An increasing number of $100K+ income households are shopping at Walmart (WMT), giving a clear indication of a sign of the times.
“In the face of a pretty challenging macro environment, consumers are looking for value,” Walmart CFO John David Rainey told Yahoo Finance Live on Tuesday.
The retail giant highlighted a gain in grocery market share from households during the third quarter, including higher-income shoppers.
“About 75% of that [share gain] is coming from the income demographic or the household that is making more than $100,000 a year,” said Rainey.
The CFO also pointed to customers increasingly “trading down” on item selections.
“If you look at things like private brand penetration, we saw an increase in our private brand penetration of 130 basis points in the quarter,” said Rainey.
“Similar to what we saw last quarter, we’re also seeing trade downs into less expensive proteins, things like beans and peanut butter and hot dogs from higher priced meats,” he added.
October’s Consumer Price Index (CPI) reading of 7.7% came in cooler than expected, but food inflation was up a whopping 12.4% compared to a year ago.
A recent New York Fed survey shows households expect food prices to rise 7.6% in the next 12 months- up from 6.8% in September.
An expectation of continued elevated prices coupled with a higher cost of living, is showing households across different income levels are becoming more sensitive to their purchasing power.
“Customers that came to us less frequently in the past are now shopping with us more often, including higher-income customers,” Doug McMillon, President and Chief Executive Officer, said during the retailer giant’s earnings call.
“Regardless of income levels, families are more price-conscious now,” he later added.
Ines is a markets reporter covering stocks from the floor of the New York Stock Exchange. Follow her on Twitter at @ines_ferre
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