Walgreens plans a major store pilot in Indianapolis as it experiments with various concepts in transitioning its drug stores into “health and daily living” stores.


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Indianapolis to become retail lab for Walgreens

September 26th, 2011

DEERFIELD, Ill. – Walgreens 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 end of this year the drug chain expects to finish conversions of 75 stores in the Indianapolis area that will reflect its new, community-driven approach to drug store retailing and patient care, according to John Spina, vice president of retail integration and new format development.

Another pilot is already under way in the Chicago area that showcases a new health care-focused format, in which the pharmacy area is positioned as a neighborhood health center. Overall, 20 stores in the greater Chicago area will be testing the concept; at presstime 17 of the stores had been converted.

The new store format made its debut 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.
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.

Those include its “food oasis” stores — begun in August 2010 with 10 Chicago-area locations and slated to expand to 1,000 stores nationwide over the next five years — and the 22,000-square-foot upscale Duane Reade store 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 pointed out. 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.

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