Strategy based on products, presentation and service

DEERFIELD, Ill. — Walgreens is redefining the beauty shopping experience at many of its stores. As of the end of 2016, about 1,800 locations had been converted to the drug chain’s “Beauty Differentiation” concept. The strategy centers on three elements: enticing products, an engaging retail presentation and a level of service not typically seen in your local drug store, including specially trained beauty consultants.

While the rollout is a multi-phased, multi-year effort, the customer response so far has Walgreens executives confident that the retailer is on its way to becoming the destination of choice for today’s beauty care consumers. The company’s vision to transform drug store beauty shopping has led the editors of Mass Market Retailers to name Walgreens as the Beauty Innovator of the Year.

“Our Beauty Differentiation strategy is an important part of our overall strategy at Walgreens,” said Linda Filler, president of retail products and chief merchandising and marketing officer for Walgreens. “We are focused on elevating our customer offering and experience, strengthening customer value and marrying our small-format location strength with an omni approach.

Added Lauren Brindley, group vice president and general merchandise manager for beauty and personal care at Walgreens, “The whole idea of Beauty Differentiation is about offering customers the best global beauty brands in a welcoming, accessible and inspirational environment, accompanied with impartial experts and customer care.”

In creating the new beauty business model, the retailer relied in part on results from 12- to 18-month trials for its flagship No7 brand in New York and Phoenix, according to Walgreens Boots Alliance (WBA) co-chief operating officer Alex Gourlay.

“We’ve done our homework, and it will take some time,” he said. “We believe that we have the right customers in our drug stores. Twenty percent, more or less, of our customers are who we call the ‘feel good’ customers. They’re primarily women, and they’re primarily coming to Walgreens for health care needs. So we are focusing on how we can communicate with them so they see Walgreens as more of a beauty retailer.”

At the redesigned Walgreens store in Vernon Hills, Ill., for example, beauty’s prominence in the retail mix is evident just steps inside the entrance. A wall of stylish, backlit cosmetics displays runs the length of the store and showcases WBA’s No7 and Soap & Glory global brands, as well as such staples as L’Oréal, Maybelline, CoverGirl, Neutrogena, Almay, Rimmel, wet n wild, essie and Sally Hansen.

“Many of these locations had the whole store relaid as part of a macro space realignment,” said Filler. “Beauty received the largest space increase, but health and wellness also received some more space. So part of the lift comes as a result of using all of our space more smartly, according to our analytics.”

Customers entering the Vernon Hills store’s beauty area are greeted by colorful gondolas highlighting new items, advertised specials, and national and exclusive brands. Enhanced signage makes it easier for shoppers to locate product categories, whether it be makeup, skin care, hair care, beauty accessories, scents or personal care items.

“This is an accessible, comfortable experience. It’s not about an over-the-top experience,” Gourlay said. “We’re removing any clutter from the front of the store so customers can see [the beauty department] as they walk in.”

Garnering special attention on the cosmetics wall are the displays for the No7 and Soap & Glory brands. “We’re trying to bring in different brands for different customers,” Brindley said. “As we build our beauty strategy, we want to ensure that we have products for all types of customers, ages and backgrounds so everybody can find something to suit them.”

Customers have embraced No7 and Soap & Glory, according to Filler, who added that the latter has proved to be an eye-catcher. “It looks great in the store. It’s a vibrant brand, and the visual identity makes it really pop in-store,” she said. “It sort of calls you from across the store saying, ‘Come see me, come check me out.’ ”

Filler is looking for more products from suppliers that set them — and Walgreens — apart in a crowded retail environment. “We’re working with many of our suppliers on the potential for exclusive, innovative new products and how we can generate excitement with our customers,” Filler said.

The No7 and Soap & Glory displays offer something else different in the chain drug beauty arena: test products. “We’re offering testers for these brands. Customers can test, try, play and explore with the products. It also means our beauty consultants can try the products on customers,” Brindley said. “This is more like the experience you would find in a beauty specialty store, but we are able to provide the accessibility like no one else can.”

Another linchpin of Beauty Differentiation is the consultation station, which has a mirror and a swivel chair stool. There, the beauty consultants can perform a range of services, from providing advice on skin care, doing mini-makeovers and applying test products to measuring skin moisture and matching skin tone using handheld digital tools like a hydrometer and the MatchMade device. The latter assesses a customer’s skin tone and points her to a matching No7 foundation.

“We’ve invested much more in training, tools and techniques,” Brindley said of the consultants. “This is about helping customers find whatever makes them feel beautiful and understanding what solutions she needs.”

The customer interaction driven by the consultants helps build relationships, executives noted.

“Beauty enthusiasts, in particular, really love finding what’s new,” said Filler. “We have the beauty consultant there to tell the news, tell the story, and talk about new solutions or products and new innovations. Our customers appreciate that.”

And shoppers aren’t limited to what’s in-store. The consultants’ digital toolset includes a tablet that enables them to search, view and order products available on Walgreens.com but not currently in stores.

“If customers want to order a product right there in the store and have it shipped to the store without a shipping fee or to their home, they can do that,” Filler said. “It’s a device for engaging with customers and their interests. But it’s also an ominchannel tool. A very important part of our vision going forward is to drive a seamless, branded omnichannel experience.”

This past fall, Walgreens debuted another key component of its beauty offering: The Beauty Enthusiast, a free beauty club for its Balance Rewards loyalty program that’s designed to give the retailer’s best beauty customers something extra.