When it comes to implementing new digital strategies, “Speed is key” says Walgreens’ Rich Lesperance. “There's not a lot of time to wait for the future.”
As Walgreens’ senior director of Digital Wallet and Rewards, Lesperance oversees the team that develops and implements new-media strategy for the retail giant. Travel industry companies would do well to take a page from Walgreens on the application of digital media to everything from customer service to new product development.
This is the second excerpt from a dialogue between Lesperance and Travel Weekly PLUS Editor in Chief Diane Merlino.
Merlino: How does your group function within the Walgreens organization?
Lesperance: We are consciously shifting new channels into the rest of the organization. A great example is we have a dedicated team for customer service on Twitter and Facebook.
We believe in the honeycomb model. Imagine many different clusters made up of the divisions in your organization and all these different channels, like social media. That channel is very powerful, but the merchandising team views 
it very differently than the customer service department or the marketing team.
It’s not for the social media team to tell them how to do their jobs, but it is our role to help bring new tools into play. That's been a winning model for us, and that's why it’s important having a team that's moving fast, on the lookout, on the cutting edge. But our goal is never to own everything; it’s to see how we can feed it into the organization.
Merlino: Apart from the customer service example you described, are there other ways your team is shifting new digital channels into the Walgreens organization?
Lesperance: Yeah, absolutely. I think the biggest example is in product development. Because I'm a digital guy, I'm going to use a software example, but it could equally apply to other things.
A couple of years ago we gave our Facebook fans the ability to upload their photos to Walgreens.com. You could just click and upload your Facebook photos to our site, and from there you could print them. It was pretty much a linear extension of a capability on our website. That’s good for some people, but it's not groundbreaking. What is groundbreaking is when you come up with an entirely new type of product.
People are taking more photos and they're sharing more photos. There are lots of photo-sharing sites and apps; they’re exploding in popularity. We recognized that for a lot of people, Facebook is the first place they go to notify loved ones when they're engaged or when they have a child or about a great vacation they took. But it's very hard to go back and retrieve a photo you posted that you really loved and look at all those comments your friends made about it.
We saw an opportunity for people to print those memories and comments along with the photos. Leveraging our existing infrastructure we created an app called PrintWorthy a few months ago. It was our first real product innovation based on the [Facebook] social graph. It’s your print with your friends' comments on the right side, so you can capture that moment when you were engaged, or about the birth of your child, along with the comments. 
And you don't have to go digging through your timeline to find it years from now, so it becomes a nice keepsake.
The real point here is we don't simply take a channel and add it to the mix. That’s good if that's all you're going to do, or all you can do, and that's certainly a good start. But how do you build a new offering that complements your existing offerings? Because now, in this new world, you have different data and different customer needs that you can address.
Merlino: You mentioned the word “groundbreaking.” How important is that in the work you’re doing, and where does the juice for that come from — from you and your group, or is it the general mentality at Walgreens, or a mix?
Lesperance: It’s a mix. We really believe that it has to be in the DNA of the organization and that good ideas come from everywhere. No one has a lock on great ideas, and it has nothing to do with your place in the hierarchy in the company or how new or how old you are to the company. We try to create forums for innovation and give people the opportunity to share ideas and creative thinking.
I don't have a magic bullet there, but there are conscious efforts to ensure it's not a small group of people in a black box. You’ve got to solicit ideas from the organization, especially one as complex as ours. We have so many different businesses, and more than 95% of our employees are not here at headquarters; they're all out there in the field, in every state in the country. And a lot of our greatest ideas come from our stores, the people who have worked for this company 20, 30, 40 years and talk to our customers every single day. They have varying degrees of knowledge about digital, but they really understand our business.
Merlino: What do you see as the top business opportunities presented by digital, social and new media?
Lesperance: No. 1 is engagement, something we haven't talked much about yet. Engagement is a very broad term, but what it means for me is rethinking marketing and rethinking your relationships with your customers.
There's tremendous value in engagement in terms of getting customers to talk with you online, share their ideas, give feedback on products, tell you what their likes and dislikes are, and participate in evangelism of all sorts, whether you want them to tell their friends about a promotion, a contest that's running, or help someone in need by donating a flu shot. The mind boggles with endless opportunity.
Merlino: Most companies want to know the connection between digital initiatives and the bottom line.
Lesperance: I think we're going to get better analytics and understanding about how that drives sales. But I wouldn’t worry too much about seeing exact, hard revenue from engagement; if you wait for the metrics to be perfect, you will miss the boat on engagement. There are some companies that may have a hard time with that, but that's kind of the reality of where we are. The analytics are immature, but the opportunity to engage with people in a meaningful way is very real and very powerful, and we'll see the analytics mature along with that.
Merlino: What other digital opportunities are out there for travel businesses?
Lesperance: There's an opportunity to see your business with new eyes: not to see digital as a marketing channel alone, but to come up with new services and new products that weren't even possible before people had a phone that has more computer power in it than what most governments had 10 or 20 years ago. Phones that have things like a camera that can scan barcodes-- and that soon will be able to do much more -- creates logical extensions for your business.
We try to think about what Charles Walgreens would do with mobile and social if he was starting a pharmacy today. Because at the heart of it, these are just ways to do what this company has always been excellent at, which is forming strong relationships with its customers. We call it social media today, but there's nothing new about being social and connecting with your customers, understanding them well. We’re excited to develop new products to do that.
Merlino: You’ve talked about your team’s focus on speed in introducing digital innovations. Do you see that as a crucial factor for all businesses?
Lesperance: Speed is key. There's not a lot of time to wait for the future.
We are very hungry and looking globally for who's doing things well, who's being creative, and trying to learn from other companies and brands. It's not just about looking at the pharmacy or the drugstore model. It’s very much looking at this global revolution and how emerging media is changing retail.
Merlino: I know your group has developed digital strategies for millennials. Have you done the same for other specific customer demographics?
Lesperance: Yes, of course. One of the real benefits of digital media is you have such a profound ability to target and understand the demographics of who you're talking to. It’s a great opportunity to test and learn. With a national TV campaign it’s much harder to pivot quickly and glean insight from a specific demographic. It's much easier when you can engage with them on a specific platform.
Merlino: Is there an average shopper at Walgreens?
Lesperance: Well, we like to say it's America, given that our 8,000 stores reach two-thirds of U.S. households in a three-mile radius. Our core focus is typically the female shopper, but we are everywhere, so we do represent mainstream America.
With digital there are obviously platforms that skew a little differently. Pinterest started with Midwestern moms, and Foursquare is a little bit more skewed toward a younger male audience, more toward urban areas. That’s a great opportunity to partner with different content-sharing services and try different promotions and different creative marketing programs to see what works.
Merlino: Are you working on any new initiatives with Pinterest or Foursquare? Or with Google or Facebook?
Lesperance: I can't discuss anything that hasn’t launched yet, but we work closely with pretty much all the major players. There is a lot of mutual interest from digital and newer media companies in working with a big, established retailer like Walgreens. It’s amazing to see how quickly things have changed, and how much energy is focused on the retail/digital/mobile/social experience, on all sides of the table. So there are definitely a lot of partnerships.
Merlino: What emerging trends should travel businesses keep an eye on?
Lesperance: Well, I know it's a cliché to say mobile is the future, and I wish I had something more profound to say. But what's kind of shocking is the degree to which companies are often taken by surprise by new technology. If you look at the projections for mobile adoption and traffic, even the most aggressive predictions were way too conservative. Just go back and look at the numbers over the last two or three years. So, I think that we should stop being surprised, and make the investments now.
It doesn't sound very innovative or exciting, but how many organizations have actually opened their own emails to 
see how these emails look on a mobile device? And, if I click through the links, do I land on a page that's even readable on my Samsung S-3 or on my iPhone? The fact is that many companies are still struggling with that. You've got to cover the basics before you worry about how to use cutting-edge digital wallets. At some time soon, there will be a tipping point where the majority of online traffic is going to be from mobile and not desktop, but many organizations see mobile as a sub-team within e-commerce.
It's strange for digital teams to think that way, because e-commerce was always the cutting-edge new thing, and now there's something else that's making them rethink themselves. The corollary is the shift from many channels to omni-channel. Customers become omni-channel before companies do, so that's where we have an opportunity to all catch up.
Merlino: What do you love the most about your work, Rich? You're clearly passionate about it.
Lesperance: It’s seeing a complete transformation in how we do business. I think it's exciting to see the customers responding, whether it's downloading your app, liking your Facebook page, placing orders through digital or mobile, or some other new way. That's very exciting to me, and hopefully Charles Walgreen would be proud.
ALSO SEE: How Walgreens Translates Digital Innovation Into Action
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