Drug Store News

Merchandising mimics customer needs

Merchandising mimics customer needs – Consumables

Rob Eder

It is best not to look at CVS as one 4,100-store-plus chain, company chairman, president and chief executive officer Tom Ryan has said on more than one occasion. Clearly, this is the principle by which the chain’s consumables merchants, led by vice president of general merchandise and consumables Allan Goldman, operate.

CVS gives its customers a number of different looks in its convenience foods departments–depending largely on the local shoppers’ definition of what constitutes convenience food. And that, too, depends on where CVS’ customers happen to be shopping at the time.

Of course, this really isn’t only the case for CVS’ consumables business. As both Ryan and executive vice president of merchandising and marketing Chris Bodine have explained to Drug Store News, CVS doesn’t have one prototype. It operates several variations on its current prototype–the main reason why Beauty at the Door only appears in about 1,000 of its stores. Those are the 1,000 stores in which the concept works.

“In our urban markets where we tend to operate smaller boxes, at lunchtime, you tend to have higher traffic counts,” Bodine told Drug Store News in a past interview. “It might work against you to put in Beauty at the Door.”

For CVS it is about adapting its prototype to fit the profile of its stores, the customers who shop there and how they like to shop the store. It is about “creating more browse time and impulse opportunity for our customers, Bodine added, and making sure that its customers are able “to migrate the front-store the right way.”

So, if you are at work, you might be shopping one of CVS’ urban stores, where instead of a lot of pantry-fill and meal solution items, the selection runs longer on snacks and candy and offers plenty of coolers to merchandise a broader assortment of cold, single-serve beverages. If you work near one of CVS’ downtown Chicago Loop stores you might find sandwiches and salads in the coolers. In Boston, CVS’2 Centre Plaza store, which serves a large business and tourist crowd, the recently converted store features convenience foods at the door–a lot of salty snacks and plenty of coolers.

But at that, it’s not quite like CVS operates one urban prototype, either. There can be cultural variations in its mix, as well–and that means something broader than marketing even just to African-American and Hispanic consumers. In the North End, Boston’s “Little Italy,” CVS’ Hanover Street store features a 4-foot run dedicated entirely to Sclafani food products. And it’s very difficult to keep enough olive oil and canned tomatoes on the shelf, an associate from the store told Drug Store News during a store visit ha late May. The customers in this part of town–made famous by the ’70s era “Prince Spaghetti Day” TV commercials–understand authenticity, and carrying the regional brand favorite demonstrates CVS’ understanding of the needs of its local customers.

Out in the suburbs, the mix changes and deepens considerably, particularly in markets like Ridgefield, Conn., and Wakefield, R.I., where the chain operates two of its larger-sized stores–the latter, a 19,000-square-foot behemoth by CVS standards–and uses its grocery offering more strategically to steal customers from nearby supermarkets. The consumables offering in these stores is massive and is anchored by huge open coolers that run along a wall in both stores.

The Wakefield store, which opened Aug. 23, competes with a Shaw’s supermarket, located only a few hundred yards or so up the road on Main Street. However, for as much space as Shaw’s has devoted to HBAs–some 156 linear feet–CVS is deeper in grocery and household consumables. The grocery offering occupies more than 180 linear feet in CVS’ new Wakefield store.

The deep parking lots and longer checkout lines at supermarkets, such as Shaw’s, Super Stop & Shop and many of the other bigger box food chains with which CVS competes, make buying food at the drug store a lot more appealing for customers who aren’t necessarily looking for meat, fish and other perishables. Especially if the offering includes the things Mom needs to set a quick dinner on the table.

Clearly, that is what CVS is counting on in its suburban stores. The assortment in stores like the one CVS operates in Wakefield, R.I., run deep on items that go from box to plate in 30 minutes or less–the Supper Bakes and Hamburger Helpers of the world.

COPYRIGHT 2003 Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.

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