Competition intensifies in coveted Bay area

Drug Store News, Dec 16, 2002 by Mike Troy

The level of competition found northeast of Tampa is similar to other areas throughout the region. In addition to Eckerd, Walgreens, CVS, Publix, Wal-Mart and Target, supermarket operators WinnDixie, Albertson's and Kash 'n Karry operate roughly 100 stores among them, nearly all of which have pharmacies.

The competitive situation is likely to intensify further as all of the forces that contributed to past growth remain in place. Florida, and the Tampa Bay area in particular, are expected to continue their growth, with the state's population increasing by 250,000 residents each year of this decade--the Tampa Bay area accounting for 15 percent of that increase, according to the Tampa Bay Regional Planning Council's economic development report issued July 8. The planning group includes Manatee County south of Tampa Bay in its definition of the region.

"Hillsborough, Manatee and Pasco [counties] are expected to experience much more growth than Pinellas County through 2010 due to the ample amount of land available. Pinellas County comprises only 280 square miles, and population trends have now slowed because of limited land resources," according to the planning group's report.

That hasn't stopped retailers from finding new ways to tap the market. Wal-Mart opened its first supercenter earlier this year in southern Pinellas County. What makes the project noteworthy is that an old drive-in theater had to be bulldozed to make room for a store that quickly has become a high-volume unit with annual sales reportedly in excess of $100 million. A similar approach is being taken in the northern portion of the county at the site of the Clearwater Mall at Gulf-to-Bay Boulevard and U.S. 19. The mall is being demolished to make room for new retail construction that will include the county's first Costco and SuperTarget stores. Of course, both of them will have pharmacies.

Top players by store count

Retailer   1999  2002  2005 *

CVS           0   14     35
Eckerd       97   98    103
Publix       21   43     52
Walgreens    81   94    106
Wal-Mart     20   29     42  

Source: Metro Market Studies and Drug Store News

* Estimates

  Includes Neighborhood Market, Sam's Club, supercenters and discount
stores

RELATED ARTICLE: CVS turns to the sky for self-promotion

When CVS entered the Tampa Bay market a few years ago, it had quite a few things going for it.

Because many of the area's residents are transplants from the Northeast, they already were familiar with the CVS name, and its stores were a welcome sight. In addition, the state's part-time residents and tourists who migrate south in the winter also know the CVS name. Even long-time locals who had never heard of CVS couldn't help but notice the chain's attractive stores located in high-traffic areas. With aggressive pricing on grand-opening specials, newspaper inserts and heavy in-store promotion of its ExtraCare loyalty card, CVS made a big impression.

The chain could have stopped there, but it also took the unusual step of buying advertising on large billboards in close proximity to its stores. The marketing tactic couldn't be applied at all of its 14 Tampa Bay area locations because some are in predominantly residential neighborhoods where zoning doesn't allow for billboards. However, in more commercial areas, CVS has taken full advantage of billboards to call attention to its stores.