32 Chain Drug Review/April 27, 2015 My Turn Millennials know what they want from drug stores By Alex Perwich A survey by nonprofit organization Enactus USA provides some insight into the Millennial shopper (age 35 and younger). Enactus polled 1,777 students about their shopping habits at chain drug stores. Results were segmented to compare responses for Millennials and non-Millennials (36 and older). Ninety-four percent of the survey respondents were Millennials and 6% non-Millennials. Students were asked about how frequently they shop, the products and services that they seek, on-site health care services and the influence of social media. Here are some of the survey’s key findings: beauty products, 49%; and prescription drugs, 43%. Non-Millennials were more likely to seek prescription drugs (26% compared to 16%) and over-the-counter medications, (25% compared to 21%). Millennials were more likely to seek food and beverages (23% compared to 13%). • Millennials more comfortable receiving health care services at chain drug stores. When respondents were asked about their comfort level with receiving health care services that were once restricted to the physician’s office (e.g., immunizations and treatment for routine ailments) at a chain drug store, 20% reported being very comfortable, 44% somewhat comfortable, 26% somewhat A personalized experience is important to younger consumers. • Millennials more likely to shop monthly. When asked about the frequency of visits to chain drug stores, 7% reported every few days, 26% weekly, 40% monthly, 14% quarterly, 6% twice a year, 2% annually and 4% never. Millennials were more likely to shop monthly in comparison to non-Millennials (40% compared to 35%). Non-Millennials, however, were more likely to shop at least weekly (30% compared to 25%). Among the 4% of participants who reported never visiting a retail pharmacy, 69% reported they had no need to because they were never sick, 10% reported inconvenient locations, 8% reported they preferred natural remedies, 6% said the prices were too expensive and 2% reported privacy concerns. Only 5% reported that they never visited retail pharmacies due to a lack of health insurance. Non-Millennials were twice as likely to report never shopping at a chain drug store compared to Millennials (7.45% compared to 3.04%). • Millennials more likely to seek food and beverages. Of products and services the respondents reported seeking at chain drug stores, the most frequent were food and beverages, at 57%. This was followed by over-the-counter medications, 55%; general merchandise, 50%; p032_CDR_04-27-15 32 uncomfortable, and 10% very uncomfortable. Millennials were more at ease receiving health care services at a chain drug store compared to non-Millennials (70% very/somewhat comfortable, compared to 60%). Of those 36% of respondents who reported that they were very/somewhat uncomfortable receiving health care services at a chain drug store, the most common reasons given were: 44% were unsure of the qualifications of the staff providing care, 19% never considered getting services at a chain drug store, 17% preferred their own doctor, 12% had concerns over privacy and 8% choose not to receive immunization, so they see no need to seek care. Many students reported confusion over who would be providing the health care services at chain drug stores and whether they were trained and licensed to provide care. • Millennials more influenced by social media. Respondents were asked about the significance of social media in shaping their views: 14% reported that it is very significant, 33% somewhat significant, 26% somewhat insignificant and 27% very insignificant. Millennials were more influenced by social media, with 47% rating it very/ somewhat significant, compared to 40% of non-Millennials. Thirty-seven percent of nonMillennials reported that social media was very insignificant for shaping their views, compared to only 27% of Millennials. • Millennials want targeted marketing and information. Twenty-six percent of students identified marketing and promotions as the best thing chain drug stores could do to make their services more appealing to Millennials. Specifically, they cited increasing the use of social media, especially Twitter and Facebook. Students felt that advertising should focus more on Millennials and not so much on children and the elderly. Changing the image of chain drug stores from pharmacies to “one-stop shops” was highly suggested. Students reported that the majority of their television viewing is through Netflix and not traditional cable channels; therefore, their exposure to traditional commercials is limited. Many reported that they were unaware that chain drug stores even offered medical services and said that future marketing should fo- cus on describing these services and other enhanced benefits. Other suggestions cited for increasing appeal to Millennials were cheaper prices, mentioned by 18% of the respondents; increased convenience, 12%; medically credentialed staff on site, 11%; enhanced customer service, 10%; better selection of desired products, 9%; privacy for service in the pharmacy and for health care services, 7%; updated facilities, 6%; and increased focus on corporate social responsibility, 1%. Students encouraged retailers to offer competitive prices and student discounts. They suggested frequent promotions, loyalty discount cards and campus events. They also encouraged such incentives as buyone-get-one-free and increasing available coupons. There were many suggestions for making services more convenient and enhancing customer service. Students suggested online prescription refills, online appointment scheduling, “text when ready” pickup services and Apple Pay. Other convenience factors were 24/7 availability, shorter wait times, and drive-through and delivery services. Students expected chain drug store employees to be professional, friendly and knowledgeable about over-thecounter medications. Concern about the qualifications for health care service providers was frequently mentioned. Students encouraged chain drug stores to make this information easy to find and provide assurances that health care services are safe and comparable to care in a physician’s office. Additionally, there were many comments about the need for privacy when asking pharmacists questions about prescriptions or receiving health care. Students want more products that appeal to their interests, particularly natural medicines, vitamins, and organic and fresh Alex Perwich food. Cleanliness and layout of the store is also important. Many stated that current facilities look worn and cluttered and they wouldn’t feel safe receiving health care. Some students suggested that a coffee shop would make the layout more welcoming. Some students reported that they would rather shop at chain drug stores that practiced corporate social responsibility. They felt better about shopping at stores that gave back to the community, engaged in charitable work and helped the less fortunate who could not afford health care. A few students suggested that chain drug stores should consider eliminating cigarette sales if they are serious about moving into the health care arena. Overall, Millennials were more likely to frequent chain drug stores for preventive health care needs, food and beverages and less likely to seek prescription drugs. Retailers that offer competitive pricing and a wider selection of vitamins, natural remedies and healthy snacks will be appealing to this generation. Alex Perwich is president of Enactus USA, an international nonprofit group that uses entrepreneurial action to improve the quality of life and standard of living for people in need. He can be contacted at aperwich@ enactus.org. Outlook for young shoppers takes turn for better CHICAGO — During the economic downturn, Millennial consumers struggled more and for longer than their older shopper cohorts. But the prospects for of young adult shoppers have brightened, according to market research firm IRI. At the close of 2014, Millennial consumers — those ages 18 to 34 — were among the most optimistic shopper segments. Among Millennials, the IRI Shopper Sentiment Index rose sharply in the fourth quarter to reach 114 — by far the highest it had been since the index began in 2011, the consumer market researcher noted. “A strengthening job market, loosening credit markets and the honing of savvy shopping strategies are all helping to provide reassurance and optimism among this up-and-coming shopper segment,” observed IRI Thought Leadership editor Susan Viamari. Currently, Millennials account for just under 20% of the U.S. population. But IRI pointed out that these shoppers are finally showing some level of optimism about their financial situation and are starting to open their wallets to spend. Millennials represented 17% of consumer packaged goods dollar volume in 2014, compared with 19% for Generation X and 38% for baby boomers, but that is slated to rise to 29% by 2020. That would make Millennials second only to boomers (32%) and put them ahead of Generation Xers (18%) as CPG purchasers. ‘Millennials are a key growth market for CPG.’ “By 2020, IRI estimates that Millennials will account for just under 30% of CPG dollar volume. This translates to more than $250 billion annually,” IRI stated in its “Channel Migration: The Road to Growth Has Many Lanes” report. The report shows that among retail channels (excluding Walmart), Millennials’ share of CPG spending has declined by 1.7% at drug stores, 0.8% at grocery stores and 0.1% on the Internet, while increasing by 1.8% at mass merchants/supercenters, 0.5% at dollar stores and 0.3% at warehouse clubs. “Millennials are a key growth market for CPG marketers in the coming decades,” IRI explained. “Millennial shoppers consistently demonstrate unique consumption and shopping habits, which must be understood and delivered against by CPG marketers who wish to win their loyalty.” 4/14/15 2:14 PM