Something important is happening at Walmart: it’s not abandoning its core customer. It’s broadening its appeal.
Walmart remains focused on price and continues to cut prices across thousands of household items. But in its most recent quarterly results, the company said its U.S. market-share gains were “led by upper-income households.”
That’s worth paying attention to.
Mark Zandi, chief economist of Moody’s Analytics, recently highlighted why. The top 20% of U.S. households by income now account for nearly 60% of personal outlays, up from about 50% in the early 1990s. The bottom 80% now account for roughly 40%.
For retailers, that’s a major shift in the addressable market.
Walmart’s success with higher-income consumers is often described as “trading down.” That’s part of the story, but convenience matters just as much. Pickup, online assortment, faster fulfillment and Walmart+ allow shoppers to get more of what they need from one retailer.
That’s a powerful value proposition, even for consumers who can afford to spend more.
Wealth is also concentrating spending. Moody’s estimates that households in the top 20% hold almost 90% of corporate equities and mutual funds. When the stock market rises, the resulting wealth effect is concentrated among the same households already driving a disproportionate share of consumer spending.
The result is a retail economy that can look healthy in aggregate while many households remain under pressure.
For the 12 months ending March 2026, Moody’s estimates that spending by the top 20% grew 6.5%, compared with 2.7% for the bottom 80%. After inflation, spending among the bottom 80% was essentially flat.
That creates an interesting challenge for retailers.
The answer is not simply to chase affluent consumers. Most retailers still need their lower- and middle-income customers. The opportunity is to capture more spending from higher-income households without weakening the value proposition that built the business.
Walmart can do that. Costco can, too. Both have brands built around value that can appeal across income groups.
From a commercial real estate perspective, the shift puts even more emphasis on household income, spending power and convenience when evaluating retail locations and trade areas. The strongest retail concepts will increasingly need to serve multiple income groups without confusing either one.
Walmart’s strategy is not really about moving upmarket. It’s about redefining value.
The demand for value remains broad. The spending power behind that demand is becoming more concentrated. Retailers, landlords and developers should be paying attention.
