Can Walmart Take on Trader Joe’s With bettergoods Launch?

Walmart is introducing a new premium private label, called bettergoods, that includes plant-based mozzarella, organic chocolate milk, chicken wings with brown sugar BBQ, and campfire roasted salsa that the discount giant describes as “approachable and — most importantly — affordable.”

Walmart’s largest private brand food launch in 20 years, bettergoods offers 300 items, including frozen, dairy, snacks, beverages, pasta, soups, coffee, and chocolate. Prices range from under $2 to under $15, with more than 70% costing less than $5.

bettergoods items will fall within three “distinct category pillars,” specifically:

• Culinary experiences: These items spotlight innovative recipes, elevated ingredients, and food-trend-forward offerings, including specialty salts and seasonings. Examples include Hot Honey Seasoning (under $3); a line of jar soups, including Creamy Corn Jalapeno Chowder (under $4); and premium Bronze Cut Pasta from Italy ($1.97).
• Plant-based: These products feature distinct green branding. Items include Oatmilk Non-Dairy Frozen Desserts ($3.44 a pint) and a cheese alternative with “an incredible cheesy pull when melted” (under $4).
• “Made Without”: This category offers a variety of options that cater to different dietary lifestyles, like gluten free, or made without artificial flavors, colorings, or added sugars. Offerings include Sweet Cream Dairy Creamer, made using four ingredients; gluten-free, antibiotic-free, all-white meat chicken nuggets; and Carnitas, Taco, or Tinga Seasonings (all under $2).

In line with Walmart’s “Every Day Low Prices” motto, bettergoods offers “quality, unique, chef-inspired food at an incredible value.” However, unlike many private brands that offer alternatives to national brand offerings at a lower price, many bettergoods items “are totally unique to Walmart, introducing customers to new and exciting flavors and concepts.”

“All of our research tells us that the customer expects these types of goods,” said Scott Morris, SVP of private brands, food, and consumables for Walmart U.S., on a media call. “They expect to have these elevated ingredients and offerings that we provide, and they are also looking for those healthier options.”

He added that bettergoods will be “very much being incremental” and won’t cannibalize Great Value, the chain’s largest private label that’s focused on generic products similar to national brand counterparts at lower prices.

The launch comes as private labels are taking share from national brands amid inflationary conditions. Circana reported private brands in the CPG category grew to 25.5% of unit sales in 2023 from 24.7% in 2022. Major competitors, including Kroger and Target, are also aggressively bolstering their private-label food offerings while Aldi, which offers largely private-label products, is expanding rapidly.

The New York Times suggested that bettergoods is aimed at helping Walmart “retain higher-income individuals” who’ve been trading down in the last few years amid inflationary spikes.

A Bloomberg article speculated that bettergoods represented a “bid for Gen Z dollars.” Morris told reporters, “As an industry, we’re seeing younger customers be more brand agnostic, prioritizing quality and value, and driving increased interest in private brands.”

Axios theorized that Walmart is “making a play for millennials,” citing data from Circana showing private label growth being driven “by consumers, particularly those with children, as well as millennial and Gen X households without children, who are strategically employing a variety of methods to stretch their dollars amid high inflation.”

A Wall Street Journal article described the launch as “a big strategic bet” to compete better against Costco, Trader Joe’s, and Whole Foods — all known for their distinctive private labels. The WSJ wrote, “It is likely to rankle food manufacturers already fighting for space on Walmart’s shelves. And it is part of Walmart’s efforts to keep bringing people to its stores even when they aren’t on the hunt for inexpensive necessities.”