Walgreens
John Boot first started Boots store in in UK. The Boots business developed under Jesse Boot, John Boot’s son. Charles R Walgreen purchased the drugstore where he had worked as a pharmacist in Chicago. Walgreens began back in 1901 after Charles bought it out and began the business under his own name. Walgreens is Americas largest chain of pharmacies. Charles became a registered pharmacist, packing his own drugs in order to make sure the quality and affordability was there. By 1925, Walgreens had more than 65 stores and had expanded to Milwaukee, St Louis and Minneapolis. Only two years later, he took the company public, and at the time of the Great Depression he had more than 500 stores. In 1934 Walgreens stock was listed on the New York Stock Exchange. Charles Walgreen died in 1939, and the business was passed on to his son. In 1975 sales exceeded $1 billion and the thousandth store opened in 1984. On to 1992, Walgreens opened its first drugstore with a drive-thru pharmacy and in 1999 Walgreens.com launched its online pharmacy. In 2012 Walgreens and Alliance Boots formed a partnership to create the first global pharmacy-led, health and wellbeing enterprise. They formed the Walgreens Boots Alliance Development joint venture in Bern, Switzerland. As of August 2018, Walgreens operates around 9,560 drugstores with a presence in all 50 states, District of Columbia, Puerto Rico and the U.S. Virgin Islands.
CVS
In 1892, Frank Melville took over three stores owned by his employer. The first CVS opens in 1963 in Lowell, Massachusetts, as a discount health and beauty store which customers can bag their own merchandise. In 1964 the CVS name is used for the first time and in 1969 Melville acquires the first CVS chain. In 1990, Peoples Drug Stores, which was a 490-store chain, is acquired by Melville and is merged into the CVS chain. In 1994, CVS enters the pharmacy benefits management field with the creation of PharmaCare Management Services. In 1999, Goldstein retires as the chairman of CVS and Thomas Ryan succeeds him as chairman and CEO. Soma.com, the first major online pharmacy is acquired and rebranded as CVS.com. Although CVS trails Walgreens in terms of overall revenues, CVS Corporation is the largest drugstore chain in the United States in terms of number of stores and number of prescriptions filled. CVS has more than 4,100 stores in 27 states in the U.S.
Customer Groups
Walgreens and CVS both have customer groups. They like to create memberships for certain customers to give them a “thank you” for being loyal customers and thus keeping them as their customers and encouraging them to purchase more. One of the biggest ways they do this is through discounts. If you’ve ever seen a Walgreens or CVS receipt you know they can be long, this is because they always attach discounts or coupons on the bottoms of their receipts to get their customers to return and buy something else. I am a loyal Walgreens customer, and I signed up for their beauty points. This allows for me to purchase things, earn points and then those points add up to money value, and then give me money off the next time I shop there. This is called their Balance Rewards club which for every 1000 points you earn, you get $1 towards your next visit. They even give you points for how much you work out and track your sleep on their app. For linking a health device, you earn 250 points, for a workout you earn 20 points per mile and when you track your sleep you get 20 points per log. This is a form of a customer group. CVS has a similar type of club called the ExtraCare Beauty Club which gives you $3 for every $30 you spend. They also send out welcome gifts, birthday gifts, access to new products, samples, and exclusive deals for the people who join this club.
Image the store projects to Customers
Visual Merchandising
Walgreens:
Visual merchandising is the presentation of a store and its merchandise in such a manner that will attract the attention of potential customers. The key purpose of this is to create impact, give the customer a shopping experience, entice the customers to make a purchase and to maximize sales. Sight lines are key spaces that your eye catches as soon as you walk into the store. With Walgreens, it’s usually the beauty section. As soon as you walk into any Walgreens, the beauty section is right there. They do this because women are generally the ones that go shopping and pick up stuff for the house so they focus on them and their needs as soon as they walk in, in hopes that’s where they’ll head first. Right when I walked into Walgreens, there was a liquor store on the right and then the actual store on the left, with two separate entrances. Everything in the store was very modernized and very well lit. The lights they had overhead were LED lights, and made the whole store feel bright and airy. Everything was well organized and you could easily navigate your way around the store and get everything you needed. They utilized the counter-clockwise shopping experience, making the door to the entrance/exit on the right-hand side of the store, you entered, walked around from generally right to left, and the checkout area was on the left of the entrance. Walgreen’s had concrete floors and white walls, but also had touches of blue, grey, and red all over the store, generally where the signs were. With old Walgreens, the inside were narrow, harshly-lit aisles which were piled high with merchandise. Now a days, the drugstore giant has stores with a crisp contemporary look that is airy, roomy, and even playful. Their fresh approach extends to their exteriors, which are no longer drab and interchangeable. An article wrote, “I wouldn’t call it drugstore chic, but let’s give credit where its due: When it comes to design, the company is finally entering the 21st century, where the quality of store experience matters as much as selection, price and location. The new look is an integral part of Walgreens’ folksy effort to brand itself as the drugstore, ‘at the corner of happy and healthy’.” The same article said that the old Walgreens stores were stacked high with merchandise up to the ceilings, but as competition rose and once the recession hit and shopper behavior started to change, Walgreens had to make their stores more customer-focused. In a 2012 gut rehab they re-arranged the inside into neighborhood-like quadrants. One for cosmetics, another for drugs, and another for items like greeting cards and the last for “consumables” like Halloween candy. To break down monotony, aisles in the consumables quadrant are turned at a right angle to the other aisles. In the drug and cosmetic areas, LED’s highlight products, which make it easier for aging eyes to read the product labels. The pharmacy received a lot less cluttered look, and overhead monitors advise people when their prescriptions are ready. Wall graphics are done in comforting blues and greens. The manager of the store said “The customers like it, they like the flow of the store. They seem to spend more time here… they’re not in such a rush.” The recent changes reflect the fact that a Walgreens store is laid out a little bit like a convenience store. In convenience stores, the milk case in invariably in the back, which makes you walk past the chips, dip and other items you didn’t come in to purchase. At Walgreens, the pharmacy serves the same purpose. That’s why it was important for the company to redo the front of its stores and split them into these “neighborhoods.” This change has been a big plus, making the store interiors more pleasant and this starts to eliminate the generic “prototype” look that has impaired so many American towns.
CVS:
CVS stores offer convenience, in location or product, over quality. Their stores have rectangular box like lights. The floor plan of CVS is very similar to other stores like Rite Aid, but not similar to Walgreens. The registers are generally to the right of the entrance, instead of the left and also, unlike Walgreens, CVS has self-checkout service. Another thing I noticed walking into CVS was that their floors were carpet, and right when you walked in you were bombarded with aisles and aisles of stuff. The layout seemed sloppy and unorganized. I asked the CVS manager if they had a layout of the store I could take a picture of and he informed me that they did not. I also noticed that CVS doesn’t flow in the traditional counter-clockwise pattern most retail stores acquire. The entrance was in the center, to my left was the beauty products and to my right was the checkout lane. In the back, right of the store they had their pharmacy, and along the sides they had the essentials; wine, food and beverage, the pharmacy, their home health section, a baby section and then finally the beauty section. The color of their walls and ceilings were white, it was not very lit and the light fixtures seemed to be a little outdated.
Another thing with CVS is in October 2014, they stopped selling cigarettes and all tobacco products. The move was inspired by CVS’s goal of becoming more of a health-care provider that offers an integrative experience for customers. CVS hopes that the move will help them strengthen relationships with hospitals, insurers, and physician groups as they transfer to a more comprehensive health-care alternative. They said that cigarettes have no place in an environment where health care is being delivered. CVS has a grid layout which has parallel aisles with merchandise on selves on both sides of the aisle. This is similar to Walgreens, but Walgreens has also ventured out into the racetrack design which is also known as a “loop” which is a store layout that provides a major aisle that loops around the store to guide customer traffic around the different departments within that store. As of recent, CVS partnered with Toshiba to add a new digital commerce platform that helps drive in-store customer engagement. The TCx Elevate is a thin client platform that supports consumer self-scanning experiences, associate mobile POS and visual tools that can be used across store departments, including the pharmacy. In addition, this solution will enable the retailer to gather actionable insights needed to create a frictionless checkout and help the company to stay on pace to its “commitment to enhance the customer experience through continuous innovation” said Ray Auger, senior VP, retail systems, CVS Health. CVS’s mission is to reinvent the pharmacy by offering innovative solutions that help people on their path to better health. In April of 2017, CVS Pharmacy unveiled a new store design that enhances the retail customer experience with a new assortment of healthier food, heath-focused products and expanded beauty selections paired with informational signage throughout the store to help customers discover new offerings. With its innovative digital programs, these changes represent the next evolution of the customer experience at CVS. The latest improvements are designed to drive growth in categories that are most closely tied to the company’s health-focused purpose and expertise, while delivering a shopping experience that no other brick-and-mortar store can replicate. They are also rolling out major changes to as many as 70 new stores in 2017, with plans to expand to several hundred more in 2018. The new, health-focused formats have 100 feet of new merchandise in health, beauty, and healthier food and use a streamlined layout to highlight themes that make shopping easier. “Discovery zones” in their key health categories take a holistic approach to care and product selections, and customers are guided by informational signage with guidance to make finding the right solution easier.
Online Presence and Functionality
Walgreens
Walgreens now lets customers shop online and pick up their orders at more than 7,600 of their stores. The online orders will ship to the stores for free and will be ready to be picked up within one to three business days. Walgreens’ ship-to-store option doesn’t match the near-instant gratification of services that are offered by their competitor CVS. Their website is updated constantly on all sales, events and new items. They send out newsletters and special offers to anyone who registers their email. The pharmacy customers can sign up to receive text messages to pick up or refill prescriptions. On Walgreens actual website, they have a “Website Accessibility” page. On here they talk about making sure their website is accessible to all of their visitors, including those with visual and related disabilities. They state that they have taken a number of steps to improve their website access and make sure that those who use their keyboard solely for navigation, require accommodations due to vision impairments, or are using assistive technologies such as screen readers can more easily interact with the content on their website. They strive to provide equivalent text for the appropriate images and non-visual elements, providing heading structures for page elements, offer skip navigation links within the header, they use consistent navigation techniques and style of presentation throughout the site and they have row and column headers to easily identify data tables. They also have an “Online Privacy & Security Policy” which lets their customers know how they collect, use, share, and protect information about them. They say that your personally identifiable information is information that can be used to identify or contact you. That your name, home address, phone number and email address are all examples of identifiable information. Walgreens also has a live chat option on their website where you can ask questions about ordering prescriptions, resetting your mobile password and how to check out on your mobile device. Walgreens has Instagram, Twitter, Facebook, and Foursquare. They recently surpassed 1 million fans on Facebook and has also integrated its network of more than 7,700 drug stores through mobile platforms on Facebook Places and Foursquare.
CVS
Once you get onto their website, it’s pretty all over the place, just like their stores. It’s very in your face, lots to look at and click on and its very overwhelming. Their website has lots of tabs that you can navigate to: Pharmacy Services, CVS/pharmacy stores, My Account, ExtraCare, Mobile, Help, Prescription Benefit Management, Corporate Information and Deals. You can shop online and check out and choose to pick it up in store or have it delivered to you. You can also order photos on their website, refill your prescriptions, and make a MinuteClinic appointment. CVS has also implemented functional improvements to benefit its customers with visual impairments and other disabilities. They want to ensure their website is accessible to persons with a wide range of disabilities, including blind computer users who use a screen reader or magnification technology on their computers and those who rely on a keyboard instead of a mouse. “An accessible website is crucial if people with vision loss are to obtain goods, services and information on an equal footing,” said the Vice President, Paul Schroeder. Their key accessibility features on CVS.com include: heading structures for page elements, alternative text for appropriate images and non-text visual elements, skipping navigation links within the header, labels for forms and appropriate input fields and data table markup. CVS is present on Facebook, Google+, LinkedIn, Twitter, YouTube and Instagram. Their pharmacy and MinuteClinic also have all of their own social media platforms as well. They have a large social media presence and have millions of followers on all of them.
Merchandise or Service
Walgreens
They have all kinds of merchandise ranging from beauty, personal care, and vitamins to grocery items, household items and sexual wellness items. Their store at the brick and mortar locations and online all carry the same things, and have a wide variety of many different merchandise. The quality of stuff the merchandise at Walgreens is on the higher end of things, compared to most convenience stores. They carry well known items, as well as their own personal brands as well. They make sure people have a variety of different prices and quality to choose from so that they can attract as many different social groups as possible.
CVS
CVS has started to focus on an assortment of healthier food, health-focused products and an expanded beauty selection. They are addressing the demand for healthier foods and the retailer has recently added more better-for-you options. Healthier choices like Alo Exposed Waters, EPIC bison bars and That’s It. bars will make up approximately 50% of all food options in the store, according to CVS. Additionally, they’re focusing on products that meet nutritional and dietary preferences—like heart healthy, good source of protein, gluten free, sugar free, organic and non-GMO project verified. CVS plans on removing certain chemicals from beauty and personal care lines by the end of 2019. All parabens, phthalates and formaldehyde donors in products within the CVS Health, Beauty 360, Essence of Beauty and Blade store brand product lines will be removed. They were also the first national retail pharmacy chain to announce the removal of artificial trans fats from all exclusive store brand food products. So even though CVS may begin to carry less merchandise and less options, their options will be better for you and focus on being healthier alternatives to normal convenience store snacks.
Customer Services Offered
Walgreens
Walgreens offers many services to their customers. One of the first things they ever started doing was providing it a place to print out pictures and also get your picture taken for your Passport. As of recently, though they offer many other services relating to your health. Their Healthcare Clinic has three different services—prevention and wellness, treatment, and monitoring and management. With the prevention and wellness service, they provide vaccines, physicals and health screenings and testing. On the treatment side, they can treat illness, aches & pains, minor injuries and even skin conditions. With their monitoring & management service they help with ongoing health conditions and medications and treatments as well. They have a customer service line that you can call with any complaints or questions and they obviously have their Pharmacy as well. With the pharmacy you can ask questions, get refills or even get a new prescription in store or though the drive-thru. They print out labels that are in your language, they have large print labels, and even easy-open caps for people with arthritis and joint conditions. With Walgreens, you can return anything with in a 30-day period of purchase as long as you either have the receipt or the card you purchased the items with.
CVS
CVS offers digital printing of photos as well as having pictures taken for Passports. They offer a lot of the same customer service as Walgreens, but in my opinion their actual customer service reps were nicer. When I walked into CVS and was taking my pictures I had many people stop me and ask if I needed help finding anything, I informed them I was there for a school project and that I didn’t need anything, but yet people still asked if I needed help. I passed by the Pharmacy and a young man stopped me and asked again, if I needed help and I told him the same thing. I came to the conclusion that he was the manager there, or someone higher up because he wasn’t in the same uniforms as everyone else. He answered a lot of my questions with a smile on his face and pointed me to different parts of the store that Walgreens would not be able to offer. His customer service skills were amazing and I enjoyed talking to him and felt comfortable doing so. CVS also offers a clinic called the Minute Clinic. The services at the Minute Clinic are: Minor illnesses, minor injuries, screenings & monitoring’s, skin conditions, travel health, vaccinations and injections, wellness & physicals, and even women’s services. Along with their Minute Clinic, they have a pharmacy as well, with enables customers to drive through or walk in, ask questions and pick up their prescriptions.
Store/Online Personnel
Walgreens
When I first walked in, I was greeted as I usually am “Welcome to Walgreens.” The staff was friendly and smiled at me. I walked up to the counter and asked if there was a manager on duty who could answer a couple of questions I had regarding a school project. She told me that there wasn’t, but she did have someone who could answer questions. I looked at this lady’s lanyard, and she was a shift lead, which told me that they don’t have managers in store on a regular basis. That was not a good thing, in my opinion. Her name was Ashley and she was very nice, she answered all of my questions, provided me with a layout of the store and informed me that she didn’t care about me taking pictures of everything. Everyone was in uniform and looked of a professional manner.
CVS
When I entered CVS, I wasn’t greeted by anyone, I actually had to walk up to the lady behind the register and ask for help, which was disappointing. I asked her if she had floor plans I could use for my research and she informed me that she did not. I proceeded to walk around the store, taking photos and looking at everything the store had to offer. When I got to the back of the store I spoke with the manager who helped me out a lot, actually and answered a lot of my questions and then I was constantly asked by other employees if I needed help with anything. They were all in matching uniforms, except for the manager and they all looked professional and well kept.
Traffic Flow Pattern/Store Layout
Walgreens
Walgreens store layout has three out of the four mentioned in the text. Their selling space is obviously where they display all of their merchandise, their aisles covered on each side with merchandise and also their checkout area. They also had their merchandise space where they stock everything that isn’t on display, and that was in the back of their store. I got to walk into their personnel space, where the employees take breaks and where the manager on duty and the shift lead do their daily work. Walgreens did not have a customer space where you could sit down and relax while others shop, but they did have a place to sit next to the pharmacy and the clinic. Walgreens uses a Gridiron or straight traffic pattern. They have their merchandise on either sides of the aisles and their checkout area was located at the entrance/exit of the store.
CVS
I noticed that CVS also only has three of the four store layouts as well, the selling space, the merchandise space and the personnel space. I didn’t get to see their personnel space like I did with Walgreens, but I did ask their manager about it. Their store pattern is Gridiron as well, because of the fact that they have their parallel aisles with their merchandise on either sides and the checkout is at the entrance too. I asked if they had a store layout I could take a picture of, but they said they only had their large blueprints and I couldn’t see those.
Store Exterior
Walgreens
In order to signal to customers that the interior had been changed and to attract new customers, the exterior was remodeled with large windows that draw more light into the front of the store, where cosmetics and consumables are for sale. The twin gables were removed, blue and white paint replaced the old brown, and a curving canopy, which is supported by canted steel columns, was installed at the main entrance.
This particular Walgreens was on a corner in a single lot with a Chase Bank next to it. They were right next to the beach, so there was palm trees and other tropical landscaping. There were two entrances to the store, one in the front and one off to the left side, easy entrance for people going through the drive-thru pharmacy.
CVS
CVS stores at this time are mostly still their old look. They haven’t renovated a lot of their stores yet, especially the ones in the smaller cities. Their exterior is a pale tan, and have a giant archway in the front, with their logo centered in the archway. Their logo has red letters, and a heart at the front of it. The marquee is on the side of the road, and pretty tall so that the cars passing by can easily see the sign. This specific CVS was in a shopping center with a Winn-Dixie, a nail salon, a tanning bed salon, a Hair Cuttery and a few others. They have a lot of business around their store, which is good because they’re easily accessible.
Recommendations/Discussion
Walgreens
With Walgreens, I find that they suit their customers’ needs exceptionally better than CVS. They’ve renovated the majority of all of their stores to keep up with the 21st century and even if the outside isn’t renovated, the inside is. They’ve taken the modern aspect to a whole new level and made sure they were keeping up with the times because people these days don’t just care about the product, they care about where it is that they’re shopping as well. As with areas for improvement, I find that Walgreens has taken this upon their selves and realized where they could improve, and has done it. Everything you could want to find in a convenience store is here, and not only that, they also included a clinic in store so that people could avoid racking up their medical bills and have a convenient place to get their checkups done. I personally prefer Walgreens because they generally have a better selection of things I am looking for. I prefer their makeup and beauty section because they have a better variety and options and I am part of their rewards program that saves me money each time I shop there. I find they have better wine and alcohol selection as well, and can always find what I’m looking for when I go.
I also got the opportunity to talk to the Director of Pharmacy and Retail Operations of Walgreens, his name is Jerry Telson. He happened to be a family friend of my moms, and I figured he would have useful information for me completing this assignment. He informed me that Walgreens main goal is to have a customer centric approach and making sure they cater to the customers first and foremost. All deliveries and maintenance is done overnight to ensure that the customers aren’t interrupted while shopping. He also told me that his consumers want everything all in one place so that they don’t have to go to a bunch of different places. Right now, Jerry is focusing on bringing dental work into all Walgreens, and one specific store off of Fletcher Ave in Tampa is under renovation right now to bring Aspen Dental Center to the local Walgreens. By having lab work, dental work, hearing aids, clinics and prescriptions all done in one place, it eliminates the need for people to go to a bunch of different places. Jerry also told me that Walgreens number one goal is to be “Americas most loved pharmacy led health and well-being retailer.” He said the “loved” is important because it makes an emotional connection between the consumer and the company. I thought this was interesting because it really is so important to be able to connect to your customers and really make sure that you’re catering to them every chance you can.
CVS
As far as CVS goes, I think they aim for a different target market than Walgreens’ does. They are beginning to focus on selling healthier options, which would be beneficial for the people who are looking to buy those types of things. They also stopped selling cigarettes, and in my opinion, doesn’t really matter, but quite a few people I know stopped going to CVS because of this. Their argument was, how’re you going to stop selling cigarettes, but continue to sell alcohol and other items that are just as bad for you. So, they stopped giving them their business. I think CVS could improve first and foremost by updating their stores and keeping in touch with the 21st century. Their stores are very dull and very bland and I find that when you spice things up with your decorations and your image, that more people are going to want to enter your store. When CVS updates their stores, and keeps this healthy image throughout, and not just when it comes to cigarettes, I think their stores would become juristically more popular. But for now, I think they still have a lot of work to do, and I don’t see their business growing without updating. I also find that CVS doesn’t focus on catering to their customers as much as Walgreens does. If they did, they wouldn’t have their employees stocking shelves while you try and shop, they would also be more focused on trying to update their stores so that people can have a more comfortable and relaxed time shopping.