Retail News Breaks
Walgreens pilots new 'health & daily living' formats
September 26th, 2011
CHICAGO – Walgreen Co. is testing a new store format around Chicago and plans a major store pilot in Indianapolis as it experiments with various concepts in transitioning its drug stores into "health and daily living" stores.
By the year's end, Walgreens expects to wrap up conversions of 75 stores in the Indianapolis area that will reflect its new, community-driven approach to drug store retailing and patient care, John Spina, vice president of retail integration and new format development, said in an interview.
The pilot under way in metropolitan Chicago entails a new health care-focused format that positions the pharmacy area as a neighborhood health center. Thus far, 17 of the stores had been converted and, overall, 20 stores in the greater Chicago area will be testing the concept.
The format premiered last November with the reopening of a store in Wheeling, Ill., and a new store opening in Oak Park, Ill. Spina described those outlets as "the first manifestation of bringing our strategy to life: transforming from a traditional drug store to a health and daily living solutions store."
He explained, "We came to the conclusion that to win in the future we're going to have to step away from the traditional drug store format. We kept hearing from customers saying there's no difference from one drug store to another. So with our real estate assets, we asked, 'Can we claim the territory of 'well' in retail?' Nobody else has staked that claim."
Going forward, there will be no new "prototype" per se — a store's components and layout will reflect the health, wellness and everyday living needs of its community, Spina said. "Every store is going to be a little different. It depends on the neighborhood," he noted.
Walgreens' Nimesh Jhaveri in front of the "health guide" station at the Oak Park, Ill., store. "This is more than a drug store. This is a health care point of contact."
The difference will be in "the content of merchandise and solutions that we provide customers in their neighborhood," Spina said. For example, he explained, a Walgreens unit in one community may have a larger beauty presentation than others, a store in another area may carry an extensive assortment of fresh food and groceries, and a store in a different neighborhood may devote more space to home medical equipment.
Walgreens has already rolled out elements of this strategy in its Customer-Centric Retailing initiative as well as some high-profile launches, such as its "food oasis" stores and the upscale Duane Reade opened in July at the landmark 40 Wall Street building in Manhattan.
The Indianapolis pilot will mark Walgreens’ first test of its new store concepts across a full market, Spina said. It will involve about 50 stores in the Indianapolis metropolitan statistical area and another 25 in outlying communities. "We’ll be touching the whole market with elements of the health and daily living experience," he said.
With the new formats in Oak Park and Wheeling, Ill., and elsewhere in metro Chicago, Walgreens is bringing the future of pharmacy into the present. The model transforms the traditional drug store pharmacy department into a local health center and conveys a key message to consumers: Pharmacists and chain drug stores are convenient providers of health care, not just prescription drugs.
"It's centered around how we help customers and patients live well, get well, stay well and eat well," Nimesh Jhaveri, executive director of pharmacy and health care experience for Walgreens, said last month during a of the Oak Park store. "We're testing the concept to understand the consumer and patient feedback, and we're also trying to understand how the new practice of pharmacy plays a part in patient care and improves patient care," he explained.
As seen at the Wheeling, Ill., store, the new format brings the pharmacist up front to encourage more interaction with patients.
To customers heading into the Oak Park Walgreens, it's clear that this community pharmacy is unlike anything they've seen before.
Signs along walkways to the entrance set the theme of convenient health care. One says, "Walgreens Flu Shots. Walk in anytime," while another for the store's Take Care Clinic reads, "Sore throat? Sinusitis? Flu? Drop in." And signage emblazoned on the front door states, "Pharmacy, Take Care Clinic, immunization, advice + information … Walgreens Oak Park."
Once inside the spacious store, customers' eyes are drawn straight ahead to the pharmacy area, atop which in giant white letters against a serene blue background is the message, "Well at Walgreens. Neighborhood Health Center."
The first thing visitors see in the pharmacy area is a circular white desk staffed by what Walgreens calls a "health guide." Equipped with an iPad, the guide helps customers select over-the-counter products, prepare and register for a clinic visit or an immunization, and accomplish other tasks. Another key function of the health guide is to facilitate a visit for a new prescription, a refill or a consultation with a pharmacist. Pharmacy patients also can use the adjacent touchscreen kiosks for express pickups and refills.
"The other thing you'll notice about this pharmacy area is it doesn't look like a drug store," Jhaveri noted. Indeed, the health guide station fronts a contiguous area housing the pharmacy, a Take Care Clinic, a health resource center and meeting rooms, almost creating the feeling of a doctor’s office visit rather than a trip to the drug store.
A prescription drop-off and pickup counter is adjoined by a partitioned "ask the pharmacist" desk for easy interaction with patients. Those preferring more privacy can meet with the pharmacist in a neighboring consultation room with a translucent sliding door.
Bordering the pharmacy is the "Health Corner," which provides health education materials in a seating area and has a conference room for community events. There's also an e-commerce station with computers for browsing Walgreens.com. Next to that is the Take Care Clinic, which has its own waiting area and examination rooms much like those in a physician's office.
The front end of the Oak Park store conveys the wellness theme and reflects Walgreens' efforts to enhance the shopping experience.
All the while, patients can look up at video screens above the health guide station to see who's next to be served at the Rx counter and clinic. The screens also display information on other Walgreens offerings.
"As we continue to realize the value of pharmacists and what they can do, we want to provide more of a health care focus so when patients walk in they see it's not simply about filling their prescription. It's really about receiving a health care service," Jhaveri said. "We want to let people know that this is more than a drug store. This is a health care point of contact."
The front end of the Oak Park store reflects Walgreens' ongoing efforts to enhance the shopping experience. A high ceiling, extra-wide aisles and lower gondolas create an airy feel and give customers a panoramic view of the shopping area, which is bathed in natural light, thanks to ample windows around the exterior.
Large-lettered wall signage and distinct color schemes catch shoppers' attention and make it easy for them to locate departments. For example, there’s an enhanced beauty presentation dubbed "Beautiful," and a brightly hued consumables section — under the banners "Fresh Choices" and "Eat Well. Good Food to Go" — features end-caps with fresh produce and a freestanding refrigerated case with an assortment of grab-and-go food.
The store also has sections for durable medical equipment, diabetes care and diet/nutrition items plus a self-serve photo station (rather than a full photo department). And outside are a drive-through pharmacy window, a "Web Pickup" parking spot for online orders and an electric vehicle recharging station.
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