, Beauty, Express Scripts, Valeant, and More. Drug Channels. https://www.drugchannels.net/2016/04/walgreens-boots-alliance-talks-pharmacy.html