Sam's Club (NYSE:WMT) CEO Rosalind Brewer announced that the wholesale club will attempt to reinvent itself after another disappointing quarter.
Though Brewer noted in a quarterly earnings call that some progress had been made, results were less than expected, comp sales lacked guidance, and net sales and profits were softer than in the previous year, reported The City Wire. In fact, comparable sales were down .4 percent excluding fuel, and down 3.8 percent including fuel. Therefore, the retailer will turn to testing this year as it looks to improve in the long term.
Sam's Club will continue to focus on merchandise assortment, marketing, member rewards and e-commerce in order to lift sales and drive traffic. Also, a new chief membership officer was hired to oversee data scientists and marketing professionals to improve customer engagement.
As a first step, Sam's Club will differentiate its assortment by adding 20 percent to its organic offerings—a step intended to reach out to millennials. Second, the retailer will focus on membership decisions, based on data and analytics. Third, new programming will enhance member value. For example, Sam's Club recently launched Free/4/10, which provides Plus members with free or discounted prescriptions for members with Alzheimer's, diabetes, mental health problems, vitamin D deficiency and prostate issues. The final step is to invest in e-commerce. Sam's Club also recently relaunched Club Pickup, resulting in a 37 percent sales increase in the program.
Brewer attributed the weak quarter to negative comp sales in electronics, technology and office supplies, as well as food deflation in fresh categories. On the bright side, traffic and ticket sales were up due to strong double-digit growth in Club Pickup sales from online orders.
Sam's Club has recently been adding to its list of services for its members. For example, last month the retailer added five new solutions, for both business and personal needs, aimed at saving members up to $2,300 a year. And last fall the company introduced healthcare, payroll and legal services for its members.
-See this The City Wire article
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