Walgreens’ technology upgrade helps merge digital and physical for associates, managers and customers

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“Four or five years ago,” says Rob Armstrong, “we’d go to the NRF show in New York and it would be a somber gathering. We saw the challenges bricks-and-mortar retailers were faced with, and it wasn’t just competition and ecommerce. It was how customer expectations were changing.”

Armstrong, who is vice president of portfolio marketing for Zebra Technologies, notes that what customers were expecting was omnichannel retailing, i.e., the ability for a customer to interact just as smoothly and easily with an actual store as with a website. The main pieces of this puzzle — integrated inventory and customer relationship management, in-store pickup of online orders, ship-from-store, etc. — had become clear a few years ago. What had not become clear was how to do all these things well, smoothly and at a profit.

The pinch point was stores, particularly associates: Websites are easy. If customers want to know more about something, they just click on it. If they ask a human a question, however, all the goodwill in the world won’t help if they don’t know the answer or how to find it quickly. That said, people have a lot of advantages, among them intuition, empathy, imagination and the ability to read nonverbal cues. They may not be as well informed as websites, but they’re smarter and more fun to talk to.

BRIDGING THE GAP

What’s needed, then, is a way to bring together the digital world of websites and management systems and the physical world of stores and associates — in real time, face-to-face with a customer. One retailer making a major investment in doing that is the Walgreen Company, a division of Walgreens Boots Alliance Inc.

In 2017 the company began replacing its PC-based in-store technology with handheld and tablet mobile computers from Zebra. According to Andrea Farris, Walgreen’s vice president for special projects, customer experience and store technology, the company has replaced 50 to 60 percent of store systems already and will be at 100 percent by the end of the next fiscal year.

Zebra is a longtime retail specialist and had been supplying Walgreens with various devices for years. It was chosen to partner with Walgreens on this project after what Farris describes as a robust and comprehensive sourcing project.

“When we began the program we had 8,000 stores, and the hardware devices we had in the stores for inventory management were getting to the end of their life cycle,” Farris says. “The need to continue upgrading our system couldn’t be supported by those systems, but more importantly, as consumer needs and demands changed, we realized our team members needed better tools. They needed to be able to spend less time focusing on operations — front-end and back office tasks — and more time on customers.”

OUT OF THE BACK OFFICE

Walgreens does an extensive business in cosmetics; a key part of its sales program is a staff of consultants who greet each customer as they come in and provide both advice on displayed products and products available on order.

Under the old system, an associate (or a manager or anybody else) who wanted to know something about an item in inventory had to go into the back office where the PC was, log on to whatever application was appropriate, find the information, jot it down on a piece of paper and return to the front of the store where the customer was waiting.

With the new system, any tablet-equipped associate can show a customer a selection of products, place an order for pickup in the store or for home delivery or direct the customer to a neighboring Walgreens that has the item in stock. Beauty consultants can also use the system to obtain sales visibility, where they can see on an hourly basis where they are against their daily or weekly targets.

Store managers are also liberated from the back office. “If I’m a manager,” Farris says, “I can access solutions that allow me to manage tasks that need to be completed in the stores. For example, I can see my planogram information. Before, I had to go to the office to consult a black-and-white printout of the planogram. Now I can access it as a zoomable and see right in front of me what it should look like when it’s set up.”

PARTNER PROGRAMS

In addition to near-ubiquity — the company has 9,650 stores in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands — Walgreens offers customers a widening variety of goods and services through partnerships with other companies. These include Sprint (cell phones and phone service), Humana (in-store health clinics), Birchbox (cosmetic products), Kroger (groceries) and FedEx (package pickup and drop-off).

Speaking of this latter arrangement, Zebra’s Armstrong says, “I live in Milwaukee. One day last winter I was scheduled to have some wine delivered, and I didn’t want it to sit out on the front porch and get ruined. I called FedEx and asked them to deliver it to the Walgreens just two blocks away from my house, and they said sure, no problem. When I went to get the wine, it was there in the store, nice and warm. I picked up a couple of other things while I was in the store, and I was on my way.”

Two things stand out about that story. One, it’s a terrific example of the kind of borderless customer experience modern retailing needs to provide. Two, it’s difficult to imagine that kind of three-cornered transaction working very well if the associates at Armstrong’s nearby Walgreens hadn’t been able to almost instantly access the shipping documents for his wine and accept payment for the other purchases he made.

TECHNOLOGICAL SHIFT

A shift in underlying store technology is helping enable the rapid adoption of systems that make this possible. Much of the technology used in retail, within the supply chain and for some level of store and shopper engagement, has been based in the Windows Mobile operating systems, a discontinued line which will no longer be supported after December of this year. The result, Armstrong says, is a massive shift toward the Android system for mobile devices, which is intuitive for younger users, making training easier, and is also secure. It is, he says, the underlying technology for the system now in use at Walgreens.

This is apparently winning acceptance not only with associates and store managers, but with Walgreens’ management as well. “Obviously we can’t share the financial results,” Farris says, “but the program is tracking well against the business case in terms of cost, as well as in terms of benefits we have been able to achieve through reduction of expenses and improvements in operation. We’re very happy with the results so far.”

 Peter Johnston is a freelance writer and editor based in the New York City area.

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