Walgreens Expects Nice! Results from New Private Label
Walgreens is serious about becoming a player in the grocery business. The drugstore chain announced this week that it was rolling out a new line of products under the Nice! private label.
According to a company release, the Nice! line will include more than 400 food and household items at prices as much as 30 percent lower than equivalent national brands. Most of the new items will be on Walgreens’ shelves by early next year.
The drugstore chain intends to retire other store brands, including Café W, Deerfield Farms, W and others, as it consolidates under the Nice! label. The chain’s Good & Delish private label line of premium snacks and beverages, originally developed by Walgreens’ Duane Reade business, will not be affected by the introduction of the Nice! brand. The chain will also continue to market over-the-counter health products under the Walgreens label.
"Store brands have always been a core part of our business. With more shoppers seeking value in this economy, we’ve been able to attract new customers across every income level to our brands and maintain their loyalty with a focus on quality and assortment," said Joe Magnacca, Walgreens’ president of daily living products and solutions, in a press release. "Now with the launch of Nice!, we are streamlining our offering to make it even easier for customers to identify high quality everyday essentials at a great value."
Walgreens intends to launch an integrated marketing campaign for Nice! touting the brand’s quality and price savings compared to "other national brands" available to consumers.
"With the consolidation of brands, and the additional products we will roll out under Nice!, we expect it will become a leading brand," said Moe Alkemade, Walgreens divisional vice president and general merchandise manager of private brands. "Our store brands are no longer just the value option, they are the smart option."
Walgreens, citing Nielsen, said 75 percent of its current customers already purchase one or more of its store brands.
"We believe we will continue to build loyalty to our stores and our brands as shoppers find favorites on our shelves that will become staples in their everyday lives," said Mr. Magnacca. "We are confident that our more refined approach will provide a new level of simplicity and choice, which is the ultimate value objective for our core customer."
Discussion Questions: Is Walgreens on the right tack with the consolidation of private label items under the Nice! label? Which retail chains do you consider among the best when it comes to the development and marketing of store brands?