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Walgreens storefront

Nearly seven months after the launch of Walgreens‘ new loyalty program, the company is acknowledging what many customers have been saying all along. While the company may think Balance Rewards is the best thing since sliced bread, it turns out that not everyone loves it. But that’s okay, Walgreens says – that just means better rewards for everyone else.

Since the program debuted in September, Walgreens executives have been praising the program, and have been saying their customers are praising it as well. They continued to do so last week, but with a small caveat.

In discussing Balance Rewards at a retail conference in Orlando last week, Walgreens CFO Wade Miquelon discussed one aspect of the program that has had “a little bit of a negative consequence.” “We put a lot of teeth in it,” he said. “We basically said to customers, if you’re not a Balance Rewards loyalty member, you don’t get any of our promotional prices. There are some people who do not like that.”

Indeed there aren’t. Some disgruntled customers are still complaining. “If your store posts something on sale, it should actually be on sale to all customers that enter and shop there,” one commenter griped on Walgreens’ Facebook page just a few days ago, “not only to those customers that give the store their personal information in exchange for a ‘membership card’.”

Some infrequent Walgreens customers are still not aware that the advertised prices are only valid if you’re a Balance Rewards member. Otherwise, you’re stuck paying full price. And Miquelon says that’s for the best. “That allows a lot of extra currency to fund people that do want to be loyal,” he said. In other words, those who pay full price – either because they refuse to join the program, or they’re not aware that they ought to – are just helping to fund the discounts for everyone else. Overall, Miquelon acknowledged there is a learning curve for all involved. “I think initially you do ruffle some feathers,” he said, “but for the 90% of people that want more, that want to be incented… over time it’s a much better model.”

Much better for Walgreens, at least. Balance Rewards now has some 65 million members. And, though he didn’t offer specific numbers, Miquelon said Balance Rewards members are buying more, and more of them are starting to redeem their accumulated points.

That’s been a concern about the program for a while, as many members seemed to be accumulating points but comparatively few were redeeming them (read: “Walgreens Balance Rewards: Many Have Signed Up, Few Have Cashed In”). Since then, Walgreens executives have been repeating variations of the line, “We’re starting to enter the redemption phase now, and that’s when the real magic happens” (again, without offering specifics). And Walgreens indicated a few months ago that it was considering new ways to incentivize members to cash in their points (read: “Walgreens Says Balance Rewards Will Get More Rewarding”).

So far, the incentives have mostly been new ways to earn points. Yesterday, Walgreens ran a one-day promotion where you could earn 5,000 points by spending a total of $30 on anything. And the chain recently announced that members could earn more points by logging “healthy activities” like walking, running and weight management on the “Steps with Balance Rewards” site. Members will receive 20 points per day for tracking their weight, and 20 points per mile walked or run. And if you have a wireless activity tracker such as Fitbit, Withings or BodyMedia, you can set it to sync with the Walgreens site so your activity is logged automatically and you don’t have to visit the site and enter it yourself. Your earnings are capped at 1,000 points per month, though, meaning if all you do is track your weight and walk a mile every day, you’d blow past the limit before the month was even over. So Walgreens may want you to be healthy, but apparently not that healthy.

So the best way to amass a lot of points is still to continue buying products that offer points – which can then be redeemed for cash-off-your-total discounts. And if you aren’t a Balance Rewards member, don’t count on employees to help you out. “I know all of us have been into a store before where there’s a loyalty program and you say you don’t want it,” Miquelon said, “and the manager takes the key fob and swipes it and says, well, you can have the discount anyway. Our employees don’t do that – or they won’t be employees.”

When he said Walgreens “put a lot of teeth” into its loyalty program – he wasn’t kidding.

7 Comments

  1. THIS PROGRAM IS A BAD JOKE!!! WE HAVE HAD 100 POINTS FOR MONTHS, SPENT $93.04 TODAY AND STILL HAVE 100 POINTS. NOT WORTH THE TIME AND EFFORT TO DO… WALGREENS NOT THE SAME STORE THAT WE KNEW FROM THE PAST. WILL ONLY DO LIMITED BUSINESS WITH THEM IN FUTURE!

  2. SCAM of the dirtiest kind. You earn your measly reward and they give you the coupon at checkout, then give you 3 days to cash it in. How many of us go to the drug store every 3 days? We buy what we need while we’re there.

  3. Bob Fortino says:

    I refuse to participate in Walgreen’s or any other store’s discount card program. The reason being is simply that it doesn’t make sense that Walgreens would offer loyal customers (by virtue of a plastic card?) steep discounts while refusing the same savings to those that don’t participate. There must be a catch. I shop at Walgreens all the time without the financial benefit of the rewards program, and the clerks are visibly astonished when I refuse their offer to join up. I tell them the same thing every time: Why do you need my personal information in order to offer me savings; isn’t my very presence in your store enough incentive for both of us?
    I don’t think there is any mystery as to why customers in the balance rewards program realize a discount, while holdouts like myself pay full price: the information a customer gives up to Walgreens is far more valuable information than the resultant discount. Information is money, and as such, holds great sway with any corporation. Think of the time and money rewards customers are actually saving Walgreens by freely telling them about themselves and their spending habits. To put it more succinctly, when I shop at Walgreens I pay more but Walgreens learns nothing about what I bought, when I bought it, and with what frequency. When the card-carrying rewards customer shops at the same store, Walgreens is fed valuable marketing information that they can now use to promote products and better understand their customers intimate shopping habits. Without the ‘information swipe,” Walgreens is left guessing what to promote next and can only extrapolate from scant register information.
    Essentially, rewards customers are doing the arduous and expensive job of marketing experts. I have to admit, it’s clever and it most likely works. But it’s also duplicitous and and unfair.
    Welcome to Walgreens!

  4. I’ve spent $330 at Walgreens and have ZERO points in my account. They need to take another look at earning points.

  5. If they have your drivers number, they can easily get your social number

  6. This is not your grandfathers WAG; the CEO and Board have eliminated the pride,integrity,and trust that the original “Walgreens” offered to its customers. No respect for customers or employees;it the economy were not so bad I doubt that anyone would work there. Telling my Pharm Students to work elsewhere. There are no longer any incentives to be there-

  7. So there are 64 Million card holders and say each card has 20,000 points. Who is earning the bank interest float on all the loyalty money (points)? Its not the customers or the loyal card holders. And I suppose the points expire over time or are reset earning even more to Walgreens bottom line. Strategy: Use those point (your money, Walgreens interest income points) before it burns a hole in your pocket. Then grift the emergency non card holder in the middle of the night with highly over priced purchase.

    Any retailer would be foolish to price match the drugstores as the customer has to be a card holder to get a fair market price when it is on sale, and puts points into a “store interest float” account and for which the customer can loose if the points expire or are surrendered. Why would anyone shop there? The quality of the product is no different and the pricing is a grifter’s convience scam.

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