Walgreens will invest in U.S. customer experience, IT
Deerfield, Ill. - Walgreens Boots Alliance is ahead of schedule in its synergy efforts since Walgreens and Boots officially merged in December 2014. At its 2015 Analyst Day in New York City, the retailer’s leadership team outlined plans to support the customer experience in its Retail Pharmacy USA division with investments in key operational efficiencies such as IT systems, modernizing pharmacies and investing in customer care.
These investments are part of key business drivers that will move the newly-created, international organization forward as it operates in diverse markets across the globe with a common aim and focus.
Executive Vice Chairman and Acting Chief Executive Officer Stefano Pessina said, “We are just over three months since the completion of our strategic combination and the launch of Walgreens Boots Alliance on Dec. 31, which itself happened months ahead of the original schedule thanks to the extraordinary work of our teams in the final weeks of 2014. We have achieved a lot in a short period of time, and everything we have seen convinces us that there is significant opportunity. It may take different forms in different markets, and there may be many components as it takes time to deliver. But the potential is there," he said.
And while the newly branded Walgreens Boots Alliance is open to both joint venture and M&A opportunties in the marketplace, Pessina asked analysts to give the company time to digest and assess the U.S. retail marketplace.
“Across our organization we have excellent people running solid businesses and running them well on a daily basis. This is an extraordinarily capable and dedicated group with an excellent track record of leading complex international businesses in truly tough conditions to deliver systematic and sustainable value for our investors," he said. “Beyond that, our size and scope means that if we are effective in our delivery, we will be one of the companies that helps shape the future of health care, pharmacy and retail on a global basis. As our businesses and the markets in which we operate evolve and change, we have many opportunities.”
Addressing the group of analysts today were leaders from the company’s three divisions (Retail Pharmacy USA, Retail Pharmacy International and Pharmaceutical Wholesale), its cross divisional functions (including Global Brands and its Global Pharmacy Market Access group), Walgreens Boots Alliance Development and the company’s finance team.
Pessina emphasized the strategic and tactical advantages derived from the company’s Pharmaceutical Wholesale division. “Our wholesale business is not only highly cash generative while providing a common platform and true international presence, but it is also an enabling business in a sector with scope for further consolidation,” he said.
“Wholesale lets us enter new markets at scale more rapidly than retail, while its cash flows help give us financial scale and efficiencies. And it brings the mindset of running a low margin operation – with all the rigor and discipline that demands – throughout the combined company’s culture. Finally, it is our wholesale relationships and experience that form the basis of the procurement work being done at WBAD. Without wholesale, we would not be able to achieve anything like what we are in terms of world class procurement in pharmaceuticals.”
Leaders from the Retail Pharmacy USA division highlighted the industry shifts impacting the division and, in response, where the division will operate and how it intends to win. Included in that plan is creating an integrated, back-to-basics approach in its pharmacy and front of store operations designed to deliver ultimate convenience, customer loyalty and extraordinary customer and patient care. That customer experience also will be supported by investments in key operational efficiencies such as IT systems, modernizing our pharmacies and investing in customer care.
From a retail pharmacy network access perspective, company leaders described how they’re working to create a global market access mindset through disciplined investment, a focus on patient pull-through and evolved stakeholder partnerships. In the specialty pharmacy market, the division is using a differentiated model to manage costs and improve outcomes by providing access to care in a cost effective, clinically appropriate setting and through partnerships involving Biopharma, payers, providers and patients.
With a retail footprint across Europe, Asia, Latin America and the Gulf, the Retail Pharmacy International division has seen increasing demand for its brands globally. As the division’s leaders work to grow the business organically in existing markets, they are also looking for opportunities in new markets. The division continues to benefit from the exchange of learnings across all of its markets; from the virtuous cycle between health care and wellbeing; from insights gained through loyalty programs to increase personalization; from deploying digital solutions; and from its relationship with manufacturers and suppliers.
More specifically in the U.K. market, Boots is quickly developing new pharmacy and omnichannel models while continuing to innovate in health and beauty in response to changing customer expectations and how they now live their lives. Boots is focused on more personalization and expert care; more confidence in the value it offers with inspiring rewards; and easy and seamless access for all of its customers’ health and beauty needs.