“Customers are the link to a successful business. A business organization should focus on a huge number of customers, for this customer satisfaction and loyalty should be incorporated along the long-term goals” (Khadka & Maharjan, 2017). The mission of CVS is “We provide expert care and innovative solutions in pharmacy and health care that are effective and easy for our customers.” CVS Health is helping to improve health and pharmacy care through scientific research, analysis, collaborations, and advocacy. This organization strives to help individuals work towards better health goals. C
VS main goal is to focus on being more affordable and practical than its competitors to continue to gain an advantage with customer loyalty packages. The company focuses on contributing to the overall health of everyday individuals. Furthermore, the organization is reinventing the pharmacy experience to have a more active role in everyone’s unique health experience to keep loyal customers. They offer advice on prescriptions as well as assistance with pharmacy benefits and management. One primary goal of CVS is to be able to positively influence health behavior and shape the future of health care for residents, businesses, and communities.
Another goal is to be known as a neighborhood pharmacy by locating stores in walking distance or at least within a couple of miles from neighborhoods. The company focuses on trying to become a one-stop shop as an alternative to supermarkets and some of its other competitors by also offering health care services, such as flu shots, diabetic testing, and separate walk-in medical services. Health is essential for CVS as it is an integral part of the company’s mission and goals.
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CVS will continue to work towards being innovative when it comes to being able to offer more health care services in the future to keep customers not only satisfied but also loyal. The company’s goal is the keep reinventing itself and not become complacent as the healthcare industry continues to grow. The intent is to continue to deliver high quality, affordable health care to all its customers and to remain a household name in an industry that is highly competitive. As CVS strives to help its customers on their plan to better health, the company will continue to look for ways to remain competitive, affordable, and offer high-quality products that are easy to access for loyal customers.
As per the CVS mission, the company is not here to make money, even though that is an integral part of the business. The company is more focused on helping the world to become healthier by starting in the local communities and branching out where need be. It is part of their social responsibility as well. We all need the option of having access to affordable healthcare products, offered in one centralized location. Thus, the one stop shop is ideal for everyone and a great way to keep customers satisfied and loyal to the organization.
In this context, I will be drawing out the strategic planning process of the organization, CVS Health. I will investigate how the companies works to improve customer stratification and keep loyal customers away from other competitors. In the literature review I will discuss the internal and external analysis of the company, CVS Health. Following, I will provide a discussion on customer satisfaction and customer loyalty. With this intention, I will show the relationship between customer satisfaction and customer loyalty through an organization. To wrap up the context, I will provide a short discussion on managerial issues and implications to solve customer satisfaction and customer loyalty.
Larry J. Merlo started his career at CVS Pharmacy in 1990. Merlo, classified as a pharmacist, sought education from the University of Pittsburgh School of Pharmacy. On March 1, 2011, he became Chief Executive Officer (CEO) of CVS Health. Accordingly, the name “CVS Pharmacy” changed to CVS Health. CVS Health is a company that has a mission to improve the healthcare environment. The company contributed to that mission when they decided to eliminate the selling of tobacco in their retail stores in 2014.
Excluding the sale, smoke enabled CVS Health to be known as a company which transfers health care by delivering breakthrough products and services to various individual’s health issues. Consequently, the organization was able to gain customer satisfaction to the business because of such decisions to withgo selling tobacco products. CVS wanted to continue to establish a healthy environment and follow the organization’s mission statement. Merlo stepped up to take on the leadership role to manage healthcare, make it affordable, and emphasized the practical ways of operating in the communities and other businesses.
Merlo decided to rebrand Target and add CVS Pharmacy to the building. Thus, allowed for an improvement in strengths, brands, and culture. The reason for this expansion for CVS Pharmacy in Target companies is to have a partnership that not only serves as a complement to the customer’s experience but also to make the products and services more accessible to customers which can later increasing customer satisfaction and customer loyalty in the long run. With Merlo’s leadership skills, the company has surpassed the most achievements in local pharmacy history and has patched the way to an abundance amount of economic growth worldwide.
Nevertheless, Merlo has played a significant role in making CVS Health an improvement to the pharmacy/healthcare industry. His leadership skills have advanced him from not only just being a pharmacist but to now being the CEO of CVS. The organization is using their advantages to continue to expand in the right direction while also providing an excellent health-conscious environment for the customers.
Its strategy is to reinvent the pharmaceutical world for health care and rebrand the company’s effort to emphasize aligning the company for an expanded role in providing health care services beyond the traditional retail pharmacy business model which will give the customers satisfaction in health care. Furth more, leaving CVS to become a non-tobacco company. The decision to remove all tobacco products is a part of rebranding the company. The company is taking an active yet supportive role in shaping the future of healthcare through programs, medication adherence, delivery of care by walk-in medical clinic and support of patients.
An industry is a group of companies offering products or services that are close substitutes for each other. An industry classifies as a competition ring. A company must be able to take advantage of opportunities to get ahead and stay competitive. An external analysis is by reaching the customers’ appeal to continue to keep customers satisfied and loyal to the organization.
Once all the boundaries identify the industry, managers must analyze competitive forces within the industry environment to sort out opportunities and threats. In the following context, I will discuss the Porter Five Forces to classify ways that CVS are able to gain customer satisfaction and customer loyalty. CVS is in the retail healthcare industry. The first competitive force is a risk of entry by potential competitors. Companies often discourage or buyout other retail healthcare companies to prevent their share of the industry going down. For instance, CVS acquired 500 People’s Drug Stores in 1990. The second competitive force is the intensity of rivalry among established companies within an industry. Gaining market share is vital and it is a struggle.
In CVS’s case, its competitors, directly and indirectly, are Walgreens, Rite Aid, Kroger, and Wal-Mart. These rivalries are very intense and cause price changes to satisfy customers and to keep customer’s loyalty. The third competitive force is the bargaining power of buyers. If there are two or more companies in an industry, customers/buyers will have choices. Customers/buyers will have the ability to choose between CVS or Walgreens; therefore, CVS and Walgreens will have to lower prices. Thus, a threat is deemed. CVS will continue to have to shift the organizations strategic planning to stay ahead of competitors regarding satisfying customers.
The fourth competitive force is the bargaining power of suppliers. Suppliers are organizations that provide input into the industry, such as materials, services, and labor. If a skin care cream producer offers CVS with a subpar product and customers complain, lower revenues for that product can give CVS the position to bargain for a lower price. Thus, helping CVS save money which can be used elsewhere while keeping customers satisfied. The final force is the threat of substitute products. The similar products of a different company can satisfy customer needs.
CVS may offer Clearasil skin care products and are currently out of stock, but Walgreens may offer Neutrogena skin care products and be fully stocked. The retail healthcare industry is intense. Health care is an essential industry because of the many products that customers need, ranging from headache medicine, stomach pain medicine, muscle ache medicine, skin care, ear care, eye care, foot care, etc. With all those different product offers, companies must be very attentive and detailed to generate loyal and satisfied customers.
