The Columbus Dispatch featured an article “Drugstores become shopping ‘destinations,’ with fresh food and more” about this relatively new development. According to Rite Aid’s chief operating officer, Ken Martindale, “Drugstores are trying to figure out what their role is. We’re in a new environment where everyone is selling everything.”
Walgreens, including their Duane Reade chain, is creating destination drug stores offering a wide array of product and services. They have six flagship stores across the country. I’ve been to the Duane Reade store at 40 Wall Street in New York’s Financial District. It is a retail wonder. You can see what they’ve accomplished from a video report of their grand opening reception. There was also a detailed report at brandchannel.com highlighting what the store offers.
In 2014, when the NAMA OneShow is in Chicago, make it a priority to visit the Walgreens flagship store at 151 North State Street – at the northeast corner of State and Randolph.
Will you be seeing this new chain drug store format in your area? Only time will tell. Make sure that you pay attention to how the immediate consumption competition is changing in the neighborhoods near where you operate.
Never forget who the competition is
For our industry, we must understand that the only time we compete with other operators is when a contract is up for bid at a location. At that time, for that bid, we compete directly to be the service provider – whether we offer micro-markets, vending, onsite foodservice or office coffee service.
For the other 364 days each year, we compete with any other company offering ‘immediate consumption’ beverages, snacks and food. That generally describes products purchased to be consumed within the next 15-30 minutes.
An important rule about competition and competitors, taught to me early in my career, was “…to never obsess and never worry about competitors. Learn about their strengths and weaknesses. Figure out what to improve, what to eliminate and how to change what you offer. Then go out and do it. Out-think them even if you cannot out-spend them. It all comes down to how well you execute your plan.”
My contacts and connections in the convenience store channel tell me that bigger and better stores are being designed – product offerings will be even more inventive, more convenient – in-store merchandising will be more appealing and tied closely to social media alternatives.
What is your plan to out-think and out-execute the competition? If you don’t have that plan you need to create it and begin executing it. The competition is not sitting still. They want our customers. They have plans to steal our traffic, our transactions.
Just what we need – more competition!