When the prices of essential goods soared in 2021 and 2022, some Americans who didn't regularly shop at Walmart increasingly turned to the retailer known for its affordable prices. The company is now looking to retain these new customers and attract others with a new selection of plant-based, gluten-free, and deluxe dishes.
On Tuesday, the retailer announced a new store brand that it says will make “quality food more accessible.” Executives described the Better Goods brand as the company's biggest foray into the private label food business in 20 years.
Better Goods products include oat milk frozen desserts, plant-based macaroni and cheese, and frozen appetizers like chicken curry empanadas and brie filo blossom. More than 70% of the items will be under $5, the retailer said.
“All of our research shows that customers are expecting these types of products,” said Scott Morris, Walmart's senior vice president of private food and consumables brands. “They expect premium ingredients and products from us, and they also want healthier options.”
The company says its store brands are growing among shoppers from all demographics, especially Gen Z shoppers, which includes those born in the late 1990s and early 2000s.
Analysts want to see whether retailers can retain high-income people who started shopping at Walmart in the past few years as inflation eases. The company is taking various steps to become more attractive to customers. Walmart announced that it plans to open new stores and renovate existing stores. Analysts say the company has also changed signage, displays and other visual merchandise to make its stores more appealing to affluent shoppers.
Walmart executives said Better Goods is not specifically marketed to high-income consumers, but acknowledged that the assortment could appeal to those shoppers.
“We're not necessarily targeting a specific demographic,” Morris said on a call with reporters. “But we also know that it may appeal to certain demographics in certain ways. So we want to make sure that every customer has a new option on our shelves and in their digital experiences.” “We see this as an opportunity to further increase loyalty to Walmart by offering new products, new inspiration, and new products.”
Walmart has other store brands, some of which have been around for years. Morris said the company has $14 billion of brands, eight of which are in the food aisle. The company's Great Value brand, introduced more than 30 years ago, covers many food products. The company said that while some of his Better Goods products are similar to Great Value products, it is not concerned that the brands will compete with each other.
“We don't see it as cannibalizing our core Great Values,” Morris said. “In fact, we see it as very incremental.”
Some of the new private label food products are already being sold in Walmart stores and online, and most will be on the market by the end of the year, the company said.