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Shoppers Drug Mart’s Mike Motz puts the grocery into pharmacy

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Mike Motz practically grew up in the grocery aisle. He worked in several different departments of the Ontario chain Miracle Food Mart, from meat and produce to grocery and cash. 

By Jane Auster

Photography by Brandon Gray

 

After a stint with data company ACNielsen, he returned to grocery, at the Oshawa Group, before leaving for Shoppers Drug Mart in 2003. Now, as president of the giant pharmacy chain (acquired by Loblaws in March 2014), the self-described “fresh guy” has become focused on freshness.

 

It’s been just over a year since Loblaws completed the acquisition of Shoppers Drug Mart. What have been the most significant changes at Shoppers Drug Mart as a result of the acquisition?

From a consumer standpoint, the biggest changes relate to the private brands. Shoppers Drug Mart’s Simply Food and Everyday Market are gone, and there are more private brands from Loblaws, where there is an opportunity to increase our penetration with President’s Choice and No Name SKUs. President’s Choice alone has tremendous equity and is definitely a great brand, with room to grow in the drugstore.

How do you see the relationship between Loblaws grocery and Shoppers Drug Mart in the context of a changing retail pharmacy environment?

I think that grocery is two components: dry and fresh. We have been in the dry business since 2008. Now we are testing how time-pressed consumers respond to shopping “fresh” in the drugstore. We’ve just finished testing a range of fresh food in six pilot locations in Toronto and recently (May) rolled out our food pilot in eight Regina stores. This pilot should be a real test of our grocery strategy, whether consumers see us as more than just a fill-in and as a place where they can buy their groceries.

Will you roll out the new grocery strategy to all Shoppers Drug Marts, and do you have a timeline?

There are no plans for a rollout yet. We still have a lot to learn. Even in Toronto, we want to go through a key cycle of seasons to monitor which categories in the drugstore continue to grow and which categories continue to decline. For instance, the magazine section faces more and more erosion as people switch to online reading. The photo section is reducing as most photos now are taken off a phone. We may be able to optimize those areas to add fresh food.

And as we fine tune the fresh assortment, we can determine whether we roll out differently depending on the market. For instance, a young, urban Toronto environment will be vastly different from what we see in Regina. We are even using a different pilot approach. In the Toronto pilot, we didn’t advertise any of the products, while in Regina, where the pilot will span the entire city, we can test flyer programs and pricing.

How are the pharmacist-associates at Shoppers Drug Mart embracing the new fresh food model?

People are more health-conscious and focused on their health than ever before. This message really resonated with the pharmacists in our pilot stores. Who better to have that health conversation with consumers than pharmacists? [Fresh grocery] is a new pillar for pharmacists to deliver convenience and wellness to their patients.

They are excited about the proposition. They understand that it is a pilot and want to know what it will look like. Pharmacists understand that their role has evolved along with patient services, and they are front line in the healthcare system. They are looking for tools to enable them to talk to consumers about healthier lifestyles.

You were quoted in the Toronto Star last August as saying, “The biggest hurdle is having customers believe that they can get fresh food at a pharmacy.”  How do you overcome that hurdle?

Maybe I wouldn’t use the word “hurdle”. No one else has launched fresh food in pharmacy in Canada. It is a different mindset for the consumer to truly believe that a drugstore can carry fresh. But not so long ago, consumers had to buy their beauty products at a department store. It took us 12 years, but now we are the largest prestige beauty retailer in Canada. With fresh food, people will need to trust us. We feel we are on the right path. In one form or another you will see enhanced fresh in the drugstore business.

Does the introduction of fresh in pharmacy keep you up at night?

It doesn’t keep me up at night, but it does cause me to ponder the level of success in determining what works and what doesn’t work. We have a very strong core business, whether it’s health, beauty or convenience. We want to continue to enhance each side of the business. People look to Shoppers Drug Mart to be on the leading edge.