Future Shop: DR’s new flagship is major leap for drug store retailing

It’s like stepping into a time machine and jumping ahead a decade or more.
 Housed in a historic 1930s property that once was the tallest building in the world, Duane Reade’s newest flagship store at 40 Wall St. in New York — the first co-branded Duane Reade/Walgreens store — offers a glimpse of how retailers will use technology and develop new in-store services to create a much more interactive shopping experience.

“We are taking the best of Walgreens and the best of Duane Reade and bringing them together, and this store really exemplifies that,” Joe Magnacca, president of Duane Reade and president of daily living products and solutions for Walgreens, told Drug Store News. “And it takes a lot of innovation that we have been working on at Duane Reade and gives it a real chance. This becomes an incubator for new ideas and new concepts ... and whatever works here, we have a chance to apply that to other locations both in Duane Reade and Walgreens.”

There’s no doubt that the shopping experience within this 22,000-sq.-ft. Duane Reade location, which officially opened on July 6, is like no other.

“I think what they’ve brought to the U.S. market ... is obviously a lot of work and a lot of research and diligence on global best practices,” said Ken Nisch, chairman of JGA, a retail design and brand strategy firm. “I always think of a drug store as a bit of a kit of things if you’re not feeling well, if you’re having a tough day, having a minor home disaster relative to bits of do-it-yourself products — and I think they’ve totally transcended that. They created a store that’s about looking your best, feeling great and eating well ... in a very upscale, fresh sort of way.”

This co-branded store marks the first time that Duane Reade has introduced to its consumers the “Powered by Walgreens Pharmacy Network” concept, which links the system to the Walgreens pharmacy system. This enables out-of-state residents and visitors to have their Walgreens pharmacy information available at this Duane Reade store. By mid-October, all Duane Reade locations will be “Powered by Walgreens.”

However, is the seamless connection of pharmacy data on the back-end just the beginning? While Duane Reade has made no such announcement, it isn’t so far-fetched to imagine the industry at large leveraging such technology in the future.

Duane Reade partnered with Lawrence, a Tensator Group Co., to employ at 40 Wall St. the industry’s first Virtual Assistant. Using the latest in holographic imaging and audio-visual technology, the Virtual Assistant creates the illusion of a real person who greets customers when they enter the store.

Virtual Assistants already are in place in the United Kingdom at London Luton and Birmingham airports, conveying to travelers pre-screening information. At 40 Wall St., the Virtual Assistant provides guidance on everything store-related, including making suggestions and recommendations on products available to shoppers. The reality, however, is that these Virtual Assistants are fully customizable, and the functionality could go well beyond simply greeting shoppers.

“This thing is fully customized. The reiteration of a HIPAA-compliant virtual assistant, I could visualize her sitting behind a ‘desk’ so it would almost be like a ... virtual pharmacist sitting behind a desk,” said Keith Carpentier, senior business development manager for Lawrence. “You could approach it and hypothetically [if] you engaged your [loyalty card] or prescription, it could then speak to whatever personal health information the enterprise needed to convey. The fact that the enterprise can control the message is huge.”

The Virtual Assistant also could feature a menu of frequently asked questions and/or an embedded barcode scanner so customers could scan a product or a prescription to receive, for example, drug information or pricing. Have trouble understanding English? No problem. The Virtual Assistant also could be embedded with an unlimited number of languages to further assist non-English speaking customers. Have a loyalty card? Scan your card and she will greet you by name.

And then there’s the food. In recent months, several pharmacy retailers have made a much greater push into “fresh,” but this store completely redefines what it means to sell food in a drug store. The overall food selection balances national brands with local, well-known vendors. There are in-store sushi chefs, a juice/smoothie bar and partnerships with local New York gourmet retailers and such eateries as Zabar’s and the Carnegie Deli. It also features a Coca-Cola “Freestyle” machine, dispensing 130 combinations of Coca Cola-owned fountain drinks.

“We have really pushed the envelope hard on food,” Magnacca said. “A lot of the inspiration comes from Europe, where we’ve seen people push the envelope, to be quite honest.”

Europe also served as the inspiration for beauty within this location, which has an expanded Look Boutique with several European beauty brands that are newcomers to Duane Reade.

Technology and an increased focus on customer service also make a play in beauty. There’s an automatic fragrance sampler so shoppers can try more than 40 different scents on their wrists, as well as a virtual makeover tool so beauty mavens can “try on” makeup before they buy. The store also offers beauty services, such as an Essie/OPI manicure bar and a hair styling salon provided by Phyto Universe, typically not found in a U.S. drug chain.

For more photos of the flagship store:


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