May 18, 2021 at 05:05PM

Less than two weeks after a leaked memo showed that Walmart was fretting about losing share in its crucial grocery franchise, the brick-and-mortar giant said Tuesday (May 18) that it had actually increased it slice of the food and beverage category over the past 90 days.

This, as the Arkansas based company announced first-quarter earnings results that showed its better than expected growth of both its online and in-store sales, after nearly a decade where the retailer’s market share remained relatively flat.

“This was a strong quarter … and we’re encouraged by traffic and grocery market share trends,” Walmart President and Chief Executive Officer Doug McMillon said in a statement. “Our optimism is higher than it was at the beginning of the year.”

The leaked memo, which dates back to February, read, “Grocery, the growth engine of the business, is losing share rapidly. More than ever, Walmart shopper[s] are choosing the competition.” Alongside this statement, the memo showed data indicating that consumers have been choosing competing grocers more often and choosing Walmart less often.

While grocery sales were down compared to the same period in 2020, when consumers’ early pandemic pantry stocking supercharged sales, they grew “low-double digits on a two-year stacked basis,” according to a company presentation. In Canada, Walmart’s online sales grew 116 percent led by online grocery, and subsidiary Sam’s Club sales grew 10 percent, with grocery sales showing high single digit growth led by the drinks, snacks and candy categories.

In recent weeks, the company has been guiding consumers to its grocery eCommerce options through its suite of branded content. On Tuesday (May 18), following Walmart’s Q1 earnings release, First Media announced its partnership with Walmart to expand its So Yummy food platform with a 24/7 video food content stream, an extensive collection of recipes, its social media content, and more, with all content “made fully shoppable by Walmart.”

“Walmart is focused on meeting our customers where they are and we continue to create innovative ways to shorten the distance between inspiration and purchase,” Sarah Henry, senior director of content and influencer marketing at Walmart, said in a statement. “We are excited to partner with First Media to bring entertaining, shoppable food content to customers in a fun, seamless way.”

Earlier in the month, the retailer launched its Hidden World of Waffles + Mochi series, featuring shoppable food-centric videos created in collaboration with Netflix’s Waffles + Mochi children’s TV show, featuring an endorsement from the Netflix series’ cohost and executive producer Michelle Obama.

In April, Walmart made a major play for consumers’ post-pandemic online grocery spend, announcing the expansion of its InHome service, which delivers groceries into customers’ refrigerators while they’re away. The service is meant to make eGrocery a possibility as consumers return to the office and become unable to answer the door at home for their mid-workday grocery delivery. Additionally, recent PYMNTS data finds the Walmart+ membership program is growing its member base by millions each month. The company is also looking to increase its fulfillment capacity and to speed delivery times — in April, the company announced its investment in autonomous vehicle company Cruise.

These investments may already be paying off — looking ahead, Walmart Executive Vice President and Chief Financial Officer Brett Biggs shared on a call with analysts that the company expects “grocery market share gains to continue.”

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