Five years after making a big deal to acquire Drugstore.com and Beauty.com Walgreens Boots Alliance is shuttering the two sites.

Last Thursday in a regulatory filing Walgreens said it would take a pre-tax charge of $115 million to shut down Drugstore.com and Beauty.com before the end of September.

There were several options we considered to focus on shareholder return, but right now our intention is to focus on Walgreens.com, a company spokesman says.

Walgreens acquired Drugstore.com and its subsidiary e-commerce sites Beauty.com and SkinStore.com in 2011 in a deal valued at $409 million.

Shuttering the subsidiary sites indicates Walgreens desire to build a single brand centered on health, wellness and beauty, says Paul Schrimpf, an associate partner at brand and marketing consultancy firm Prophet.

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Walgreens is bolstering its presence online to compete with the likes of Amazon, which is stealing sales from it, Schrimpf says. The misperception is that Walgreens greatest competitor is CVS. Its not. Its Amazon in retail, and the likes of OptumRx in prescription drugs. Having two fewer brands to worry about will allow Walgreens to focus its e-commerce strategy on the flagship site, he says.

Its about winning online, and to do that it needs to build a strong, single brand, Schrimpf says. It is not only more efficient to invest in one brand, but also more effective because youre able to cross-sell other products.

In May, Walgreens sold SkinStore.com to The Hut Group, a U.K-based mass merchant that owns other e-commerce sites including MyBag.co.uk, MyProtein.com and ThuHut.com.

Walgreens other domain, VisionDirect.com, an e-retailer of contact lenses and eye care accessories, will remain its own digital entity, the Walgreens spokesman says.

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Walgreen also is losing its chief digital healthcare executive. Fitbit has hired Adam Pellegrini, formerly vice president of digital health at Walgreen, to be its new vice president of digital health. Pellegrinis primary role will be developing new business relationships with health systems and health insurance companies as part of Fitbits push to work more closely with corporate America on online wellness and fitness programs. He will start at Fitbit on Sept. 6.

His replacement at Walgreens has yet to be named.

 

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