CVS Marketing Strategy
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CVS Marketing Strategy
The pharmaceutical and health industry in the U.S is quite competitive. This calls for the leading players to devise wise marketing strategies, and CVS has been at the forefront for that. CVS is in the healthcare sector, according to the Fortune 500 page (2020). Initially, the company dealt with pharmaceutical products, but it has evolved to provide medical services, cosmetics, and even household items (CVS, 2020). The company is at its maturity stage in the product life cycle as it has continued to experience a stagnation for levels for its main product-pharmaceuticals since 2012 (Fortune 500, 2020).
This means that the future marketing approaches of the company should focus on rebranding and the introduction of new products into the company. This is in line with the diversification strategy to provide a fresh cash cow for the company as the pharmaceutical products approach the decline stage. The main competitor of the company is Walgreens Co. it is also a leading drugstore in the U.S. The products that the company offers include cosmetic products, pharmaceuticals, and medical supplies, and household items. The difference between the offerings at CVS and Walgreens is that the latter does not offer minute clinics Talbot, 2019). This means that the customers cannot get checked for minor illnesses and get their prescriptions on the spot.
The first important thing to understand is the products that the company offers. CVS deals with both products and services. The company has a clinic chain where people get medical assistance. They also provide prescription drugs and other medical supplies. On the pharmaceutical products, the company has about 9600 retail stores across the globe (Virginia Community Colleges, 2019). Trained pharmacists are in charge of prescribing and issuance of drugs. In the retail clinic, the company has more than 1100 clinics with professionals to help patients with minor health problems. Summarily, the company’s primary goal is to offer low cost and convenient products to their clientele, which gives them a competitive advantage.
The company understands that there has been a rise in the costs of healthcare in the U.S. Thus, the focus at CVS is to ensure that they maintain the affordability of their products. The company achieves this with value-based pricing models. Here, the company sells the drugs depending on the value that the clientele knows they are extracting from the company. However, it is essential to note that the prices do not go above the market prices.
In the place aspect, the company has efficient distribution strategies. As earlier mentioned, there are over 9600 stores where consumers can access products on the retail scale. The company also provides products on wholesale terms from their 18 major distribution centers whose locations are strategic all over the U.S. When it comes to promotion, the company has diverse strategies in places such as their website, radio and television adverts, and social media platforms. The company utilizes its social media platforms to communicate to the market on issues such as the discount prices and exclusive coupons.
The main competitor of CVS is Walgreen Co. Since there is a similarity in the products and promotion strategies, the companies compete when it comes to the place and pricing. Both companies use value-based pricing models. They also focus on low costs for the products that they offer their clientele. CVS achieves competitive strategies through its use of scan-able discount cards. The consumers can scan these cards in store for coupons. This means that the consumer will keep coming back as it is a form of incentive. Walgreens uses only the loyalty cards to get consumers to visit their stores, which is not as enticing as the use of discount cards. The company also makes use of discount plans as it gives its customers 2 percent off nonprescription items. It also provides a one-dollar discount for every two prescriptions making the customer prefer the store that offers a discount as opposed to Walgreens, which does not.
References
CVS. (2020). https://www.cvs.com/
Fortune 500. (2020). https://fortune.com/fortune500/2019/search/?name=CV
Talbot, P. (2019). Inside Walgreens’ Marketing Strategy. Forbes. https://www.forbes.com/sites/paultalbot/2019/07/21/inside-walgreens-marketing-strategy/#77f82462428c
Virginia Community Colleges. (2019). CVS Marketing Plan. https://sites.google.com/a/email.vccs.edu/bus100ttran/cvs-marketing-plan