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The drug store marketplace is highly competitive, so retailers need to go above and beyond to increase consumer loyalty. In order to appeal to the growing number of health-conscious shoppers, drug stores have evolved to become more of a health and wellness destination for consumers. Increasingly, locations offer in-store clinics, as well as a wider array of health and wellness products and programs.

Taking this initiative a step further, CVS Caremark announced that it will stop selling cigarettes and tobacco products at stores nationwide by October 1, 2014.

“Drug stores’ continued expansion of retail health clinics and their corresponding services help them compete effectively against other retailers as a destination for superior support of consumers’ health and wellness needs” comments Mintel Senior Retail and Apparel Analyst Ali Lipson. “Retailers can further expand on this by offering more health and wellness-related services such as in-store fitness classes, massages, acupuncture and other wellness programs.”

Pulling cigarettes from the shelves is a bold and drastic move for a retailer, as CVS estimates it will lose $2 billion in annual revenue. However, the retailer is banking on the positive association it will get by eliminating tobacco products. The move shows the commitment that CVS has to creating a healthier society by not making cigarettes available. Additionally, it puts the retailer in a better position to become a health care provider.

In conjunction with pulling cigarettes off the shelves, CVS will also execute a “robust national smoking cessation program.” Data from Mintel’s upcoming Smoking Cessation Products—US, March 2014 finds that 30% of consumers surveyed currently smoke, and among those, nearly half are trying or plan to try to quit. Almost 40% of those who tried to quit in the past struggled with withdrawal symptoms, while more than one third of those interested in quitting smoking would be interested in trying therapy to help them quit, notes Mintel.

“Since smoking is both a physical and psychological habit, most consumers need more support than just a product to help them quit.” notes Mintel Health and Wellness Analyst Emily Krol. “Quitting smoking is usually a twofold process: kicking the habit by changing behavior and eliminating the nicotine cravings. Companies that understand that quitting is the most difficult challenge smokers face and provide a variety of solutions to help quitters will be most successful.”

As discussed in Mintel 2014 Trends: Investing in Prevention, Americans are open to solutions that can help them to be more responsible. This includes limiting the availability of unhealthy products, such as cigarettes, as well as educational resources about how to effectively quit smoking.

“Consumers are more conscious of how their decisions today could have negative effects down the line. In order to avoid going down the wrong path, people are hospitable to friends, online support systems, and even retailers that support and encourage the positive life choices they’re trying to make today,” said Jennifer Zegler, Global Food and Drink Analyst at Mintel. Consequently, removing cigarettes will be seen positively by shoppers and health officials alike. The announcement from CVS has received much praise from government constituencies, and will elevate the perception of this retailer specifically as a health provider.

For more information, see Mintel 2014 Trends: Investing in Prevention, The Drug Store Shopper—US, January 2014, and the upcoming Smoking Cessation Products—US, March 2014.

 

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