Will Sam’s new plan lead to sustainable growth?
In an email to associates sent last Friday, Sam’s Club president and CEO Rosalind Brewer wrote that after a nine-month review of the business, she was ready to share elements of a new strategic plan intended to build sustainable growth for the chain.
Ms. Brewer said Sam’s would target four key member segments to achieve its goals:
- Large families with kids between the ages of six and 18;
- "Neighbor" families who live within a few miles of a club and regard it almost like their local grocery store;
- New mothers who spend on items for their babies and have the potential to become loyal members of the club;
- Social couples, both young and old, who like to entertain.
To better serve these groups, Sam’s Club intends to focus intently on the merchandise sold in its clubs. "To do this successfully, we need to harvest data from members and the marketplace," wrote Ms. Brewer.
She announced a number of organizational changes intended to deliver merchandise that will connect with Sam’s members. These included Jason Shaw being named as vice president of category management to "deliver the analytical horsepower needed by our merchandising teams to make informed decisions."
Sam’s, which also is putting greater emphasis on fresh foods, promoted Russell Mounce, senior director of produce and floral, to vice president, divisional merchandise manager of produce. The chain is also looking to hire someone to fill a similar role for meat.
According to Ms. Brewer, key customers are also interested in purchasing locally made food and drinks. To address this need, Sam’s has moved Greg Cathey from vice president of Sam’s Club global leverage to vice president, divisional merchandise manager of regional buying, food and beverage.
Private label will also be a key component of Sam’s merchandise strategy. In her email, Ms. Brewer wrote, "Moving forward, we’ll be developing a broader, integrated private label strategy that will sit above the category level. We intend to build fewer, much stronger private label brands." Sam’s hired Chandra Holt from Walgreens to lead proprietary brands.
In expressing optimism about the outlook for the club channel in general and Sam’s in particular, Ms. Brewer pointed to the chain’s use of digital technology as a key differentiator in the marketplace.
"We’re transforming the shopping experience with digital technology, making it easier for our members to shop in and out of the club," she wrote. "Last year, we created the new SamsClub.com team led by Jamie Iannone, president of SamsClub.com. We’re already the digital leader in the warehouse club channel and believe over time we’ll have the best use of integrated technology in retail.
- Sam’s Club makes major strategy, personnel moves – Chain Store Age
- Sam’s Club outlines new merchandising strategy, organizational changes – Drug Store News
Do you see substantial opportunities for Sam’s to grow its members (consumer) business? Which of the areas identified by Rosalind Brewer — category management, fresh foods, locally made foods and beverages, private label and digital technology — do you think are most likely to pay off for Sam’s?