Amazon CEO Andy Jassy revealed that their online pharmacy business is thriving as frustrated customers turn away from locked-up drugstore products.
Amazon CEO Andy Jassy said that the company’s online pharmacy business has gained customers who are frustrated by locked-up products in physical drug stores, a measure many retailers have taken to prevent theft.
Jassy made the remarks on an earnings call with investors and reporters on Aug. 1 after the e-commerce giant released its second-quarter results, which showed a boost in profits but a miss in its revenue estimates.
When discussing future earnings prospects, Jassy highlighted his belief that Amazon’s focus on making the online shopping experience smoother would translate into strong growth for the company’s online pharmacy business.
“On the pharmacy side, I think you’re right that you’re seeing that business continue to grow and to get more resonance with customers,” he said, adding that customers “love the customer experience of Amazon Pharmacy.”
Jassy then drew a comparison between “the experience and the speed and ease” with which customers can order at Amazon’s online pharmacy compared to walking into a physical drug store.
“If you walk into pharmacies in cities today, it’s a pretty tough experience with how much is locked behind cabinets, where you have to press a button to get somebody to come out and open the cabinets for you and a lot of shoplifting going on in the stores,” he said. “So, the combination of what’s happening in the physical world and how much improved we’ve made our pharmacy experience is driving a lot of customer resonance and buying behavior.”
The rise in certain types of crime, especially retail theft, in urban areas has forced some pharmacy chains to bolster security and take measures like locking up products.
Retail crime led nearly 30 percent of retailers to reduce or alter in-store selection, including by locking up products, according to the NFR. Another 28.1 percent closed a specific store location while a whopping 45.3 percent reduced store operating hours to mitigate the risk.
Making products less accessible to customers, limiting hours of operation, or closing certain stores outright all have an impact on sales, which online retailers are well-poised to pick up.