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The Doing Business in Bentonville Podcast
To create an ecosystem that connects leaders of all kinds – industry, community, student, educational, civic, investment and entrepreneurial – to help overcome Omnichannel Retail barriers through exclusive, insight-rich content.
The Doing Business in Bentonville Podcast
Ep. 123 - Better Brands, Smarter Stores
Step into a Springdale store and club with us and see why Walmart’s growth streak feels unstoppable. We break down what’s actually happening on the floor: clearer sight lines, displays that teach as much as they sell, and end- caps that can host a $5 deal and a $250 mixer without confusing the shopper. The result is a shopping journey that feels like landing on a well-designed website, intuitive, discoverable, and built to nudge you into the right aisles.
We unpack the engine behind the scenes too. Walmart’s “second productivity loop” blends profitable e-commerce, retail media, membership, and marketplace to fuel the classic flywheel of traffic, expense leverage, and price leadership. That strategy shows up as lean inventory with strong in-stocks, faster turns, and a floor where marketing finally stands shoulder to shoulder with merchandising. You’ll hear how the spark, typography, and iconography now frame supplier storytelling, and why co-branding is the new entry ticket for displays, packaging, and promotions.
Assortment is where the balance becomes obvious. Challenger brands and premium names have real presence, while private labels like Bettergoods and Member’s Mark read like quality badges, not just opening price points. Beauty feels like a specialty shop, toys like a specialist aisle, and housewares like a curated home store, without losing the fast-moving value play that built the business. If you’re a supplier, you’ll leave with clear steps: design displays that educate, align visuals to the retailer’s system, and plan retail media to amplify in-aisle stories. If you’re a shopper, you’ll recognize why the trip just feels better.
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Hello everyone and welcome to Doing Business in Bentonville. I'm Andy Wilson, and it's so great that you're joining us again. And thank you. I have today. We have got some great guests this morning. We're going to get straight into that really quick. But before I do, I have one thing I want to say to all of our viewers. Thank you. Because of you, you have now expanded our reach to over 100 countries. We have thousands of views a day, because of you. So thank you for your loyalty. And you know, you can always reach out to me on LinkedIn, message me, and I don't care what you message me about, I will answer you. And I I love getting those comments from you. So thank you. Let's get straight away. So welcome, Leon Doom. Welcome. Thank you. Thank you. Wow. It's great to see you guys again. Of course, Leon is almost a regular here. I know. I love it. You know, Leon, you came before we went way back when we had live events. That's right. Wow. And you know, we're going to do that again. I'm looking forward to it. Yeah, we are. We're talking about we're talking about live events right now. In fact, uh, I'm not supposed to talk about this yet, but there may be one this year. So, okay. So stay tuned. Yeah, we're working on it. And uh, but Leon, uh, you and Doom, again, thank you. Thank you for being here. I enjoyed our time yesterday, and we'll talk about our store walk we had in the Walmart and the Sam's Club yesterday. And um, you know, Leon, you have always brought such great insight to our viewers and to doing business in Bentonville and your knowledge and expertise, you know, um, it's just helped us so much. So thank you. Thank you. It's been great. So, but let's give a bit more introduction to you and to Doom. So if you'll begin and talk about your wonderful company, your background, and then we'll pass it over to Doom and you do the same, okay? Absolutely. Yeah, sure.
SPEAKER_01:So uh Smurf, I work for Smurfit Westrock. Smurf at Westrock's uh uh a leader uh in the packaging, uh, merchandising, uh e-commerce packaging space as well, um, really around the world, uh across substrates, so primary packaging and and uh and secondary packaging, tertiary, e-commerce packaging, um, and across categories. So, you know, um from edible to non-edible to general merchandise to um food service packaging, uh you name it, uh we do uh we're in the packaging business, um, uh kind of uh around the world and and across uh across categories. I'm uh VP of Retail Insights and Solutions uh with Smurf at Westrock. Um been in the uh with the company now coming on eight years. Um but uh prior to that, about 33 years now in the uh in the consumer goods and uh and retail space. How about you, Dune?
SPEAKER_02:So I'm the local account executive for the Bentonville-based uh design center for Smurf at West Rock. So I handle basically everything we do for SAMS and Walmart. I work with our local design team. We have a full facility that allows us to do prototyping, quick runs, everything from signage to setting your displays at the layout center. We're just a full service on the ground team here to support the suppliers when they need something done quickly, set at the layout center, revisions. That's what we're here for to support really Walmart, Sam's and the supplier community. Wonderful.
SPEAKER_00:But Dean, this is your first time with us on doing business in business. It is in person. Right. We're glad that you're here. Thank you so much. Known each other for a long time, and as as uh and and so as Leon and I have, and so it's just great, gentlemen, to have you. We had such a great day yesterday, everyone. I have to I got to tell you this, you know, my 25 plus years at Walmart. One of the things I never I never, never uh uh uh I loved so much and never wanted to stop doing was walking Walmart stores. And yesterday, uh the three of us got to do that. And uh we're going to get into the details of those two stores uh with the store and the club in a moment, but it's but what we want to do is really I want you to hear from Leon. He's he's really done a lot of work and a lot of and has given a lot of thought into what I call Walmart success. And Leon, please share that and then we'll get into the store walk. But talk about, you know, how has Walmart got to this point? Yeah. And they just released our uh third quarter results, and you're gonna share that. You're gonna talk about those two, the foundation, it's all public. So um, Leon, talk about that.
SPEAKER_01:Yeah, it is really uh it's hard to talk about Walmart today without using superlatives. You know, I mean they are just running on all cylinders. Um, you know, the first quarter of this year they were up uh up four and a half, and then they beat it. You know, the the next one with at uh at four six. Um my gosh, it traffic was up, ticket was up, uh all departments that they report were up, despite general merchandise deflation, they were still up. Um so you saw all of these variables coming into play. Um the uh e-commerce business was up uh 26, 26 percent, I think it was. Advertising was up uh in the 40s, um inventory was kept at around 2 percent. When you've got a comp growth of 4.6 to keep inventory at 2 percent and still maintain uh in stocks, I mean this is just a it's from success to uh uh to success. So really hard to find anything uh negative there. They've been spending years now, as you know, investing in technology, investing in automation and supply chain and and also uh marketing and their media networks. And I think we're starting to move into a period now where we could actually say they're harvesting some of that, some of that success. I mean, look at Sam's. My God, Sam's up six percent. Um you know, growing. And the other couple of things I I I've I've noticed here is you know, the the strength of that e-commerce business and the extent to which now, as they've said, this is this is a profitable business for them. You know, it used to be when e-commerce grew disproportionately and profit took a hit. Right. Well, that's no longer the case anymore. All of that automation that they put in place, I think is really driven that. A third of their operating profit now, Andy, comes from um e-commerce, advertising, membership, third-party um um uh distribution, et cetera. And they've created what they call a second PL. Now this is fascinating. For those of us who let you and I who grew up in the pro the traditional productivity loop, which is uh you know, it's it's Bible. Yeah. So it's it's retail Bible, I should say. Absolutely down here. I I teach a class at University of New Hampshire, and and we study the productivity loop. You know, I mean it's it's it's part of the lure of uh the lure of retail. They've created, in effect, with this second PL, a new productivity loop that is feeding the primary one. And then the last one I would point to it's kind of a long answer to your question. No, that that's keep going. I love this. The long answer, uh the the the last thing I'd say here, and that the part is part of this long answer, is Walmart has pulled off here something that it's very, very hard to find in global retail. And that is they are now appealing to America's bifurcated shopper base. You know, the the middle has been completely hollowed out. And uh the American population has really moved toward the two poles. And as that has happened, Walmart, particularly in this new format we'll talk about, has been able to achieve the capacity, in my view, to appeal to both of them at the same time. And when you can appeal to two different shopper groups at the same time in the same box, um that is remarkable. You know, they're not doing it by going after the middle and sort of splitting the difference, right? But to say, no, look, we're gonna satisfy the higher end and keep our, you know, we'll say standard American shopper base there. I was looking at the stat a couple days ago from 100x. Their fastest growing uh net promoter score growth is among those shoppers, making over$200,000. Right. So again, this ability to serve two the two Americas, we'll call it if you want to to simplify it, red and blue America or Urban and Rural America, however you want to think about it. You put all that together and um, you know, uh gosh, if you would have bet against Walmart in a few years ago, uh that would have been a pretty, pretty missed, that would be a mistaken bet that you would have made.
SPEAKER_00:You know, uh that balance that you just talked about, uh, one of the things that you did yesterday and both of you did yesterday, you pointed out examples of that balance. Yeah. Do that today for our viewers as we walk through this because uh you you know, I I walk a store a lot, but what I I learned a lot from my tour yesterday, both Sam's and Walmart. And I think for our viewers, what what these gentlemen are gonna do is is give you some great, as I said at the beginning of the show, great insight here. So buckle up, lean on, get your notepad out, because here we go. We're about to we're about to get this done. So um, Doom, anything you want to add to what we are and talked about?
SPEAKER_02:As far as what we see in the department that I deal with, which is mainly displays, signage, merchandising, we do see a lot of the same thing to where, you know, Walmart is still one of the leading retailers for annual event, to where they go very large in fourth quarter around, you know, really items for that low dollar, the best deal you're gonna get of the year. And then literally within a week, they'll reset the store and you can go in and you're looking at you know, thirty dollar toys, you know, three hundred dollar appliances. Right. You can go in and you know, outfit your dorm with a full set of furniture. Right. It's just amazing that there's so much within the box now to where there's really nothing you can't go into a Walmart and not shop for. Right.
SPEAKER_01:One of the things you mentioned too yesterday, that was great. Um we're we looked, we went to one of those end caps uh in the uh um in the spring Springdale store, and we we we saw this this, you know, it was a couple hundred dollars, I think it was. A$250 mixer. Yeah, a$250 mixer.
SPEAKER_02:And you said what did you you you said I back in the day,$40 years ago, that you would not have seen, and Andy, you know that from the past, that that's an item that typically you would not see on shelf on an NCAP at all. Right.
SPEAKER_01:And here we saw multiple examples, particularly in general merchandise, yeah, of these, you know, 200, because that 300 high price points here in the end caps, you know, adjacent to you know, uh, we'll call it a you know a an opening price point item or a uh a private label price point, you know, that was five bucks or something. And it's that's what I'm talking about. I don't know any other retailer right now that's pulling that off the way they are.
SPEAKER_00:Well, I think as we we're gonna dive into it the store walk. So get ready. We're about to walk a store. And uh so you so you can just walk with us. Uh our guests can just walk with us. Uh but I think as we begin this walk, and I think that again when we talk about just just I want to say this, keep in mind, think about what Leon talked about. It's a balance. There's two, it's not the middle, it's two ends. And and it's difficult to execute in 4,000 plus Walmart stores and and and and and lots of Sams clubs, right? But we seen that being executed yesterday. We certainly do. I mean, in both facilities. And we also we had the opportunity to uh to speak with the store manager of the Walmart store. What a great team and uh that we met yesterday in the store. And we want to thank them for all of their hard work in both of those facilities we walked through. All the associates and the and the management there, just great, great looking stores. Great stores. Yeah. If I was walking to that store as a district manager back in the day, I would not give them very many notes. I would just probably say, keep doing it. Whatever you're doing, just keep doing it. Okay. All right, uh, let's do this. Let's dive into the store walk. Yeah. Okay. So take us through that and then we'll put some comments.
SPEAKER_01:And I broke it into a few. I I can just you've got a bit of an analyst mind here, so I've kind of broken into some buckets for us to kind of um kind of think about. The first one would just be called merchandising and layout. And the thing that you notice immediately there um is that the layout itself enables you when you first walk in to have visibility now to to the entire Especially the SAMS and the Walmart. Both the SAMS and the Walmart. Right? Uh and we're referring, of course, to the to the uh Walmart store of the future concept. But when you when you when you go in now, you've got visibility to everything. You know, and it's kind of like when you go onto a website, right? When you go onto a website, you've got a menu bar at the top, you've really got visibility so that you know where you want to dive. This is an online first framework in that regard. Just like you go onto a website and you know where to click and how to navigate, you know where to find where you are and what you're looking for. Similarly, now you're able to do that very, very easily. And so it enables more uh more visibility, but also more cross box kinds of kind of uh shopping. Um I think the in in terms of the the the layout, you see the elevation of certain uh departments more than you have in the past, certainly apparel. Um I think you know, you and I walking through there, I mean, it's it's pretty hard not to think that you're in a mid-market apparel, I'm not gonna say department store, but pretty close to a mid-market uh apparel. And you you and I know years ago, uh one well, they used to call it just uh jeans, underwear, socks, and tees. Right? Well, this is a uh this is a a player in the apparel space right now, uh, in ways that if you haven't seen it, I think it's really changing the game in the apparel space. So I think the first thing I would say is just overall the the the attention paid to sight lines and design within the store is important. The other thing I would say is from a um from a display perspective, we saw a lot more eye-catching displays, you know, better with vignettes, the lighting on those vignettes. Um particularly strong in in um in um um house house housewares, but also I would say um health and wellness, OTC, uh that department very, very strong. Um and the other point that that we see is you know, kind of in the display business is better integration between um primary packaging, that uh retail-ready packaging, and even the display architecture and you know overhangs and things like that. We saw a number of those in Sam's as well, which means there's a lot more attention being paid to merchandising per se, that we're going to really focus in on the cube here of the shoppers' sight lines. And that means that merchandising has to work harder in these display, it it of in these displays in the store. They have to align better with Walmart's overall merchandising ethos and standards and all that. And they've all gotta work together kind of and sound corny, but symphonically, right? And they they've all got to work together. And Walmart is being a very go, very good merchandising maestro of this merchandising symphony in this store. And that's what impresses me. Um and I it's it's better better merchandising than I have seen for a long, long time. It's a this new format from from a layout perspective, I think is uh uh is really just is really best in class. Did I miss anything there?
SPEAKER_02:Was there something that you'd pull out? I would say that what we're seeing is in displays very similar to what you stated. They are elevating a lot of different categories. If you look at HBA specifically to where Andy you and I talked yesterday, we saw displays to where it was almost a 50-50 mix of product and education around the product. Right. Um that back in the day would have been in the 80-20. It used to be 80% product, very little uh you know, education or billboarding as you used to see on displays. Right. On the pallet trains, you know, you look at a back to school uh, you know, stocking stuffer, that's really going to be all about getting as much product onto a vehicle as possible because those are your high volume items. But really in HBA housewares, you are seeing a lot more elevated displays. You're you're allowed to kind of go outside what typically we've seen in the past, still working within the style guide, obviously, but it just gives the suppliers a lot more room to kind of play, bring the brand forward, and really show you know the advantages to what they're supplying to are.
SPEAKER_01:And it reminds me back again about this capacity to be both engaging, right? It's this bifurcation. I'm gonna engage you where I need to. And in other cases, like in in for stocking stuffers, it's look, here's the product, it's at a great price, come, you know, come and get it. Walmart's bread and butter, you know, the capacity to act, you know, effectively in fast-moving consumer goods. But at the same time, you see these, we see it a lot in cosmetics, just really eye-catching um displays there that are just as engaging, have as much stopping power as you would see again um in uh in other channels. And that I didn't think Walmart ever before thought maybe they had the right to merchandise that way. Well, today, where so much of their growth is coming from those shoppers making over$100,000 a year, uh they're they're more than leaning in. They're leaning, leaning forward.
SPEAKER_00:Um, you know. You know, I think such great points on the merchandising side and the marketing side. You know, one of the things that that you all were pointing out to me as we walked through yesterday is what a great job that marketing is doing today, integrating this merchandise concept that you talked about from everything from colors to packs to all of that. I don't think I've ever seen it this good.
SPEAKER_01:You know, you make a good point. I back in the day, uh gosh, now it's been a number of years, but uh I was a retail analyst with uh with Cantor. And uh I had uh Walmart as one of my uh one of the retailers that I was an analyst on. And my gosh, back then in the day, and this is you know maybe 15 years or so ago, marketing was not Walmart's strong point. Okay? You can say that. Yes. Walmart was a was a merchant. That's exactly right. I mean, they were merchants and they they uh attached an operations engine to merchandising that created the greatest, you know, story in retail. Right. You know, they're the the biggest retailer uh in the world. What I have been noticing, and this kind of leads me, as you said, kind of into this you know, sort of this second uh uh uh bucket for me. So good good handoff here, is what marketing is becoming more important to them. And you see it in coloring, you see it in the ubiquity of the spark everywhere, you see it um in the new Walmart font size, uh you see it in um uh the use of um uh iconography and emojis and signage. What this says today is that Walmart branding is I don't know if it's just as important, but it is becoming just as important as the manufacturer's branding. And you and I would use the words house of brands, right? Walmart would say, look, we're a house of brands, and they are they are house of brands, but increasingly those brands that are selling in and through Walmart have to acknowledge that the Walmart brand, I don't mean the private label, that's a separate conversation. Right. Um but Walmart's branding qualities are becoming more important almost to the extent today that you've got to think about it as co-branding. That you've got to think about your coloring, your fonts, your messaging, your taglines. You know, how does your messaging align with, in effect, Save Money, Live Better? What part of that Save Money Live Better brand proposition are you representing? Um I think that becomes a lot more important than what we have seen in the past. And I think it it shows you just how powerful marketing has become for them. And it's part of that maturity curve where they're now operating on all three core cylinders of retail merchandising, operations, and now marketing. And when you can put those three together, you're a game changer. Yeah. Perfect. You're a game changer. Sorry. You know, now in that same bucket, right? I think there's some other stuff that they're that they're doing as well. Um that I think we want to draw attention.
SPEAKER_00:We can do it now, or you can let's do it. Yeah. I mean, oh no, it's good. I think we're I think you guys are on a roll about this. And and you know, and what I I again, our guests, we should I want you to picture this because so what I want you to do is next time you go into a Walmart store, I want you to look at what these guys are talking about. And they were they pointed out multiple examples throughout the store where where the manufacturer, the supplier, has integrated this marketing piece into the co-Walmart piece. And I have never noticed it like I seen it yesterday.
SPEAKER_01:Yeah.
SPEAKER_00:It was so obvious. It's almost so seamless.
SPEAKER_02:You know, that's a good work. It used to be you almost had to hunt for it when you went into Walmart. And now when you walk in, it's almost it's just so natural.
SPEAKER_00:I don't know, and and I and I I wrote this down as a learning point for me to follow up on uh after we discussed. I I don't know if I see it that done that well in any other retailer. Trevor Burrus, Jr.
SPEAKER_01:There are other retailers who have to be able to do that. Yes. Where you know, the buying of the manufacturer's product is thought to be unique because you bought it at that retailer type of thing. Um but you know, again, uh Walmart today, you know, it the that marketing leg of the stool, three-leg stool, right? The marketing leg of that stool was always the one that uh needed a little work, right? It always needed uh needed something. And today, my goodness, um, you know, and and we we could think about this like too, that the their Walmart is increasingly uh a media company as well, yeah, right? I mean, they have a retail media network, they've got the partnership with Paramount and with uh with Walmart, Walmart Plus, you've got the Visio partnership. So these media qualities are starting to infuse themselves within the company. And so our manufacturers, the manufacturers who service them need to think in addition to thinking about Walmart as a place to sell products, because we've said this before, about 80 percent of what Walmart sells still sells off a shelf with a per i a consumer buying it off the shelf. Right? And the other 20 percent is e-commerce, and most of that is store-enabled e-commerce. So you know, this talk of you know the the store is in trouble, the store is thriving critical to the access. We've seen that in both locations. I mean, my gosh, the store is is is the bone marrow, it's the beating heart of the Walmart enterprise. But what what you're starting to see now is that mean our manufacturer um customers have to start paying a lot more attention to that marketing and media environment within which they're selling. Because the other things that that we're seeing from a from a product perspective, when you walk that store, okay, when you walk it, is you do see a lot more higher-end brands. Even in the grocery department and certainly in cosmetics, you start you're you're seeing a lot more brands that you and I would pass, and we'll buy one yesterday and say, I can't imagine. Well can you imagine 10 years ago Walmart ever would have had um had one uh had that brand up or that brand. We'd be pointing out these these brands that uh you know they they wouldn't necessarily have uh have had. They're also succeeding very well among emerging brands, the so-called challenger brands that are out there. And a few years ago, it wasn't Walmart wasn't necessarily the destination for the hot, cool, you know, millennial Gen, uh Gen Alpha, what a Gen Z sort of focused brands. Today they are. Today that is the place where a lot of these brands want to go to be seen. And it's it's uh it's because Walmart is growing uh amongst every demographics segment that that makes a difference. At the same time, they're leading in the opening price point, largely through private label, right? And like but but even there, you know, we the the success of that better goods brand. I mean, it's over it's a billion-dollar brand now. And to a shopper not knowing that they wouldn't know this was necessarily a a private brand, and certainly not a Walmart. This is this is no great value. You know, this is no equate, this is a brand in and of itself that in many cases is priced above or slightly above some of the national brands um that are that are in play. Um so the the the capacity for this house of brands to also bring forward a private label portfolio, and you know, we haven't even mentioned about general merchandise. The array of general merchandise private brands that Walmart has very not say quietly, but just barely under the radar screen launched over the past several years, uh is nothing stored sort of astonishing.
SPEAKER_00:I think we've seen that on display very well in Sams. Sams, for sure. When you gentlemen were pointing out uh the but you know, when we look at the Members Mart product and felt it and touched it and and and and smelt it, all of that, uh it definitely was quality.
SPEAKER_02:It's no longer just an opening price point item. It's an item you're gonna go in and it is it is challenging what used to be that higher value name brand item.
SPEAKER_00:Yeah, and and then I I love that is exactly right. And then when you you you you just talked about the goods brand. Better goods brand. Yeah, better goods brand. It's it you're right. It's everything we looked at on it was quality. Yeah. And then it was slightly above. Slightly above, slightly above. But Walmart says this is worth it. Yes. And that again, back to building your in-store brands with quality, it's a quality product. That's right.
SPEAKER_01:You create a you create a reinforcing loop. Yeah. Right? Because you bring in better quality products, you bring in a better quality consumer. That's that balance again, right? Back to the balance. Right. And the the challenge, Andy, is and you know we all we've all been around long enough to know lots of retailers uh by the side of the road, you know, who've tried this sort of thing, they either go for the middle figuring we'll split the difference, and that doesn't work. Um they alienate one end or the other because they go too far in one direction and alienate the shopper they had before, their capacity to say to this shopper, to to a lower income shopper or middle income shopper, and to an upper income shopper, hey, we've got you covered for your upper income shopper, we've got, you know, we've got Walmart Plus, we've got and it includes particularly important is the Paramount Streaming uh there. You've got quality name brands, particularly in general merchandise. You've got challenger brands, emerging brands here that are impressive. Uh you've got a d uh a health and wellness in a in a beauty department that you know, a standalone.
SPEAKER_02:A store within a store.
SPEAKER_01:Yeah. Standalone specialty beauty. Yeah. And that's really uh that's really something. You know, they're they're capac in in the in the uh in the toy department. I mean, that looks like a toy specialist today. Yeah. Um, you know, where you could do your full-end shopping. But it's got not only the private label opening price points there to compete with, say, you know, lower end um uh uh discounters in the marketplace, but it's got the wooden toys too, you know, and that capacity to do both without alienating either. Um my gosh, uh that's the that's the trick. And that's where you've got to give Walmart credit. You've got to step back at this point. Look, you and I know it a few years, just a few years ago, you know, people were wondering, you know, in this internet and digital and crazy age and all that, you know, is is can can Walmart survive here? And you know, with you know new formats coming out that are exciting and energetic, and you know can Walmart survive? The answer has been definitely Yes. And they've not only survived, they have excelled from an in-store merchandising perspective, and certainly from an e-commerce, from a tech and e-commerce perspective, which we're going to talk about next. Just their their capacity to become a tech powerhouse, but not for the sake of tech, but tech for the sake of merchandising. That's the part where, you know, you you you wouldn't have been able to say that a few years ago. And people would have doubted you and said, I don't know that they can play here. Um and uh and they've they have proven so many of those folks wrong. Um and so they deserve the credit.