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Walgreens comps rise for April

BY Allison Cerra

DEERFIELD, Ill. — Sales for Walgreens during the month of April edged up 5.5%, thanks to a boost in both front-end and pharmacy sectors.

The drug store chain said that total front-end sales experienced a 9.4% boost, while comparable front-end sales benefited from the later Easter holiday with a 6.5% increase.

On the pharmacy front, sales increased 3.5%, while comparable-pharmacy sales increased 1.8%, accounting for 64.4% of total sales for the month. Prescriptions filled at comparable stores increased 2.3% in April. Calendar day shifts, however, negatively impacted prescriptions filled in comparable stores by 1.9 percentage points, Walgreens reported, adding that the recent over-the-counter switch of allergy drug Allegra negatively impacted prescriptions filled by 0.3 percentage point.

Customer traffic in comparable stores increased 2.3%, while basket size increased 4.2%.

April sales in overall comparable stores increased 3.4% for the chain, which was negatively impacted by 1.2 percentage points due to the calendar day shift. On a combined basis, comparable-store sales for the March/April period rose 3.3%, marking a 6.7% rise from the same two months in 2010. Additionally, comparable-store front-end sales for the combined March/April period increased by 4.1%, while customer traffic in comparable stores increased 1.6% and basket size increased 2.5%.

Duane Reade stores are not included in any comparable-store results, Walgreens noted.

Walgreens noted that its overall April sales rose to nearly $6 billion for the month, compared with about $5.7 billion in April 2010, and attributed a 0.7 percentage point contribution from Duane Reade.

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Forrester survey: 91% of retailers have mobile strategy in place or in development

BY DSN STAFF

Washington, D.C. — More and more retailers are experimenting with mobile and social initiatives. According to “The State Of Retailing Online 2011: Marketing, Social, and Mobile” report conducted by Forrester Research. for Shop.org, 91%  percent of retailers currently have a mobile strategy in place or in development (up from 74% a year ago), and 72% say they will increase their spending on social networks this year over last.

However, the overall amount of mobile traffic and revenue has not increased dramatically, suggesting that investment levels in site optimization may still be inadequate. For example, 48% of retailers report having a mobile-optimized website; 35% have deployed an iPhone app; and 15% offer an Android app and an iPad app, respectively. Challenges for retailers include differentiating the consumer experience on a tablet versus a smartphone and figuring out features and functionality in dueling app/mobile Web ecosystems.

Compared with past years, social networks surfaced higher as an investment area among retailers. Social networks ranked fourth on the list of successful customer acquisition sources, up significantly from last year. Yet the ROI associated with social is muddy: 62% of retailers said the returns on social marketing strategies are unclear, and nearly the same percentage said the primary ROI from social marketing is listening to — and gaining a better understanding of — customers.

“The data indicates that significant investments in social and mobile tactics will be in place this year,” said Sucharita Mulpuru, VP principal analyst, Forrester Research. “Retail executives should have modest expectations for the benefits of social commerce.”

With regard to mobile, Mulpuru said retailers should be working to increasingly integrate features and functionality into the physical store experience.

“While consumers may not be extensively exploring product information yet, basic store information, transparent pricing, and easy checkout capabilities are likely to be the most pressing opportunities for most sites in the near term,” she said.

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Supervalu looks to grow on multiple fronts

BY DSN STAFF

CHICAGO — Supervalu detailed its strategic plan to deliver profitable growth in the future for shareholders at an investor event May 3.

Commenting on the company’s plans, Supevalu CEO and president Craig Herkert said, “We are focused on acting as one company, working toward a common goal of delivering increased value to all of our customers and meeting their needs neighborhood by neighborhood.”

In a company press release, Supervalu said its senior management team discussed efforts to improve sales growth at the company’s traditional retail banners. In order to accomplish this, Supervalu said it would have to improve promotion of its value pricing, enhance such fresh offerings as locally grown produce, develop and maintain a compelling collection of private brands, which will be folded into the company’s Essential Everyday private-label line, adjust store assortment and format based on the needs of each neighborhood, and improve the customer experience in stores and online.

One of Supervalu’s long-term goals is the national expansion of its Save-A-Lot banner. The company said it intends to grow this banner by 160 new stores in fiscal 2012, keeping the company on track to reach its goal of building a network of more than 2,400 stores by 2015.

During the meeting, the company also announced the addition of the Save-A-Lot Today brand to its private-label program. The new Save-A-Lot Today brand is an opening price point line with most products priced under $1.

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