In
rolling out its first paid membership loyalty program, CVS Pharmacy not only is
demonstrating confidence in its 20 years of rewards expertise, it’s recognizing
the nation’s readiness to pay for good health.

The program,
CarePass, is
the first membership initiative that offers free national pharmacy delivery and
around-the-clock healthcare access, expressly to make it easier for
members to care for themselves and their families. CVS began testing the
program, an extension of its ExtraCare service, in
Boston in October 2018.

In
addition to serving customers, CarePass serves to distinguish CVS’s loyalty
efforts from those of its direct competitors and, for that matter, the whole
retail industry. CVS competes with supermarkets, drug stores and even
department stores in certain categories, such as beauty. To better resonate
with shoppers, the $195 billion chain
is transforming itself into a holistic wellness brand. The new CarePass offers
a level of exclusivity to those customers equally serious about it.

And it
is a serious business. The wellness industry is approaching $4.2 trillion globally,
according to the Global Wellness Institute. Spending
in wellness beauty, personal care and nutrition alone generates $1.8 trillion.

“Building on two decades of success with
ExtraCare, we know how powerful it can be for our customers and our
business to design and leverage our loyalty program specifically with our
customers’ actual preferences and pain points in mind,” George Coleman, senior vice
president of merchandising at CVS Pharmacy, said in an email conversation.

How CarePass Works

CarePass
is designed to be flexible. Members can opt for the $5 monthly fee, for month-to-month membership, or pay a flat $48 for a year.

Benefits
include free one- to two-day online purchase delivery (on eligible items and
prescription drug orders), a 20% discount on certain CVS Health brand products
and access to a live pharmacist, around-the-clock, who has secure access to members’ prescription
histories with CVS Pharmacy.

As an
added thank you, members receive once-monthly $10 CarePass promo rewards, which
are automatically
added to their ExtraCare reward cards at the beginning of each monthly cycle
and expire at the end of the monthly cycle. (Note: Membership
is limited or unavailable in some states, and not valid at Target stores.)

Behind CarePass: A Q&A

Coleman took time to answer questions about
CarePass. Following are edited excerpts of our Q&A.

Q: Why did CVS introduce CarePass?

George
Coleman: We know people love our ExtraCare program, which
has more than 64 million active members, but we also recognize that some people
want both simplified value and access to our unique services and offerings. We
created CarePass with those customers in mind, making it easier for them to
save money while taking care of themselves and their families.

Q: What results of the test in particular contributed to the decision to
take the program nationwide?

GC: Our
pilot of this program exceeded our expectations across all metrics. We are
expanding this program ahead of schedule based on initial results from a few
select markets, which shows we are seeing increases in traffic and spending
levels for enrolled members that beat our projections.

For
example: Average CarePass members spend three to four times more than
our average CVS customers. As a retailer, we’re looking to drive growth and
attain new customers, and CarePass has appealed to a wide range of consumers,
with 30% of CarePass members being new or previously unengaged customers.

We’ve
also seen incredible engagement by members across all of our digital channels,
including pharmacy delivery, our app and CVS.com. Based on all of this data,
it’s clear our members have enthusiastically embraced the program.

Q: Did certain consumer groups react to the new program offering in notable
ways?

GC: We’re
excited to see that CarePass appealed to a broad audience, including
millennials, who make up 20% of our memberships.

Q: What changes did you make to CarePass during the test as a result of
feedback?

GC: We
rewarded our members with different surprise perks at key moments throughout
the year. For example, members have been able to receive free sports physicals
at their local MinuteClinics and free photos during the
holidays. We’re going to enhance and evolve the program after hearing even
more feedback from our customers following the nationwide roll-out.

Q: What’s next for the program?

GC: We’re
most excited about the potential for growth for this program across the enterprise.
We’re constantly working on the evolution
of our programs and considering new ways to deepen the
access to health care and health service that will make it
easier for our customers to take care of themselves and their families.

Healthy Choices

At $5
a month (or $48 a year), CVS believes it has identified its shoppers’ comfort
level when it comes to paying the price of priceless advantages, such as wellness.
It may have also discovered a virtuous cycle.

Those
memberships fees will help pay for the program, but ideally will support more
accurate communications and offers to its frequent members, for even healthier
rewards. Thus, it could lead to the promising pattern: the healthier the members
live, the better their rewards, the more engaged they become in CarePass, and
so on.

You can read my earlier coverage of the CVS CarePass pilot in Forbes.com here .

This article originally appeared in  Forbes . Follow me on  Facebook  and  Twitter  for more on retail, loyalty and the customer experience.