Will Walgreens & CVS Prevent Amazon’s Healthcare Domination?

Will Walgreens & CVS Prevent Amazon’s Healthcare Domination?

By Dan Stanek

When it comes to the leading drugstore brands, CVS and Walgreens, the headlines don’t stop as they attempt to reinvent their businesses. Every day, it seems, these retailers are changing their offerings or making moves to outwit the competition.

The results, however, are still pending. There are several reasons for all of the activity. Certainly, CVS and Walgreens seek to improve their positioning in the marketplace, as they search for new revenue streams. They are also in a formidable battle against each other, considering recent acquisitions and the desire to be on every corner of every city in the country.

The biggest threat, however, comes from the tsunami that seems to take over entire industries and devour brands in its wake. That wave would be Amazon, of course. CVS and Walgreens are attempting to proceed with an offensive strategy. Once a retailer or industry for that matter is stuck in defensive mode against Amazon, it’s over. Amazon wins. Ask Barnes & Noble, department stores, Toys ‘R’ Us, Sears and countless others.

The biggest threat, however, comes from the tsunami that seems to take over entire industries and devour brands in its wake. That wave would be Amazon, of course.

The biggest public Amazon warning signal to the healthcare world was its purchase of PillPack. With all of its logistics and delivery advantages, Amazon needed that access to patients, doctors and insurance. Enter PillPack. It won’t be long before Amazon is shipping customers their prescriptions along with their socks, paper towels and books on their summer reading list. But don’t think that Amazon will stop at simply delivering pills. As consumers begin to get more comfortable with virtual doctor visits, Amazon could consider a full-service healthcare offering. That’s the likely game-changer CVS and Walgreens are hoping to preempt with all of their recent moves.

The list goes on.

The question remains whether any of the acquisitions, added services or product mix changes will be enough to prevent Amazon from making a major impact on their bottom lines. No one can say that Walgreens or CVS is standing pat when it comes to their businesses. In an era where so many big retailers have stood still while modern retail has past them by, these two are making a lot of noise in the industry. The battle continues.

Dan Stanek
Dan Stanek
Executive Vice President
WD Partners
dan.stanek@wdpartners.com
+1 614 634 7337
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