Developing new products and services

Alliance Boots, formed by last year's merger of Boots and Alliance UniChem, has reported a successful year of trading. The company's profits rose 7.4% to £641m in the year to 31 March and much of this is attributed to cost savings achieved through the merger of the two companies (BBC, 2nd May 2007). Now the company is looking for ways to increase profitability through increased revenue generation.

The owners of Boots the Chemists have announced plans to open doctors' surgeries in their 150 outlets. The company is also putting 'Health Halls' and consultation rooms in its stores so that shoppers can get advice there rather than see their GP (The Telegraph, 10th June 2007). The director of healthcare and store development at Boots told the Sunday Telegraph:

'Getting a GP appointment has an impact to the UK's workforce as people have to leave work early to attend the surgery with the resultant impact on productivity'.

In developing their new service proposals, Alliance Boots undertook pilot services in Poole, Dorset. (BBC, 10th June 2007). The company has not released detailed information of the other mrket research undertaken to inform its new product development. However, the Times 100 provides a case study providing a detailed explanation of the types of market research used in developing new products for the well known brand NIVEA.


Alliance Boots to put GPs in stores – The Telegraph, 12 June 2007

150 GPs 'planned in Boots stores' – BBC News, 10 June 2007

Profits rise post-merger at Boots – BBC News, 2 May 2007–how-market-research-supports-new-product-development-process–87-260-1.php

Possible Study Questions:

How might cost savings have been achieved by the merger of Boots and Alliance UniChem?

For Economists: How might the provision of out of hours GP services be considered to have positive externalities?

Other than the use of pilot studies, how else might Alliance Boots have undertaken market research in the development of new services?