Developing Digital DNA

Posted on 29. Oct, 2013 by ideaworks in retail strategy

Imagine being first to utilise a brand new technology that allows customers to interact with your store directly, order what they need, and have the product home delivered even before they click off. US drugstore Walgreens achieved that utopian goal…over a century ago.

What was the “new” technology? The telephone. How did Walgreens do it? Pretty simple – when a customer called to refill a prescription, Charles Walgreen Sr. just kept them on the line long enough for the delivery boy to arrive with their medicine. It must have seemed like magic.

Fast forward 100 years or so, and Walgreens is still innovating via the latest technology. One of their most popular smartphone apps is “refill by scan”. Simply scan the label of your empty pill bottle, and you automatically place an order for the refill. Magic. And so simple to use that Walgreens is refilling a prescription every second and even has several customers over 100 years of age who delight in transacting that way. Walgreens has a series of fun ads to explain how fast and easy the process is. Check one out here:

I heard these stories at the Annual Summit of shop.org (the US National Retail Federation’s digital division), held earlier this month in Chicago. The Windy City also happens to be the hometown of Walgreens, the drugstore behemoth. CEO Gregory D. Wasson took to the stage to talk about how the 112 year old company had “got” the digital revolution since he took the reins in 2009.

Many traditional bricks and mortar retailers have either been sluggish to embrace new technology, or have introduced digital for digital’s sake (Facebook page anyone?) Walgreens has done it differently…in two ways.

Firstly, Wasson wasted no time in hiring a President of e-commerce (Sona Chawla), and then allowing her to get on with it. He saw his role not as CEO when it came to digital, but “Chief Roadblock Remover, Chief Doubt Remover”. Secondly, Wasson always viewed digital as a servant of strategy – a tool to accelerate Walgreens’ growth imperatives, and help deliver to customers the “three W’s – what they want, when they want it, where they want it”.

Today, Walgreens has three clear goals for digital:

  1. Own convenient fulfillment For instance, Walgreens is trialing Same Day Delivery, using their 8,000+ stores as “mini distribution centres”.
  2. Bring together social and mobile to transform the local experience Walgreens was the first retailer to integrate scannable POS coupons on FourSquare, which pop up and are redeemable as soon as a customer “checks in” at their local store.
  3. Engage patients through e-health experiences Besides “refill by scan”, Walgreens has introduced “transfer by scan” – you can use your smartphone to scan pill bottles purchased through other pharmacies, and Walgreens can refill it.

What are the lessons that “an old brick and mortar company has learned?” Wasson says that you need to organise your business around “a very different breed of retail professionals” – designers, data scientists, software engineers, web developers and more. He believes passionately that you need to “connect” the organisation both internally and externally – linking all elements of your business to deliver “One Walgreens Experience”. And you must continue to innovate, using digital to help turbo-charge a “customer-crazed culture”.

Charles Walgreen Sr. would be amazed and delighted at how technology is transforming the Walgreens business today. Even if modern management can’t replicate his trick of delivering a product before the customer clicks off.

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One Response to “Developing Digital DNA”

  1. Wayne

    31. Oct, 2013

    Amazon. com is the small retailers only hope!

    Wayne

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