DEMOGRAPICHS AND SEGMENTATION In the past, the pharmaceutical industry faced some up and downs. Consequently in a reduction of prescription volume, because of a decrease in physician visits as result of the weak economy and weak flu trends. However, some significant factors are expected to drive the growth of the pharmacy benefit management market: • Increase in ageing population. • Increase in healthcare expenditure • Improving economic conditions • Increase in life expectancy rate • Rising use of drugs The demographics of the country look very promising for the industry, since the population in the age group of 65 and older are growing faster than the total US population. The amount of people aged >65 years is expected to escalate from …show more content…
The chain had always presumed that it should adapt its establishments to habitual clients who were buying First-Need products, and other front-of-store, or nonprescription, items. The reality was the best customers were people who visited the pharmacy frequently (Schultz, 2010). The Pharmacy segment generates around 70% of establishment sales, so in order to maximize its revenue the chain has to get people to take their medications (Schultz, 2010). According to Company chief health care strategy and marketing officer for CVS Caremark, Helena Foulkes. “These are people with chronic conditions. There is a high frequency of visit, which is often driven by the fact that they’re taking multiple medications: diabetes, heart …show more content…
• CVS is more preferred by those currently employed and making a middle class annual income of $50K-$125K (Civic Science, 2018). • The primary trading area is 2 miles from the store location. The secondary trading area is up to 5 miles from the store location. CVS has a pharmacy within 5 miles of 90 percentage of the US population. The tertiary trading is approximately 10-15 miles. The company elaborated this profile to identify the needs of its clients and organized its offer to meet them better, in such a way that profit is maximized. This prevents CVS to not waste resources and time on clients who would not report enough profit, and treat the key targets as distinguish groups with distinguish needs. Allowing the company to choose its target audience based on its capabilities and