Walmart, the largest grocer in the United States, is introducing a new private label called Bettergoods in an effort to sustain its growth amidst high inflation. The company conducted research and found that customers were looking for more elevated and inspirational food options, as well as healthier choices like plant-based products. Bettergoods is designed to cater to these preferences and will feature trend-driven and chef-inspired foods, with most items priced at less than $5.
Walmart’s decision to launch Bettergoods is driven by its desire to retain the shoppers it has attracted in recent years, particularly younger and more affluent customers. The retailer’s grocery business accounts for nearly 60% of its sales in the U.S., and its low-priced reputation has helped it attract higher-income grocery shoppers during a time when inflation has put pressure on budgets. In the most recent fiscal year, Walmart’s net sales for groceries in the U.S. rose by nearly 7% to $264.2 billion.
The introduction of Bettergoods comes at a time when more customers are turning to store brands due to product shortages during the Covid-19 pandemic and rising prices of national brands. The success of low-priced grocery chains like Aldi, Lidl, and Trader Joe’s, which prominently feature their own private labels, has also contributed to the changing perception of store brands. As a result, grocers have been revamping their private-label offerings by introducing more unique and affordable items.
Walmart’s Bettergoods brand will include items across various categories such as frozen foods, dairy, and snacks, with prices ranging from under $2 to under $15. The products will fall into three major areas: culinary flair, plant-based options, and items that exclude certain ingredients like gluten or antibiotics. Bettergoods will join Walmart’s existing collection of private brands in the grocery department, including Great Value, which is the most popular private grocery brand based on recent purchase data.
Overall, Walmart’s introduction of Bettergoods demonstrates its commitment to meeting customer demands and sustaining its growth in the face of inflation. By offering trend-driven and affordable options, the retailer aims to retain its customer base, particularly younger and more affluent shoppers. With its vast grocery business and strong reputation for low prices, Walmart is well-positioned to compete in the evolving landscape of store brands and continue its success in the grocery industry.
