Magazine article Marketing

Boots Focus Helps Revive Optimism

Magazine article Marketing

Boots Focus Helps Revive Optimism

Article excerpt

Boots is concentrating its efforts on its core strengths in health and beauty. It is also planning to put the space in its range of stores to better use. Sue Beenstock looks at the growing confidence of the high-street retailer

When Boots' half-year results are announced on Guy Fawkes' night, they are unlikely to prompt any financial fireworks, but they'll nevertheless bring smiles to many readers' lips.

The reason is simple: the high-street retailer, which experienced unspectacular 8% growth last year, is, according to some analysts, at last exploiting its huge store space and adopting a more dynamic culture in Britain's [pounds]9bn healthcare market.

It is three years since the appointment of Steve Russell as managing director and one year since Richard Holmes became marketing director. Insiders say the duo's impact is about to be felt.

"Russell's not changed the corporate culture," says one. "He has just concentrated on our specialisms: health and beauty. Focused on that and not wavered." There was a time in the 1970s and 80s when Boots appeared to lose its way, with unsuccessful forays into selling TVs, videos, gardening equipment and pet food.

By contrast, the initiatives announced in the past 12 months have stuck pretty firmly to Boots' health and beauty portfolio. This summer saw the chain move into health and travel insurance with five off-the-shelf policies, through Royal and Sun Alliance, supported by an [pounds]8m TV ad spend.

It expects to sell 250,000 policies by this time next year. In-store opticians are doing well and Boots the Dentist is being trialled in the Midlands with six standalone and in-store surgeries.

There are also plans afoot to open a chain of sandwich bars in its 20 largest stores, possibly leading to a series of Boots cafes on the high street. A home-shopping catalogue came out last year and there are rumours it could be the first high-street store to go into digital TV. It is exploring e-commerce and in-store kiosks.

Finally, nine million customers are said to use their Advantage Card on a regular basis - one million more than expected a year after launch. Customers collect a point for every 25p spent, which can be put towards treats, such as health spa breaks, or Boots products.

Launched two years after most supermarkets brought out their loyalty cards, the Advantage Card is capable of storing and downloading everything from medical details to shopping habits. …

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