Back in 1998, shortly after AMZN stock became a publicly traded equity, Amazon acquired Drugstore.com. It operated the online pharmacy for more than a decade, never achieving the growth it expected from the venue. Amazon eventually sold Drugstore.com to Walgreens in 2011, which finally shut the website down last year.
There are differences this time, however. This time, insurers may be even more supportive of lower-priced alternatives to traditional brick-and-mortar pharmacies. Another difference is that Amazon.com has already ventured into the medical supplies and equipment business. The leap to drugs wouldn’t be a great one now.
Bottom Line for AMZN Stock
Amazon CEO Jeff Bezos is never short of ideas. Some of them are ill-advised, like using aerial drones to deliver packages — one unfortunate mishap over a busy road could prove fatal. Other ideas are brilliant, such as the establishment of a network of brick-and-mortar stores. The stores wouldn’t have to be a profit center in and of themselves.
They would be outstanding branding and messaging tools, facilitating the sale of digital goods while also serving as a pickup point for orders of physical goods.
As bold as the ambition might be, the entry into the pharmaceutical business is one of many ideas current and prospective owners of AMZN stock will want to add to the “smart” column. There’s actually some money to be made in the business, which is something the company can’t say about all of its services and products.
Better yet, with the addition of prescription to its other recently unveiled offers like groceries and fashion advice, Amazon further cements itself as a lifestyle company … as opposed to a mere e-commerce venue.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.