Dive Brief:

• Despite keeping its price low and introducing services and foods to make its stores convenient places to visit, Wal-Mart stores are struggling in part because its customers are.

• Wal-Mart’s grocery business, half of its business, has suffered because food stamp benefits were decreased last year, which led to a .9% decrease in food sales.

• Last week the retail giant said Q2 profits would likely miss expectations after reporting its smallest Q1 sales growth in almost five years, a problem the company blamed on the continuing severe weather and food stamp cuts. 

Dive Insight:

With Wal-Mart Stores core customers benefiting less from the improving economy than higher income consumers, the retailer has made moves to offer higher-priced clothing and food, with mixed results. While some analysts think the move is wise, others think the retailer should concentrate on the lower-income shopper, as Wal-Mart is unlikely to draw shoppers more likely to go to Macy’s or Nordstrom for clothing.