retail news in context, analysis with attitude

Phil Rosenthal of the Chicago Tribune had a column over the weekend in which he excoriated local retailer Walgreen for simultaneously marketing itself as being a leader in health and wellness services and existing "at the corner of happy and healthy" while simultaneously selling tobacco products that were "long ago deemed a major health hazard." (CVS and Rite Aid are equally at fault, he says.)

"It's strictly business," Rosenthal writes about a tobacco selling habit that is difficult to break. "The calculation is that while tar and nicotine might stain their brands' claims to be partners in healthy living to the degree that anyone thinks about it, the failure to give regular customers what they want poses a greater threat."

Michael Polzin, a Walgreen Co. vice president, agrees that this is a financial decision at odds with the company's philosophical brand positioning: "We're well aware of the health issues related to (tobacco) products. But we also need to stay competitive in the marketplace and offer the products and services our customers want and expect us to carry, even when we wish they were making healthier choices ... "Our main competitors - whether they're other chain drugstores, grocery stores with pharmacies, mass discounters with pharmacies to convenience stores - they all sell tobacco products. And when you consider that 20 percent of all Americans use tobacco products and expect to find those items in our stores, we'd be at a tremendous competitive disadvantage if we didn't offer them."

"The American Medical Association, American Heart Association and American Pharmacists Association are among the many groups to have come out strongly against pharmacy sales of tobacco products," Rosenthal notes, but, "until the smoke clears, it may be hard to see drugstores as more concerned with their customers' health than their own."
KC's View:
I tend to agree with Rosenthal's argument - that the major drug store chains, by emphasizing their health care credentials and working to claim a bigger role in the nation's health care infrastructure, now must deal with the fact that when it comes to selling certain products, they appear to be hypocritical. (Except in places like San Francisco and Boston, where they're legally prevented from selling tobacco.)

This debate is not likely to go away; the way things work these days, it seems to me that it will become more pronounced, that the "we'll be at a competitive disadvantage" will be less effective, and that the drug chains should not take it likely. Perhaps, moving forward, they need to rethink their business model so that they can be more consistent ... maybe rethinking how the store is laid out so that the inconsistencies seem less egregious.