Is Walmart Really a Supermarket? Depends on the Store

With over 4,700 retail units across the U.S., Walmart is an undisputed giant in grocery and commercial retail. But with massive 180,000 square foot Supercenters, online grocery delivery, and smaller format Neighborhood Markets – is Walmart truly still a supermarket? I‘ll break down each concept and you can decide.

Defining a Supermarket in 2024

First, let‘s examine how retail analysts actually define a "supermarket" versus other store concepts:

Supermarket

• Primary focus on food/grocery merchandise (80%+ of sales)
• Typically 30,000 – 50,000 square feet
• Full fresh food departments – produce, bakery, meat, etc.

Superstore

• Wider selection beyond just grocery, like apparel and home goods
• Larger footprint over 50,000 square feet
• Grocery still key component (~50% sales)

Supercenter

• Even broader general merchandise selection
• Massive footprints over 100,000 sq ft
• Lower share of grocery sales (~35% of mix)

With those industry definitions in mind, let‘s analyze Walmart‘s concepts.

Traditional Walmart Stores – Not Supermarkets

Walmart originally opened in 1962 as a small discount department store focused on value-priced general merchandise. While the retailer steadily expanded its grocery mix, even most modern traditional locations derive only ~15% of sales from grocery items.

With far more general retail merchandise than food, Walmart‘s traditional stores clearly don‘t qualify as supermarkets today.

Traditional Walmart Store Key Stats

• Average size: ~80,000 square feet
• Grocery sales mix: 10-15%
• Target consumer: Price-conscious general merchandise shoppers

Neighborhood Markets – The True Supermarket

Seeking to win market share from traditional supermarkets, Walmart launched its Neighborhood Market grocery concept in 1998. With a sharp focus on fresh foods and daily needs, these small-format stores come closest to a traditional supermarket:

Walmart Neighborhood Market Key Stats

• Average size: ~40,000 square feet
• Grocery sales mix: 80-85%
• Target consumer: Weekly grocery shoppers

With over 85% sales concentration in grocery items, Neighborhood Markets fit squarely under the definition of a modern supermarket.

Supercenters – Too Big to Qualify

Combining a full grocery selection with Walmart‘s general merchandise assortment, Supercenters average a mammoth 180,000 square feet. While the retailer calls it a "one-stop shop", Supercenters are really more of a hybrid concept.

Walmart Supercenter Key Stats

• Average size: ~180,000 square feet
• Grocery sales mix: 30-35%
• Target consumer: One-stop for all household needs

Considering their massive size and non-grocery product concentration, Supercenters cannot reasonably be considered supermarkets.

Walmart Concept Comparison

So clearly only the Neighborhood Market stores, with their 80%+ grocery concentration, meet the technical definition of a supermarket.

Next I‘ll analyze why the other concepts receive different classifications from credit card rewards programs.

Impact on Credit Card Grocery Rewards

Many top rewards cards offer enhanced bonus categories like 3-6% cash back for supermarket spending. However, since Walmart Supercenters focus more on general merchandise, they are actually classified as "discount stores" or "superstores" by card networks.

For example, Visa assigns Walmart Supercenters either Merchant Category Code (MCC) 5310 for discount stores or MCC 5311 for warehouse clubs. Neither code qualifies for grocery bonuses.

On the other hand, Visa properly assigns Neighborhood Markets the MCC 5411 supermarket designation. So shopping at Neighborhood Markets likely will trigger credit card grocery bonuses.

Below is a comparison of how top credit card networks classify Walmart concepts:

So credit card networks recognize Neighborhood Markets as supermarkets, while classifying Traditional and Supercenters differently.

Prescriptive Advice – Maximize Your Rewards

If your goal is to earn maximum grocery bonuses, make Walmart Neighborhood Markets your first choice:

• Shop Neighborhood Market stores to trigger lucrative credit card bonuses
• Avoid Supercenters for grocery bonus spending
• Consider general cash back cards for non-grocery Walmart purchases

Based on my retail analytics expertise, this is the optimal way to structure your Walmart spending for bonus rewards.

Conclusion – It‘s Complicated, But Neighborhood Markets Deliver

Walmart encompasses multiple retail concepts so blanket "supermarket" classification is dubious. In my analysis, only Neighborhood Markets fully meet the 80%+ grocery concentration typical of supermarkets.

On the other hand, Traditional stores and massive Supercenters incorporate far more general merchandise to qualify. And credit card rewards programs properly distinguish Neighborhood Markets, directing valuable grocery bonuses appropriately.

So in the end – yes Walmart does operate true supermarkets…but only in the form of the Neighborhood Market stores. Keep this advice in mind when you shop to maximize your credit card rewards!