Walgreens on Wednesday announced its cutting prices and launching a series of new promotions throughout the summer in an attempt to entice price-conscious consumers and drive sales.
Walgreens said it would lower prices on more than 1,300 national and store-brand products. Among its summer promotional campaigns, the company plans to bring back Walgreens' myW Days in mid-July. MyW days are exclusive promotions for myWalgreens members, underscoring the company's attempt to boost its loyalty program.
Global Chief Financial Officer Manmohan Mahajan told analysts during a second quarter earnings call that it's still in the midst of a challenging retail environment as there is a continued "shift in discretionary spend away from the drug channel as consumers seek value."
Sales at retail stores open at least a year declined 4.3% in the quarter.
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To boost profits, Walgreens is taking a page from retail behemoths Walmart and Target as well as grocers Aldi and Amazon Fresh who have been announcing promotions in recent weeks in a bid to pull in shoppers amid high inflation, which has fallen considerably from a peak of 9.1% notched during June 2022.
Prices are still up 19.4% since January 2021, before the inflation crisis began.
Walmart U.S. CEO John Furner told analysts during an earnings call that the company has almost 7,000 rollbacks, which refers to temporary price reductions on goods.
Similarly, Target announced it was cutting prices on 5,000 popular products. Both major retailers acknowledged that consumers are still feeling the pinch, with Target executives noting how one in three Americans are maxing out their credit cards.
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Earlier this month, discount grocer Aldi announced it was passing along $100 million in savings by slashing prices on more than 250 items through Labor Day. Amazon Fresh said U.S. customers can save 30% on 4,000 weekly rotating grocery items every day.
Industry analysts told FOX Business that these cuts aren't necessarily an indication that the inflation crisis is getting better.
Morningstar Research Services consumer equity analyst Noah Rohr argued that these price reductions "are more indicative of the competitive landscape than inflation."
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The "price cuts are more a reflection of retailers trying to capture and retain customers during a tougher economic backdrop because they really want to build long-term customer relationships," he added.
FOX Business' Megan Henney contributed to this report.
