Marketside Gets Fancy as Wal-Mart Eyes Gourmet

One complaint about Wal-Mart’s Marketside stores when they debuted last year in Arizona was that a retail concept that was supposed to emphasize high-quality prepared food had a rather bland line up. Wal-Mart has been addressing that concern.

A small, 15,000 square food store format, Marketside, with four stores in the Phoenix metropolitan area, was Wal-Mart’s answer to Tesco’s Fresh & Easy stores. Yet, it provides Wal-Mart with another benefit. Like Fresh & Easy, Marketside is convenience oriented, a place developed for folks on the go, with lots of takeout meals complemented by enough groceries and other merchandise so that anyone coming in for a quick bite can pick up those few everyday items that won’t wait until the next big shopping trip. Because of the way it’s positioned, the convenience food has to be competitive with restaurant take out. Essentially, for Marketside, Wal-Mart has to approach food differently, making the concept not only a selling proposition, but a test kitchen. Don’t be surprised if what proves popular at Marketside starts showing up at Wal-Mart’s Neighborhood Market grocery stores and its supercenters.

Of course, Wal-Mart will have to shake off old habits, including its tendency toward the very safe and very mainstream, and apparently it is doing so. A second generation of food already has rolled out at the stores and it’s fancier stuff. Macaroni and cheese is still among the side dishes but so is grilled asparagus and roasted red skin potatoes.

Even if Wal-Mart is getting fancy, it’s still value oriented and, as a visit to one Phoenix-area Marketside store demonstrated, signs emphasizes that shoppers can assemble meals inexpensively. Main meals run $8 and $6 but they are put together and presented with a gourmet orientation. For $8, Marketside offers a range of 16-inch pizzas with toppings that include big chunks of chicken and pepperoni as well as family-sized tamale pies. For $6, it offers marinated beef fajitas and barbecue beef brisket and with garlic mashed potatoes, each meaty and large enough to feed two. At $4, the store stocks flatbread pizzas, also with a range of toppings, which could be one big meal by themselves or could feed two with a salad, which, naturally, Marketside also provides, and in a range of variations and prices.

Wine also is a major part of the store mix and conspicuously positioned next to the prepared foods. Besides the usual wine categories such as Merlot, the store included displays under signs reading Interesting Reds and Interesting Whites, essentially creating a segment of store-recommended wines. That may be a new experience for Wal-Mart, but, if its picks catch on, the company could become a force in value gourmet food, a sector of retailing that Trader Joe’s has almost single handedly popularized, at least up until the deployment of Fresh & Easy and now Marketside.