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How Walgreen Makes Money From Healthier Shoppers

How Walgreen Makes Money From Healthier Shoppers
Photograph by Michael Keller/Corbis

Walgreen, the biggest drug-store chain in the U.S., has been trying to make its customers healthier—at least ostensibly. It’s a counter-intuitive strategy for a company that collects one in five U.S. pharmacy dollars and fills 821 million prescriptions a year to treat diabetes, high cholesterol, and a spate of other conditions that might be improved by some push-ups or prancercising.

It’s also making for some healthy returns. This morning Walgreen posted an 86 percent increase in profit for the recent quarter, which it attributed in part to a new loyalty program that grants discounts to customers based on how much they exercise. Sweat equity in action! The company now has 85 million people enrolled in its loyalty program, launched about a year ago, and boasts that it is the fastest-growing such initiative in the world.