Following the announcement that CVS Health (NYSE:CVS) would acquire the pharmacies and clinics at more than 1,600 Target (NYSE:TGT) stores, Target's CEO Brian Cornell sat down to answer some questions on the company's blog, A Bullseye View.
Cornell referred to the new partnership as a "significant shift" in Target's business model into one that focuses on delivering wellness products and services across the store. In addition, the relationship will help further the expansion of TargetExpress locations.
When asked why Target did not just invest in its own in-store health care services, Cornell replied that CVS can add a level of expertise while also offering "traffic-driving benefits and offers" to guests. This leaves Target to focus on its strengths, including product design, merchandising and marketing, to grow in the wellness category.
"More and more, our guests want to lead healthy and active lifestyles, and they are thinking about wellness as part of everything they do," Cornell said. "Moving forward, Target will focus on further strengthening our wellness offerings, giving guests more ways to eat well, be active and find natural and clean-label options—areas we know they are passionate about."
Cornell went on to explain that the different approaches to health would complement one another. For instance, Target has strengths in guest convenience as well as value and success across food, apparel, health and beauty. But CVS would bring to the table its history of operating pharmacies and clinics.
Together, the retailers will build five to 10 TargetExpress stores with a CVS/pharmacy inside.
Read the entire interview on A Bullseye View.
-See this A Bullseye View blog post
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