Walgreen’s Ups Ad Budget

Jan 09, 2003
George Anderson

By George Anderson

Jeffrey Rein, chief operating officer, Walgreen’s announced yesterday that the nation’s largest drugstore chain would increase its budget 12-13 percent and spend approximately $360 million on advertising this year.

The decision comes as Walgreen’s attempts to generate greater volume and profits from its front-end categories. The drug store chain reported that its December front-end same-store sales fell 0.2 percent.

Moderator’s Comment: Do you think Walgreen’s decision
to increase its advertising budget will have a significant impact on its front-end
(non-Rx) business?

Walgreen’s spent less on promoting/discounting during
the Christmas season in an effort to protect margins. Evidently, the chain has
decided that more volume at lower margins is better than less volume at higher
ones. [George
Anderson – Moderator

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