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Boots BetaLab: Can the Boots brand really become known for tech and innovation?

By Leslie de Chernatony | consultant

May 27, 2015 | 5 min read

The traditional shopping experience is changing rapidly. AR, VR, touchscreens, immersive experiences and smartphones have all played their part in transforming the retail environment we once knew – and with it, shopper expectation.

Can Boots lead the way in tech and innovation?

The Post Office is using biometrics to better understand the pressure points for its consumers. Wagamama and Apple are looking to let you pay with your watch. It’s a brave new world.

There’s also a lot of hype as retailers rush to promote their latest technological offerings before they’ve really proved their usefulness. So it’s been interesting to note the relative lack of fuss made about a recent initiative by Boots, which points to some rather exciting possibilities for technology and retail.

The company has opened a new operation, Boots BetaLab, featuring a sizeable and entirely newly recruited team of technologists and tech product managers based in the heart of trendy digital Shoreditch. They’re charged with developing new products and services for one of the UK’s biggest retailers.

So what, you may say. Isn’t that what Boots has always done? Yes and no. Boots has always been an innovator, investing significant sums in new product development with great results down the years: Ibuprofen, E45, Soltan, Strepsils and No7 Protect & Perfect to name just a few.

But great product development of this sort is no longer enough. Boots has been savaged by commoditisation of healthcare and everyday beauty products, losing significant market share to supermarkets. Cheaper prices and the ultimate convenience of picking up the items as part of the weekly grocery shop have been hard to counteract.

Boots BetaLab sounds good, but will the retailer be able to make a difference or is it simply jumping on the digital bandwagon? One that Argos arguably started 12 months ago when it scrapped its iconic paper catalogue. Can the very traditional Boots brand really be known for technology and innovation?

Done right, it could be. Rather than trying to fight the supermarkets on their own turf, Boots is trying a different approach with BetaLab. In an age of the ‘measurable self’, people are interested in managing their health and wellbeing through technology. We’re starting to see apps, wearables and associated software to manage our wellbeing and Boots could be ahead of the game here.

That’s because around 18 million people carry its Advantage loyalty card, and they’re a lot more active than other loyalty card members so the data is richer. It also has a 70,000-person panel that answers questionnaires and tests products. Overlay this with biometric, transactional and health data, and the opportunities for new products and services start to appear.

The service area is particularly intriguing. With the NHS squeezed, some health authorities and CCG (clinical commissioning groups) are running campaigns to convince members of the public to go to pharmacists instead of GPs for minor ailments.

This opens the door for the development of innovative new services and products. Digital health coaching programmes, health apps and virtual health specialists are all on the cards. Boots is taking the fight away from commoditisation to create new revenue streams. Of course, some might wonder if the private sector should be making up for the funding cuts of the NHS, but at least this way the technology is being made available.

Will people pay for this more bespoke premium approach? Boots seems to think so, and with most of the UK within 10 minutes’ drive of a store, the opportunity to bring together physical retail and technology in a new and profitable way, could be huge.

The level of investment Boots is committing points to something more meaningful than a half-hearted piece of incremental innovation. But can an entirely new team, in a new office and a new location, really deliver something that is both valuable and true to the Boots brand?

Personally, I look forward to finding out.

Professor Leslie de Chernatony is a board director at LIFE Agency

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