Yahoo! Finance and The Week The Trend Desk

I live in a household with five people, three of whom are under age 10. As a result, Mrs. Trend Desk and I spend a lot of time in drugstores -- trying to keep up with the endless cycle of teeth brushed, knees scraped, and hair shampooed. But recently I've detected two interesting trends in drugstores -- trends that speak volumes about the future of health care and about investing more broadly.

The first is embodied in an outfit with the unlikely name of Elephant Pharmacy. It's a drugstore with a twist. It sells the sorts of things you'd buy at a typical Walgreen's store. But it fills herbal prescriptions, too. And it boasts "an unprecedented selection of alternative remedies, natural body care and cosmetics, natural foods and wines, high-quality vitamins and supplements, yoga and Pilates gear," and so on. It calls itself "the drugstore that prescribes yoga." Elephant, as well as a similar venture called Pharmaca, is another sign of how products and services that were once considered exotic and counter-culture have migrated to the mainstream.

It makes sense, actually. Many of the offerings in traditional drugstores have become commodities. Consumers can find dozens of inexpensive products that can keep their teeth white and their bodies fragrant. That means that drugstores are looking for the antidote to commodification, new ways to boost sales and increase margins. Alternative and complementary medicines fill that gap.

And this directly addresses the demands of the 800-pound gorilla of the health-care marketplace: The tens of millions of health-conscious, meaning-seeking Baby Boomers. No wonder CVS, the nation's second-largest pharmacy chain, has invested in this venture. If you can't beat the elephants, join them.

The second trend in drugstores is the emergence of freestanding health clinics that provide routine medical care -- administering flu shots, diagnosing ear infections, prescribing antibiotics -- at a very low price, often under $50. These days you can find Minute Clinics inside CVS stores, Redi-Clinics at your local Wal-Mart, and Take Care Health Clinics at Rite-Aid.

Why are these clinics flourishing? They save consumers money, time, and hassle. And the truth is: Many medical conditions just aren't that complicated. With the aid of diagnostic software, a nurse practitioner can discover what ails you and prescribe the remedy -- all in the time it takes my wife or me to roam Rite-Aid's aisles to find some Elmo toothpaste and cherry lip gloss for the wee Trend Desklings.

Put these two drugstore trends together, and you have a glimpse into the emerging health-care marketplace. Just as physicians no longer have a monopoly on health information, with these customer-friendly in-store clinics, docs no longer have a monopoly on health services, either. Today, consumers want routine care -- think oil or tire changes for the body -- to be fast, cheap, and convenient.

But buyers are often willing to pay a premium for products and services that are more holistic, that carry a compelling back story, or provide them with a sense of meaning. This is perilous for big companies that don't adapt. But it's a potential bounty for large retailers like CVS, Walgreens, and Rite-Aid that can combine scale with nimbleness. (Full disclosure: In the last year and a half, I have done one small project for CVS. It was unconnected to the ideas in the column. I don't own shares in CVS.)

Making Profits by Pursuing Purpose

Everybody knows what a for-profit company is. And everybody knows about its counterpart, the non-profit organization. But have you heard of "not only for profit" companies? That's a new kind of enterprise -- a business that makes money for its shareholders but also has a broad, public-spirited mission.

The marquee example is Whole Foods Market (WFMI), the nation's fastest-growing grocery chain. A few months ago, Whole Foods CEO John Mackey told "Reason" magazine: "Making high profits is the means to the end of fulfilling Whole Foods' core business mission. We want to improve the health and well-being of everyone on the planet through higher-quality foods and better nutrition, and we can't fulfill this mission unless we're highly profitable.... Just as people cannot live without eating, so a business cannot live without profits. But most people don't live to eat, and neither must a business live just to make profits."

I don't know about you, but I've gotten tired of all those antiseptic corporate mission statements that talk about "satisfying stakeholders" and "being proactive" and "thinking outside of the box." Ugh.

Mackey's vision is different. It's clear. It's audacious. And it's about doing good. But -- and here's the beauty of it -- it's also a recipe for doing well. Check out the company's performance. Whole Foods' market capitalization now tops $9.6 billion. In the last five years, its share price has climbed a whopping 400%. Not bad for a do-gooder.

Other companies seem to be following suit. Google wants to "organize the world's information." In the last year, it easily outperformed the S&P. Meanwhile, Sun Microsystems' Jonathan Schwartz, recently elevated to CEO in an effort to turn the company around, told "Newsweek" that his goal "is to see most of the planet online." Even GE has appropriated the language of bold public possibility.

To be sure, some of this is corporate spin. But there's also something important going on. The best-performing companies increasingly include those that combine purpose and profit -- because that's the way to attract talent and stand out in a crowded marketplace. The lesson for investors: If you want to make a profit yourself, try adding to your portfolio some companies that are not only for profit.

You Talk. I Listen

Last month's column ("Investing in Tomorrow's Liquid Gold") triggered a huge reaction from readers:

• In response to the item about water becoming the new oil, several readers wrote to recommend PowerShares Water Resource Portfolio (PHO), an ETF that invests in companies focused on water treatment and technology.
  
• My item on the new VOIP application Jajah prompted Oliver McFalls of Riverside, Calif., to write: "Dude, Packet 8 lets you use your regular phone and you don't have to pull up a Web site to make a call. $20 a month unlimited long-distance within U.S. and Canada. Very cheap international rates. Surprised you don't know about it." Sorry. Never heard of it, dude. But it looks interesting.
  
• After reading the item on the DIY revolution, a few readers suggested I check out WikiHow, a massive open-source writing effort that aims to build the world's largest how-to manual. Looks like a great resource. Alas, since there are still no instructions on how to write a trend column, I'll have to continue to wing it.

Want to share a tip, suggest a trend, or pick up some stuff for me at the drugstore? Ping me at dantrend@danpink.com. I read every e-mail and respond to most.