Walmart Closes Stores; Campbell Soup Supports GMO Labels

Walmart Recommits to
Established Formats

In mid-January, Wal-Mart Stores Inc. announced its plans to close 256 stores around the world, 154 in the United States.

On the company’s website, Walmart CEO Doug McMillon noted that this was a difficult move for the company, but one that was necessary for its overall health.

“Managing our portfolio is essential to maintaining a healthy business. This allows us to create an even stronger Walmart by winning with our proven store formats and deepening our relationships with customers,” he wrote. “Ultimately, this is in the best interest of our company and reflects the priorities of our growth plan. That plan is focused on winning with stores, deepening our digital relationships with customers and enhancing critical capabilities through technology and data, a next generation supply chain and talent.”

The affected stores in Arkansas include 10 Walmart Express locations, the company’s smallest-format stores, which were first introduced in 2011. Included in that total were stores in Decatur, Gentry, Gravette and Prairie Grove.

In fact, the closings mean the elimination of the Walmart Express brand, Walmart’s version of a convenience store. Analysts noted that several factors contributed to the demise of the format, including assortment and location issues.

Jeremy Bowman at Motley Fool wrote: “Walmart made several other mistakes on the merchandising level, seemingly shrinking its supercenters to fit into a much smaller size instead of developing a concept around the format. It stocked multiple brands of the same item, costing space, and consumers often felt the product selection was not right.

“The company did not have data or experience with consumer preferences in such stores the way its competitors did, and it was eager to adapt to feedback. Finally, many of the stores were simply cannibalized by supercenters, underscoring a larger problem with the express format,” he wrote.

The decision to eliminate the express brand and close underperforming stores ultimately allows the company to focus on other priorities. These include the successful Walmart Neighborhood Market brand, the ongoing development of supercenters, and expanding Walmart’s e-commerce and omnichannel offerings. As McMillon notes, this fine-tuning is necessary if Walmart is to remain competitive against Amazon and other online, and offline, retailers.

Retailers Reinforce
Healthy-Living Trends

Consumers who want to continue their New Year’s resolutions into February can look to many retailers for support. From new management at in-store health clinics to fresher, healthier dining options, stores are actively promoting healthy lifestyles.

The trend toward active encouragement of healthful habits began several years ago, and Wal-Mart Stores Inc. helped lead the charge by labeling nutritious food as “Great for You,” offering in-store cooking classes, sourcing affordable organics, and even partnering with Humana to provide insurance customers with a healthy food discount card.

“Millennials are purchasing two times the amount of produce as previous generations,” said Jessica Hendrix, president of Saatchi & Saatchi X. “They care more about what they put into their body which means retailers and suppliers need to share their plans as new laws about the products are implemented. Shopping and consumption is emotional — how retailers connect more emotionally at key purchase decision points is more important than ever.”

Other retailers are also getting in on the act. Walgreens, for example, recently made headlines when it announced that it was selling its Chicago area in-store health clinics to Advocate Health Care, a major network of practitioners and hospitals.

One major, and healthy, advantage of this arrangement is that consumers who already have a relationship with Advocate no longer have to worry about transferring their Walgreen’s medical records to their primary care physician’s office. This ensures a continuity of care that may not happen if a patient receives care from a clinic unconnected with their regular provider.

Target is also getting in on the act by partnering with SoulCycle, a fitness company famous for its full-body cycling classes. Target customers will be able to participate in free classes at stores around the country, and even purchase cross-branded exercise apparel.

Another change is Target’s decision to partner with Freshii, a restaurant chain that sells healthy “fast foods” such as salads, juices and wraps. Target is testing Freshii in its Minnesota and Chicago stores in hopes that customers will appreciate an alternative to the pizzas, burgers and fries that are frequently sold in big-box stores.

Campbell Soup Co.
Supports GMO Labeling

The presence of genetically modified organisms (GMOs) in packaged and prepared foods has long been a subject of controversy.

In a 2014 poll, Consumer Reports found that 92 percent of Americans want their food labeled for GMOs. The food industry, on the other hand, as well as the U.S. Food and Drug Administration, has battled against mandatory labeling.

Why the controversy? It depends on who you are talking to. Those who support labeling believe that it is in the best interests of consumers to know what is in their food. The opposition to mandatory labeling argues that GMO foods and foods containing GMO ingredients are safe and that labeling is unnecessary and possibly confusing.

Dan Charles at NPR.com noted: “Most of the food industry, along with the FDA, has opposed mandatory labeling of GMOs. The FDA says that there’s no reason to require such labels because current GMO ingredients are identical, nutritionally, to conventional ingredients. In fact, if consumers react to it as a warning to avoid such ingredients, it would actually be misleading.”

Much to the surprise of both consumers and the media, Campbell Soup Co. recently announced its support for GMO labeling. While the company makes it clear that it doesn’t dispute the safety of GMOs, it also wishes to respect the preferences of the American public, according to a press release from the company.

“Campbell has been engaged in the conversation about GMO labeling for several years and has taken action to provide consumers with more information about how its products are made, including the presence of GMOs, through efforts like its website, www.whatsinmyfood.com. With 92 percent of Americans supporting the labeling of GMO foods, Campbell believes now is the time for the federal government to act quickly to implement a federal solution,” according to the press release.