LabCorp deal brings blood testing to Walgreens’ pharmacies


LabCorp deal brings blood testing to Walgreens’ pharmacies


Customers handling their medical concerns might soon be visiting Walgreens for more than just picking up prescriptions or using the self-serve blood pressure cuff.

The pharmacy chain announced that it will be opening medical testing facilities in 600 of its stores in conjunction with LabCorp, according to Bloomberg. The decision comes as Walgreens’ rival, CVS, is also adding more medical services to its stores following its acquisition of the health insurance company Aetna.

This is not the first move that Walgreens has made indicating that it plans to establish itself as a leader in healthcare services. The chain announced earlier this year that it will roll out a store format that combines its full range of healthcare services now offered in disparate locations.

Walgreens and CVS have also been trying to outdo each other in spaces far afield of the pharmacy. Earlier this year, CVS announced the expansion and enhancement of its beauty department into a Millennial-targeted store-within-a-store in four test locations. The pilot is taking place in partnership with in-home beauty service GlamSquad. Shortly after that, Walgreens announced that it had invested in subscription-based beauty startup BirchBox and would be piloting in-store BirchBox shops in 11 test locations.

Other brick-and-mortar retail chains outside of the drug channel also begun pursuing a piece of the healthcare pie.

Popular regional grocer Publix, for instance, launched a pilot of “telehealth” kiosks in 12 Florida store locations last December. The kiosks allow shoppers with non-urgent medical issues to conduct live video chats with healthcare professionals, who guide them through the use of in-kiosk self-examination tools and then offer a diagnosis based on the data gathered. Publix intends to launch 13 more kiosks in response to the pilot’s success.

BrainTrust

"All physical retailers need to look at ways to provide valuable services to the customer that drive traffic and create a relationship beyond the register."

Tom Erskine

CEO, One Door


"Getting back to more neighborhood-based care will ease the friction and enable patients to quickly get the services they need."

Anne Howe

Principal, Anne Howe Associates


"Mail order prescription drug companies are crowding the category. Retail pharmacies have to adapt or die."

Carlos Arambula

VP of Marketing, FluidLogic


Discussion Questions

DISCUSSION QUESTIONS: Is improving in-store healthcare services the right move for Walgreens to make? Will these offerings work comfortably alongside enhanced front-end offerings in beauty and other categories?

Poll

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Mark Ryski
Noble Member
5 years ago

This is the future of drug/pharmacy retailing. It makes complete sense to offer expanded healthcare services at stores like Walgreens. Consumers want convenience and that applies to healthcare services as much as it does beauty and other categories. I think this is a very smart move on the part of Walgreens and I would expect to see many more healthcare services being offered by Walgreens and other major players in the future.

Neil Saunders
Famed Member
5 years ago

It makes strategic sense for Walgreens to move more strongly into health. However, it is the same old story: neither Walgreens nor CVS seems to have a clue about how to design a compelling and engaging retail experience. As it stands, most of their stores are not places I would like to visit for health services.

There is a real opportunity here to shake up the health arena, but creating compelling destinations with great customer service is a key part of winning the battle.

Tom Erskine
5 years ago

Yes! Providing valuable in-person services is a key ingredient to store success in the new world of omnichannel retail. All physical retailers need to look at ways to provide valuable services to the customer that drive traffic and create a relationship beyond the register.

Tom Dougherty
Tom Dougherty
Member
5 years ago

In-store healthcare services is not differentiating. CVS has made such things table-stakes. The real issue for pharmacies lies in reinventing their meaning in an important way.

Currently, consumers don’t know what the stores ARE. Sure, they sell over the counter and prescription drugs— but beyond that are they simply a convenience store?

If you need proof of the category problem just look at their real estate investment.

There are times when four different chains occupy the four corners of an intersection (at times the same chain might be on opposing corners).

This means the prospective customer sees no difference between the stores. They choose one merely because it is in the direction they are traveling. Preference is lower than the effort needed to turn around.

Contrast that with IKEA. Customers are willing to travel hours.

Pharmacy. This is one of the WORST categories in retail. They all need brand work.

Paula Rosenblum
Noble Member
5 years ago

That’s a very cool idea. And it’s great for LabCorp as well. Walgreens is doing some very clever things. Small footprint store, and a soupcon of health and beauty services. I like the vaccination opportunity as well.

Art Suriano
Member
5 years ago

I can see an opportunity with some customers who are interested in the healthcare services Walgreens will be offering. However, I don’t see it as a vast market. What happens overall with healthcare in this country will have a lot to do with it. Moreover, even though we are becoming more health conscious as a society, we ourselves only tend to be aware of our own health just after we discover some issue after a diagnosis. Indeed, the patient who visits the doctor and learns they have high blood pressure might be more inclined to check their blood pressure in the store if available, but not the average customer. It’s good to encourage people to take better care of themselves, so only good will come out of this, but I don’t see it as a significant game-changer for Walgreens.

Dick Seesel
Trusted Member
5 years ago

Anything Walgreens can do to reinforce its brand image as a headquarters for health-related products and services is worth testing and expanding. (As opposed to expanding its assortment of “everything else under the sun,” such as candy, cigarettes and liquor.) Just make sure the LabCorp affiliation is credible, since Walgreens ended up with egg on its face when it ran after the Theranos deal.

Anne Howe
Anne Howe
Member
5 years ago

I like that Walgreens and CVS are offering more health-related products and services.The best part is that the locations are much more convenient to shoppers. Healthcare visits, lab work and testing are all necessary evils, especially so when they require a drive to a big hospital setting that’s hard to navigate,, especially for caregivers transporting older patients in wheelchairs. Getting back to more neighborhood-based care will ease the friction and enable patients to quickly get the services they need.

Dave Bruno
Active Member
5 years ago

Another way to make the store relevant. Absolutely a good move for Walgreens!

Craig Sundstrom
Craig Sundstrom
Noble Member
5 years ago

Given the Theranos scandal, this seems like a curious (ill considered?) choice with which to jump into, or perhaps really “further into” medical services. Not, of course, that the problems of a particular firm should tarnish an entire industry, but I think nevertheless they point up the issue of credibility. Cost and (increased) accessibility are important issues in healthcare, but quality remains far and away the most important (particularly when insurance is paying for things). So while I think they may have something to offer, and wish them well, there are some barriers to entry that need to be overcome.

Carlos Arambula
Carlos Arambula
Member
5 years ago

Definitively. Come in for the ancillary services of flu-shot or lab work (conveniently called-in by your physician) and stay for the HBC, OTC medicine and more importantly the prescription drugs.

Mail order prescription drug companies are crowding the category. Retail pharmacies have to adapt or die.