WHAT IT MEANS AND WHY IT'S IMPORTANT — Nice! may tout no-frills packaging, but make no mistake, Walgreens' latest private-label introduction is anything but. It's another example of Joe Magnacca's influence as president of daily living solutions; and it's another way by which Walgreens will better connect to its customers. Indeed, the packaging is more similar to the DR Delish brand than Walgreens' typical store-brand fare. But perhaps most important, Nice! represents a strong push into a key drug-store differentiator going forward — food offerings.
(THE NEWS: Walgreens officially kicks off Nice! launch. For the full story, click here)
And it couldn't have come at a better time. The state of the economy is fast becoming a top-of-mind concern for Americans, again, as both prices at the pump remain relatively high, compared with last year — a national average of $3.57 per gallon as of Aug. 22, as compared with $2.71 per gallon a year ago, according to AAA's Daily Fuel Gauge Report — and food prices continue to rise.
According to Deloitte's "2011 Consumer Food and Product Insight Survey," nearly 9-in-10 survey respondents (87.7%) believed prices in food stores are escalating, and almost three-quarters (74%) said the size of some packaged goods is smaller. Consequently, savvy consumers are purchasing more private-label and store-brand products, the survey found. More than three-quarters of respondents (75.3%) purchased lower-priced products, and nearly 2-in-5 respondents (39.6%) added more private-label products to their grocery bags.
Couple that insight with Walgreens' July announcement that the chain would create some 1,000 "food oasis" stores over the next five years, and you can begin to see that food offerings in drug stores aren't just a passing fad. At least not at Walgreens; food is here to stay. In those stores identified as a "food oasis," Walgreens has expanded its food selection by up to 60%, offering a larger assortment of fresh fruits, vegetables, whole grains, lean protein and other healthy meal components to help address the need for greater access to affordable, nutritious food. And now, a line of store-brand value food and other household items to round out that offering.