Sam’s Club, The Store Brands 2023 Retailer of the Year, is laser focused on shopper needs as it eyes growth in 2024 and beyond.
On The
“We’re member obsessed.”
That was the simple, three word response from Myron Frazier, Sam’s Club’s senior vice president of Member’s Mark, when asked to highlight the key factors that are driving growth the Walmart-owned warehouse club has enjoyed in 2023.
As Sam’s closes out the year and heads into 2024, it does so on a trajectory of growth with Member’s Mark a significant component of its success and future plans, a main reason Store Brands has named the company its 2023 Retailer of the Year.
In reporting its most recent financials, Sam’s Club in its fiscal year third quarter reported sales of $22 billion and a comparable store sales increase of 3.8% when excluding fuel sales. The company has also announced plans to open 30 new clubs in the coming years along with new fulfillment and distribution centers. In fact, two of those new supply chain facilities will open near St. Louis and Minneapolis in early 2024.
The story of member obsession — as Frazier put it — at Sam’s Club has been an evolving story and more recently extends back nearly two years ago when the retailer decided it was time to overhaul its Member’s Mark assortment.
The brand arrived in stores in 1998 and in 2017, Sam’s consolidated its 20 proprietary brands under the Member’s Mark label. In early 2022, the retailer announced new initiatives for the brand that included the renovation and reformulation of more than 1,200 items since 2020. The brand’s logo and design were also updated.
Today, products sold under Member’s Mark are omnipresent throughout the store and its prices are noticeably lower than similar items sold from national brands.
We’re focused on delivering products that are innovative, on trend, and of high quality. And our members are noticing what we are doing with our products and Member’s Mark is increasingly becoming a reason they renew their membership.
2023 Retailer of the Year
Mark
(Shoppers) are consistently looking for products that have sustainable qualities and they appreciate the work we’re doing to drive this effort with our suppliers.
“We’re member obsessed.”
— Myron Frazier, Sam’s Club
With Sam’s Club being a division of Walmart, it is working to meet a host of sustainability goals by 2025. Notable among those is to have 100% of its product packaging be either recyclable, reusable or compostable within two years. But there are other targets the retailer is working to achieve with its Member's Mark assortment.
“We’re working to have 100% of our coffee, tea, and cocoa be Fair Trade Certified,” Frazier said. “We’re also working on other goals such as using organic cotton and are focused on floral pest management, so we have several initiatives that we’re working on and have made really good progress.”
With meeting corporate sustainability goals top of mind, Frazier said Sam’s Club is also aware of the growing role sustainability plays in the purchase decisions made by its shoppers.
“They are consistently looking for products that have sustainable qualities and they appreciate the work we’re doing to drive this effort with our suppliers,” he said.
Messaging the effort being made with sustainability can also be challenging, but Sam’s has taken steps to highlight the work it’s doing with its customers. A big part of that effort has been sharing information on its website where the retailer outlines its goals along with the work already in progress. Going forward, Sam’s Club will be enhancing its use of space on product packaging to share its sustainability efforts with shoppers.
“I'm really proud of the team for making that bold step and we believe that that will continue to drive awareness and help to shape and shift behavior to produce more recyclable material so that we can create a better circular economy,” Frazier said.
With retailers such as Sam’s Club and others continuing to see growth in private label sales, some have invested marketing dollars during 2023 to launch consumer direct advertising programs to highlight their respective brands and product assortments.
Frazier noted that Sam’s Club promotes Member’s Mark across a multitude of platforms including social media, on its own media networks and on its website.
“We have great marketing and PR teams,” he said. “We are aggressive in how we present Member’s Mark to our members and the message of quality and value is resonating with them.”
As we think about what we have the ability to do as a brand, our goal is to provide a better quality of life for our members. So, if that means going to a premium space that we haven’t gone into before as it relates to a quality tier or pricepoint, then we’ll go there.
Sam’s Club in its fiscal year
third quarter reported sales of
and a comparable store sales increase of
$22
billion
when excluding fuel sales.
3.8%
Throughout the years, Sam’s Club has seen an increase in demand from consumers for Member’s Mark-branded products, Frazier said. And while economics continues to play a role in shoppers choosing private brands over national brands, he believes there are other factors at play.
“We’re focused on delivering products that are innovative, on trend, and of high quality,” Frazier said. “And our members are noticing what we are doing with our products and Member’s Mark is increasingly becoming a reason they renew their membership. But my goal is actually to take it further than that. I want us to be the number one reason that people join Sam’s Club and current members renew.”
In meeting that lofty goal, Frazier said the Member’s Mark team operates with the mindset of a startup, but combines that with the operational discipline and attention to detail of a retailer that has been in business for many years. The data Sam’s is able to access allows them to stay aligned to the wants and needs of shoppers, identify likes and dislikes and recognize expansion opportunities.
Throughout 2023, Frazier reported growth for Member’s Mark across all categories, with food and consumables the most notable as items in both are purchased with the greatest frequency.
“There’s a lot of demand (with food) obviously, but we’ve seen excitement across our entire brand inclusive of furniture and apparel,” he added.
Among the new items that have found their way into the Member’s Mark product stream over the past year has been sports drinks and variety pack chips.
“Our members love the combination of the quality and value we offer in both categories,” Frazier said. “If you look at the snacks category today, products we offer such as freeze-dried strawberries and other healthy snacks have done really well for us. We’re continuing to develop new and exciting items to expand our healthy offerings, particularly in our food and home meals spaces.”
While offering few specifics on new products coming to Member’s Mark in the year ahead, Frazier did say the brand, which he defined a “true lifestyle brand,” impacts members in every part of their lives. This, he said, provides a great deal of opportunity for Sam’s Club to expand the product offerings under the brand.
“I mentioned chips and sports drinks earlier, and you’ll see us continue to grow in those categories,” he said. “Overall, we’ll continue to look for more categories and more spaces to add value for our members as they tell us what they want.”
— Myron Frazier, Sam’s Club
With team Member’s Mark constantly looking to up its game in the continuing effort to meet the needs of its shoppers, has the growing consumer acceptance of private label products in recent years given retailers a higher plateau from which to develop new items?
“We think so,” said Frazier. “What we have found is that being as obsessed as we are with our members, we are able to offer a proposition to them that's differentiated and it's exactly what they want. So we spend a lot of time working to understand what they want, how they want it to show up in stores, and what is the right value.”
This could also open opportunities for Sam’s Club to offer what would be viewed as premium products that are priced in line with national brands, but exclusive to the retailer.
“It's no longer a place that we're avoiding,” Frazier said. “As we think about what we have the ability to do as a brand, our goal is to provide a better quality of life for our members. So, if that means going to a premium space that we haven’t gone into before as it relates to a quality tier or pricepoint, then we’ll go there. But no matter what we do, we have to make sure we’re true to the brand.”
A major talking point related to product development with products sold under the Member’s Mark brand is sustainability. The growth of private label in recent years has given retailers an opportunity to incorporate various sustainability goals into their product development efforts. This includes several aspects ranging from product sourcing, seeking packaging that is more Earth-friendly, and developing ways to streamline supply chain operations to reduce carbon footprint.
— Myron Frazier, Sam’s Club
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By Greg Sleter