New Duane Reade Flagship Store Sets the Standard

NEW YORK -- As a major New York City chain and part of the Walgreens family of companies, Duane Reade could have designed its new flagship store to fall in line with corporate lockstep. But take just a few steps inside the 22,000-square-foot location and it's easy to see that something's different here.

"We kept the space in its original architecture," Michael De Fazzio, senior director of store concepts for Walgreens Co., told CSNews Online at today's grand opening event. "We tried to give it a downtown New York City feel."

The store, located at 100 Broadway in the financial district, overlooks Trinity Church Cemetery and the Canyon of Heroes parade route. A museum-like exhibit features past historic events that have taken place in the neighborhood. It's also less than a quarter of a mile from the company's Wall Street flagship store, which opened one year ago. But while the two locations have a number of things in common, they aren't carbon copies.

"The offerings here on a convenience level are complementary to Wall Street," said De Fazio.

Amenities new to the Broadway location, however, include two new "upmarket" stations in the foodservice area. The upmarket: chop gourmet salad bar features premium, ultra-fresh fixings, while a full-service barista staffs the upmarket: café, which brews regular drinks and specialty beverages to order. Meanwhile, the Good & Delish self-serve hot soup station offers eight flavors here.

The first floor of the store also includes upmarket: juice and upmarket: sushi, which debuted at the Wall Street store. The Wall Street location's sushi chef prepares sushi for both stores daily; packages are then rushed to 100 Broadway in refrigerated containers to maintain freshness.

"We've gotten great feedback from our customers with respect to what they asked us to do," said De Fazio, noting that the company's "New York living made easy" strategy has been in the works for more than four years. "They asked us to make the shop easier."

To that end, the new flagship store on Broadway has wider aisles, clearly defined product category areas and a queue system at the front of the store to simplify the checkout process.

"This customer is a little bit more transient; it's a little more touristy," De Fazio said of the community. "We thought this would be a faster store, and the product selection you see [reflects] just that."

At the same time, the store offers a sizable range of daily living items for the increased amount of residential customers it sees during evenings and weekends. Standard convenience -store offerings of candy, snacks, beer and frozen food also take up much of the first floor. A Coca-Cola Freestyle machine allow customers to choose from a huge range of fountain drink flavors.

Instead of a small shelf of greeting cards, the store boasts two separate sections of American Greetings and Papyrus cards, ensuring customers have all the selection they might want.

The second floor of the store houses a "hybrid boutique" beauty section that stocks higher-end skin care and beauty products along with more affordable offerings. It's adjacent to the store's pharmacy, reflecting the company's mission to become a health and beauty destination.

The pharmacy is powered by the Walgreens Pharmacy Network, which was integrated last year and is now present at all 253 Duane Reade stores, according to De Fazio. "It's important to grow the pharmacy end of the business, because we are New York's convenience store," he said. Next to the pharmacy counter is a wide waiting area in which a health guide may be added later on.

Duane Reade is leaving itself room to grow on more than an individual store level. "We're using these flagship stores as a baseline for where we want to take the business going forward," De Fazio said. "Not everything's going to end up in every store, but we'll put it in the store that it fits. And we'll do that based on location, demographic, ethnicity, income level; all those things that you truly measure your business against.

"This is like a test drive for us to see where it works, how it works, and what we need to do better to make it more successful," he added.

Future stores are expected to follow the lead of the flagship locations, and size does matter. "We don't take small spaces anymore," said De Fazio, acknowledging that although not every new location will have a 22,000-square-foot footprint, the company wants them to be big enough to give customers the shopping experience they deserve. "Convenience" is the keyword he stressed when asked to name the Broadway location's primary feature.

"It's all about content relevance. You have to have the right content in the store," he said. "You can have the prettiest store in the world, but if you don't have the right content, it doesn't matter."