After being frozen in place since the beginning of the COVID pandemic, the wheels of innovation are turning once again. Concerns about the supply chain and the need to keep products in stock have subsided to the point where leaders of drug, discount and grocery chains and their counterparts in the vendor community are shifting their attention back to ideas for elevating their brands and transforming the consumer experience.
CVS Health exemplifies the trend. The company has turned a drug store in Millis, Mass., a Boston suburb, into a laboratory for testing concepts designed to improve the CVS Pharmacy prototype. While still very much in keeping with the CVS brand of retailing, the Millis store is a departure in several important respects, according to senior vice president and chief merchandising officer Musab Balbale.
Laid out in a circuit, the store has an uncluttered, contemporary look — 18% of the SKUs normally found at a CVS outlet have been eliminated — creating an environment in which the drug chain can communicate more effectively with customers about the relevance of its health and wellness offerings, as well as making interaction with store personnel easier. By doing a better job of “editorial storytelling,” Balbale says that CVS will create a unified, authoritative voice that reinforces the impact of the company and its brand partners.
Target is another retailer working to raise the bar in terms of innovation. “One of the common things that we hear from our guests is they’re looking for news, they’re looking for innovation, they’re looking for something exciting,” said Rick Gomez, executive vice president and chief food and beverage officer at the discounter. “So that’s an area where we’ve been leaning in with our own brands, whether it’s Good and Gather or Favorite Day. We’ll launch a couple hundred new items across both of those brands.
“And we’re partnering with our national brands to continue to bring innovation and news to the marketplace, because that’s what people are ready for. They’re tired of eating the same old things, they want stuff that’s new, exciting and different.”
Gomez made those comments at The Wall Street Journal’s Global Food Forum last month. He appeared with Wendy Davidson, president and CEO of the Hain Celestial Group, who remarked that the experience of COVID caused companies to view innovation through a different lens: “What I like now is it’s allowing us to restart the innovation engine with that intentionality up front. What is it going to do for our customers? What is it going to do for the guests when they come in?”
The consumer stands to benefit as executives strive to come up with relevant answers to those questions.