This month’s edition of the Private Label Manufacturers Association’s (PLMA) web based video magazine PLMALive! includes my latest commentary on what’s going on in Private Brand. In “Exercise for Savings” I discuss Walgreens’ new private brand wearable fitness monitor and its potential to drive traffic and create loyalty.
Exercise for Savings
At the beginning of 2015, drugstore chain Walgreens launched a product that took private brand to a whole new level. The “Well at Walgreens” private brand wearable fitness monitor was designed to compete directly with the likes of Fitbit, Garmin and Jawbone. But for just $59.99 the Well at Walgreens Activity Tracker is more smart watch than simple activity tracker. In addition to tracking sleep, steps taken and calories consumed, the device is a fully functioning Apple and Android compatible Bluetooth enabled watch that offers phone call, text and meeting notifications.
The retailer is attempting to become a one-stop shop, not only for pharmaceuticals but also for lifestyle and preventative healthcare products, and the Walgreens private brand portfolio is a lynchpin of the strategy.
According to a new research report from Juniper Research, fitness trackers will triple to about 57 million in use worldwide by 2018, up from just 19 million this year. But from now until 2018, the smart watch category will be gaining steam and by 2018 will take over as the most-worn wearable device. This movement will begin in earnest with the launch of Apple’s watch on April 24th. The Apple watch will retail for as low as $349 for the entry-level Sport model to as high as $17,000 for the top-tier 18-karat gold edition.
Walgreens has carved out a space for their new device that puts fitness tracking and basic smart watch capabilities within the reach of every shopper. But the new fitness tracker includes a truly groundbreaking element that catapults it beyond simple price and features. The tracker syncs with the Walgreens Balance Rewards loyalty program and app and allows customers to earn Balance Rewards points just for doing everyday healthy activities. They can automatically track every step and earn 20 points per mile, 20 points per activity, 250 points when they set their first goal, and 250 points when you connect the device. Balance Rewards members can then redeem 5,000 points and receive a $5 reward to redeem on their next purchase. The more points they earn, the bigger the reward.
But what we are seeing so far is only a glimpse into the “brave new world” of digital wellness. According to the Pew Research Project, only 6% of consumers currently track some aspect of their health digitally. The incentives of saving money and accessing wellness information are likely to drive more widespread adoption of digital health and have the potential to grow both loyalty and share for Walgreens.