Page 32 - Retail Pharmacy March 2021

30 CPD ACTIVITY MANAGING THE VITAMINS, MINERALS AND SUPPLEMENTS CATEGORY Shannon Kerr MBA General Manager: Projects & Programs at Pharmacy Platforms As a marketer and project manager with more than 20 years’ experience, Shannon has focused on the community- pharmacy space for the past 10 years. Shannon’s experience encompasses branding, digital marketing, loyalty programs, above the line and retail marketing. Her project skills enable a coherent and integrated message across all elements of pharmacy marketing Shannon Kerr also works at instigo. For the purposes of full disclosure, instigo has a commercial relationship with the Pharmacy Guild of Australia to deliver the Health Advice Plus program into community pharmacy. Instigo also provides a range of business services to API including some marketing services, professional services coaching for Soul Pattinson and Pharmacist Advice stores and outsourced merchandising resources for Soul Pattinson, Pharmacist Advice and Club Premium. LEARNING OBJECTIVES After completing this CPD activity, pharmacists should be able to: • Describethesizeandpotentialofthe vitamins, minerals and supplements (VMS) category to overall front-of-shop profitability. • Describehowtorealisethegoalsof customer satisfaction and optimise sales. • DescribeandutilisetheRingand Tigert ‘Retail Pentagon and Triangle’ theory, including the importance of people, products, placement, price and promotion in driving category sales. 2016 Competency Standards: 4.4, 4.5. Accreditation Number: A2103RP4 (exp. 28/02/2023). Introduction The VMS category is typically the largest category, outside of cough, cold and flu, in terms of space, and can be challenging for shoppers to navigate due to the varied offering. A pharmacist can optimise the category in-store for both customer satisfaction and business success in a number of ways. Ongoing changes due to the current Covid environment, competition, remuneration and changing customer behaviour in community pharmacy make ensuring that the front of shop is delivering a suitable return essential for a successful business. In particular, the VMS category is a core category within community pharmacy, with potential for significant growth in most stores and at a high relative margin. Customer service A Forbes article1 on the different types of customer service states: “Customer service is the advice or assistance a company gives its customers ... customer service is giving assistance to customers on how to best use \[a\] product, trouble- shoot any issues, and ensure they \[have\] a great buying experience.” The article outlines that the goal of customer service is to maximise the customer satisfaction experience. Customers already trust the advice pharmacists give, and the pharmacy environment is conducive to providing customer health literacy and engagement, particularly in the VMS category. Achieving business goals To position the pharmacy as a genuine health solution destination, especially a VMS specialist destination, certain steps need to be taken. For the average pharmacy, the dispensary constitutes about 60-70 per cent of turnover, and the balance of sales comes from the front of shop, which takes up far more floor space proportionally to sales return than the dispensary. The imperative for most pharmacies is to increase the return from front-of-shop sales through increased basket size and increased average transaction value. The VMS category, which sits beside pharmacy-specialist categories – such as pain relief, sinus/allergy, cough, cold and flu, and digestive health – has significant potential for community pharmacy. The aim is to identify the services, products and ranges that can support incremental sales for better margin and profit in this department, and more holistic solutions for your customers. One means of realising incremental sales is by facilitating the expertise of staff to develop and expand health specialisation positioning. Once both depth and breadth of expertise is formed around certain health conditions, an expansion of the solution offer into new health areas is possible. The Retail Pentagon and Triangle The following strategies to build the VMS category are based on the established retail theory ‘The 8 Ways to Win in Retail’ by Lawrence J Ring and Douglas J Tigert.2 The pentagon represents the five major customer-facing activities through which your pharmacy can visually differentiate themselves in the marketplace: ‘place, product, price, promotion and people’. The retail triangle supports the pentagon in the goal of achieving operational effectiveness through ‘superior systems, logistics, and supply relationships’. All these elements should be considered to effectively optimise the VMS category. Systems that support the VMS category may include staff induction training that outlines the importance of the category along with appropriate product training, periodic planogram and sales reviews, and performance metrics that are consistently reviewed. Logistics within the VMS category centres around effective ordering and stock management, ensuring out-of-stocks are minimised, particularly on key SKUs, and that ageing stock is monitored. Effective supplier relationships are those where both parties benefit, the ultimate aim of the supplier is increased sales, and they can assist a store to achieve this through: • Aligning brand advertising and promotions to store specific promotions, eg, a catalogue. • Supporting brand promotions with window and gondola end displays. • Taking advantage of supplier training (in-store and online training resources). • Incentives to achieve increased sales, eg, rebates or staff/store prizes. ‘Place’ and layout This is the most basic area to start, but often the most crucial: if your VMS category layout is wrong, customers won’t (and sometimes can’t) buy what they need. Some key things to take into consideration are: • Basic retail standards – the first principle. The store should be clean and well presented. Regardless of anything else, research shows that if customers perceive the store as dirty (both internally and externally) they draw the conclusion that products are more likely to be old and the stock on offer less relevant. RETAIL PHARMACY • MAR 2021 1 CPD CREDIT