Why Walgreens wants to follow your every footstep

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Staff Reporter

If Walgreens is following your every footstep, it’s only because it’s trying to get to know you.

Steps is a little-known — and little-used — addition to the drugstore’s Balance Rewards initiative, but it may offer some insights into where the company is going. The program lets users of the Balance Rewards loyalty program track their walking, running and weighing — either manually or through networked devices like a FitBit or Withings scale — in exchange for points that can be redeemed for in-store cash. How many points? Well, to earn $5, members must walk 250 miles, or log their weight 250 times over 250 days. But it’s not really about the points.

Steps was designed in part to make Walgreens’ rebrand as a wellness destination “more real,” according to Dennis Armbruster, a managing partner at LoyaltyOne Consulting, which helped design Balance Rewards. “It was a way to really crystallize in the consumer’s mind what the brand really meant.”

So far the community building seems to be working. Since merging with the Balance Rewards program in April, Steps has awarded 370 million points to its close to 900,000 members. General forums on the Steps microsite feature tens of thousands of views, and the most popular health and wellness articles posted to the site have thousands of comments.

“Where we were seeing individuals go on Walgreens[.com] perhaps once a month, we’re seeing them interact with us maybe two or three times a week,” says Bonnie Gordon, Walgreens’ director of cause marketing.

Though website traffic doesn’t necessarily translate into money for Walgreens, Armbruster claims that in LoyaltyOne’s research, soft benefits like Steps’ community-building efforts can result in a 20 percent lift for consumer behavior, adding significant traction to a program with hard rewards like points alone.

Still, of the 85 million people signed up for Balance Rewards, little more than 1 percent have opted into Steps. Gordon chalks up the low traction to Steps taking a backseat to getting customers used to the reward system, which launched last fall. As Walgreens customers become more familiar with Balance Rewards, Gordon says the company plans to bring Steps into the limelight through a series of marketing campaigns.

When it does expand, Steps will likely have effects outside of increased engagement and fitter followers. Adding networked devices like FitBits and Withing scales dovetails nicely with the fact that Walgreens happens to sell networked devices like FitBits and Withing scales. If more users sign up, additions like vitamin sales or points for in-store blood pressure monitoring could have a noticeable effect on the bottom line. “You can see where in the future there could be a long list of ways to enhance this … whether its flu shots or clinic visits or other just healthy behaviors,” Armbruster says.

With ownership of or stakes in drugstores around the world, Walgreens could see significant benefits in a full rollout of a wellness program like Steps. “You’d hope that would be the case,” Armbruster says.

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