Walmart is introducing a new grocery brand called BetterGoods in an effort to retain shoppers during a period of high inflation. The brand will offer trend- and chef-driven foods priced at less than $5. With nearly 60% of Walmart’s sales in the U.S. coming from its grocery business, the retailer aims to attract higher income shoppers by offering low prices amidst economic uncertainty. In the most recent fiscal year, Walmart’s net sales for groceries in the U.S. rose 7% to $264.2 billion, demonstrating the strength of its food business during challenging times.
The rise of inflation and the shortage of national brand products during the Covid-19 pandemic have led consumers to turn to store brands for affordability. The popularity of low-priced grocery chains like Aldi, Lidl, and Trader Joe’s, as well as Costco’s Kirkland brand, has also contributed to the normalization of buying store brands. To keep up with changing consumer preferences, grocers have been revamping their private label offerings to include more unique and affordable products. Walmart’s BetterGoods line will feature items across various categories such as frozen foods, dairy, and snacks, priced between $2 and $15.
Other retailers have also been expanding their private label business to compete with discounters like Aldi and Dollar General. Target, for example, launched the Good & Gather and Favorite Day brands, offering a diverse selection of grocery items including salad kits, peanut butter spreads, and ice cream bars. Kroger introduced the Smart Way brand, focusing on low-priced essentials like mayonnaise and sliced bread. Walmart’s BetterGoods will join the existing private brands in its grocery department, including Great Value, which is the largest private grocery brand in the country.
The launch of BetterGoods reflects Walmart’s strategy to cater to evolving consumer preferences and retain customers in an increasingly competitive market. By offering unique and affordable products under its private brand, Walmart aims to appeal to a broader range of shoppers and drive store and online traffic. As inflation continues to impact consumer spending, the popularity of store brands as a budget-friendly alternative to national brands is expected to grow. Walmart’s focus on expanding its private label business positions the retailer to capitalize on this trend and maintain its position as the country’s largest grocer.
With the introduction of BetterGoods, Walmart is tapping into the growing demand for affordable and diverse grocery options amidst economic uncertainty. By offering a range of trend- and chef-driven foods at competitive prices, the retailer aims to attract and retain customers who are looking for value and quality in their grocery purchases. Walmart’s new private label brand is part of a broader strategy to evolve its grocery business and adapt to changing consumer preferences in the face of inflation and heightened competition from discounters and other retailers.
Overall, Walmart’s introduction of the BetterGoods brand is a strategic move to strengthen its position in the increasingly competitive grocery market. By expanding its private label offerings with unique and affordable products, the retailer aims to retain customers, attract new shoppers, and drive store and online traffic. As consumer preferences continue to shift towards store brands as a budget-friendly alternative to national brands, Walmart’s focus on growing its private label business positions it well to capitalize on this trend and maintain its status as the country’s largest grocer by revenue.
