CVS 2000 Annual Report Download - page 11

now have more than
1500 CVS-brand
products, including
over-the-counter
items and health and
beauty aids, as well as
our premium line of
Gold Emblem® snacks
and beverages. These
private label products
offer quality and cost sav-
ings for our customers and
competitive profit margins
for us.
CVS’ First-to-Market Advantage
For those new products that are not exclusive to
CVS, we place a priority on bringing these items to
market faster than our competitors. Our success with
the introduction of Olay Total Effects® demonstrates
the benefits of this strategy. By being first to market,
CVS has achieved a 36% share within the total U.S.
drug market, significantly higher than our 23% mois-
turizer segment share. We have found that being first
to market allows us to build sustainable market share
ahead of our competitors and reinforces our innova-
tion with consumers.
The most dramatic front-end growth occurred
last year in our photo business where sales rose more
than 20%, and our market share of Kodak’s business
increased significantly. To enhance convenience, we
added more one-hour labs in 2000, reaching a total of
3,000 chainwide. At the same time, we have been at
the forefront in introducing new photo-related serv-
ices. For example, we now offer a service that allows
customers to drop off film from a regular camera and
have their pictures uploaded onto the Kodak Picture
Center® at CVS.com.The popularity of this site has
made it the industry’s fastest-growing photo-sharing
service, making us Kodak’s #1 online customer. We
continue to explore opportunities for the introduction
of other unique photo services.
We aim to
further enhance
our value to custo-
mers through the
introduction in
2001 of a new
branded relationship
marketing initiative,
ExtraCare®, making us
the only major drug-
store with a loyalty
program chainwide.
This initiative has been
tested in six markets
for a number of years,
enabling us to continu-
ally refine our program.
Through ExtraCare, we are offering special promotions
and incentives to our best customers, to reward their
patronage of CVS and encourage higher loyalty. For
example, benefits may include opportunities to earn
rewards and free merchandise in select categories
through support from our vendor partners, exclusive
savings on purchases, access to special mailings with
highly customized coupons and health information,
automatic sweepstakes entries, and participation in a
college savings program. CVS is the exclusive pharmacy
participant in UPromise, a savings network that makes
it easy for families to accelerate savings for college
through partnership with America’s most trusted brands.
CVS’ exclusive Essence of Beauty bath
and body products have received an
excellent response, generating strong
repeat purchases.
CVS operates 3,000 one-hour photo labs, up from
2,000 in 1999, and our share of the U.S. photo
processing market continues its rapid growth.
…innovative…
“We take pride
in knowing our
customers, and creating
unique products and
services to meet
their different and
changing needs.”
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2000 Annual Report