NEW YORK – A Walgreens executive at the Mcommerce Summit: State of Mobile Commerce 2013 conference said that focusing on increasing mobile and tablet engagement levels helps drive the retailer’s overall digital engagement level.

Walgreens sees more than 12 million weekly visits to its digital properties, with about 40 percent of this taking place on its mobile apps and Web sites while 10 percent happens on tablets. This translates to approximately 5 million weekly visits on mobile alone.

“I want to make sure the 40 percent goes as high as it can,” said Tim McCauley, senior director of mobile commerce at Walgreens, Deerfield, IL.

“By increasing the 40 percent and the 10 percent, the 50 percent also increases,” he said. “The entire pie is being increased even though the slice on mobile is also increasing.”

The Mcommerce Summit: State of Mobile Commerce 2013 conference was organized by Mobile Commerce Daily.

The Passbook boost
Mr. McCauley also said that Apple’s Passbook app has been very beneficial, helping the drugstore chain attract a significant number of new users for its app.

With app discovery an issue, the launch of Passbook helped Walgreens gain visibility for its app as many of the first merchants to integrate with it received a boost in their ratings on the Apple App Store, which in turn lead to more downloads.

The executive also pointed to how Passbook is helping the merchant engage with customers. Passbook enables Walgreens to take advantage of that app’s geolocation, always on capabilities to reach its customers.

The merchant’s positioning is to help people get, stay and live well and mobile helps it reach this vision.

Walgreens already has 8,000-plus stores, which helps it drive convenience for customers but as it focuses on the intersection of healthcare, retail and digital, mobile is a clear extension of this.  To take advantage of this, Walgreens is leveraging mobile to help it be everywhere that its customers are.

Customer engagement
A big focus for Walgreens is increasing customer engagement, and mobile plays a key role in reaching this goal. Walgreens operates ten different mobile apps and Web sites.

The retailer’s app concentrates a lot of different features addressing how its customers interact with the retailer, including pharmacy, photos, a pill reminder and loyalty.

One of the ways that Walgreens measures its growth in mobile is with online refills. Three years ago, ten percent of its online prescription refills were done on mobile and now that number is more than 50 percent.

Walgreens is refilling one prescription per second on a mobile device.

Mobile is also helping retailer the drive the average customer spend. Compared to customers who spend in-store only, customers who shop both in-store and online spend at a level 3.5 times higher while those who shop in-store and on mobile spend at a level 4 times higher.

However, customers who spend online, in-store and via mobile spend at a level six times higher.

“If they do all three of those, we have a really engaged customer,” Mr. McCauley said. “They hopefully are satisfied and we see the results.

“These are our most valuable customers and we want to make sure we are interacting with them wherever they want,” he said.

Changing interactions
To measure engagement, the retailer takes the number of monthly visits and divides that by the total number of downloads.

“We are looking to make sure that we are retaining the customer that downloaded the app a year ago,”  Mr. McCauley said. “We want to make sure we are providing the features that keep them coming back.”

The company’s research shows that the volume of mobile prescription refills tends to peak earlier in the day than online refills and then jumps significantly over online refills at the end of the day.

“We are allowing them to do this when they want to,” Mr. McCauley said. “It has changed how they interact with us and it  has made a much more positive engagement.”

Mobile has also played a key role in the roll out of Walgreens’ national rewards program, which was introduced eight months ago.

Walgreens sends reminders to app users who have made a shopping list featuring items from its weekly circular to remind when items are going off sale.

In-store value
The merchant is also increasingly focusing on leveraging mobile to enhance the in-store experience with aisle mapping, product information, mobile coupons and integration with the loyalty program for in-store purchases.

“The early success we had started out the store – now we are moving inside our store,” Mr. McCauley said.

“We’ve done all the things to enhance our customers’ experience pre-trip, now how do we increase the value when customers are inside our store,” he said.

Another way Walgreens is trying to increase convenience with services that use mobile such as ship to home, ship to store and Web pick-up, which enables users to place an order online via mobile and come into the store to pick it up.

The retailer is also taking some of its mobile services and extending them to third-party apps as another way to drive customers into its stores. For example, the ability to send mobile photos to Walgreens to be printed out and refill prescriptions are both now available on third-party apps.

Cost per acquisition
It has also integrated with fitness apps such as Fitbit so that users can log how many miles they walk and earn rewards points from Walgreens that can be automatically redeemed in-store from the retailer’s app.

Walgreens also tracks the cost per acquisition for mobile app users very closely and has found that when it slows down on its marketing efforts to drive downloads that this has a negative impact on the number of downloads.

“When you increase the engagement, we are seeing growth in satisfaction, utility and value,” Mr. McCauley said. “As we improve customer satisfaction, we are seeing people coming back more and more.

“Engaged customers have a higher satisfaction and spend more,” he said. “Engagement starts outside of the store and continues inside the store – the best engagement is integrated and seamless.”

Final Take
Tim McCauley is senior director of mobile commerce at Walgreens, Deerfield, IL