Walmart announced on Tuesday that it is putting a new grocery label on the shelves called Bettergoods — the largest private food brand launched by the retailer in two decades.
The move could help Walmart hold on to higher-income shoppers who have flocked to the retailer in times of higher inflation by filling Walmart’s grocery aisles with 300 new products tailored to vegan, gluten-free, and adventurous dietary choices.
Bettergoods has three focus areas: plant-based goods like $3.44 oat milk ice cream, culinary flair foods like bronze cut pasta for $1.97 or jalapeño chowder for under $4, and “made without” foods, like gluten-free products.
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Bettergoods will introduce shoppers “to new and exciting flavors and concepts,” Walmart wrote in a press release. This distinguishes the brand from Walmart’s existing Great Value line, which focuses on everyday staples and is the country’s largest private grocery brand by revenue.
Walmart differentiates Bettergoods from competing brands by making many items in the brand “totally unique to Walmart,” per the press release. Competitor Target launched its own Good & Gather grocery label in 2019, with a focus on everyday items as opposed to unique ones.
Most Bettergoods items will be under $5, with prices ranging from $2 to $15.
Credit: Walmart
Walmart has a substantial food business that contributes to over half, or 60%, of its overall sales in the U.S. It was the largest grocer in the country by revenue last year, ahead of Kroger and Costco.
Rising inflation may have driven shoppers to Walmart for cheaper groceries — and Bettergoods could be Walmart’s way of holding on to them with higher quality, trendy goods.
Scott Morris, senior vice president of private brands, food, and consumables for Walmart U.S., told CNBC that Walmart expects Bettergoods to appeal to the higher-income, younger shoppers that have started shopping at its stores in the past few years.
Walmart started working on the new brand after shoppers said they wanted “elevated culinary, inspirational types of items” and healthier options, according to Morris.
A March report from the U.S. Bureau of Labor Statistics shows that food prices increased year-over-year in some categories, with the prices of meat, poultry, fish, and eggs rising 0.9% over the year, while fruit and vegetable prices rose 2%.
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Walmart closes healthcare clinics
Walmart also announced Tuesday that it would close another part of its business, Walmart Health.
The retailer is closing all of its U.S. health clinics, 51 locations across the U.S., and shutting down its telehealth service.
Walmart said that low profits in the health center space forced it to make the “difficult decision.”
“The challenging reimbursement environment and escalating operating costs create a lack of profitability that make the care business unsustainable for us at this time,” the company said in a press release.
