Loyalty360 Q&A: Walgreens focused on growing share of its most valued customers

NEW YORK - Over the course of Walgreens Boots Alliance 2015 Analyst Day, Alex Gourlay EVP Walgreens Boots Alliance and president of Walgreens, promised analysts that the Walgreens Balanced Rewards loyalty program would be getting a makeover. Already the program boasts 80 million users to which Walgreens Boots Alliance had the capability to deliver as many as 30 million personalized offers. 

 

Part of Walgreens strategy is to build and retain its share of its most valued customers. More so, it turns out, than investing in attracting new customers to the business, according to a question-and-answer piece Loyalty360, the Loyalty Marketers' Association, published on Thursday. 

 

"The value that an existing high value customer brings to the business is much greater than that of the average new customer," Mindy Heintskill, senior director, loyalty and vendor collaboration for Walgreens, explained to Loyalty360. "As such, it makes more sense to focus on investing in the retention of high value customers."

 

But focusing on retention over acquisition can be a tough sell, Heintskill added. "Some people believe that retention-based programs focused on rewarding high value customers give money away to customers who would have purchased anyway. Contrary to this point of view we’ve realized incremental sales in each of the Balance Rewards 'thank you' campaigns when compared to a control group," she said. "Significantly, the majority of the incremental sales are generated from existing brand buyers. In addition to the short term benefits, the program has provided the long term benefit of improved retention/loyalty."

 

Heintskill, along with Lisa Zhao, senior manager of loyalty and vendor collaboration, Walgreens, and David Hess, head of analytics, emnos, will present a session titled, “Driving Customer Engagement and Sales Growth through Personalized Marketing” at the 8th annual Loyalty Expo, presented by Loyalty360, April 27-29, 2015, at the Loews Royal Pacific Resort at Universal Orlando in Orlando, Fla.