Focus on: Mobile Retailing
By many accounts, Walgreens is already a mobile retailing veteran. But eager to keep its service exciting and valuable, the drug store chain recently added a new product-mapping service within its mobile strategy.
Walgreens began its mobile journey in September 2009, when it launched an app designed to “improve the way our customers interact with us,” explained Tim McCauley, senior director, mobile commerce for Deerfield, Ill.-based Walgreens.
The services supported by the app include electronic prescription refills, access to prescription histories, the ability to order photo prints, a store locator, access to the chain’s weekly ad, the ability to browse merchandise and check stock availability, and browse and pay for orders.
Such robust functionality has consistently placed the Walgreens app among the top 50 free apps downloaded through Apple’s iTunes Store. Building off of this excitement, the chain was ready to add a new dimension of functionality, one that further improved the in-store experience. For Walgreens, this translated into a product-mapping component.
“Initially, our app helped users navigate the shopping experience outside the store,” McCauley said. “As consumers begin to enter the store with their device, we needed to deliver more value, relevance and excitement to their shopping experience. The mapping offering does this.”
McCauley expects the service to help customers build shopping lists prior to visiting stores, and easily navigate aisles once they enter.
“It helps them preplan their trip, and then make the visit a better experience once they get there,” he explained. “We need to provide services that remind shoppers what’s on sale, and help them find what they want.”
Walgreens required a solution that could deliver easy navigation, scalability and the flexibility needed to support its breadth and expansion plans. The chain partnered with St. Louis-based aisle411 based on its robust, customer-friendly display and its seamless integration with its mobile app.
Walgreens provided aisle411 with formatted product mapping data, customized for each store. As shoppers launch the Walgreens app, they choose the store locator icon, select their desired location and then choose the store maps icon, which connects them to a store-specific schematic, complete with labeled aisles. Users can build shopping lists either by adding items from the weekly ad or manually entering them. The map directs shoppers to where they reside in their chosen store.
Since launching the mapping software in July, Walgreens’ customer and employee feedback has helped the company make additional enhancements, including creating more streamlined lists and simpler mapping.
“[When we make] product searches and mapping operations easier, the shopper experience improves,” McCauley said. “We hope to further streamline functionality in time for the holidays.”
Retail Forecast 2013
By Phillip M. Perry
Overcast with clearing skies — That’s the economic forecast from a major research firm as retailers enter a new year. Drizzly conditions will remain at least for the first half of 2013 as consumers hold tight to their pocketbooks. By the summer, though, light should break through the clouds as the resolutions of critical national uncertainties encourage corporate hiring, capital investment and consumer spending.
The coming year as a whole is not expected to bring significant relief over 2012.
“We expect the recovery to remain lackluster,” said Sophia Koropeckyj, managing director of industry economics at Moody’s Analytics, a research firm based in West Chester, Pa. (economy.com). “The pace of growth will be too slow to meaningfully bring the unemployment rate below 8%.”
The numbers tell the tale. Moody’s expects GDP to increase by 2.4% in 2013. That’s not much of an improvement over the 2.3% anticipated for 2012 when figures are finally tallied.
Moody’s forecast might not seem all that bad, given that the GDP increase for an economy in average growth mode is 2.5%. However, a nation recovering from a recession needs a more robust expansion.
“By most measures, this recovery is among the weakest in the past 50 years,” said Koropeckyj.
What’s holding things back? Koropeckyj points to a number of areas:
“Fiscal restraint on the local and national level, weaker global demand, a housing market that has hit bottom but has a long way to go to become healthy, and weak income growth are all constraining a stronger pickup in employment.”
Other factors are the weakening economies of China and Europe — both important export markets.
All those factors are coming together to subdue the public mood.
“Consumer confidence is still at a level consistent with a recession,” said Scott Hoyt, Moody’s senior director of consumer economics. “Consumers remain concerned about economic conditions. There is still high unemployment, weak growth in wages, volatile stocks and high gasoline prices. There are a lot of things to keep consumers on edge.”
Retail sales: Retailers will suffer as concerned consumers hold onto their purse strings.
“Retailers are most concerned about jobs and income,” Hoyt explained. “The economy is not adding jobs fast enough to lower unemployment. Wage growth remains weak, and it is not putting the cash in the pockets of consumers that retailers would like to see.”
Moody’s expects pressure on retailers early in the year because of the major weight of a constraining federal fiscal policy. Consumers will continue to be impacted by the anticipated terminations of two initiatives: the social security payroll tax holiday and extended unemployment insurance benefits. Reduced federal spending, by eliminating some jobs, will also have an indirect but significant effect on consumers.
“We expect the environment to be difficult in 2013, with core retail sales growing at some 2.3%,” Hoyt said.
That pace represents a de-escalation from the 3.2% anticipated when 2012 figures are finally tallied. To put those figures in context, average annual core retail sales grew at 4.6% prior to the 2008 financial crisis. (Core retail sales exclude volatile revenues from auto sales and gas stations).
Good news: If the economy remains troubled, corporations have managed to thrive. By piling up mountains of cash, they have positioned themselves for a fresh round of capital and labor investment when the time is right.
“Businesses are in excellent financial health; their costs are down and they have become highly competitive and profitable,” Koropeckyj said. “Employers have little slack in their labor forces so layoffs have declined dramatically.”
By the fall of 2013, Moody’s expects major market uncertainties to be resolved as lawmakers bridge their differences, raise the Treasury debt ceiling and agree to longer-term tax and spending policies.
“Combined with the Fed’s aggressive actions and a more stable Europe, all of this will ease business fears,” Koropeckyj said. “Growth will accelerate and unemployment will begin to fall.”
Phillip M. Perry is a New York City-based business writer.
Children’s Place CFO resigns, replaced by former Talbots COO
Secaucus, N.J. — The Children’s Place Retail Stores Inc. reported Monday that its CFO Steven Baginski has resigned the company, effective immediately.
According to the retailer, Baginski is leaving to pursue other interests.
Former COO and CFO of The Talbots Inc., Michael Scarpa, has been named Baginski’s successor, effective Dec. 3.
Scarpa also worked at Liz Claiborne Inc. for 25 years.
In related news, Children’s Place also said its board approved the repurchase of up to $100 million in stock. The company approved the repurchase of $50 million in stock in March, and at the end of the third quarter $21.6 million remained under that authorization.