Walgreens’ Clever Prescription For Profit: A Big Dose Of Digital Innovation

Not all digitally-savvy businesses are new to the arena. Venerable retail legend, Walgreens, is managing to remain relevant today by making digital innovation a priority throughout its organization. The store that for decades would find the best local corners for its brick-and-mortar stores, is now reaching cyber-corners of the world to do business. The Drug Store Chain's three focus areas for its ongoing digital transformation are 1) Creating a wellness experience. 2) Transitioning the traditional community pharmacy to digital, and 3) Creating an unprecedented global platform. 

Here are some of the ways Walgreen's is making digital innovation a reality: 

1. Scaling back its new store openings to free up capital, bandwidth and resources.

2. Striking strategic partnerships with global heavyweights, such as Alliance Boots , the largest drug store chain in the U.K. and AmerisourceBergen in the U.S.

3. Increasing its ecommerce presence: With the acquisition of drugstore.com in 2011 , Walgreens now operates five e-commerce sites -- Walgreens.com, drugstore.com , Beauty.com , VisionDirect.com and DuaneReade.com. (The Drugstore.com acquisition gained Walgreen's 60,000 more SKUs, a batch of seasoned e-commerce professionals, and an extensive distribution network).

4. Offering same-day delivery for many online purchases, from 8,000 distribution centers across the country,

5. Focusing on Customer Wellness.

6. Developing Mobile Apps. (e.g. Walgreens’ Refill Reminder app alerts its users via email or text message when their prescriptions are getting low; and gives customers the opportunity to refill them directly through the app (customers can complete this task by simply scanning the barcode on their prescription bottle with their smartphone); and the store's Pill Reminder app alerts users when they need to be taking their medication, along with which medication they should be taking.

7. Establishing Customer Loyalty: New program called Balance Rewards already boasts 85 million members.

8. Making digital tech available to shoppers in store.

9. Providing store associates with the ability to order products for customers online if they're not available in-store.

10. A shop online, pick up in-store program that's available at 900 Walgreens locations.

11. Becoming the first retailer to integrate point-of-sale coupons on Foursquare.

12. Bringing pharmacists, nurse practitioners and health guides (armed with iPads), out from behind the counter to engage with customers.

Walgreen's has assembled some statistics of interest:

* 40 percent of Walgreens’ web traffic is coming from smartphones.

* 10 percent of Walgreens' web traffic is coming from tablets.

* The company's median mobile customer is a 45-year-old woman.

Bottom Line For Your Bottom Line:

Give Walgreens a lot of credit for establishing clear strategic goals and going about them in a clear, competitive way.  

At the Shop.org Annual Summit last week, Walgreens President and CEO, Greg Wasson, summarized his own presentation as follows: "Our goal is to blur the lines between channels… We want to weave digital experiences in and around the store, giving consumers a single, seamless Walgreens experience."*

It appears that they're succeeding very nicely.  

*Source: Joe Keenan's notes on Walgreens' President and CEO, Greg Wasson's keynote presentation at the Shop.org Annual Summit, How Walgreens is Transforming the Traditional Drug Store (Retail Online Integration).   

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Gilon Miller, CMO

About Author

Gilon is a seasoned marketing, sales and business development executive with over 15 years of experience in the software and Internet business. He is the Founder and CEO of GuruShots. Previously, Gilon was the CMO of Upstream Commerce, VP of Marketing at iMDsoft and Director of Global Marketing at SAP. He earned an MBA at the MIT Sloan School of Management and a BS in Electrical Engineering from Tufts University.
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