Walmart redesigns Great Value private label brand

WalmartTürkiye’s largest private brand, Great Value, has a new look.

The company announced Wednesday that nearly 10,000 of the brand’s products, from LED bulbs to gallons of milk to frozen chicken nuggets, will hit shelves in new packaging starting in May. Walmart first launched the brand in 1993 and hasn’t changed its look in more than a decade. The price of the new packaging and the products inside will remain the same.

Shoppers will see Great Value’s more modern and colorful packaging, starting with snacks, followed by cereals, cream cheese and sour cream items. It will take about 18 to 24 months for each product to arrive in new packaging, said Scott Morris, senior vice president of private brands for Walmart US.

According to market researcher Numerator, Great Value has higher household penetration than any other store-owned brand in the country; 87% of US households purchased at least one product from this brand in the past year. The top five private label brands by household penetration in the U.S. are all owned by Walmart, which is also the nation’s largest grocer by annual revenue, the firm says.

Still, Walmart’s overhaul of Great Value is an aggressive play as more companies improve the quality of their in-house products. Amazon’s grocery brand has become the fastest-growing private brand year-over-year in terms of unit volume since its launch in October, according to Numerator. Some retailers e.g. costco and Trader Joe’s have attracted customers because of their reputation for low-priced, high-quality private label food and wine, among many other products. Aldi, a retailer that stocks almost exclusively its own brands, is expanding its national reach by opening more than 180 stores in the U.S. this year.

Additionally, the revision coincides with Walmart’s significant gains from customers with annual household incomes over $100,000. It attracts more affluent shoppers by not only offering lower prices, but also faster deliveries and more unique and stylish products. For example, Bettergoods, a private-label grocery line that launched nearly two years ago, has added more chef-focused flavors, plant-based products and trendy ingredients.

David Hartman, Walmart’s vice president of creative, said in an interview with CNBC that customer research showed shoppers liked the quality and price of the products but “felt the brand expression on the package was a little delayed.”

“What they felt was a sense that this was a compromise,” he said. “They love the product from a food and consumable standpoint, but they don’t take a lot of pride in displaying it in their home or with their family.”

The new packaging looks more colorful and vibrant than the previous version. Hartman said Walmart chose the new design to make it easier for busy shoppers to find what they’re looking for in store aisles or on the Walmart app.

Clearer, shorter packaging will also help Walmart’s pickers, who move quickly when plucking items from shelves for customers’ online orders, Morris said.

Morris said the company must meet demand for specialty brands that don’t look, taste or feel like cheaper imitations of national brands.

“As a result, customers continue to expect more from private brands,” he said.

The market share of private brands increased in the USA. They hold roughly 20% of the total grocery market in the U.S., compared to roughly 45% to 50% in Canada and Europe, according to Steve Zurek, NielsenIQ’s vice president of advanced analytics. Still, he said, that’s a notable jump from roughly 15% in the U.S. about a decade ago.

He added that Gen Z customers (the younger customers that retailers are now chasing) are pushing private labels even further because they are buying into brands more than previous generations, often preferring them to well-known national brands.

“That stigma is slowly disappearing,” he said. “Having a store brand on the counter while you enjoy is almost a badge of honor in some ways, depending on the generation.”