A  close up of industrial bricklayer installing bricks on a construction site - Brick and mortar stores concept
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We're living in the fourth industrial revolution; one made of smart devices, new business models, and digitized supply chains. So in an era like this one, why do brands like CVS Pharmacy choose to bet on brick and mortar as their primary way of doing business if the benefits of digital disruption are so well-documented?

The answer might be simpler than we originally thought. As Gartner's Digital Transformation In Retail says, "Every customer interaction is a unique opportunity to harness long-term value by providing exceptional service. Retailers must leverage technology that augments the customer's preferred way to shop." 

In the case of CVS, a pharmacy chain with at least one pharmacy within a 5-mile radius of 71% of the country's population, according to recent estimates by Quartz, staying in the brick and mortar side of town might not be such a crazy bet after all. 

To understand the reasons behind CVS' decision, we've asked eCommerce and eRetail experts for their opinion on the brick and mortar vs eCommerce debate and if whether or not Amazon Pharmacy represents a threat for CVS.

CVS: A Brick and Mortar Giant

Even though CVS still bets on brick and mortar, they are still accelerating their digital transformation efforts and offer their customers the option of buying products on their online store. In fact, during the pandemic, online orders increased by 1,000% according to Digital Commerce 360º

However, the company is still betting on their brick and mortar to foster connections and build communities around the town's corner store, something that for millions of people living in middle America is a way of life. 

In fact, during CVS' Q2 2020 conference call, Larry Merlo, CVS' CEO stated that "the environment surrounding COVID-19 is accelerating our transformation. It is providing new opportunities to demonstrate the power of our integrated offerings and the ability to deliver care to the consumer in the community, in the home, and the palm of their hand."

With the recent CVS and Aetna deal, CVS might be able to offer primary care directly from drugstores and clinics, once again, benefiting rural and suburban populations with lacking health services. For consumers, this could mean that CVS will become a full-service health care shop and not only a pharmacy where you get your prescription.

Under that perspective, it seems that brick and mortar offers a few major advantages versus online pharmacies. As Greg Birch, SEO Specialist at Las Vegas, NV.-based Store Space says, "people who take prescriptions regularly are naturally going to gravitate towards having their prescriptions delivered each month promptly. When someone goes to the doctor or has surgery, and they need antibiotics, pain medication, etc., they're not going to wait for Amazon to fill that prescription because it can take up to 5 days for Amazon to get your medication to you."

Related Article: The New, No-Touch World of Commerce: Reimagining Customer Experience

Facing the Competition

In November 2020, Amazon launched its own online pharmacy, empowering customers to buy prescription medicines on Amazon. Customers need to provide some basic information, and insurance details and Amazon will take care of the rest. In an interview with the BBC, Amazon Vice President TJ Parker stated that they aim to make things simple for people in need of medicines." Amazon works hard behind the scenes to handle complications seamlessly so anyone who needs a prescription can understand their options, place their order at the lowest available price and have their medication delivered quickly," he said.

Moving towards the pharmacy industry during the pandemic can give Amazon an edge versus other competitors such as CVS and Rite Aid, especially if they will deliver prescriptions at a discounted price. Therefore, it doesn't seem that Amazon Pharmacy will become a fad; on the contrary, it will continue to be a serious contender to pharmacies unwilling to disrupt themselves and start delivering online solutions for patients. 

Yet, as CVS makes a move to offer primary care across The U.S., chances are that it will still be the first option for many people with spotty internet access or for older or non-digital populations who might benefit from the face to face interaction and the sense of community that your corner pharmacy offers. 

Therefore, it seems that, just as Birch says, "if they play their cards right, CVS can easily beat Amazon at the pharmacy game. They could fill and deliver prescriptions quicker and cheaper, and they could fix errors much quicker since customers can come to the store to get things straightened out."