What Walgreens’ decline teaches us about the power and peril of marketing

The story of Walgreens’ decline is a business case study in leadership missteps, shifting consumer behaviors and competitive pressures. But at its core, Walgreens’ fall is a marketing failure. It lost its relevance, let its stores become unappealing, struggled to engage customers and failed to modernize its brand for a digital-first world.

The marketing problem at the heart of Walgreens’ decline

A brand is not just its products, stores, or financial performance. A brand is a relationship with its customers, one built on perception, trust, and relevance.

Walgreens possessed all the essential elements for market dominance: unparalleled brand recognition that resonated across generations, a strategic network of locations within five miles of 78% of the American population and a consistent flow of in-store customer traffic that most retailers could only dream of. Yet somehow, these formidable competitive advantages gradually eroded, transforming from powerful market differentiators into missed opportunities as the company failed to capitalize on its unique position in the retail landscape.

The side effects of brand identity crisis

For decades, Walgreens’ brand revolved around convenience. But convenience changed, and Walgreens didn’t. When Amazon made e-commerce seamless and CVS positioned itself as a “health-first” destination, Walgreens remained stuck in the middle, neither the cheapest, nor the most innovative, nor the most customer-centric.

CVS made a bold move to stop selling cigarettes in 2014, reinforcing its identity as a healthcare brand. Walgreens hesitated, keeping tobacco on its shelves even as its competitors signaled a shift toward wellness. The mixed messaging diluted Walgreens’ identity. Was it a healthcare leader? A convenience retailer? A discount pharmacy? Customers weren’t sure, and when customers are unsure, they leave.

A digital deficiency that proved terminal

Digital transformation wasn’t optional, it was essential. And Walgreens missed the moment.

CVS aggressively expanded into digital health services, building an online pharmacy experience that integrated seamlessly with insurance providers, offering easy prescription refills and telehealth visits. Amazon, meanwhile, entered the space with PillPack, revolutionizing prescription management for the digital age.

Walgreens, by contrast, built a fragmented online presence that never quite delivered on ease or integration. While competitors were turning their apps into full-service health platforms, Walgreens lagged.

The consequence? Walgreens’ customers moved their purchases online, and instead of buying from Walgreens.com, they bought from Amazon, Walmart, and CVS.

Store experience: A chronic condition

A retail brand is only as strong as its stores. Walgreens’ stores became a liability rather than an asset. Customers noticed the decline in-store experience, dimly lit aisles, cluttered layouts, long checkout lines, and underwhelming product selections. Meanwhile, staffing cuts led to worse customer service, making it harder for customers to get prescriptions filled quickly and accurately.

Compare this to Target, which has doubled down on store experience with remodeled layouts, specialized in-store clinics, and curated product selections. Or look at Ulta, which has successfully merged beauty retail with a personalized customer experience through digital engagement and well-trained staff.

For Walgreens, stores should have been a differentiator. Instead, they became a reason for customers to look elsewhere.

When marketing becomes merely symptomatic rather than systematic

Great marketing doesn’t just sell products, it reinforces a brand’s purpose and creates meaningful connections with customers.

Walgreens, however, took a scattershot approach to promotions, relying on generic discounting rather than building loyalty through personalized engagement. Its loyalty program lacked the sophistication of CVS’s ExtraCare or Amazon Prime, both of which use data-driven marketing to create personalized offers and incentives.

The result? Walgreens trained customers to see it as an expensive option, where promotions were unreliable and loyalty went unrewarded.

Lessons for the industry: how retailers can avoid Walgreens’ fate

For retailers and marketers, Walgreens’ decline offers a stark reminder: a strong brand must evolve with its customers, not expect customers to stay loyal out of habit.

So, what can other retailers, particularly those in brick-and-mortar, learn from Walgreens’ mistakes?

The brand identity prescription

Walgreens wavered between convenience store and healthcare hub. A brand without a clear identity struggles to attract and retain customers.

Every retailer must define what makes them indispensable: is it value, experience, exclusivity, or something else? Walgreens should have leaned into affordability and trust, a “people-first pharmacy” focused on accessible, community-driven healthcare.

Digital therapy: integrating online and offline experiences

Retailers that thrive use omnichannel marketing, where digital drives traffic to stores and stores enhance digital engagement. Walgreens needed a stronger mobile app integrating prescription refills, telehealth, and personalized promotions like CVS or Walmart Health.

The digital experience shouldn’t compete with the physical one; it should complement and enhance it, creating a seamless customer journey that builds brand loyalty regardless of touchpoint.

In-store rehabilitation

The physical store should be an extension of the brand identity, not an afterthought.

Walgreens should have reimagined its stores to be modern, accessible, and digitally integrated. Express prescription pickup kiosks could have reduced wait times. More prominent healthcare partnerships in-store would have reinforced their wellness credentials. Community-driven health initiatives might have made each location a genuine neighborhood health hub rather than just another chain store.

Data: the preventative medicine for brand decline

Walgreens had access to millions of prescriptions, purchase histories, and behavioral insights, but failed to use them effectively.

Imagine if Walgreens used AI to create personalized healthcare recommendations, subscription-based medication plans, and targeted product promotions. Data-driven loyalty programs (think Amazon Prime or Starbucks Rewards) could have transformed Walgreens from a place people occasionally shopped to a habit.

Can Walgreens recover? A treatment plan

There’s a path back, but it won’t come from financial restructuring alone. Walgreens’ best hope for a turnaround lies in marketing:

• Rebuilding trust in its brand by defining its core value to customers requires more than just a new slogan, it demands a fundamental rethinking of what Walgreens stands for in a crowded marketplace.

• Modernizing its stores to make them welcoming, efficient, and engaging means investing in both aesthetics and functionality, turning each location into a destination rather than a necessity.

• Investing in digital and data-driven marketing to create personalized, habit-forming loyalty would reconnect Walgreens with customers who have drifted away to more digitally savvy competitors.

• Fixing pricing perception to compete better with value-focused rivals is essential in an era where consumers can instantly compare prices online.

The lesson for retailers? Marketing isn’t just about selling, it’s about survival. In a world where customers have infinite choices, a brand that fails to evolve will fade into irrelevance, becoming a case study rather than a competitor. Walgreens’ story is far from over, but whether it regains its footing depends on whether it learns the lessons it should have years ago.

Just as a doctor wouldn’t treat symptoms without addressing the underlying disease, retailers can't solve deep-seated brand problems with superficial marketing fixes. Walgreens’ journey from retail powerhouse to private equity rescue case shows that even the strongest brands need constant care and evolution, a prescription that every retailer should fill before it’s too late.