Target announces CFO’s departure, executive changes
Target’s finance head is leaving.
The discounter announced that CFO Cathy Smith will be retiring from the company. She will continue in her role until her successor is named and then move to an advisory role until May 2020 to ensure a smooth transition. Target has retained a search firm to help it conduct an internal and external search for its next CFO.
“On behalf of our board of directors and Target’s entire team, I want to thank Cathy for her leadership and valuable contributions since joining the company in 2015,” stated Target chairman and CEO Brian Cornell. “Cathy’s deep expertise and leadership helped usher in strategic change for Target and positioned us for sustainable, long-term growth.”
In addition, Target announced the following changes, effective immediately, to its leadership team:
• Mike McNamara, Target’s chief information officer, will now lead the enterprise data analytics and business intelligence team, in addition to his leadership of Target’s technology services. McNamara joined Target in 2015 after serving in various roles with Tesco and has transformed Target’s approach to its information technology strategy, team and operating systems, the company said.
• Chief marketing officer Rick Gomez has been named chief marketing and digital officer and will now lead Target’s digital team, focusing on personalization, loyalty and the overall shopping experience. Gomez joined Target in 2013 and was named CMO in 2017. Prior to Target, Gomez held various positions at MillerCoors, PepsiCo and the Quaker Oats Company.
• Stephanie Lundquist, who has served as Target’s chief HR Officer since 2016, has been named president of food and beverage. Lundquist joined Target in 2005. She will remain a direct report to Cornell and a member of the company’s leadership team.
• Melissa Kremer, senior VP HR, has been promoted to Target’s chief HR officer, taking on leadership of the enterprise-wide human resources strategy for Target’s 350,000 team members globally. She will join Target’s leadership team and report to Cornell.
• Katie Boylan, senior VP, communications, has been named chief communications officer, with oversight of internal communication, corporate and brand communication, public affairs and crisis and issues management.
Giant Food Stores to open new grocery store format
Giant Food Stores is going urban — and smaller.
The 95-year-old supermarket company will debut its new grocery store format, called Giant Heirloom Market, on Friday, January, 25, opening a 9,500-sq.-ft. store is located in the Graduate Hospital neighborhood of Philadelphia. It is the first of several locations planned for the city.
The store will combine modern innovations with a community focus. Local vendor partnerships will be center stage, which will feature goods from such popular Philadelphia-area food purveyors as High Street on Market, Isgro Pastries, One Village Coffee, and Sarcone’s Bakery.
In addition, Heirloom Market will feature an onsite “produce chef” to encourage exploration and who will be available to cut fresh vegetables and fruit on demand. Along with everyday essentials and fresh and seasonal items, the merchandise assortment will include a vast array of plant-based foods, local artisanal breads and a curated selection of craft, imported and domestic beers and wines
Shoppers can also create their own olive oil and vinegar blends, infused with the flavors of their choice, at a do-it-yourself station. Also on the menu: a sampling station.
If customers ever need something that is not available in-store, associates will help guide them to in-store iPads to order online, with the goods to be delivered the next day. For added convenience, Giant Heirloom Market will offer both self and mobile checkout.
Giant has had a presence in Philadelphia since 2011, but the Heirloom Market store will be its first in the downtown area. The location is the first of several stores planned for the city.
Giant Food Stores operates more than 170 stores in Pennsylvania, Maryland, Virginia and West Virginia.
Drug chains face year of transition
The year ahead will be one of transition for the nation’s largest drug chains, as CVS Health digests its acquisition of Aetna, Walgreens continues to assimilate its 2018 purchase of 1,900-plus Rite Aid locations, and the remaining Rite Aid operation moves forward following its terminated merger attempt with Albertsons.
Burt Flickinger, managing director of New York-based Strategic Resource Group, said that the merger was a “missed opportunity” that could have bolstered Rite Aid’s ability to further invest in such offerings as its loyalty program.
As the chain looks to the future, Rite Aid CEO John Standley said in a recent conference call with analysts that the company would focus on three strategic priorities in the year ahead: Serving as the trusted advisor to its pharmacy customers; providing customers with a convenient and personalized shopping experience; and building a winning value proposition for payers and providers.
To achieve these goals, Rite Aid is implementing several initiatives, including seeking to stabilize reimbursement rate pressures, expanding access to limited and preferred networks, enhancing its pharmacy clinical capabilities to improve outcomes, and leveraging its wellness brand. Rite Aid also is refining its merchandising, expanding its omnichannel capabilities and expanding its PBM EnvisionRxOptions Medicare Part D business.
“We’ve also continued to build new stores and convert additional locations to our innovative wellness store format, which we believe is the best format in the chain drug industry,” Standley said.
CVS Health cites Aetna opportunities
Larry Merlo, president and CEO of CVS Health, said in a call with analysts that he sees significant opportunities in the year ahead from the acquisition of insurance provider Aetna.
“Both CVS and Aetna are passionate about revolutionizing the consumer healthcare experience,” he said. “And while we have been clear that the cost savings are substantial, this transaction is about the significant value creation that will be realized as a result of growth.”
CVS Health said it expects to begin testing a new store format, offering a suite of health services as a result of the Aetna acquisition early in 2019.
During that same call, Eva C. Boratto, who has been named as the CFO of the combined company, said she sees growth in retail pharmacy prescription sales as an ongoing driver of growth in 2019, along with momentum in specialty pharmacy.
Barriers to more rapid growth in 2019 include ongoing pressures on reimbursement and uncertainty in the regulatory environment.
“Some of those [regulatory changes] that Health and Human Services is talking about could be positive or negative,” Boratto said.
Walgreens sees Rx increases
Walgreens also said retail prescription sales have been on the rise, and are expected to grow in the coming year, with the recent acquisitions of the prescription files from Fred’s and of the prescription-drug division of DaVita Rx.
Stefano Pessina, vice chairman and CEO of Walgreens, said he sees the business moving forward in 2019 around three key areas:
- Developing omnichannel capabilities in pharmacy and retail, which Pessina described as “easily one of the biggest transformations our business has
- Developing a modern, differentiated retail position that leverages the chain’s
convenient locations; and
- Transforming pharmacies into healthcare destinations.