How Walgreens Boosted Revenue Using The Latest Digital Technologies
- Find out how Walgreens obsesses over customer feedback, offers customers the power of choice and focuses on simplicity to ensure they create shareholder value.
- This 116-year-old company still understands the power of innovation.
- Walgreens' digital strategy and focus on customer experience is leading the way.
Technological advances are impacting marketing decisions and the consumer experience in ways that are yet to be fully understood. The pace at which these changes occur have created significant challenges for marketers and businesses alike. In short, it’s hard to keep up. To stay innovative, current, and ahead of the curve.
Data is a primary driver of marketing decisions, but translating this information into informed decisions about customer experiences is a different story.
A surprising innovator in the field is 116-year-old chain store Walgreens (NASDAQ:WBA). The $117 billion global destination is at the forefront of delivering digital experiences that engender excellence, efficiency, and trust online, much in the same way that the company incorporates geolocation, a digital wallet program, and an Internet of Things strategy to enhance their in-store experiences.
Leading the charge is Deepika Pandey, Group Vice President, Customer Experience, Direct and Digital Marketing at The Walgreen Company. One of the top tech influencers in retail according to Chain Store Age, she has developed an intimate understanding of technology advances while maintaining a laser focus on the customer experience.
I recently interviewed Deepika to understand how Walgreen’s multi-channel digital experience has contributed to $47 billion in annual revenue since she joined the brand in 2008.
Ms. Pandey has been able to demonstrate that when consumers engage through multiple channels, their worth increases significantly. For instance, customers who engage the brand in-store and online are 3.5x more valuable, but when consumers engage in-store and online through a mobile device, they are 6x more valuable.
This is quite significant considering that 70% of Walgreens’ customers engage with the company through mobile platforms and 50% of digital sales are derived from the same source.
Here are five ways that others can follow Walgreens’ lead and push to the forefront of innovation.
#1: Leverage the Power of Technology Online and in Real-World Stores To Better Serve the Customer
"I rarely think that there is just one answer to serve consumers. Having options gives you a lot more power.”
Customer use cases and journeys are getting more and more complicated. So the more options that you have, the better off you’ll be able to fulfill consumers’ needs. In Walgreens’ case, this means offering multi-channel solutions that make it easier for customers to feel better, regardless of where they shop.
If you look at what Walgreens' has done with mobile and how the company has transformed the in-store experience through mobile, you know one of the things the retail app does is flip to in-store mode when you enter a store and show you the features that are most relevant to your shopping experience: “So it’s the coupons that you have clipped and getting easy access to them, your loyalty points, and even information about the store.” Remarkably, more than 50% of Walgreens' app users have used the app while they’re in store.
#2: Focus on the Simplicity Piece
“Simplicity is complex, but when you get it right you win every time. You’re trying to take that friction out of the experience, and we’re just obsessive about that.”
Deepika used Apple (AAPL) as an example of excellence in simplicity - instructions are never needed for their products: “If you have to release a video to explain a new app, that app is too hard. What I love about Apple is you don’t have to read an instruction booklet to use their products.” That should be your ultimate end goal - no instructions needed.
As far as Walgreens' in-store experience is concerned, the company recognized that customers want the checkout process to be fast. As a solution, they linked mobile payments to paperless coupons and Balance Rewards program. This allows customers to access their rewards by using Apple or Android Pay.
#3: Develop Experiences that Resonate Powerfully with Consumers
“I think the reason we’ve been successful is that (we aren’t creating) technology for technology’s sake. It’s really thinking through the customer issues that we’re trying to solve.”
You can’t solve every use case, so you have to figure out the main use cases that you want to serve. Deepika provided a stellar example of delivering meaningful experiences powered by technology through the company’s Refill by Scan app.
This app makes it dead simple to refill a prescription: You simply take a picture of your pill bottle and submit it - a process that takes roughly 17 seconds. In a few hours, your prescription is ready to pick up at your local pharmacy. One customer stated that they had so much fun using the feature that they wished they had more prescriptions to refill. Less than four months after becoming available on both iPhone and Android platforms, Refill by Scan accounted for more than half of all prescription refills ordered through Walgreens’ mobile applications.
This success ultimately drove other lines of business to follow suit and develop digitally enhanced experiences that really resonated with consumers.
#4: Encourage Employees to be End Users
“There’s nothing that replaces the experience of going through something as a consumer. . . What we like to do when we’re talking about our roadmap is to come up with quick and dirty POCs so that people can really see what the customer is going to experience.”
As a natural byproduct of large organizations like Walgreens, there are a myriad of variables that could result in customer experience failures. So it’s imperative that all customer-facing employees are proficient not only in their normal duties but with the technology that a brand leverages as well.
For instance, a cashier that is assisting a customer who is having issues with the Walgreens app is going to be much more helpful than one who is inexperienced with the mobile offering.
This is why Walgreens encourages everyone - from managers to the people who stock shelves - to step into the customer’s shoes. This type of role playing allows representatives to effectively understand customer hiccups that may occur, and resolve many of these issues on the spot, creating a more positive experience for consumers.
The experience itself is invaluable. Looking at a company’s operations from a shopper’s perspective enables one to, “...really understand what those break points are and where are the opportunities for improvement.”
#5: Obsesses Over Customer Feedback
“When you’re talking about falling in love with your customers, I think it’s really all about having that customer focus, taking the feedback that you’re getting, acting upon it, and thinking differently.”
Walgreens doesn’t just skim customer reviews. They have developed an internal application for viewing the feedback left in the App Store, Google Play, and similar locations. The company then inspires teams to take the feedback, think outside-the-box, and build unique, highly resonant apps and services.
As all these cross-channel technologies continue to emerge, we're seeing the customer experience transform. It's becoming both streamlined and simplistic, highly personalized and powerfully resonant. For brands, the key is to maintain your focus on the customer and not get lost in technology for technology’s sake.
This article was written by
Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Business relationship disclosure: I have a business relationship with Oracle but not with Walgreens.
*Disclosure: CX Factor is sponsored by Oracle, a client of Fanatics Media. Walgreens is not a client.
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