CVS, Tobacco, and Low-Income Customers

Posted , posted by Erica | Posted in Featured, Opinion

In February of this year, CVS announced plans to stop selling tobacco products in its 7,600 stores nation-wide. This change is set to take effect on October 1st. As the stores prepare to take so-called “cancer sticks” off their shelves, I wondered – how would this affect low-income people?

I read a great article by Marcus Wohlsen of Wired about how Amazon’s new Flow feature (which lets you point your phone’s camera at a product and order it instantly) puts CVS at a severe disadvantage as it tries to compete in the household product arena (http://www.wired.com/2014/02/amazons-new-app-cvs-nixing-cigarettes/). This has forced CVS to “edit” its identity a bit, and CVS, in turn, has chosen to position itself as the premiere health care destination.

This is great news for low-income customers. Here’s why:

  • •CVS stays in business, and low-income consumers who do not shop online can still, you know, buy paper towels and stuff. A Pew report from 2013 (http://www.pewinternet.org/2012/04/13/digital-differences/) on digital differences reports that, “Purchasing products online is significantly less popular with adults over age 65. Those who have not completed high school and those in households making less than $30,000 per year are less likely to buy products online, while college graduates and those in households making more than $75,000 are more likely to do this. “
  • •Although smartphone ownership is increasing among low-income adults (34% of white adults and 48% of black adults who earn less than $30k/yr own a smartphone [Pew 2014]), income disparities in broadband access at home persist (broadband adoption is only 40% of those whose household incomes fall below $20k, vs. 87% of those who live in households that make over 50k [FCC survey: http://www.slideshare.net/blueeyepathrec/fcc-broadband-access-survey]) OR 54% among whites who earn less than 30k/yr vs. 78%/91% respectively for 30-74,999 & 75+/year; 50% vs. 72% and 91% for blacks).
  • •Low-income people are more likely to be smokers and having one less place where they can buy them may make them think twice about doing it. According to the CDC report from 1/14, smoking prevalence was significantly higher among persons living below the poverty level (27.9%) than those living at or above this level (17.0%).
  • •If CVS can continue to build and maintain a (large enough) profit margin using this tactic, than other pharmacy retailers will follow, and two things may happen:
    • o1) Nobody will sell tobacco anymore, and people won’t care cause everyone has already quit because smoking is as outdated as having a rotary phone (a what? A rotary phone (link to image of rotary phone).
    • o2) These retailers will help provide better wellness care to all sorts of people, including those with chronic illnesses. This will increase their chances of staying well, and hopefully out of the ER.*

*I have no data to back this up; it’s just a prediction from my overly-optimistic-American heart.