The digital marketing initiative known as “My Weekly Ad” is helping CVS Caremark grow sales and deepen engagement with loyal customers by providing them with personalized versions of the retailer’s weekly ad.
The My Weekly Ad program was launched last fall and Wednesday morning during a presentation at the IRI Summit CVS Caremark SVP of merchandising and retail pricing Judy Sansone shared additional details regarding the program.
“We deliver a personal circular to every customer who is a member of our ExtraCare program and is registered on CVS.com,” Sansone said. “There is so much more power in delivering a truly personalized experience.”
CVS Caremark still relies on traditional print circulars, about 45 million each week, but the ongoing decline in Sunday newspaper circulation presents a major challenge for CVS Caremark and other retailers who for decades relied on the Sunday paper as a delivery vehicle for their weekly ads.
Recognizing this shift as well as the potential for digital technology to serve customized offers, CVS Caremark sought to leverage the wealth of data found in its database of ExtraCare member behavior. The result was the creation of My Weekly Ad last fall and superior redemption metrics that have the company looking to increase its investment this year.
According to Sansone, the typical print circular features about 300 items and the average customer will purchase about eight of the featured items.
“With My Weekly Ad we are seeing redemption rates that are seven to 10 times the rate of non-personalized offers, which is allowing us to drive a higher level of engagement,” Sansone said. “Roughly 30% of everything we spent in 2013 was on personalization tools because the investment is driving a higher level of engagement and that figure will be even higher this year.”
The opportunity for personalization and engagement is huge at CVS Caremark because the company’s 15-year-old ExtraCare program now boasts 70 million active members (defined as those who have participated in the past six months) and the shift toward further personalization is undeniable.
More than 1,000 people attended the IRI Summit and in a message clearly intended for an audience largely made up of CPG company representatives, Sansone said it is time for marketers to evaluate their investments.
“Review your portfolios for opportunities to reinvest from underperforming mass vehicles to more personalized and profitable offers,” Sansone said.
CVS Caremark is applying that same philosophy to the store experience with a clustering initiative designed to make assortment more locally relevant. Sansone said the company has about 8,500 planograms for 70 categories and further optimizing assortment based on local demand characteristics offers tremendous potential.
While most of her comments were focused on front of store, she made sure to mention that at CVS Caremark, “pharmacies and Minute Clinics are where personalization comes to life.”