This article was updated on May 17, 2011.
This article is part of a package on consumers and Walmart. Read the other article, on what not to buy at Walmart.
Low prices are back at Walmart. For years, getting stuff for less was the only reason for going to Walmart, even if some of us donned a baseball cap and dark glasses so our friends wouldn’t see us slipping through the doors to save a few bucks on tube socks for the kids.
In recent years, however, Walmart tinkered with that formula to appeal to a more upscale audience — bringing in nicer fashions and organic foods, trimming its selection of bargain price items, and touting its environmental record. The change was about as popular as merlot at a monster truck rally. High-end shoppers were unimpressed, while Walmart’s traditional customers cozied up to the dollar stores, resulting in declining sales.
What’s a retailer to do? If you’re Walmart, you go back to basics. The company announced recently that it was focusing again on its trademark “everyday low prices” approach, and broadening the assortment of items it carries this year by 8,500 items, starting with dry groceries, snacks, and beverages. Walmart will also soon be adding products in its fresh foods cases and health and wellness aisles, followed by expanded offerings in entertainment, sporting goods, and plus-size apparel as the holidays approach. And in April, the mega-retailer launched its most aggressive “ad match” policy yet, promising to match the lowest prices advertised by any competitor.
In December 2009, we highlighted some of the best (and worst) products to buy at Walmart as the retailer went upscale. With its new strategy in place, we’ve added some new items to our list, in addition to updating the information on some of our earlier picks. Here are our revised choices.
1. Name-Brand Groceries and Snacks
Walmart’s prices on soups, cereals, chips, and cookies from companies such as Quaker, Kellogg’s, and General Mills remain some of the best in the business, and its expanded selection means it’s more likely you’ll find the products you want, says Jonni McCoy, a frugal shopping expert and founder of Miserly Moms. McCoy’s favorite Yoplait yogurt is about 8 percent cheaper at Walmart than at her local grocery store chain, for example. Word of caution: While McCoy loves to save a nickel, she avoids Walmart’s store brands for food, such as Great Value. “You don’t save that much and there’s a big difference in quality,” she says.
2. Regional Favorites
As part of its push to bring shoppers back into the stores, Walmart is restocking the shelves in some locations with products with distinctly local followings. So in Denver, Walmart is working to bring Colorado Proud locally grown produce back to its stores, as well as the popular Blue Bell brand of ice cream. In Phoenix, where hiking is prevalent, customers can look for deals on energy bars from Kashi and Camelbak water carriers. And in Dearborn, Mich., Arab-American customers can find a selection of Middle Eastern food products from Tut International.
3. Moderately Priced Consumer Electronics
Despite Walmart’s back to basics campaign, its selection of mid-range televisions and digital cameras continues to be quite good, and its prices very competitive. The retailer stocks high-def TVs from top makers such as Samsung, Sony, Philips, and Sharp, as well as digital cameras made by the likes of Nikon and Canon. And it recently expanded its offerings to include iPads and iPods from Apple, and the Nook electronic reader from Barnes and Noble. (While iProducts class up the joint, even Walmart can’t discount Apple merchandise much so the most you’ll save is a few bucks on an iPod Touch; iPads still start at $499 a pop).
What Walmart doesn’t have is an army of educated sales people ready to explain all the settings on the back of that SLR or the differences between a high-def TV with a resolution of 1080i versus one with 1080p. But such service may be less important now if you, like 90 percent of consumers, turn to the Internet for detailed product reviews, notes James Russo, Nielsen’s vice president of global consumer insights.
“Consumers will do their research outside the store,” says Russo. “So if Walmart has the right selection and price point, consumers will go there.
Walmart sells many high-end phones at good prices, including the Blackberry Curve 3G and the LG VL600 LTE for just under a dollar (97 cents, to be exact) when you sign up for a two-year contract from Verizon or Sprint. This is good news if you’ve reached the end of your phone contract and are looking to compare new phones and carriers all in one place, since Walmart sells phones and service plans from each of the largest U.S. carriers: Verizon, AT&T, Sprint, and T-Mobile. So if you want to see how Verizon’sDroid, which uses Google’s Android operating system, matches up against the iPhone, Walmart is the place for you. You can’t do that at an AT&T store, or even at one of Apple’s fancy boutiques.
While Walmart has been criticized in the past for being more concerned with price than environmental or labor issues when sourcing its goods, one area where it’s improving its record is with coffee. In 2009, the company partnered with TransFair USA, an independent certifying agency, to offer fair trade-certified coffee in its Walmart and Sam’s Club stores. The coffee is sustainably grown by farmers who receive a living wage, and the beans are roasted in a specially designed carbon-neutral roaster. Initially this fair trade coffee carried a premium, but now the price differential has vanished. A 12-ounce bag of fair-trade coffee from Walmart costs $5.48, compared to $5.58 for supermarket brand Eight O’Clock coffee. And by selling fair-trade coffee, Walmart vastly expands the market for such goods.
Carmen K. Iezzi, executive director of the Fair Trade Federation, a North American association for such products, says Walmart’s move into fair trade was promising, although she cautioned that it’s too early to tell how much impact retailer’s efforts will have, and Walmart has yet to commit to fair trade in the way that Trader Joe’s and Whole Foods have. Still, coffee is a good start. “When any major corporation begins to move in the direction of more sustainable practices, that is a positive sign,” says Iezzi.
6. Laundry Detergent
When it comes to the environment, Walmart’s suppliers have often fallen far short of best practices. Now the chain is trying to clean up its act by offering more eco-friendly products. One area where it’s done the most is laundry detergent. In 2008, the company switched to selling only concentrated laundry detergent in its U.S. stores — these products use up to 50 percent less packaging and require less fuel to transport than the earlier versions. Once again, scale matters: Walmart has a serious carbon footprint, so cutting laundry detergent containers by half can have a big impact.
Walmart has taken steps to combat phosphates, which pollute the water and lead to an explosion of the algae population that destroys fish habitats and plants. The company already says there are no phosphates in detergent it sells in the U.S., and it has set a goal of cutting the amount of phosphates in the detergent it sells in all of North and South America by 70 percent. In addition, Walmart is working with suppliers to increase the concentration of its laundry detergent by two to three times by the end of 2012, further reducing packaging and fuel consumption.
And Walmart has unveiled broader initiatives to improve its eco-image. In 2009, the company began developing a sustainability index in cooperation with several other large retailers and many manufacturers and universities that will eventually rank all of its suppliers and products based on their environmental impact. Although the full rankings are not out yet, Fast Company has called the initiative “one of the most impressive things we’ve seen a big box retailer spearhead — ever.” Says Honor Schauland, a campaign assistant at the Organic Consumers Association, a Minnesota-based consumer advocacy group: “Walmart is taking some important steps, although they’ve still got a long way to go.”
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