What Retailers Can Learn From Walmart’s Success with High-Income Households
Key Takeaways
The share of high earners who shop at Walmart reached a new peak in November 2024, when 87% of consumers earning $100,000 or more annually said that they shop at the retailer, according to Morning Consult Intelligence.
Walmart’s membership program, Walmart+, also saw a 17% increase in the share of high-income consumers using the service over the course of this year, indicating that these customers are likely to stick around.
The benefits of Walmart+ encourage members — who are often young families — to take advantage of multiple modes of convenience and savings offered through the program, deepening their loyalty.
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Walmart’s Q3 earnings report was indisputably a banger. The world’s largest retailer saw strong growth, attributable in part to growth in membership revenue and increasing market share from high income households. These stats are revealing of larger retail sector trends, where consumers at all income levels are pursuing value, and Walmart has successfully met their needs by delivering on value in addition to enhancing their product assortment.
Securing the loyalty of these higher-income customers requires more than shaving a few dollars off the weekly grocery shop. Gains in Walmart’s net favorability with high earners shows those customers could be there to stay, but an even stronger indicator is the share who are using Walmart+, Walmart’s paid membership program that offers free delivery, savings on gas, and streaming services among other benefits.
Walmart sees its highest share of high-income shoppers to date
The share of $100K households who say they shop at Walmart a few times a week rose three points in the third quarter, from 16% to 19%. That growing frequency helped to bolster the total share of high income households that shop at the retailer to new heights in the third quarter, and this trend will continue through the remainder of this year and into the next.
Walmart has gained market share with all income groups
While high earners have bolstered retail spending this year as those with lower incomes have pulled back, they’re not immune to a good deal. Beyond grocery, Walmart’s opportunity to gain ground comes from merchandise categories like apparel and home categories, where the retailer has made efforts to improve their product selection.
Influencers, a critical discovery source for young consumers, are also helping to get the word out. A few years ago Courtney Grow alerted her followers to a specific Walmart tee shirt that went viral. Walmart also partners with influencers for sponsored posts. Seeing their products alongside high-end brands also commonly featured by the same creators helps to reposition Walmart in these shoppers’ minds.
Walmart+ gains help cement customer loyalty with big spenders
High earners are also increasing their usage of Walmart+, which will help the retailer secure these customers’ loyalty for the long haul. The share of high earners who report using Walmart+ also rose 17% this year.
Those who use Walmart+ at least weekly tend to have similar income breakdowns as the general population, though that is shifting. Members tend to be younger, with higher concentrations among Gen Zers and millennials, who tend to spend more in discretionary categories than older generations. Walmart+ members are also more likely to have children in their households. The program’s benefits cater to busy families, with free delivery, fuel discounts and a Paramount+ streaming subscription included.
Walmart+ weekly users are young, tech savvy and trend focused
Walmart+ users are more likely to be goal oriented, adventurous trend setters, compounding their likelihood to spend more on new product releases and general merchandise that helped boost Walmart’s sales last quarter.
Offering such a robust, fee-based membership program isn’t the right move for every retailer. For Walmart, it helps keep customers sticky by pushing them to use more of their range of products and services. For other stores, using existing rewards programs to drive usage of services can help to grow their share of wallet. For example, Sephora uses their gamified loyalty challenges to promote in-store services and buy online, pick up in store options. QSRs reward customers for trying new menu items. The key is in expanding the customer’s perceived value of their relationship with your brand.
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