Promotions and discounts are a trap easily fallen into, and the Walgreen Company just confirmed its stumble. Sales were up for the quarter but revenue down which according to corporate spokespeople was attributed to excessive promotions. Promotions are best used to create trial — to get people to do something they wouldn’t do otherwise. When people need an incentive, promotions work.
Walgreens looked at the slowing economy and decided to cut prices and give product away as a tactical means to spark business. I am not privy to the exact product offers and have not seen the supporting communications, but will bet they did not support the core Walgreen brand idea, which if the website is accurate is “The Pharmacy America Trusts.” And even if it did support the branding idea trust is such a lazy and hard to differentiate strategy for pharmacies, it’s no wonder sales are tailing. Walgreens needs a real idea. And it’s in their storesevery day. They just have to find it. Peace!