Brunet Pharmacies · Alternatives Define Analyse Recommend Implement Status%Quo% Sell Acquire%...

Brunet Pharmacies QUT Real World Consult ing

Agenda Define

Opportunity & Issues What does success look like?

Analyse

External & Internal Alterna<ves Resources

Recommend

Solu<on Opera<ons

Implement

Plan Timetable Capability & Feasibility Risks Finance

Problem

Lack of brand differen<a<on

Complex legal context

Increased compe<<ve rivalry

Loyalty issues

Unsure how to keep up with evolving consumer trends

Analyse Recommend Implement Define

“How to differen-ate yourself and

drive loyalty in a crowded market”

What does success look like 2016?


PROFIT 20%

increase

BETTER STORE PERFORMANCE 15% increase in

revenue

LOYALTY 3x current membership

CUSTOMER SATISFACTION

8/10

External Analysis


INDUSTRY RIVALRY -‐ high compe<<on

pharmacies -‐ well resourced

players -‐ liYle differen<a<on

HIGH

SUPPLIER POWER -‐ well resourced suppliers

-‐ supplier op<ons

LOW

BUYER POWER -‐ low switching

costs -‐ convenience -‐ proximity

HIGH

NEW ENTRANTS THREAT -‐ high regula<on/legisla<on

-‐ high cost -‐ acquisi<on regula<on

MEDIUM

SUBSTITUTES -‐ mul<vitamin -‐ allied health

LOW

External Analysis


INDUSTRY RIVALRY -‐ high compe<<on

pharmacies -‐ well resourced

players -‐ liYle differen<a<on

HIGH

SUPPLIER POWER -‐ well resourced suppliers

-‐ supplier op<ons

MEDIUM

BUYER POWER -‐ low switching

costs -‐ convenience -‐ proximity

HIGH

NEW ENTRANTS THREAT -‐ high regula<on/legisla<on

-‐ high cost -‐ acquisi<on regula<on

LOW

SUBSTITUTES -‐ mul<vitamin -‐ allied health

LOW

KEY LEARNING: Intensely compe--ve external market where your consumers

have a lot of power

Internal Analysis


STRENGTHS -‐ innova<ve & pioneering spirit -‐ mobile presence

-‐ brand with heritage & reputa<on

-‐ strong media presence -‐ Parent company

WEAKNESSES -‐ regulated industry in

online sales -‐ undifferen<ated

company adver<sing

OPPORTUNITIES -‐ MaSante program -‐ strong database

-‐ excellent knowledge of customer

THREAT -‐ well resourced compe<<on -‐ price war

-‐ crowded market -‐ undifferen<ated

company adver<sing

Internal Analysis


•  Socially progressive with consumer trust Value

Proposi<on

•  Aging popula<on •  In choosing a pharmacy they value knowledge of pa<ent records & quality of advice received

•  In returning to a pharmacy they value quick service Customers

Capability Analysis


Valuable Rare Unable to be Imitated

Supported by Organisa-on

People ü û û ü Technology ü ü û ü Bricks & Mortar Stores ü û û ü Communica-on ü û û ü Database ü ü ü ü

KEY LEARNING: Opportunity to leverage and exploit database & technology to drive compe--ve advantage

Analysis Summary


Con<nue

• Focus on consumer engagement

• Proac<ve health message

Take Advantage

• Human Capital • Exis<ng Masante Program

• Strong database

Be Aware

• Well resourced compe<<on

• Evolving consumer trends

Recommendation: Internal Focus


Refresh Brand

Data Driven Customer Engagement

Increase Customer Value

Alternatives


Status Quo Sell Acquire Compe--on Merger Joint Venture

(Target) Expand Loca-ons

Internal Focus

A\rac-veness

•  Strategic Fit Low Low Med Low Low High High

•  Sustainable Low Med Med Med Low High High

•  Profit Low Med Med Med Med High High

Achievability

•  Regula-on Low Low Low Low Low Med Low

•  Funding High Low High Low Low Low Med

•  Logis-cs Low Low High Med High Low Low

•  Timely High High Med Med Med Low High

Affordability

•  Cost High Low Low High Med Med Med

Competitor Differentiation


0

1

2

3

4

5

6

Price Quality Service Size Loyalty Digital Offering Communica<on

Jean Coutu Uniprix Pharmaprix Familiprix Proxim Acces Pharma Target

Competitor Differentiation


0

1

2

3

4

5

6

Price Quality Service Size Loyalty Digital Offering Communica<on

Jean Coutu Uniprix Pharmaprix Familiprix Proxim Acces Pharma Target BRUNET

Solution Strategy

Refresh Brand




Refresh Brand


Healthier Happier Trusted New Brunet Brand

Committed to care You’re in good hands

New messaging



MaSanté CRM

Brunet Benefits Cu

stom

er Ben

efits Reminded to

take certain pills

Profile auto populated by in-store purchases

Pharmacist view of all purchases by customers

Offer to hold renewals at pharmacy

Purchase complementary products and

services

Ability to book time with

specific staff

Delegate information to

family members

Connect with digital health

trackers

Predict demand for prescription lines

Identify opportunities

for upsell

Understand demand of resources

Engage additional

consumers and upsell

Aggregate health data

Mobile Apps Website Digital Health Tracers In-Store

Mobile Apps (Enterprise App Store) In-Store



First Party

Differentiated Services

Bootcamps

Strategic Partnerships

Subscriptions Allied Health Private Health

•  Healthy Eating 12 Week Challenge

•  Weight Management 12 Week Program

•  Fit Over 60

First Party •  Weight Management

Product Subscription

Strategic Partnership •  Healthy Food Meal Plan

Subscription

•  Referrals from and to private health insurers

•  Discounts for private health members

•  Regular ‘office hours’ with allied health professionals

•  ‘Trusted Professionals’ referrals


Implementation Strategy

Low Hanging Fruit

Resource Intensive


Implementation Timeline Immediate Year One Year Two Year Three

Low Hanging Fruit

Scope first party resourcing for bootcamp

Introduce new bootcamp op<ons Review bootcamp performance

Scope first party resourcing and third party rela<onships for subscrip<ons

Introduce new bootcamp op<ons Review bootcamp performance

Nego<ate with allied health groups Introduce allied health Review allied health performance

Resource Intensive

Nego<ate with private health groups Announce new private health partnerships

Review strategic fit

Scope brand refresh and engage suppliers

Rollout new brand to all stores and media

Con<nue marke<ng ac<vi<es Con<nue marke<ng ac<vi<es, increase online spend

Scope MaSanté tech update and expansion onto new plagorms

Build and Test new MaSanté features

Inves<gate Target loyalty solu<on and inves<gate new MaSanté features

Build and Test new features

Cost: $600,000 Cost: $5 million Cost: $3 million Cost: $8 million

Capability & Feasibility


•  Conservative & purposeful •  Leveraging existing resources •  Capabilities available in your business, except for specialty

disciplines •  Financially sound •  Proven validated customer need •  Examples of similar innovation from other customers &

industries

Additional Opportunities


•  Store location expansion •  Parent group wide loyalty program •  Parent group wide cross sell opportunities •  Merger and acquisitions (not recommended)

Change Management • Retrained staff •  Strategic partnerships with allied health professionals People

• Unified IT systems roll out •  Integra<on with all sites, including delivery Logis<cs

•  Parent company to use new brand and cross-‐campaign adver<sing • Brand on TV and other relevant media Communica<ons

•  Scope new suppliers and vet against strategic fit Suppliers


Risks


Risk Likelihood Consequence Mi-ga-on

High industry rivalry High High Strategic differen<a<on; solu<on focus

Regula<on Low Low Watching brief by legal team; date privacy; membership in regulatory bodies

Finance Low Med KPIs; parent company finding sources Customer service performance Low High Internal Centre of Excellence for training

Inability to hold & find talent Low Med Oversupply of graduates; ability to source form other loca<ons

Strategic fit of partners Low High Constantly evaluate against internal KPIs; cau<ous ini<al selec<on

Finances


0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Jean Coutu Uniprix Familiprix Proxim Pharmaprix Brunet Other

Current Media Spend vs Market Share

Store Footprint Media Footprint

Finances


Company Number of Stores

Store Footprint

Media Footprint

Current Spend

Revised Spend SAVINGS

Uniprix 359 20.60% 23.68% 72,946

Brunet 176 10% 18.42% 56,743

30,805

25,937

KEY LEARNING: $25.6 million available to redirect towards proposed

strategy

Growth in Masante Membership

2011: 18,000

Members

2016: 46,494 Members


Your Brunet

PROFIT 20%

increase

BETTER STORE PERFORMANCE 15% increase in

revenue

LOYALTY 3x current membership

CUSTOMER SATISFACTION

8/10

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