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Higher-income shoppers contributed a larger share of Walmart’s sales gains in the first quarter, CFO John David Rainey told shareholders on Thursday.
“We’re seeing higher engagement across income cohorts, with upper income households continuing to account for the majority of the share gains,” he said.
The retail giant stratifies income cohorts into three categories: $50,000 and below, $50,000 to $100,000, and $100,000 and above, with each accounting for roughly a third of its customer base, according to Raney.
“Really the story or the word we’ve been using here is convenience,” he said. “We are not just a play for value anymore.”
Focused on value: As Walmart US CEO John Furner put it, “We’re very focused on value, flexibility, and convenience, and that’s working across income segments.” He added that the delivery business—which has grown rapidly and recently exceeded its pickup business—is stronger among higher-income shoppers.
Yet CEO Doug McMillon denied that Walmart is courting these wealthier customers directly, saying its focus on value has appeal regardless of your paycheck.
“We’re not trying to chase higher income cohort sales,” he said. “We just offer value.”
He explained that historically these groups have shopped at Walmart, but they’ve been more selective in the items they buy. As Walmart has expanded its assortment, he said, it’s been able to appeal to more shoppers across the income spectrum.
Despite McMillon’s framing, the company has explicitly promoted that it’s offering better quality products, with the recent launch a private-label line, called bettergoods, that it touted as “a new elevated experience that delivers quality, unique, chef-inspired food at an incredible value.”