Walgreens’ Minger Challenges Industry On Innovation
Chicago — To a packed room of specially invited small to mid-size manufacturers, Paul Minger, category manager, confections, Walgreen Co., candidly revealed the best ways to prepare for meetings with him on potential products.
The private Go-To-Market presentation resulted from a meeting between the National Confectioners Association and the drug chain some months prior, according to NCA Chairman Michael Gilmore. He introduced Minger and his boss, Dave Van Howe, corporate vice-president of purchasing, to the crowd.
“We are rolling out the red carpet,” Van Howe exclaimed, stating the event was only a precursor to exclusive meetings attendees could schedule with Minger for later in the summer.
“This will help you prepare, so you’re ready for the July program. We are really excited to see your products and discover how they can drive sales for your company and ours.”
Store Improvements Will Be Consumer-Focused
Despite a continuous 34-year record of sales and earnings growth, and its prowess for “growing best in a recession,” Walgreens intends to implement significant changes in its business, and according to Van Howe, all are focused on what the company calls CCR, consumer-centric retailing. Already in 18 test stores, the concept aims to reduce overall SKUs, stock unique products and improve shopability for its primary consumer target: value-seeking women.
Adding 450 new stores this year to its existing cadre of just under 6800 locations, the company will slow this trend during the next three years, Van Howe noted, and regretfully said about 1,000 jobs, representing nine percent of its workforce, will be cut in 2009 as well.
He said Walgreens is confident, however, that a “focus on the core,” on the types of products and services that have driven its business since 1901, will see it through the economic challenges.
Van Howe explained the overarching goal is to “deliver a compelling, preferred, routine retail destination,” and that Walgreens will be looking to its suppliers for input in reaching it.
“You can help us make it a fun store, an engaging shopping experience,” he told the crowd of more than 150 candy and snack manufacturers, “But at the end of the day, as you all know, new items drive this business.”
All Candy Expo: A Treasure Chest
New items were also the focal point of Minger’s address, taking the podium after Van Howe, and directly challenging those gathered to address innovation in their product launches.
“Don’t bring a me-too item,” Minger told those gathered. “I would say my number one complaint is that there has not really been anything new in several years.”
Offering anecdotes on past successful launches of confectionery products through the Walgreens chain, Minger set an encouraging tone by describing his penchant for what he termed “the little guy.”
“I can’t stress enough how important small- to mid-size and new vendors are at Walgreens,” he said. “You are the lifeblood of my business
“When I come to the All Candy Expo, I schedule very few meetings, and I don’t come here to meet with Hershey and Mars, who I see in my office every week,” he revealed. “Instead, I think of the show as a treasure chest, and like to walk around looking for that next great item.”
Minger suggested investments “to improve your spend with us and our spend with you,” such as promotions, displays and various media marketing campaigns can improve how well a company’s items perform.
He also said developing partnerships with suppliers can be rewarding for all parties, especially if candy makers “do their homework” and understand what might work in Walgreens’ sets.
On this point, Minger detailed two Top Ten lists he said would help potential suppliers prepare to do business with him.
What Drives A Category Manager Crazy?
- When You Go To The Boss First
- Dropping In Without An Appointment
- Not Being Respectful Of My Time
- Not Being Prepared For Our Meeting
- Not Knowing Walgreens
- Not Having A Drug Store Plan
- Pitching Me-Too items
- Incomplete Quotes
- Not Following Through After Meeting
- Items That Don’t Sell
What Makes A Category Manager Happy?
- Finding Products That Fill Unique Customer Solutions
- Opportunity To Create The Product Together (Private Label)
- Innovative Marketing Ideas
- Good Representation And Follow-Through
- Strong Consumer Offer Or Display
- Retailer Exclusivity
- Staying In Stock
- Willingness To Invest In Our Marketing Program
- Under-Promise And Over-Deliver
- Profitable Sales
