THE FRIDAY 5: The Latest Lawsuit Against Kroger; Walmart’s New Value Proposition
Welcome to The Friday 5, Progressive Grocer’s weekly roundup of the top news and trends in the food retail industry. Each Friday, we’ll take a look at the stories that are most important to our readers and also keep tabs on the trends that are poised to impact grocers.
1. Kroger Sued Over Wellness Festival, Makes Leadership Changes
The Kroger Co. was in the news this week as it came to light that singer Jewel, along with a festival company, filed a lawsuit against it, accusing the national grocer of cutting them out of the partnership that launched what has become the annual Kroger Wellness Festival. The complaint accuses Kroger of breach of contract, breach of fiduciary duty, misrepresentation and unjust enrichment, among other causes of action.
According to the lawsuit, Trevor Drinkwater, CEO of Inclusion Cos., an operator of retailer-sponsored, celebrity-backed festivals, and the singer-songwriter came up with the idea for a festival promoting mental and physical wellness. They considered partnering with several national retailers and ultimately chose Kroger. The festival turned a profit for the first time in its third year. Then on April 1, 2022, the lawsuit noted that Kroger revealed it was terminating its arrangement with Wellness Your Way Festival.
Kroger has disputed the claims and filed a motion to dismiss the case. A hearing is scheduled for April 28 for the judge to hear Kroger’s motion for dismissal.
Meanwhile, Kroger announced a round of leadership promotions this week. Joe Kelley, president of Colorado-based King Soopers & City Markets division, will serve as SVP of retail divisions, while Kenny Kimball is returning to the Utah-based Smith's division as its president.
Chris Albi, group VP of operations at King Soopers & City Markets, will step into Kelley’s now-former role as president of that division. Kendra Doyel has been elevated to president at the California- and Illinois-based Food 4 Less, taking over from the retiring Bryan Kaltenbach.
2. Walmart Investing in Customer Value Proposition
Readers were interested in multiple news stories from Walmart this week, starting with PG Editorial Director and Associate Publisher Gina Acosta’s exclusive interview with John Laney, the EVP of the Walmart U.S. food business. Laney offered a comprehensive look at how the company is accelerating its ability to serve shoppers how they want to be served in the moment.
Walmart is accelerating growth now by strengthening its focus on value, convenience and innovation, with Laney explaining that “Customers are choiceful in their spending and looking for value – saving money and time – and we’re prepared to deliver both.”
Walmart also shared this week that it is using geospatial technology to ramp up the number of delivery customers it can serve. The data science model lets the retailer divide geographic areas into precise hexagonal grids instead of relying on traditional boundaries like ZIP codes, which optimizes delivery zones for greater efficiency.
Finally, during Walmart’s 2025 Investment Community Meeting last week, subsidiary Sam’s Club unveiled ambitious growth plans that see the club retailer doubling membership and more than doubling sales and profit over the next eight to 10 years.
According to Sam’s Club President and CEO Chris Nicholas, the company is working to drive increased membership and expanded physical and digital capabilities, while also delivering an elevated experience for its members.
3. Save Mart Slashes Prices
The Save Mart Companies this week introduced a substantial price reduction campaign, cutting costs on more than 4,000 grocery items in Save Mart and Lucky stores throughout California and Nevada. Shoppers will now find thousands of items marked with red “Lower Price” tags across every department, including produce, meat, dairy, frozen, bakery, deli, floral and pantry essentials.
“As families across the nation are grappling with inflation and economic uncertainty, we knew it was time to act,” said Jim Perkins, president of The Save Mart Companies. “Shoppers deserve a break, and this aggressive campaign is designed to bring affordability back to the table. By making a significant price investment and negotiating with our supplier network, we’ve cut through the noise of rising costs to deliver what matters most — unmatched savings without sacrificing quality.”
4. Albertsons' Mojo Is Back
Albertsons Cos. reported gains for its fourth quarter of fiscal 2024 and full year fiscal 2024, which ended Feb. 22. The grocer’s Customers for Life strategy "has firmly positioned the company for its next chapter of growth and value creation for shareholders," according to CEO Vivek Sankaran, who is retiring next month.
For Q4, identical sales increased 2.3%, digital sales jumped 24% and loyalty members rose 15% to 45.6 million. Meanwhile, net income was $172 million, or 29 cents per share; adjusted net income was $270 million, or 46 cents per share; and adjusted EBITDA was $855 million.
[RELATED: Albertsons Focuses on 4 Digital Platforms for Growth]
5. Trends From the Lipari Food Show
PG Senior Editor Lynn Petrak was on the floor at the Lipari Food Show held April 9 in Novi, Mich., where she saw several food retailing trends come to the forefront. Middle Eastern fare, in particular, garnered a lot of interest, as did time-tested, artisan-style methods.
