Walgreens’ High-Tech Plans To Better Serve Customers

Having found success with a mobile app, Walgreens is looking to build on it with consumer data analytics.

CIO conducted a lengthy interview with Walgreens CIO Abhi Dhar, who shared the retail chain’s plans for using Hadoop data processing software to improve its customers’ experience.

“Hadoop is a persistent architecture that allows us to use commodity hardware to store information,” Dhar told the outlet. “When we get good at it, we will store more information than we can currently afford to store. If we can do that, we start driving more value for customers.”

With Walgreens improving its ability to manage the growing volume of customer information to which it has access, Dhar is testing to see if Hadoop — which comprises low-cost, open-source software and commodity servers — can replace traditional databases.

“Retail is a narrow-margin business,” continued Dhar, “and the fixed costs are huge, so we have to manage our fixed cost down. We’ve got to get good at any technology that allows us to drive down our fixed costs. The focus I have is on trying to drive a technology footprint that is variable and correlated to the gross margin in my business. So, I’m not spending the same amount of money whether we’re making less money or [more] money.”

Following Walgreens’ redesign of its mobile app — a process that included expanding its capabilities to offer medication reminders and integrating the retailer’s rewards program into Apple Pay — the chain, shares CIO, is also testing out beacon technology in a few Duane Reade stores — but not without considering that the occasional system failure in that regard could negatively impact the customer experience.

“If you’re going to be maniacally focused on 5.5 million people being driven to our stores through digital channels, you need everything that you innovate to be available at scale,” Dhar told the outlet. “If it doesn’t create and add value, people will just delete your app, and we care about what people think about our app.”