Why CVS’ Healthy Rebrand Is All About the Cabbage

This guest post is by WALEKpeppercommer Stefan Prelog.

Bizarre Tobacco Advertising (29)You’ve probably heard by now— CVS is looking to get healthy.  The largest pharmacy chain in the U.S. will stop chain smoking and ditch all of its tobacco products by October 1st (hey, even a large company can’t go cold turkey) in favor of a healthy lifestyle.    If you haven’t heard, you probably don’t own a T.V. or read the newspaper.

The announcement that CVS was getting out of the tobacco trade was splashed on the front page of every newspaper and news site.  A recent Google search of the terms “CVS quits tobacco” netted 18,400 results.

Not only did the news generate a glut of headlines, but it also generated praise and support from health professionals and politicians.  Everyone from  Kathleen Sebelius, secretary of Health and Human Services, to President Obama and the First Lady is showering the company with accolades.  Pretty much every person who doesn’t work for a tobacco company loves the move.

But what was the real motive behind the company’s move?  Was the company feeling fat after the holidays?  Did it get a bad physical from its doctor?  Or is it because it was suffering from a mental illness?  What else could explain dumping a product line that amounts to $2 billion a year?

It turns out CVS is crazy – crazy like a fox.   The move was brilliant.  Not only did CVS receive an immense amount of positive coverage, but it also took control of the healthcare conversation.

CVS looks like an industry leader.  It’s abandoning a flailing, maligned industry in the name of health and as a result has put tremendous pressure on its competitors.

But while CVS looks like it’s thinking about your waistline it’s really thinking about its bottom line.

CVS has said it doesn’t want to be hypocritical by supporting health care practitioners and promoting healthcare products while selling things like chewing tobacco and menthol cigarettes.

But get the stethoscope and listen to what CVS is really saying.  The company said it had identified ways of offsetting the impact on profits.  One way it identified was a smoking cessation program that it started.  CVS is looking at the big picture, and positioning itself as a company that cares about its customer’s health so it can get a piece of the trillion-dollar healthcare pie (don’t worry trillion-dollar pies are good for you).

This is a case where their marketing executives analyzed a number of factors including the expanding healthcare industry, the Affordable Healthcare Act and an aging population.  Then they walked over to accounting and crunched some numbers.  You can bet the profit potential from the booming healthcare industry dwarfed the short-term profits of a dwindling tobacco industry.

CVS’ rebrand is simply an example of good business intersecting with public relations.

It’s a brilliant public relations move.  In one stroke CVS rebranded themselves as a company that takes health seriously.  Now it just has to wait for the money to start rolling in.

Bravo CVS, bravo.  Now, can I get a piece of that pie?

3 thoughts on “Why CVS’ Healthy Rebrand Is All About the Cabbage

  1. Every time I go into my corner CVS someone is getting a flu shot or consultation. While they’re all doing it, they clearly want to be the leader. That’s why the announcement was a brilliant PR stroke because they beat Walgreens and the others. And what does a flailing chain like Rite Aid say? “Hey, we’ll grab all their tobacco business and it’ll shore up our other losses.”

    • Thanks Gerry. No surprise that profit was the underlying motive, but it was a brilliant move to wave the health banner.