Ellen Paul demonstrates how she used Walgreen’s smartphone app to scan the labels of the prescriptions she needed after she had surgery. | Rich Hein~Sun-Times
Updated: January 17, 2012 11:24AM
Ellen Paul had no voice or strength left after her recent outpatient surgery to remove wisdom teeth, so she resorted to scanning the labels of the prescriptions with her smartphone to order her pharmacy refills.
“Within two seconds, I downloaded the smartphone app, clicked to scan the barcodes with the phone’s camera and clicked once to submit — it was a lifesaver,” said Paul, an Oswego single mom who inherited her dental problems.
“I didn’t even feel up to dialing the telephone and going through all of the prompts to refill the prescriptions,” she said, noting that she had lost her voice because of having had general anesthesia administered through a tube down her throat. Paul’s partner picked up the prescriptions.
Where can you scan your prescription label, order a product pickup online, print photo albums on an iPad for delivery at home, receive a text alert when your prescription is ready and get digital coupons for checking into a store via Foursquare?
The answer: Walgreen Co.
The Deerfield-based drugstore chain, known for its aggressive store openings and solid sales and stock price, has quietly jumped into the digital age as it faces intense competition from Wal-Mart, CVS and countless online rivals, and as it tackles issues ranging from lower prescription reimbursements to higher costs for processing credit and debit cards.
In its latest initiative, available at more than 250 of Walgreen’s 500 Chicago-area stores, shoppers may check store inventory online, place an order and pick it up at the store in an hour or more.
At select locations in the next few months, online shoppers who pay more than $20 for their orders will be able to park in dedicated spaces outside of the store and call a store associate to bring the order out to the car.
Walgreen took its biggest leap into the digital space June 6 with the completion of its $409 million buy of drugstore.com, which also operates beauty.com, skinstore.com and visiondirect.com.
Drugstore.com has said the growth of mobile apps and social media will help its sales jump from $450 million now to $750 million by 2013.
The acquisition added 60,000 products and 3 million customers to Walgreen’s website, walgreens.com, which attracts 650,000 unique clicks each day and has grown 35 percent in visits from a year ago.
“We are focused on giving people more ways to get more products online,” said Sona Chawla, Walgreen’s president of e-commerce, who previously worked as an Accenture consultant and as vice president of Dell’s global online business.
The online competition is heated, with the latest entrant — Stockn’ Go at Stockngo.com — dubbing itself a cross between Overstock.com and Costco.
Walgreen uses video to burnish its website and Facebook presence, and runs health videos at HealthCornerTV.com. The videos link viewers back to walgreens.com to buy products online.
Walgreen counts more than 1 million fans on Facebook, offers live chat with pharmacists and pharmacy staffers and emails customers to solicit their online product reviews.
To support its burgeoning online business, Walgreen last year opened an e-commerce office downtown at the old Carson Pirie Scott building at 36 S. Wabash to house its e-commerce technology staff.
The company is also winning recognition for its mobile offerings, with two “Webby” awards for its free iPhone and Android apps that let people connect to the pharmacy wherever they are.
“We believe that mobile applications blur the divide between online and off-line services,” Chawla said. “We see more offerings via mobile devices, including offering digital coupons on mobile phones.”
Brian Kilcourse, a managing partner at RSR Research in San Francisco, said Walgreen and other drugstore retailers are facing the tip of the iceberg of technological challenges.
A key opportunity is for Walgreen, CVS and their rivals to use the prescription data they have accumulated to fashion personalized health-care advice, Kilcourse said.
Retailers are finding that customers like to talk to one another online — in forums such as a new-mom’s club or a diabetics’ group — to help one another with health advice. The retailer can eavesdrop in a positive way to offer pharmacists’ expertise and helpful products, Kilcourse said.
Since drugstores must safeguard their pharmacists’ personal ties with customers, they could extend the help to the store floor by offering health-advice kiosks to shoppers. Even more radical would be having pharmacists with iPads roam the store floor to help shoppers find appropriate over-the-counter medicines.
“Walgreen has an opportunity to differentiate itself from its low-cost and cost-cutting rivals, including Wal-Mart, and that’s through exemplary service,” Kilcourse said.
Retailers also are learning to respect customers’ time, since people are demanding that they use their mobile devices to make their lives easier.
That means enabling customers to order pharmacy refills online, setting up pickup and appointments in advance and ensuring that the fulfillment is quick and easy.
“Imagine a customer getting on his smartphone and telling the pharmacist he has time to get his flu shot at 4:15 p.m. He wants to know which stores have an opening so he can run in and get the shot. It’s up to drugstores to fulfill such requests, Kilcourse said.
Yet the greatest challenge looms in biotech developments, Kilcourse said. When pharmaceutical manufacturers start substituting therapies that treat targeted cells for today’s pills, what happens to the pharmacy itself?
“Imagine a world where the pill is no longer the primary delivery vehicle for a prescription,” Kilcourse said. “In its place is a drug that is inhaled, injected or absorbed under the tongue and that targets specific cells. We don’t know when it’s going to hit but we’re in the throes of a revolution.”