Will downsizing (food packs) bring a merry Christmas to Sam’s Club?
Sam’s Club is thinking smaller this holiday season. The number two warehouse club is selling smaller-sized hams and side dishes this year to better accommodate shrinking Thanksgiving and Christmas celebrations due to the novel coronavirus pandemic.
The division of Walmart began reducing the size of some of the products it sells as it became apparent that club-sized items, in some cases, were simply too large for many members as family members and friends were kept apart as a result Americans were asked to stay home and socially distance when they went out.
Megan Crozier, Sam’s chief merchandising officer, told CNBC that it reduced the size of items such as brownie packs and cake mixes as the virus spread across the U.S. Sales of these items were strong and Sam’s broadened the approach to its holiday ham selection, which will come in four, seven and 10-pound sizes this year. The retailer is also selling side dishes for a family of four with greens beans and garlic herb butter, mac and cheese and sweet potato mash with cinnamon butter.
In going to smaller packs, Sam’s is employing a strategy that BJ’s Wholesale Club, its smaller rival, has used for years. That chain made the decision more than a decade ago that its best opportunity for market share growth was to focus on competing with local supermarkets.
Sam’s surveyed its members and found that 61 percent plan to do more shopping online this year and 31 percent plan to start their holiday shopping earlier than in previous years.
The chain has responded by rolling out online shopping with curbside pickup programs at all of its 597 locations. Sam’s is putting a greater emphasis on in-club fulfillment of online orders with 100 locations designated to pick and ship purchases made by members. The retailer is looking to meet an expected increase in online orders, adding 2,000 more full-time fulfillment and distribution center associates to its payroll.
Sam’s, like others in retail, began rolling out holiday deals near the beginning of October. Management says it plans to offer more deals and new products this season spread out between now and Christmas. Its annual Thanks-Savings promotion will last 10 days this year compared to four in the past. Sam’s December Savings Event has gone from one day to 10 days this year.
- Sam’s Club Unveils Plans to Deliver Something Special Throughout the Holiday Season – Sam’s Club
- Smaller hams, downsized desserts: Sam’s Club adds petite packs as Americans plan smaller holiday gatherings during pandemic – CNBC
- BJ’s Looks to Club Supermarket Competitors – RetailWire
DISCUSSION QUESTIONS: Will Sam’s Club have success selling smaller food pack sizes for the holiday season? Do you expect the company to expand the initiative going forward, and what effect do you think this would have on its ability to attract non-business members to its clubs?