Consumer spend per person in pharmacies increased by 15% year on year for the September quarter.
While access to GLP-1 weight loss drugs are a significant contributor to the category’s growth, retail consumption has been equally important and a long time coming.
For Australian pharmacists, increasing revenue growth from front of house consumer retail has been part of a survival strategy as consumer habits in both health and retail change significantly.
CHANGING CONSUMER HABITS IN PHARMACY
Telehealth Services and instant scripts
Although demand has settled since the mandated requirements of the COVID lockdown era, telehealth services in Australia are projected to increase by 4.5 times between now and 2034, with revenue estimates ranging in the billions.
Unfortunately, for your local pharmacist, telehealth services increase the opportunity for consumers not to visit your store, as sourcing the diagnosis online may also lead to fulfilment scripts being done elsewhere.
Online Script fulfilment
One such example of this is with online script fulfilment – simple renewals made with providers such as Instant Scripts mean that scripts can be quickly home delivered, once again removing the occasion of visiting a local pharmacist retailer and filling the basket with spontaneous purchases, which represent 30 to 50 per cent of pharmacy purchases in categories like cosmetics, fragrances and sun protection, as well as personal care products such as eye, foot, dental, hair care and toiletries.
Amazon Dispensaries / online
With Amazon Pharmacy making a concerted push in the US, local pharmacists are also watching the introduction of Amazon Pharmacy kiosks in that market. The kiosks are placed in medical centres and enable patients to collect their scripts from within medical offices.
IMPLICATIONS FOR PHARMACISTS
The above factors introduce an increasing number of reasons for consumers not to visit their local pharmacist and indicate a need to find other ways to bring customers in store.
Chief among these are front of house retail strategies (those that generate customer traffic independent of prescription medication occasions), and the use of relevant health services as an alternative to visiting the GP. These can include basic health advice, clinical services, and health screenings.
HOW CHEMIST WAREHOUSE HAS CHANGED THE WAY WE SHOP IN PHARMACIES
Chemist Warehouse has continued to change the way consumers think about the category, as it forges ahead with larger store formats, increased product range, and cheaper prices. Chemist Warehouse has in effect changed consumer demand for the category in the same way that JB Hi-fi changed Consumer Electronics in the early 2000s, or how Bunnings captured Australian Home Improvement hearts from the mid-1990s onwards with its warehouse format and consumer price guarantees.
According to Fonto’s Market Metrics, during the quarter ended September 2025, almost 50% of Australians aged 18+ purchased from Chemist Warehouse at least once, increasing their spend with the retailer by 23% year on year. This was largely driven by a steady increase in average basket size, from $39 to $49 over a 4 year period.
GROCERY MIGRATION CONTINUES TO BE A FACTOR
There are significant opportunities still in areas such as personal care, household goods and health & beauty, with multiple pharmacy retailers identifying some or all of these as key growth areas.
Fonto survey data continues to show product range and availability factors as clear leverage for pharmacies when it comes to winning customers away from major supermarkets.
When purchasing specific items from pharmacies that are also available at supermarkets, 42% of respondents stated that they had done so due to the product or pack size not being available at supermarkets.
ABOUT FONTO
Fonto are partnered with Mastercard Open Finance, using transaction data supplied by consumers to understand movements in retail spending and their customer experience for those purchases.
Consumer spending data is collected via our member communities at Humaniti.com and Surveyz.com.au
