Brief:

• CVS Pharmacy is offering free gifts to shoppers who link its mobile app to their loyalty accounts. People who link the app to their ExtraCare Rewards membership can receive a free item every day from July 5-18, per an announcement shared with Mobile Marketer.
• The offers are available in the "deals" section of the CVS app, which asks users to tap on the items to redeem the offers in-store or online while supplies last. The gifts include self-care, healthy snacks and beauty products.
• CVS is running the promotion as the coronavirus pandemic forces many shoppers to use their smartphones to buy goods while also practicing social distancing, per its announcement.

Insight:

CVS's two-week promotion aims to urge people who use its loyalty program to receive discounts in stores to connect their memberships to its mobile app as more consumers shop from home during the coronavirus pandemic. The company reported a "double-digit percentage increase" in app usage for its business lines including CVS Pharmacy in Q1 from a year earlier, per a conference call with analysts. Even though CVS was allowed to keep stores open as "essential" businesses, its results indicate that many people chose to shop online amid concerns about the health crisis.

CVS's promotion comes several weeks after the chain announced a deal with delivery app DoorDash to provide same-day delivery of non-prescription products such as food and household goods in several regions. Urging people to use its mobile app can help CVS to support online sales of front-store items that include household goods, personal care products and food. While the chain reported a 1,000% increase in home delivery of retail prescriptions, it also saw a fourfold increase in the number of consumers who added front-store items to those deliveries. CVS front-store revenues rose 8.5% in Q1 from a year earlier because of the strength in consumer health and general merchandise sales. It still remains to be seen whether pantry-stocking during the early days of the pandemic persisted.

CVS is among the companies that are urging people to use their smartphones for loyalty programs that drive repeat business, with 42% of U.S. consumers saying they make purchases that earn rewards at least several times a week, according to a survey by consulting firm KPMG. Beauty retailer Sephora in May upgraded its loyalty program to include members-only discounts and free shipping for some orders, among other benefits, as the pandemic disrupted brick-and-mortar operations. Foot Locker last year combined its loyalty programs into a single one that let people access rewards through its websites or mobile apps. The restaurant industry also has embraced mobile-based rewards, including offerings from Chipotle Mexican Grill, Dave & Buster's, Dunkin', Jimmy John's, Starbucks and Taco Bell.