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Walmart customers are behaving so strangely it’s making bosses ‘sit up in their chairs’

Derek White—Getty Images for Operation HOPE, Inc.

The current state of the economy has left consumers understandably perplexed, and it appears that major corporate leaders are equally confused about consumer trends.

Predictions about U.S. spending for the remainder of 2023 and into 2024 vary among industry experts.

Bank of America CEO Brian Moynihan asserts that shoppers remain relatively stable, while Wells Fargo CEO Charlie Scharf goes a step further, stating that consumers are “still very, very strong.” On the contrary, some experts, such as Wharton professor Jeremy Siegel, anticipate a significant pullback from consumers after the summer season.

According to Walmart, a useful barometer of shopping sentiment in the U.S. as a provider of both essential and discretionary goods, it’s a mixture of all of the above. But even Walmart is grappling with what the implications are for the next 12 months.

John David Rainey, Walmart’s CFO, told the Morgan Stanley Global Consumer and Retail Conference on Wednesday that consumers behaved so strangely in October it made bosses “sit up in their chairs.”

Spending patterns during the last two weeks of October were particularly “puzzling” when compared with prior months, he continued, though he said he did not intend to be “alarmist” in any way.

Unfortunately for Rainey, Wall Street may already be spooked. The retailer’s share price has slumped this month: down 7% after a nosedive following the group’s Q3 earnings call.

On the call in mid-November, Rainey first hinted at shifting consumer behavior, saying: “We see our customers showing ongoing discretion in seeking value to manage within their household budget.”

This week Rainey sought to reassure, with Reuters reporting he said the “anomalous” behavior of shoppers and deflationary price pressures haven’t prompted Walmart, a $415 billion company, to rethink its long-term plans.

Customers are increasingly price sensitive

Customers may still be spending big en masse—the 2023 Black Friday period broke records after Americans shelled out $9.8 billion on goods—but individuals are getting increasingly wary of the price tags on day-to-day items, Walmart’s CEO said.

On the same day as Rainey’s update, Walmart CEO Doug McMillon sat down with CNBC for a more in-depth discussion about shopping habits. “Customers generally speaking are really sensitive right now. They’re prioritizing their orders, and they know there’s a chance that prices might be lower right before Christmas or right after Christmas with clearance, so that’s what we expect to happen.”

Previously Wall Street titans had said they were seeing the most softening on the lower end of the income spectrum. Citigroup CEO Jane Fraser, for example, said earlier this year that “cracks” were beginning to show in consumers who earn less.

McMillon said that’s not the case Walmart is seeing, explaining: “Everybody‘s price sensitive. We went through this period of inflation which has now changed—we’re starting to see some deflation, which we’re happy to see—but as that price sensitivity went up, everybody was looking for value.”

According to the latest data from the U.S. Bureau of Labor Statistics, some food prices are indeed beginning to come down. Data from October showed the prices of dairy products and nonalcoholic beverages, for example, had decreased while the price of gas also dropped by 4.9%. Overall this meant the consumer price index change from September to October was exactly zero.

Amazon echoes Walmart observations

Walmart isn’t alone in its observations: Amazon CEO Andy Jassy said his team saw similar trends from the top of the online tree, and seemed confident consumers would continue to turn to them for the essentials.

“Consumers are still spending,” Jassy said in an interview with CNBC this week. “They’re being careful about what they spend on, and they’re looking for bargains and deals wherever they can. Wherever they can trade down price they’re trying to do so.”

Despite some categories of the consumer price index coming down, inflation is still above the Fed’s target 2%; it was 3.2% in October. And yet, Jassy said, consumers remain resilient.

Indeed, it would take a major spike to stop them from buying the essentials: “I think people are going to buy certain retail items,” he noted. “A lot will have to go bad before people stop investing in detergent and shampoo and soap. If you look at our consumables business, the growth rate is pretty exceptional.”

This story was originally featured on