Corona has proven a catalyst for digitalisation, particularly among small businesses, and digital health is now a reality in the healthcare sector. The pharmacy sector is now responding to these trends and embracing solutions which help them to sell their products online with same-day delivery and take advantage of nationwide marketing initiatives. Is this the future of small business digitalisation? We talk to Thomas Engels, founder & CEO of online prescription-free medication marketplace Doc.Green, on bridging the gap between online and offline retail, competing with Amazon and launching a brand during a global pandemic.
Your business model enables consumers to order their medicines online, but still utilises the strong network of high street pharmacies and their delivery services. How does effective cooperation between online and offline work?
In our case, an effective cooperation looks as follows: our online marketplace Doc.Green allows customers to order a particular pharmaceutical product online, and we then pass this order on to a local pharmacy. Their established delivery service delivers this product to the customer. These pharmacies have historically offered very little capacity for customers to order online and here we saw a gap in the market. Ultimately our relationships with the pharmacies depend on our ability to bring orders in and this is where our platform and our marketing comes in. We promise to invest 80% of the monthly fee we charge pharmacies into advertising.
I get frustrated when I hear local business complain that they are losing business to online. There is nothing stopping local shops joining together under a local delivery platform and there are really strong examples of this, for example in Wuppertal.
Any small online marketplace will be competing directly with the Amazons of the world, especially during Corona. How does a smaller online marketplace compete?
Amazon Prime Now has recently partnered with the Munich “Bienen-Apotheken” to offer pharmaceutical products online. This appears to have been successful during the Corona crisis, but what is interesting is that they appear to have difficulties in rolling this out nationwide. In contrast, we are aiming to sign up 2,000 to 3,000 nationwide pharmacies. And of course through Doc.Green the consumer is still buying locally and supporting local businesses.
Compared to other countries, Germany has been slow to adopt online food delivery. In your opinion, is the German consumer more open to ordering medicines online?
Yes definitely. A 2012 study from consultancy Sempora showed that over 50% of people in Germany wanted to order medicines online (whereas for groceries it was little over half of this number). However at the time there was no solution for this. Pharmacies have always done things in a certain way and their customers have always ordered in store. There is a tendency on the part of the pharmacies to resist change. The challenge in our sector is to help pharmacies see the opportunities an online intermediary can bring.
You launched Doc.Green with a new nationwide TV campaign in April 2020, during the Corona crisis. Many brands would be nervous about this. Why did you make this decision?
We had actually planned our marketing campaign with a focus on sustainability. We realised that our product really helps in the drive towards saving CO2 because internet shopping, including delivery, generates less CO2 than city shopping by car. We started working with SevenVentures, then Corona came along. And we quickly realised it was an opportunity for us, because anyone who is worried about the virus tends not to want to go to the doctors or to the pharmacy. So we decided to go full throttle on the marketing campaign. We launched a new nationwide TV commercial under the slogan “The new way of ordering medicines”, commissioned banner advertising, new branding and put SEO measures in place. All with the purpose of finding out which marketing measures brings us the most customers.
Has this decision to launch during Corona paid off?
Pharmacies had a classic delivery service, but only in store and with a prescription. Through Corona and digitalisation they are recognising that the world is changing. Our marketing and TV campaign has certainly helped us to sign more contracts with pharmacies which is helping us to build our network and make our service available to more customers.
Since the Digital Supply Act (DVG) 2019, digital health has become an extremely important topic in Germany. From next year the e-prescription will also be available in Germany. How do you plan to use these trends and grow in the future?
On Doc.Green we already link to a sister portal which offers e-prescriptions delivery www.rezept-sicher-bestellen.de and we are working on developing a new product. With the e-prescription pharmacies have the problem of actually receiving the prescription but with our new portal you can directly order the prescription and medicines with one click and the pharmacy gets the order directly and takes care of the medicine. The customer can pick it up directly at the pharmacy or have it delivered.