All eyes (and ears) are on CVS’s June 4 Investor Day after a relatively quiet and quick first-quarter earnings call. Now merged with Aetna, the retailer has much to reveal to the financial community about both its short- and long-term goals. Since CVS’s efforts to evolve its core business will inevitably impact its suppliers, Kantar will be following the retailer closely in several key areas:
How could Aetna affect the front store? Beyond steering Aetna patients to its pharmacies through its networks, how does CVS plan to integrate the insurance company into its stores further? With the retailer so focused on its union with Aetna, it is likely that Larry Merlo and Co. will share details on how they hope to link Aetna into CVS’s stores. Could the pharmacist be trained to also act as an Aetna representative? Could Aetna patients receive exclusive discounts via Extracare or a new loyalty program? With the front store growing (albeit slowly), Aetna offers an opportunity for CVS to create a new traffic driver.
Which pilots are scalable? One thing CVS’s senior leadership team did discuss at length during its Q1 earnings call was the positive early performance of the HealthHUB pilot, promising to share more information on the future of the format during its Investor Day. Now that the day is finally here, we’ll be following how CVS plans to expand the HealthHUB into other regions. With the HealthHUB now seemingly at the heart of the retailer’s real estate strategy, what will happen to other store pilots like BeautyIRL and Take High Higher? CVS is on a fairly strict cost-optimization program, so it is likely that some of these other remodel-centric initiatives will need to be canceled as the retailer focuses on scalability and the formats that fit its vision best.
How will CVS connect its assets? Compared with its contemporaries in the drug channel (particularly Walgreens), CVS has been very quiet about how it plans to evolve digitally. With omnichannel a must-have for most retailers today, it is unlikely that CVS will ignore the subject during Investor Day. Instead, it will favor an approach that ties together both its online and offline assets to boost its loyalty offering to shoppers. How might the retailer expand or improve its existing fulfillment capabilities? We’ll be listening for any mention CVS makes to its website, app, or CarePass loyalty program pilot.
Don’t have time to listen in this week? We’ll have our POV on the top takeaways from the investor day on KRIQ after the event.
For more information, please contact:
Ben Antenore, Analyst