The choice of Karen Lynch to lead CVS Health underscores how important the company’s health care focus is to its strategy. CVS has made great strides in executing it, taking major steps like buying an insurance company for $69 billion two years ago and sacrificing revenue by taking tobacco products off its shelves before that.
The focus has been laser-like, perhaps to the detriment of its retail side. The second quarter saw a 4.6% dip in front-of-store sales, so the drugstore retailer has rebounded. While foot traffic has been just below 2019 levels in the past couple of months, visits were 1.2% higher than that during the week of Oct. 12, with momentum steady into the fall, according to data from Placer.ai.
The pandemic, while helping CVS as a retailer of essential goods, has curtailed traffic by drastically cutting down errand-running during workers’ commutes, according to GlobalData Retail Managing Director Neil Saunders. The company’s home delivery program, which keeps customers out of stores and away from additional purchases, and its lackluster wellness and beauty sales are also working against it when it comes to the store floor, according to GlobalData Retail research.
Source: Retail Dive
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