People talk outside a Wal-Mart pickup-grocery store in Bentonville, Arkansas.
Rick Wilking | reuters
wal-mart Launching a new grocery brand, as the discounter tries to retain the shoppers it has attracted during a period of high inflation.
On Tuesday, the big-box retailer said it will launch a private label called BetterGoods, a line of more trend- and chef-driven foods. Most items will cost less than $5.
Walmart is already the nation’s largest grocer by revenue. About 60% of the company’s sales in the US in its most recent fiscal year came from its grocery business.
Walmart has a big food business This helped increase store and online traffic, especially as consumers have kept an eye on their discretionary spending during periods of high inflation. And its low-price reputation has helped the company attract higher-income grocery shoppers as inflation has hit budgets.
In the most recent fiscal year that ended in late January, Walmart’s net sales for groceries in the U.S. rose nearly 7% year over year to $264.2 billion.
An employee restocks frozen food products at a Walmart Inc. store in Burbank, California.
Patrick T. Fallon | Bloomberg | getty images
But like other grocers, Walmart has seen room to grow its private label business as shoppers look for new flavors and lower prices. During the COVID-19 pandemic, products from some national brands sold less at stores and customers started buying retailers’ own brands.
Later, inflation drove up the prices of food and housing and prompted more shoppers to try store brands, which are often cheaper. Additionally, the growth of low-priced grocery chains such as Aldi, Lidl, and Trader Joe’s – which prominently feature their own brands rather than national brands – and the popularity of Costco’s Kirkland brand have changed customer perception of store brands. Has been changed.
Grocers have also overhauled their private label approach. Instead of relying on basic items like canned peas or copycat items like low-priced boxes of cereal resembling Cheerios to build their store brand, retailers began introducing more unique food items.
For example, Target launched a new grocery brand Said Good and Gather in 2019 with a wide range of items including bagged salad kits, peanut butter spreads and frozen vegetables. Another grocery brand launched by it, Favorite Day, is made up of creative approaches on ice cream bars and trail mixes.
Other retailers have introduced new private brands into their grocery aisles, focusing on affordability and discounters like Aldi or Dollar General. hooksFor example, Smart Way was launched two years ago, The brand offers low-cost basics like mayonnaise and sliced bread.
Walmart’s new grocery brand, BetterGoods, will be made up of several categories of items, including frozen foods, dairy and snacks, ranging in price from under $2 to under $15. The company said the products will fit into one of three major areas: more culinary items, such as jarred Creamy Corn Jalapeño Chowder; Items that are plant-based, like a pint of oat milk non-dairy frozen desserts; Or items that don’t contain certain ingredients, such as gluten- and antibiotic-free chicken nuggets.
The new private brand will join Walmart’s existing collection of private brands in its grocery division, which also includes Great Value, the nation’s largest private grocery brand by revenue, according to market research firm Numerator.