Rite Aid Pharmacy

Rite Aid Pharmacy



Rite Aid Pharmacy

Introduction

Efforts to redesign the healthcare system are increasingly focused on increasing value in the provision of care. The current fragmented delivery system often leads to perverse incentives, a lack of transparency, and limited transmission of health information that adversely affect patient health outcomes. Health (and value) improves when payers and providers closely cooperate to ensure that patients receive optimal, evidence-based care. Strategies to reduce short-term costs do not add value if they worsen health, increasing downstream costs to other payers. In a fragmented healthcare system, individual actors may have competing incentives that undermine value, and changing those incentives is part of redesigning the system around the shared goal of improving health.

Description of the service

Rite Aid is a drugstore chain operator in the US engaged in the sale of prescription drugs and other merchandise. As of February 2009, Rite Aid operated 4,901 stores spanning 31 US states. The company primarily operates through retail drug segment. The company sells prescription drugs and a wide assortment of other merchandise called ''front-end'' products. It provides 28,000 different types of front-end products including over-the counter medications, health and beauty aids, personal care items, cosmetics, household items, beverages, convenience foods, greeting cards, seasonal merchandise, photo processing as well as everyday and other convenience products. The company offers approximately 3,300 products under the Rite Aid private brand. Rite Aid has an alliance with GNC to co-market a line of vitamins and nutritional supplements called PharmAssure that are sold in Rite Aid and GNC stores. In addition to the above, the company offers prescription refills and other products over the Internet through riteaid.com, powered by drugstore.com. The company sells a range of products under categories such as health, beauty, vitamins, personal care, pharmacy, and household and pets through drugstore.com (its partner for online business). Further, the company has also installed 1,034 automated pharmacy dispensing units that are linked to the company's pharmacists' computers that fill and label prescription drug orders.

Rite Aid's Service process structure using structural positioning diagrams

The basis of Rite Aid's service positioning strategy is the service itself, but marketing offers little guidance on how to craft service processes for positioning purposes. A new approach suggests that within service systems, structural process design can be used to "engineer" services on a more scientific, rational basis. The product or service is a given and the objective is to manipulate consumer perceptions of reality. As Lovelock (2004) rightly points out, however, positioning is more than just advertising and promotion. Market position can be affected by pricing distribution and, of course, the product itself, which is the core around which all po itioning strategies revolve. Apart from promotion, pricing, and distribution the product is indeed a critical manageable factor in po itioning. Products often are engineered explicitly to reach certain markets, as the original Mu tang was designed to reach the youth market and light beer was created to tap the calorie-conscious consumer. Sometimes products are invented first and po itioned ...