Walmart Inc.’s Sam’s Club is turning to brands in its battle with Costco.
In other words, it is a private brand. To compete with Costco’s Kirkland Signature, the company changed the quality, quantity, and variety of its private brand Member’s Mark products.
The battle between name brand products and private label products has been going on for decades.
Some would argue that household items like toilet paper, trash bags, and paper towels are pretty much the same, but what about specialty foods and clothing items?
Sam’s Club and Costco have roughly the same number of stores across the US, but Costco generates roughly twice the annual revenue, according to CNBC.
“The club model survives because we have great merchants who are focused on developing and buying great products,” Sam’s Club CEO Chris Nicholas told the media. “Costco has done a great job with that over the years with Kirkland and we’ve seen it succeed.”
a A catalog detailing Costco membership benefits Some of Kirkland Signature’s most popular products are on display, including dish detergent, laundry detergent and vitamins, he said, adding that the product line began in 1995.
“Our mission is simple: to create products of equal or better quality than the leading brands at lower prices. And we do it by controlling every aspect of our products, including packaging and shipping,” the catalog reads, encouraging consumers to compare Kirkland Signature products to those of the name brands.
Shoppers who want either Kirkland Signature or Member’s Mark products must first become club members.
Costco membership costs $60 per year for a Gold Star membership and $120 per year for an Executive membership.
At Sam’s Club, a Club-level membership costs $50 per year, while a Plus-level membership costs $110 per year.
According to CNBC, Members Mark sales account for about 30% of Sam’s Club’s annual sales, while Kirkland Signature accounts for 28% of Costco’s.
“Members Mark products are exclusively designed with the finest materials and highest quality ingredients, ensuring the best quality and value at members-only prices,” Sam’s Club’s corporate website states.
