My far-flung family has a reunion ever year between Christmas and New Years. This year, I put my pictures of everyone on Flickr for all to enjoy. When a cousin from North Carolina called asking how to get prints, I went straight to the Walgreens website. I uploaded the pics she wanted and ordered them to be printed at the Wilmington, NC location nearest her home. Next day, she picked them up – easy as pie. In fact, picking up prints has been the main reason I go to Walgreens.For several years, drug stores have been adding categories and items in an effort to address consumers’ need for convenience and find add-on sales. Processed food, photo finishing, and office supplies arguably dilute these stores’ focus on health.
As the Chicago Sun Times reported last month, Walgreens seems to be going in a different direction. Two important moves the company made in 2007 to begin the company's shift to more clearly meeting the health needs of the communities it serves accelerated in 2008: the Prescription Savings Club and Take Care Health Systems convenient care clinics.
In late 2007, the company launched its Prescription Savings Club program to attract U.S. consumers seeking cheaper medicines. The program includes smart moves like offering to print out for consumers the price comparison on their specific prescriptions for conditions like asthma, high blood pressure, or diabetes, and calculating the monthly savings in black and white.
Enrollment in the Prescription Savings Club costs $20 a year for an individual or $35 a year for families. The program appears to be a powerful tool for customer acquisition and retention. In 2008, Walgreens signed 1.5 million members to its prescription savings club program, about 30% of whom are new customers.
Walgreens’ acquisition of Take Care is another example of doubling down on health care for growth. The in-store clinics accept Medicaid and most insurance, and charge $60 to $80 in a typical visit to people with no insurance. Walgreens also is expanding its clinics that operate at company workplaces, like Disney World in Orlando and Harrah’s in Las Vegas. The company plans to add another 120 clinics by the end of August, bringing the combined total to 800.
To make room for more clinic and prescription services, like back-to-school physicals and vaccinations against shingles for seniors, the company is looking closely at its current assortment and dropping less health-related items like pliers and duct tape. As a result, we can expect Walgreens to clean up some of the scrambled merchandising that has become commonplace in drugstore aisles. And that will be a welcome relief.
Selfishly, I hope the photo processing services pencil out, too.
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1 comment:
Interesting. I give Walgreen's credit for working harder to develop a meaningful positioning strategy/reason for being to consumers and bringing this to life in their business.
Doubling down on health is certainly much closer to what drug stores perhaps used to represent...a place where one could buy/access goods and services that would help you & your family manage your health in a better or easier way.
Generally, it seems the large drug store chains have had difficulty in relevantly differentiating. From logo design, to in-store merchandise and set-up, down to even what their employees wear…it’s hard for a consumer to remember the difference or understand why they should choose “x” chain over “y.” I'll be curious as to how far Walgreen's goes with their current strategy.
Not saying it’s easy..with supermarkets, mass merch, and the Costcos of the world now successfully competing for the prescription & OTC drug business, certainly challenging.
As a side note, I see Walgreen’s recently tried to sue the city of SF to allow them to sell cigarettes.
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