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Will a new beauty concept help CVS pull shoppers from Sephora and Ulta?

Written by RetailWire Staff

Photo: CVS

While CVS has long been in competition mainly with Walgreens and Rite Aid, the retail pharmacy chain's revamp of its beauty department could signal that CVS has another type of competitor in mind.

CVS is upgrading its beauty department into a store-within-a-store called BeautyIRL, a move it is undertaking in conjunction with in-home beauty service Glamsquad, according to InStyle. In addition to the Millennial-and-younger-focused branding ("IRL" is internet slang for "in real life"), the new store-within-a-store allows visitors to get a variety of styling services from Glamsquad's experts. It also features a "Test-and-Play Hygiene Bar," which lets customers to try out makeup, a wall highlighting trending beauty products and a section dedicated entirely to miniature beauty products.

The new format is currently available in four test locations. In 2019, CVS plans to expand the new concept to other locations and give it an online presence.

The move, which could make CVS competitive with higher-end beauty-focused chains like Sephora and Ulta, comes at a time when others in the retail pharmacy space appear to be moving in other directions. Its major competitor, Walgreens, for instance, has announced a plan to launch a store format focused entirely on healthcare services. 

CVS is working to cater to healthcare customers, as well, with the introduction just months ago of same-day and next-day delivery of prescription drugs nationwide.

CVS’s efforts to get more serious about Millennial and Gen Z beauty customers could be another example of how the retail pharmacy space is bracing itself for disruption by Amazon.

Speculation about Amazon's intent to enter the pharmacy space was confirmed earlier this summer when the e-tailer acquired online pharmacy startup PillPack. In response to the announcement of the acquisition, share prices of CVS, Rite Aid and Walgreens all fell significantly.

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