Walgreens to Track Displays
By George Anderson
A lack of in-store compliance with manufacturer promotional programs may be a thing of the past now that Walgreens, in partnership with 15 package goods companies, is rolling out a system to track displays in the drugstore chain’s more than 5,000 stores.
The pilot program will involve placing radio frequency identification (RFID) chips on displays to electronically track when, how long and where the merchandising units are placed in stores. The units will enable manufacturers to time displays being put up with advertising and promotional programs and to alert local account people when stores are not in compliance.
George Riedl, senior VP-marketing for Walgreens, told Ad Age that the RFID-enabled displays can help the chain and its partners “customize merchandising on a store-by-store basis and ultimately increase sales and profit per square foot.”
“It also will help both our own purchasing department and our vendors evaluate past promotions and plans for future programs,” he added.
Ken Harris, managing director of Cannondale Associates, said, “This could be perhaps one of the most important new developments in promotion materials in the last 20 years if it works. It provides real-time feedback on what’s working and what’s not and could be an exceptional tool for manufacturers to use.”
One of the concerns with the displays is cost. An anonymous person Ad Age reported was familiar with the system said the “semi-active” RFID tags needed for the displays cost $6 each compared to less than $1 for the passive tags being used in studies elsewhere.
Robert Michelson, CEO of Goliath Solutions, the display system’s creator, would not publicly comment on the cost.
Moderator’s Comment: What do you see as the opportunities and issues facing Walgreens and its CPG partners in connection with the use of the RFID-enabled
George Anderson – Moderator