June 25, 2024

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Walmart introduces new 'quality food' store branding

Walmart introduces new 'quality food' store branding

When staple food prices rose in 2021 and 2022, some Americans who didn't regularly shop at Walmart increasingly turned to the retailer, known for its affordable prices. Now, the company is trying to retain those new customers and attract others with a new range of vegan, gluten-free and gourmet cuisine.

On Tuesday, the retailer unveiled a new store brand that it said will make “higher-quality food more accessible.” Executives described the Better Goods brand as its biggest foray into private-label foods in 20 years.

Better Goods items will include oat milk frozen desserts, vegan macaroni and cheese, and frozen entrees like Curried Chicken Empanadas and Brie Phyllo Blossoms. The retailer said more than 70 percent of the products will cost less than $5.

“All of our research tells us that the customer expects these types of goods,” said Scott Morris, senior vice president of food and consumer brands at Walmart. “They expect those high-end ingredients and offerings that we offer, and they're also looking for those healthier options.”

The retailer says it is seeing growth in its store brands across all demographics, especially Gen Z shoppers, a group that includes people born in the late 1990s and early 2000s.

Analysts are looking to see if, with inflation declining, the retailer can retain the high-income individuals who began shopping at Walmart in the past few years. The company is taking a number of steps to make itself more attractive to customers. Walmart said it plans to open new stores and remodel existing ones. It has also changed signage, displays and other visual merchandising in ways analysts say will make stores more attractive to affluent shoppers.

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While Walmart executives said they are not marketing better items specifically to higher-income consumers, they acknowledged that the assortment may appeal to those shoppers.

“We did not necessarily target a specific demographic,” Mr. Morris said in a call with reporters. “But we also know that it may appeal to certain demographics in a certain way. So we're looking at this as an opportunity for all customers to become more loyal to Walmart by giving them new choices, new inspiration, new product on our shelves and in the digital experience.”

Walmart has other brands, some of which have been around for many years. The company has brands worth $14 billion, eight of which are in the food aisles, Mr. Morris said. Its great value brand, which has been introduced for over 30 years, covers many food items. The company said some Better Goods products would be similar to great-value items, but it wasn't concerned that the brands would be competing with each other.

“We don't look at it as anything that would eat away at our great core value,” Mr. Morris said. “In fact, we view it as very incremental.”

Some of the new private-label food products are already being sold in Walmart stores and online, and most of them will hit the market by the end of the year, the company said.