Tobacco swapped for improved beauty
CVS Pharmacy is set to upgrade its beauty sections in a bid to recoup sales lost when the US drugstore chain decided to remove tobacco from its product offering. The chain now says it will improve its beauty offering in reponse to consumer demand.
The company announced that would gradually stop selling tobacco products in February last year as it was seen to be inconsistent with its healthcare branding. Tobacco previously accounted for approximately $2bn in revenue for CVS but the products were removed from its 7,800 stores by 1 October 2014. At the time, Larry J Merlo, President and CEO at CVS Caremark, said: "Put simply, the sale of tobacco products is inconsistent with our purposes."
The company is now looking to recoup the revenue lost by the change with an improved beauty offering. Private brands and beauty advisors will be introduced into 1,000 stores. The move mirrors a trend already seen at rival US pharmacy chain Walgreens Boots Alliance which is also placing a greater emphasis on beauty in the US. CVS Caremark said that health and beauty sales in their stores have grown at a rate 25% faster than general merchandise over the past three years and beauty generates $3bn worth of sales for the company each year.
As part of the refresh, the beauty departments at 2,000 stores will be revamped and CVS has already introduced new brands including Make Up Academy cosmetics and Skin+Pharmacy skin care. CVS Pharmacy is the second-largest pharmacy chain in the USA. It generates overall sales of $19m and sees an average of 5m visitors each day.