Walgreens Aims For More Honest 'Customer-Centricity'

While most companies like to say they're customer-centric, it's seldom true. Many customer loyalty efforts are just thinly veiled sales pitches. Brian Tyrrell, Walgreens' senior director of customer marketing platforms and strategy, is trying to change that perception by better matching customer convenience to internal business goals.

"I'll be the first to admit it," he told attendees at MediaPost's Brand Insider Summit: Retail, held recently in Lake Tahoe, California. "When companies say things like 'We are customer-led,' we are lying to ourselves." Usually, these efforts are generated by a business unit with a specific goal, like reducing inventory or spurring ecommerce.

With a recent reorganization of its digital teams, the company hopes to align technology solutions with internal objectives and shopper convenience, fostering authenticity in customer relationships.

Walgreens navigates the intersection of three key profit drivers: pharmacy, retail, and healthcare services. With pharmacy accounting for 75% of revenue, marketing has catered to distinct customer segments.

Each has different marketing needs, right down to specific language. A pharmacy customer is a patient, while someone running in for cold medicine, a loaf of bread or shampoo is a customer, even "when that's the same person."

The recent organizational is meant to be for a more holistic approach that will reduce churn. "We are one of the first teams that was given the space to address the needs of the individual," Tyrell said.

The shift addresses the reality that most in-store experiences aren't very good. Since the pandemic, "most retailers are understaffed and are now acting as distribution centers. That's an issue all stores have to face."

And the integration of in-store values with online messaging remains a challenge for brands like Walgreens: "Customers might feel like Walgreens stands for something when you're in the store, but an email or digital ad isn't telling the same story."

To unify the experience, Tyrell's team started with an effort hinging on the pharmacists who work in its 9,000 stores. Whether helping distraught customers in Maui, where it has two stores, or tracking down patients by phone, pharmacists are the brand's heroes. "When Walgreens is at its best, it's with stories that come from the pharmacy," he said.

In digitizing the patient experience, Walgreens has begun tapping into its CRM data stream to better understand patient barriers, including transportation problems. "This was a big pivot for us. We have historically focused on a very transactional relationship," he said. "We'd ask them to do something, measure how many did it, and celebrate if that was above some goal. However, there was very little relational communication from a marketing standpoint. We wanted to mimic the face-to-face experience of stores."

That's led to partnerships that connect pharmacists to companies like Uber and DoorDash, enabling free same-day delivery of certain medications,  and paves the way for future collaborations.

"Every tech company has a healthcare strategy, and Walgreens' platform includes 100 million customers in our loyalty program, and eight million transactions a day. That's appealing to companies like Uber," Tyrell said.

Walgreens is also using the company’s app to make relationships stickier. The app enables people to scan a pill bottle to refill medication, print out photos, and clip coupons. "We know that if we can get a customer or a patient to download the app, it's the start of a much richer relationship, and it brings significant lifetime value."

Partnering with Walgreens' data team has made  interactions far more personal. “If, for example, a customer says cost is an issue in filling a prescription, we can say, 'Here are 10 things Walgreens can do to address that.' We can solve transportation issues in the same way. And with data science, we now have predictive models for what a patient journey might look like."

In terms of channels, Tyrell acknowledged that many of Walgreens' customers are older and less digitally engaged. "But they do have an inbox for email, and SMS has given us a ton of success. Every grandparent has been trained to send their kids or grandkids a text message, so it's a channel that felt very native, especially coming out of COVID."

He said Walgreens tech efforts will continue to highlight the pharmacy experience, "which is a bright spot for us, and we're focusing on our best customers."

He concluded by saying that he doesn't think the internal struggle between those looking to drive sales versus those representing the voice of the consumer will ever end.

“It's a constant battle. And marketing is often in the middle and has to be the bad guy. What helps is prioritization on both sides, and making sure everyone understands why we're making a decision that's best for the customer -- and in turn, how that will benefit the business unit."

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