How Walgreens is using last milers to activate same-day delivery solutions

Date : 25 February 2021

Sabira Habib

Retail Analyst

We review how the growth in online shopping has led drugstore operators, such as Walgreens, to partner with last milers. These partnerships are enabling retailers to offer same-day delivery services and are providing new opportunities because of the collaborations.

New partnership with Instacart

Walgreens has teamed up with delivery company Instacart to offer ‘customers nationwide an unmatched online assortment of Walgreens items available for same-day delivery’. The products available through Instacart’s service includes over-the-counter medications, health and wellness, beauty and personal care, household essentials and convenience products.

The service has been first rolled out in Illinois and Walgreens plans to expand it to over 8,000 stores, nationwide over the coming weeks.

Stefanie Kruse, Walgreens’ vice president of digital commerce and omnichannel, highlighted,

“Convenience is at the core of what we do and Walgreens is thrilled to be partnering with Instacart to bring customers a simple and trusted same-day delivery option for the products they need right to their door. This collaboration builds upon several other recent steps in our digital transformation to deliver health expertise to customers in new channels, which is timely given shifts in customer needs during the pandemic.”


Source: Instacart

As a result of this partnership, Instacart now provides same-day delivery services with the three largest North American drugstore chains; CVS Health, Rite-Aid and Walgreens. It also works with Canada’s largest drugstore chain, Shoppers Drug Mart.

Previous partnerships: Postmates and DoorDash

This is not the first time Walgreens has partnered with third-party delivery services. In 2020, it worked with Postmates and DoorDash to offer an on-demand delivery service during the COVID-19 pandemic.

With shoppers prioritising safety, demand for home delivery increased drastically. To meet demand, Walgreens chose to team up with third party delivery companies to offer several solutions, including curbside pickup amongst others, to help it offer a safe and seamless shopping experience.

A.S. Watson offering seamless O+O shopping experience

Watsons reported in 2020, its ecommerce business saw strong growth, with online sales doubling versus 2019. To help access more online customers and offer a fast and reliable delivery service, it recently collaborated with online delivery and payment solution company Grab.

The service will allow customers to conveniently access health and beauty products from Watsons extensive network of stores via Grab in Singapore, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam. The companies are offering more visibility and driving sales with both the Watsons mobile app and on Grabmart.


Source: A.S. Watson

Opportunity arising from collaborating with last milers

Tapping into community-based initiatives

Walgreens and Uber have launched a new initiative to help address hesitancy and access to COVID-19 vaccinations. Uber is offering people in underserved communities a free ride to get to their COVID-19 vaccination administered at Walgreens stores.

John Standley, Walgreens’ president highlighted,

“By combining Walgreens deep experience in community care with Uber’s transportation technology and logistics expertise, we will take bold action to address vaccine access and hesitancy among those hit hardest by the pandemic.”

Competing with fast order fulfilment businesses

Collaborating with third part delivery companies offers opportunities for retailers whose business model does not entirely support same-day delivery to compete with retailers like Amazon. With Amazon Prime, shoppers are willing to pay extra to receive their orders quickly. Retailers can attract customers by working with last milers to offer a subscription-free model for same-day delivery with a specific spending threshold.

Want to know more?

  • Find the latest news and insight on health & beauty and drugstores
  • Retail Analysis subscribers can read the opportunity of last milers report here
  • Read about Boots 2021 beauty trends prediction here  

 

 

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