How Walmart is winning with higher income shoppers

Today’s Walmart is a far cry from that customers have seen historicallyAccording to Walmart CFO John David Rainey, that’s no accident either.

Rainey, who joined the company in 2022 after holding senior roles at PayPal and United Airlines, told FOX Business that the nation’s largest retailer is “elevating” its brand and expanding storefronts are key drivers. , which contribute to attracting higher-income buyers.

“The Walmart of today is very different from the Walmart of a few years ago,” Rainey said, adding that it is making changes that “appeal to a much broader demographic than what we have historically.”

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Walmart has consistently reported growth among higher-income households over the past few years. In its most recent fiscal quarter, the company said it continued to “gain market share in both grocery and general merchandise” in the U.S. in which households earning more than $100,000 account for 75% of its stock gains.

Walmart’s upgraded clothing department (Walmart)

The company reported that its third quarter earnings rose more than 5% to $169.6 billion, beating Wall Street’s estimate of $167.72 billion. Adjusted earnings per share also beat Wall Street estimates by 5 cents. with the company’s stock up more than 60% year-to-date.

Rainey credits part of the company’s success to attracting a wider range of buyers, including more affluent customers, by expanding its product range, particularly in the e-commerce business. Some examples of this strategy include the addition of higher-end products such as Apple products or Bose headphones, which are “looking for more affluent customers”.

Rainey acknowledged that the company isn’t able to carry all the brands that would “appeal to a broad representation of consumers in our stores.” Here, he said, they’re the leader in its online marketplace, which has more than 700 million products in its market.

But even with this expansion of its traditional range, Rainey reiterated that the company is “not alienating our more traditional customer groups”.

Walmart’s upgraded grocery section (Walmart)

One of its main focuses has been expanding its range, bringing in more brands that appeal to “everyone.” But as the company added more products, including higher-end products, other suppliers took notice and wanted to join.

“If you’re a supplier or a vendor, you actually want to sell your product where the people are, where the eye is coming. And so that’s really helping us right now,” he said.

In addition to improving its assortment, Rainey said the company has increased investment in the store experience.

The company is building new upgraded stores and renovating hundreds of other stores.

It has remodeled an average of about 700 stores each year over the past three years, and Rainey said they will be remodeling a little more in the coming fiscal year.

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“When you walk into one of these remodeled stores, it’s very, very different from what you’ve thought of historically,” Rainey said.

Newly built and renovated shops boasting the company’s new store concept with improved layouts, greater product selection and new technology to help associates with customer support.Stores have updated signage, paint, shopping carts and a new checkout design.

There are also interactive displays and bulk products on display in certain areas of the stores so customers can get to know the products better.

The company operates more than 4,600 stores and employs approximately 1.6 million associates in the U.S. This does not include the 599 Sam’s Club membership stores that also operate in the U.S