Walgreens Mobile Flips The CRM Assumptions

Walgreens (NYSE:WAG), which has spent the past year pushing its Balance Rewards loyalty program past the 70 million mark, has found a new way to pull in members. The drugstore chain got an 8.5 percent response rate by sponsoring alerts on another company's fitness app, Mobile Commerce Daily reported on Monday (July 15).

The smartphone app, MapMyFitness, provides audio alerts to users when they're in the middle of a workout, with information on their pace. During April and May, Walgreens sponsored the first set of alerts. At the end of the workout, a full-screen Walgreens ad was displayed combined with an audio message that encouraged users to sign up for Balance Rewards to earn loyalty points for their physical activities. Those points can be redeemed for any Walgreens product, including prescriptions.

During the sponsorship period, MapMyFitness iOS and Android users logged 680,000 user workouts. That means about 60,000 users clicked through or engaged with Walgreens in some other way after the alerts and messages.

That's only a small incremental boost on top of the 70 million loyalty members Walgreens already has in the bank. But a key cross-channel challenge for brick-and-mortar chains is getting people who aren't already customers to join a loyalty program. That sounds like a contradiction in terms, since a non-customer by definition doesn't have any loyalty to a chain. But working the system backwards—hooking the user with reward points, then reeling them in to become regular customers—actually brings in new customers, while the usual process just helps lock in existing customers.

Equally counterintuitive for some chains is the idea that "cross-channel" can mean crossing into a third party's channel. But that comes back to the same problem: Retailers need a way to reach outside the customer group they can already communicate with in-store or through their own websites and mobile apps—and those customers have already heard the pitch. Without stretching beyond the usual corporate boundaries, retailers could end up talking to themselves.

For more:

- See this Mobile Commerce Daily story

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