CVS: Trading a Negative Space for a Positive Image

In February, CVS announced that it would stop selling cigarettes in all of its 7,700+ stores. By September, a month ahead of schedule, the cigarettes had indeed been pulled form the shelves, a move that company officials estimated would cost it $2 billion in annual revenue. It was a significant step in repositioning the firm to become more of a healthcare provider and less of a retailer known for cosmetics, snacks, and over-the-counter medications. The company has also changed its name to CVS Health (though this has yet to roll out in signage and other public ways) and intends to expand its in-store Minute-Clinics from their current 900 locations to 1,500 by 2017. 

What's interesting from a communications perspective is that the area behind the counter where the cigarettes used to be has been replaced by large boards with headlines like "Let's Quit Together," "You're Not Alone," "Thinking About Quitting?" and "#OneGoodReason," all encouraging customers to stop smoking. Rather than try to recoup some of that $2 billion by stocking more electronics or other high-margin gadgets in the space where the cigarettes used to be, CVS is doubling-down on its message of being seriously focused on health. So now both the messaging has changed (from "buy cigarettes" to "don't smoke") as well as the use of the space itself (from merchandise display to messaging).

It will be interesting to see how CVS uses this prime real estate going forward.