Walgreens' Nice! Extends Food Offering

CHRISTINA VEIDERS

DEERFIELD, Ill. — Walgreens is following a playbook strategy used by many grocery chains in the national rollout of its store brand Nice!, which the company here announced on Thursday.

The new brand, expected to be on store shelves by early 2012, will include more than 400 high quality grocery and household products at prices up to 30% below other national brands.

The new label grew from an effort to segment and streamline Walgreens store brand offerings. Current store brands including Café W, Deerfield Farms, W and others will be phased out and transitioned to Nice!.

"This is what grocers have done," said Andrew Wolf, managing director for BB&T Capital Markets, Richmond, Va. "It's about creating a brand. Instead of disparate brands, create a brand with its own identity and, hopefully, that drives not just trial but loyalty."

Walgreens also is focused on store brand segmentation with Nice!, an everyday more traditional label compared to its Good & Delish, a premium line. Walgreens has finessed its Delish label, which originated out of Duane Reade, to Good & Delish. Many products in the line offer benefits such as trans-fat free, gluten-free, reduced-calorie or made with natural ingredients.

Walgreens has also enhanced and expanded its petshoppe brand of pet supplies, growing from 10 items to more than 60 this year.

The Walgreens label will continue to be used for health and wellness products, which include items such as over-the-counter medicines, vitamins and supplements, first aid supplies and sun care.

Graphics on Nice! are bold, clean, and designed to be easily recognizable and simple to shop. An integrated marketing campaign will build on the brand's message around quality and savings compared with other national brands, as well as the wide variety of everyday essentials under the label accessible from neighborhood Walgreens stores.

"We are confident that our more refined approach will provide a new level of simplicity and choice, which is the ultimate value objective for our core customers," said Joe Magnacca, Walgreens president of daily living products and solutions, in a press release.

A.C. Nielsen consumer research shows that 75% of Walgreens shoppers purchase store brands in Walgreens.