The announcement by CVS Pharmacy president Helena Foulkes at last month’s National Retail Federation Big Show that the retailer will adopt standards that bring a new level of transparency to the images used to promote its beauty business caused a stir in the category and triggered a long overdue discussion about the impact of such imagery on women and girls.
Although the change in policy received the lion’s share of attention following Foulkes’ appearance at one of the Big Show’s main stage sessions, she had a lot more to say about the direction of CVS Health and the thinking of the people who guide it.
“CVS has a history of being purpose led,” noted Foulkes, who was recognized by NRF as one of the people shaping retail’s future. “In 2014 we announced that we were getting rid of tobacco in all of our stores. As you can imagine, that was an incredibly hard decision. We walked away from $2 billion in sales. But as a health care company serving people every day and helping people on their path to better health, we knew that was the right decision. We’ve made other moves around healthy food and trans fats and chemicals. Just a few months ago we talked about the opioid crisis. So I would say that this is an ongoing iteration for us, and I think we’re in an incredible moment of women’s empowerment right now.”
CVS Pharmacy is intent on keeping pace with the consumer. Under Foulkes’ leadership, it has adopted a test-and-learn model to help direct the evolution of its offer. After a period of experimentation with new formats, the drug chain is ready to reinvigorate its store base.
“One of these formats is even more intensely focused on health and beauty, and healthy foods — that’s really where CVS has the right to win, and it’s connected to our pharmacy. We’ll have close to 1,000 stores that are reset in this format coming up this year,” she said.
“We’ve got another format that is much more value oriented that we’re adding. We also have some really great work going on for the Hispanic customer. We bought a small retailer in Miami a few years ago called Navarro. It was a 33-store chain focused on the Hispanic customer, and we learned a ton. We learned that we need to really reorient the store, the products, the service experience.
“We actually have over 500 stores in our fleet where 50% or more of the population is Hispanic, and so we’ve been testing with the Navarro team this new format and it’s gone really well. We’ll also be rolling that out.
“We’ll be resetting thousands of stores this year at all of those formats. It’s the largest investment in stores that we’ve made in terms of really revamping and reflecting where the consumer is going.”
Foulkes indicated that openness to new ways of doing things is a prerequisite for any retailer that intends to flourish in a marketplace where established patterns have been upended by digital technology and new methods of distribution.
“There’s a tremendous amount of change going on in retail,” she said. “That’s why I’ve always loved it. It’s a fast-paced business. We’re dealing with disruption and chaos, and the consumer is in some way surging forward. We need to keep leapfrogging and serving her and doing things that make her life better, more fun, more beautiful, more inspiring.
“So all of us are feeling the bar going up, and it can be stressful, but to me that’s what’s exciting. The people who are winning right now are integrating their digital services with their stores.”
Health care is, of course, CVS’ primary mission, and Foulkes noted that the company’s stores will play a pivotal part in the wake of its pending merger with Aetna.
“We hope to use this as a way to transform the consumer experience around health care. Health care is hard — it’s too expensive, it’s too complicated. As consumers we’re all bearing a bigger burden of health care because of things like high-deductible health plans,” explained Foulkes, who is an executive vice president at CVS Health. “The idea would be how do we leverage the 9,700 stores that we have, the digital expertise, the consumer expertise, along with Aetna’s clear clinical and data expertise, to serve consumers better.”
Those who heard Foulkes speak came away with the sense of a company — and an executive — well on the way to reimagining health care and drug store retailing.