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DSN Industry Issues Summit: How shopper wallets are shaping baskets

The panel of executives explored how retailers and suppliers can help price-conscious consumers.
dsn industry summit

Declining shopper wallets was the big topic of conversation on panel three of Drug Store News’ 24th annual Industry Issues Summit. Panelists at the November event weighed in on how retailers and suppliers can help shoppers who are watching their purses but trying to stay healthy.

The session, “Shopper’s Wallets are Shaping Their Baskets: What Can Retailers & Suppliers Do About it?” was moderated by Deborah Weinswig, CEO and founder of Coresight Research.

Panelists included Bill Miller, senior vice president, central operations at Rite Aid; Silvia Azrai, senior vice president, consumables health and wellness at Walmart; Colette Heimowitz, vice president of nutrition and education at Simply Good Foods; Lari Harding, senior vice president, business development at Inmar Intelligence; and Eyad Farah, president of pharmacy and healthcare solutions at McKesson. Harding pointed out that overall health and beauty care sales are flat, average price is up and units are down, with the exception of cough and cold. “We’re all getting back out there and everyone is getting sick,” she said. “‘Trips for shopper’ are down, digital coupon redemptions are at an all time high, with 20% increases year over year. People are looking for savings.”

Harding also noted that 40% of all prescriptions filled are 100% paid for by the patient, and they’re paying or using a discount card or a low-cost generics program.

“That’s significant,” Harding continued. “That’s higher than ever before. People filling prescriptions through e-commerce has doubled in the last year and the number of patients also using traditional pharmacy models is down. Personalization and consumers are different, is real, and we have to address that. We’re seeing clients talking about how patients are postponing care.”

Heimowitz added that it’s important to give people nutritious solutions and meal plans on a budget, including sources of protein.

Azrai shifted the discussion to the topic of customer behavior. “There’s this drive and motivation in customers’ minds,” she said. “First, they want to take ownership of their health and wellness journey. They look at that in the sense of cost, which is a good driver of that; second, is about the ability to be more open to digital and technology; third is the readiness for building wellness habits. Proactiveness is there.”

Azrai explained that because people can’t afford to be sick or take time off from work, 50% of customers initiate a self-remedy before they engage with any professional. “Cost is an important mindset driver,” she said.

Walmart has been talking to customers since COVID and found that 1 in 3 customers will engage in preventive services, whether exercising more, eating healthier, prioritizing sleep, nutrition or more checkups.

“They are focused on six mindset shifts around health, nutrition, appearance, sleep, mindfulness and fitness,” Azrai said. “They want to build habits. Many work from home. The problem now is they can’t stick to the plan and regimens are failing. We have an opportunity to help.”

Azrai also addressed the fact that digital and technology are super important, and customers are very open to having data from a health perspective in one location. “Twenty five percent of our customers already engage in digital health management type of services, and 88% think it’s more important today than a year ago for you to think of me as a personal journey. Personalization is key. The role of social commerce is going to double in the next few years.There is quite a bit of opportunity here.”

Miller added, “We’re accessible. People are making decisions. There’s less discretionary spend. They’re making decisions to focus on health and wellness, whether it’s OTC vitamins or beauty products and focusing less on discretionary items.”

Miller said he expects 2022 to be down slightly, and he foresees that there will continue to be supply chain challenges. “Having everyday fair prices is important,” he said. “People want to make sure they are getting value for what they are purchasing. Everyday fair price means more than ever before. We’re seeing a lot of out of stocks and challenges around own brand. We’re disappointing them. We need to do a better job of focusing on that to give them value. The supply chain has been a roller coaster. We’re almost six to nine months behind because of supply chain challenges.”

On the topic of collaboration between retailers and suppliers, Heimowitz shared that Simply Good Foods’ nutrition department “sits within its legal department” to meet regularly. “Our advocacy efforts are to help people make smart, healthy choices for prevention and sometimes even to reverse the trends of any particular disease,” she said, noting that the company has worked with Walmart and Kroger on lending its expertise in their newsletters and digital communications.

“We came up with a thrifty menu for seven days, met thrifty requirements that the government expects you to do for $10 or less,” Heimowitz said. “For $70 a week you can eat healthy and include our products. We are sharing that information with our partners to give out to consumers. They are interested in thrifty recipes. How do I save money but still keep healthy? Health is the utmost target in your communication. How can I have the best health for me and my family and be able to afford it without sacrificing other things?”

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