We review how Sam's Club repositioned its Member's Mark brand, and the plans for its future development.
Consolidated 21 brands into Member's Mark
Over the last year Sam's Club has focused on consolidating 21 different private brands into one, Member's Mark. As part of this process, the retailer reviewed the entire private brand line-up to ensure that products emphasise both quality and value. This has supported the continued growth of the brand, with sales reaching $10bn annually, representing just over 17% of total sales. In the last year, 94% of its members have purchased at least one private brand item.
600 new products set to launch over the next two years
In line with the range consolidation, the retailer has also introduced a fresh design for the brand, featuring a modern, bold and stylish look. Building on this, Sam's Club will introduce 300 new products to the range this year, with a similar number of new products planned for 2018. These will span a number of categories including fresh foods, apparel and health and wellness.
Targeting higher income households
This initiative aligns with Sam's Club's strategic plan to transform its merchandise. The goal is to offer compelling products at a value that drives member loyalty. In food this has included new fresh food products and organic items as it aims to attract younger and higher income households. Underpinning this is a restructured private brand team, including new leadership along with product, quality and sourcing teams.
Mirrors the approach at Costco with Kirkland Signature
The single brand strategy reflects the approach at Costco, its key competitor, where the Kirkland Signature range continues to be a major success. Costco aims to grow this range to around 35% of sales over the medium term, up from 27% to 28% currently. The retailer is focused on pursuing opportunities in new and existing categories through developing products with a higher quality perception than the brand equivalent, at a lower price point. With Costco also expanding its range of fresh foods and organics, the strategies of both retailers are focused on attracting the member groups they want in their clubs in the future.
| Stewart Samuel, Program Director, IGD Canada|
Based in Canada, Stewart heads up all of IGD's research and coverage on Walmart globally. He is also responsible for shaping IGD's research program across North America. Contact Stewart at firstname.lastname@example.org for further insight on the region.