Week 6 Strategic Recommendation Memo

Industry force 

Strength

Provide a justifying your determination with examples

High 

Medium 

Low 

Example

Threat of new entrants 

x

Healthcare industry is expanding everyday and threatening the existence of old players in the market. One PwC survey of 1,000 adults found that nearly half of them would consider getting minor problems handled outside of traditional venues, such as buying strep throat kits at home or getting skin rash evaluations online, and many are also willing to get more complex services at home, online or in retail settings if it's more convenient and affordable. This is why I believe it is a strong force.

Power of buyers 

x

Patient needs and preferences heavily impact CVS operations and processes. Digital health startups focused on women's health care  pulled in $1.3 billion in funding across 26 deals by October 2021—nearly doubling all of 2020's funding with four months still left to go, according to digital health venture fund Rock Health. This is why I believe it is a strong force.

Power of suppliers 

x

The demand for healthcare continues to rise regardless of rising costs because citizens and government have a greater interest in health and quality of life. Market suppliers have a moderate influence because there are many suppliers. 

Power of substitutes 

x

Prescription medicines are preferred by customers because they are cheaper. It is easy for consumers to find cheaper prices anywhere there are pharmacies and medicine distributors, so substitutes have limited power. There are many pharmacies and medicine distributors in the industry, so substitutes have limited power.

Rivalry among competitors 

x

The healthcare industry faces intense competition. The healthcare industry led other companies in margin according to a 2008 report. Market competitors compete aggressively based on services provided and operating strategies. I believe that this is one of the reasons why competition has a greater power. 

Complementors 

x

Many sectors of the economy and society are being dominated by digital platform based markets. Connected preventive healthcare markets are thriving thanks to platforms like Apple Healthkit and Google Fit. Companies are combining their products and services to improve overall outcomes. A number of complementary products and services are emerging in the healthcare industry to enhance one another's offerings. It implies that complementors have a greater power than complements (Coffey et al., 2015).

References

Coffey, C., Fraser, K., Lee, H., & Kelsay, W. (2015). CVS. CVS Corporation, 1-64.

Landi, H (2022).  Women are the 'power buyers' of healthcare.  https://www.fiercehealthcare.com/tech/fierce-jpm-week-women-are-power-buyers-healthcare-and-market-evolving-to-serve-them-founders#:~:text=Women%20are%20the%20%22power%20buyers,cash%20into%20this%20growing%20market.