The prospects for CVS look rosy for the months ahead, according to an analysis from Placer.ai, not only because it is set to begin in-store COVID-19 vaccinations, but also because it is doing so from operational strength.
In a blog post, Ethan Chernofsky, Placer vp/marketing at the traffic tracker, pointed out that visits to CVS locations were down just 0.1% in October before a surge in coronavirus cases cut the number of consumers visiting retail locations and drove the visit gap to 6.8% in November. Yet, even with that renewed concerns about COVID-19 spikes, CVS visits rebounded in December and were down just 3.6% year over year that month.
Chernofsky said those numbers are impressive, considering what has been happening at retail lately. They look even betters he observed, when directly compared to what went on with CVS rivals. In Q3, CVS saw an average monthly visits gap of 3.5% even as Walgreens and Rite Aid saw gaps of 5.9% and 29%, according to Placer.ai.
In Q4, CVS saw a continuation of that 3.5% year-over-year gap while Walgreens saw its visit gap expand to 7.5%. Chernofsky insisted that this is not because of any weakness on the part of Walgreens, which has still seen relative strength compared to the wider retail ecosystem. Rather it is a testament to the ongoing performance of CVS, he noted.
The trend continued into 2021 with CVS experiencing a visit gap as low as 2.7% the week beginning January 11. CVS is a brand that’s uniquely suited to benefit from a large increase in visitors in that it sells a wide range of household products. It’s rare that a customer won’t stumble upon something they need during a visit, Cernofsky maintained, even if an eventual purchase was not intended upon arrival at the store, making CVS one of the most interesting brands to watch in the coming months.
The interest isn’t just in the potential of vaccinations to spur visits. Chernofsky pointed out that consumers have boosted retailers who sell home improvement and decor products in various retail channels, with Home Depot, Lowe’s and Tractor Supply being particular beneficiaries. Although it isn’t nearly as deep in those home categories, CVS is a convenience stop for everything from cleaning supplies to candles to outdoor furnishings to massage products. As such, many consumers are likely to pick up more than chips and Bandaids on a CVS visit, which will raise its value as a nearby shopping resource among vaccine seekers.