Times & Trends

WALMART STORES: HELPING CONSUMERS NAVIGATE A TRANSFORMING ECONOMY EXECUTIVE OVERVIEW

IRI's Times & Trends highlights new developments and critical events across all major CPG categories and channels, providing powerful benchmarking data to help guide your strategic decisions. This edition of Times & Trends explores Walmart’s role in helping consumers navigate through difficult economic times and what this means for manufacturers and competing retailers. A free summary is also accessible via the GMA website at www.gmaonline.org.

INTRODUCTION

For several years, Wal-Mart Stores, Inc. pursued an aggressive supercenter expansion plan which contributed heavily to remarkable global sales performance. After a time, though, the plan began to bring increasing cannibalization of existing stores. The time had come to regroup.

And the retailer did just that: Wal-Mart began charting a new plan for growth. While selectively reducing domestic expansion efforts (the company continued aggressive international expansion), the retailer began placing a heavier focus on driving growth within existing operations-- more efficient inventory systems, more competitive pricing strategies, and more aggressive in-store marketing initiatives.

Throughout the recession, Walmart has maintained focus. A new merchandising strategy, ‘win, play, show,’ is enabling the retailer to focus on the most promising categories and products in order to drive scalability. And ‘fast, friendly, clean’ is aimed at creating “the ideal customer experience.”

Walmart’s mission statement, “Save Money. Live Better.,” is well-suited for consumers struggling to balance the needs of daily life with the harsh realities of a recessionary economy.

KEY FINDINGS

»Despite a recessionary economy, Walmart continues to post healthy sales gains, driven by increasing household penetration, more frequent purchase occasions and higher per trip basket rings.

»Though gas prices have moderated, CPG prices remain high; Walmart continues to capture an increasing share of CPG spending among consumers seeking to save money in a recessionary economy.

Walmart Total CPG Dollar Share Point vs. Prior Year and % Change Total CPG Unit Sales and Average Regular Gas Prices
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Over the past year, Walmart captured increasing share in 59 of the top 100 CPG categories, most of which are key growth categories and categories which experienced particularly high price increases over the past year and a half.

»For the second straight year, Walmart posted share gains across key meal ingredients, meal components and convenience meals, evidence that Wal-Mart is playing an important role in helping consumers navigate a difficult economic climate.

Though Walmart share of private label sales is largely flat versus year ago, the retailer has sharpened its private label focus and is in the midst of a major re-launch of the “Great Value” brand.