Stop Acting So Surprised!

“Pharmacy stocks tumbled today in reaction to the news of Amazon entering the Pharmacy space.” That’s the first thing I read Thursday morning as I drank my coffee. I have to admit, I had an immediate eye roll moment and said out loud “STOP ACTING SO SURPRISED!”. Why do Wall Street and traditional industries act so surprised every time a tech company disrupts traditional industry? It’s inevitable and it’s obvious! 

Amazon should not even be able to compete in this space as the established players have had the benefit of seeing what a good CX (Customer Experience) looks like for over a decade, and these companies all have the resources, or at least the money, to do it. The reason Amazon can enter this market is that the traditional players have failed to deliver a CX for modern customers. They’re not doing enough and they’re certainly not doing it fast enough. This is a customer experience issue, plain and simple. Do you know what Amazon’s earth-shattering strategy is to compete in this space? “We wanted to make it easy for people to get their medication, understand the cost and get it delivered to the home,” said TJ Parker, Amazon’s vice president of pharmacy. WOW! Who knew customers wanted these things! Isn’t it obvious that a consumer wouldn’t want to drive to a pharmacy, battle for a parking spot, wait in line around a bunch of sick people, etc? That’s actually a pretty terrible experience if you think about it. 

Yes, there is a fortuitous timing of this with COVID-19, but that simply accelerated the value proposition and adoption. It certainly wasn’t the catalyst for Amazon to enter the space as evidenced by their acquisition of Pillpack in 2018. 

If this surprised you or caught you off guard, then you’re not paying attention. If you saw the obvious writing on the wall and did nothing about it, then that’s on you. This is an obvious move. 

Holding off the digital disruptors is not impossible. It’s not even really that difficult if you’re an incumbent. It takes some degree of vision, a commitment to excellence, and a willingness to invest in your future. Here are five easy things you can do right now:

1. Hire the best talent.
2. Demand excellence and don’t settle for less. 
3. View the entire experience through the eyes of your customers.
4. Ditch your ‘if it ain’t broke don’t fix it’ mentality. 
5. Stop thinking about the cost of investing in technology and think about the cost of not investing in it! 

The best thing about being in consulting is that we get to talk to and learn from many companies. We have the opportunity to speak with so many smart people who really understand their businesses and they’re good at their jobs. But I also hear businesses all the time focused on the wrong things or being delusional about the quality of their current offerings. Some companies haggle over hourly rates rather than value or outcomes. Some companies talk about using commodity resources to deliver strategic value. It doesn’t work! You have to hire the best talent whether that’s through a partner or you do it in-house. 

Half-hearted efforts or cheap knock offs won’t cut it. Go shop on Amazon and then go buy something from any of the big pharmacy companies and tell me who’s doing it right. I guarantee you that if you asked some of these CIOs or CDOs how their E-commerce or customer experience stacks up they’d tell you they think it’s great. I assure you it’s not. Go buy something from both and you tell me. Evaluate it from start to finish. Product discovery to account creation to purchase to the post-purchase experience. If you’re not familiar, the post-purchase experience includes things like how long it takes you to get your package, how easy it is to track your package, and how easy it is to return something. Businesses have to understand their customers’ journey, what great looks like, and be honest about where their company is in its current state. 

I’ll give you a personal example to make this real. I recently bought something from one of the big pharmacy players online and then realized it was going to take too long so I went to the store to get it. I tried to figure out how to return it and do you know what the protocol was? I got an 800 number and had to wait on hold only to be told that even though my package wouldn’t ship out for several days it was too late to cancel, but don’t worry, once I receive the package I can drive to a store and return it in person. How often do you think I’m going to return to shop with this company? Yep, never. Customers get to decide where to spend their money, and they don’t typically do that for worse experiences when better options are easily available. 

Just because your business model worked in the past doesn’t mean it will work in the future. The one thing I know to be true is that if companies simply do things the way they’ve always done, they’re in trouble. What worked yesterday may not work today and most certainly won’t work tomorrow. Reinvent yourself, iterate and adapt, or else your competition will do it to you. 

I also hear companies talk about how they can’t afford to ‘do it right’ or how they don’t need the ‘Ferrari’. This is a false argument. Is Amazon the Ferrari here? This is just the standard to which consumers are used to in 2020…. The baseline of what good looks like. There’s nothing ‘fancy’ about it.

The question is not whether you can afford to do it; the question is can you afford not to do it? Technology must be viewed as a strategic advantage for all businesses in 2020 and that’s not going to change. 

In 2020, every company is a technology company and every industry is the technology industry. Period. Businesses who don’t understand and accept this are not going to be around for the long term and certainly have no chance of winning their category. 

There are two outcomes in every industry. The digital natives, like Amazon, learn and master industry, or the non-digital natives/incumbents, like the pharmacy companies, will learn to deliver great technology. The digital natives are winning right now-- hands down. 

Whether you build it yourself or you hire a partner like Dialexa, you have to do it! It’s not optional. 

There are three steps to the technological epiphany: awareness, acceptance, and action. Where are you?