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Merchandising team shuffle reflects urgency to boost front end

BY DSN STAFF

DEERFIELD, Ill. —Moving to reignite a sluggish front-end business hit hard by the collapse in economic growth and consumer demand, Walgreens has shaken up its merchandising team with new promotions and a shift in duties among department heads.

Among the biggest changes: the promotion of Robert Tompkins, divisional merchandise manager for over-the-counter drugs, to general merchandising manager of the entire health-and-wellness purchasing group.

Tompkins succeeds divisional vice president and group GMM Chong Bang, who has been named vice president of customer-centric retailing. He will work with senior company executives in a major project aimed at pulling together the chain’s sprawling marketing and merchandising activities and focusing them more sharply on meeting and anticipating customer demands.

Bob Cinq-Mars will replace Tompkins as DMM for OTC categories, including pain and sleep medications, incontinence, nutrition, diet aids and smoking cessation. Robert Bobber, DMM for consumables, is now in charge of OTC categories previously managed by Cinq-Mars. Robin Randolph, DMM for electronics, will assume Bobber’s consumables business. Scott Minger, associate category manager of vitamins, has been promoted to category manager.

The management shuffle reflects the urgency of the company’s mission to revitalize its front-end business in the face of a severe downturn in the economy and in consumer demand.

To spark sales, the company earlier named Kim Feil to the new position of vice president and chief marketing officer, and George Riedl, executive vice president of marketing, to the additional post of executive vice president of merchandising.

Riedl will continue overseeing purchasing and merchandising, marketing services and research, but will also oversee the new customer-centric retailing project. “For the last 10 years, item growth has outpaced basket size growth. We’ve had diminishing returns, which require that we refocus on select categories and right items,” Riedl told analysts during an Oct. 30 conference. What’s more, he said, “Fifteen percent of our baskets leave without anything but the prescription the customer came in for.”

Walgreens will focus hard to boost sales-per-customer, Riedl added, through “solution-selling,” its new customer loyalty program and other efforts.

Nevertheless, some Wall Street analysts remain concerned about the chain’s near-term prospects, given its increasingly heavy reliance over the past two decades on its pharmacy business to drive sales and profits and the intense competition Walgreens faces from such rivals as Wal-Mart, Target and CVS.

“Unlike competitors that have a more diversified business model, we believe Walgreens is more exposed to the increasing competition from non-direct drug store competitors at the pharmacy and the front end,” noted Citi Investment Research analyst Deborah Weinswig Oct. 30. “As such, we estimate that store productivity growth, as well as earnings growth, will decelerate, and that valuation compression lies ahead.”

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Alimentary Health signs licensing agreement with P&G Pet Care

BY DSN STAFF

CORK, Ireland Alimentary Health on Wednesday announced that it has signed a worldwide licensing agreement with P&G Pet Care, makers of two of the worlds leading companion animal pet care products, Iams and Eukanuba.

Under the licensing agreement, Alimentary Health’s and P&G’s proprietary pet care probiotics will be used in P&G Pet Care’s nutritional supplement products. The global market for companion animal pet care products was estimated to be over $40 billion in 2007. Alimentary Health will receive an undisclosed royalty on sales of all products containing the pet care probiotics.

In 2001, Alimentary Health partnered with P&G to develop safe and effective probiotic products for gastrointestinal indications. In 2007, P&G Health Care started using Alimentary Health’s natural probiotic strain Bifidobacterium Infantis 35624, in Align in the US. Align is a daily probiotic supplement that helps build and maintain a strong and healthy digestive system.

“Today’s announcement comes as a result of our continued successful collaboration with P&G,” Barry Kiely, chief executive officer of Alimentary Health, said. “We are please that our ongoing efforts have once again resulted in Alimentary Health’s technology making it to the marketplace. This agreement is a result of a successful research and development program between the two companies and it brings us closer to fulfilling our vision of becoming the worldwide leader in the research, discovery and clinical development of probiotics. We are proud of our long standing association with such a leading multi-national company.”

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Kmart holds GoldK Day health services, screening day for seniors

BY Antoinette Alexander

HOFFMAN ESTATES, Ill. Kmart, a wholly owned subsidiary of Sears Holding Corp., has announced that its pharmacy division will hold the annual GoldK Day on Nov. 18 for seniors.

“Kmart wants to remind seniors that we care about their health and GoldK Day is a way for our pharmacists to give back to these important customers by not only offering free screenings, but assistance with Medicare health plan selection and information about disease states, which can help seniors make better decisions about their healthcare,” Mark Doerr, vice president of Kmart pharmacy, said.

The activities planned for the event, to be held from 9 a.m. to 1 p.m. at all 1,100 Kmart pharmacy locations, include free blood pressure screenings, free memory screenings, Medicare health plan selection assistance and more.

No appointments are necessary. For more information, customers can all 800-866-0086 or visit www.kmart.com/pharmacy.

The initiatives are tied to the efforts of the Alzheimer’s Foundation of America’s National Alzheimer’s Disease Awareness Month, the annual initiative aimed at promoting early detection of memory problems and appropriate intervention.

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