CVS Accelerates Store Evolution

CVS/pharmacy is redesigning another several hundred stores to emphasize an expanded assortment of healthy food, health-focused products and beauty — growth-driving categories most closely tied to pharmacy and in line with the drugstore chain's growing emphasis on health care innovation.Some 800 stores already devote prime merchandising space at the front of aisles and at checkout counters to "better-for-you" food options, and sport an "elevated" beauty department design. At the retailer’s “Discover CVS” media event in New York last month, it announced that as many as 70 more locations are now joining the ranks; several hundred others will be reset through 2018.With 100 feet of new merchandise, the updated store format devotes 80% of its total merchandising space to health and beauty categories and minimizes the presence of general merchandise, a category that has failed to produce sales growth.President of CVS/pharmacy Helena Foulkes said at an analysts meeting in December 2016 that the first 400 locations with the enhancements reported an average 2.5% overall sales increase and said the retailer has the potential to scale up resets to 3,000 high-volume stores over the next several years.At last month's event, however, Foulkes noted that future expansion hinged on identifying what resonates well with shoppers.“We will continue to evolve the store experience as we test and learn in order to meet the needs of our customers in the ever-changing retail landscape,” Foulkes said.Key elements of the retailer’s redesign plan include:Health “Discovery”The redesign aims to shift the focus of the retailer’s offerings from treating illness to maintaining a healthy lifestyle."We did a lot of research to understand how to best serve our customers as we began to reimagine our store experience and we found that people are thinking about their health differently and taking a more proactive approach to staying well," said Judy Sansone, chief merchant and senior vice president of front store business, in a media release. "With that in mind, we crafted a new shopping journey, all in the name of better health."According to CVS, the new layout allows shoppers to take a holistic approach to health in key categories through "discovery zones," or video-equipped gondolas that bring together new and relevant products under themes such as “fuel your day” or “find your balance.” Also included in the new format are healthy eating trend displays, themed multi-brand OTC endcaps, and informational signage that helps shoppers make product choices.The retailer also plans to make 50% of its food options healthy items, primarily "on-the-go" snacks. This includes adding 27 new items to its Gold Emblem Abound line and introducing new specialty brands. CVS will also begin offering a greater variety of vitamins, supplements, and nutrition products.CVS will also move forward with in-store optical and audio services. A handful of stores in the Baltimore-Washington, D.C. market already include vision or hearing centers next to store pharmacies, according to Drug Store News, and the retailer plans to expand the service to 50 locations by year-end, with a focus on making care easily accessible to shoppers.Trendy and Healthy BeautyThe retailer took the concept of “discovery” to the beauty category by utilizing the aforementioned gondolas as well as “trend walls” to highlight advanced and premium products, current makeup trends, new launches and niche brands such as KF Beauty’s Wunder2 and Naterra International’s Tigi Cosmetics. Additionally, display racks near checkout counters stock travel-sized SKUs for “on-the-go” options.CVS indicated that it would begin carrying additional personal care and cosmetic products with “greater skin health benefits and natural ingredients.” The retailer has been promoting skin health with custom endcaps for brands including Johnson & Johnson's Neutrogena and Nature's Bounty Co.'s Organic Doctor, as well as through informational signage concerning conditions such as eczema.The retailer also recently welcomed several on-trend brands to select stores: early this month it began stocking the Honest Co.’s line of non-toxic baby products, as well as an extensive line of Korean beauty brands, most of which are exclusive to CVS, via a “K-Beauty Headquarters” in-line display. Safer StandardsFollowing the removal of partially hydrogenated oils from all of its Gold Emblem food items earlier this year, CVS now plans to reformulate all of its private-label personal care items to exclude chemicals such as parabens, phthalates and formaldehyde donors by 2019. By that same year, the retailer also plans to implement new standards, including third party testing, for vitamins and supplements sold in its stores.“We listened when customers voiced their desire for products that provide the benefits they need with fewer ingredients of concern," Cia Tucci, vp of store brands and quality assurance, said in a media release. CVS also recently removed sun care products with an SPF lower than 15 from its shelves, announcing the change to consumers in an April 9 circular feature.Additionally, expanding on its Fit Choices labeling program, the retailer will begin marking non-food items that meet specific health needs as soon as this summer.

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