Walgreens Boots Alliance analyst event emphasizes 'change'

NEW YORK — “As a team, we embrace change. We see focused and managed change as a … great opportunity to create value. A management team with an appetite for change, and not a fear of it, is a huge asset to any business and I hope that you see this in us.” That was a key message that Walgreens Boots Alliance executive vice chairman and CEO Stefano Pessina had for attendees of its Sell-Side Analyst Event on Tuesday in New York.

Pessina — along with co-chief operating officer Alex Gourlay, global chief financial officer George Fairweather and Walgreens president of operations Richard Ashworth — hosted the event.

The event, which touched upon a wide range of topics, sought to shed greater light on how the retailer is transforming and creating greater value for its customers and stakeholders amid today’s evolving retail pharmacy landscape.

Kicking off the call, which was also webcast, Stefano pointed to the pilot program currently underway in 17 locations Gainesville, Fla. The program is enabling the retailer to test new ideas and concepts and examine pricing models in a controlled environment. More specifically, the retailer is simplifying the shopping experience with a more concise layout that holds lower SKU counts per store, as well as lower everyday pricing and new services like its Walgreens Plus subscription offering.

“Our focus has to be on winning the customers’ hearts and minds everyday. In a competitive market, it is not enough just to do better than we are doing today. We have to be able to demonstrate that what we are doing not only gives the existing customers a reason to keep coming back, but also wins us new customers and enables us to win back some that we may have lost over the years,” Pessina told attendees.

He stressed, however, that the Gainesville stores are not a “blueprint” of the future of Walgreens. The stores remain in transformation and, according to Pessina, offer only a hint of the services and concepts that lie ahead.

“What we are exploring now is only a start,” Pessina said.

Asked by analysts about the future growth of its retail-based clinic business, executives highlighted the recent emergence of urgent care capabilities in select locations. Earlier this year it was reported that the emergence of UnitedHealth Group’s MedExpress urgent care centers in select Walgreens locations had grown to 15 locations.

“We are trying different ways to bring acute or primary care into the pharmacy setting. … But I don’t see the overall number [of clinics] changing in any way,” said Ashworth. The retailer currently has more than 300 retail-based health clinics.