Walgreens is joining other retailers in cutting prices on everything from snacks to toiletries to Squishmallows to lure back inflation-savvy shoppers who are put off by high prices.
Prices on more than 1,500 items, offering both name-brand and private label items, will begin immediately online and in Walgreens stores, the company said Wednesday. In recent weeks, competitors such as Target, Walmart and Amazon have slashed prices on thousands of household goods in an effort to boost consumer spending.
For example, an 80-count jar of One A Day vitamin gummies now costs $11.99 (was $13.49), and a bag of sour cream and onion potato chips from Walgreens’ Nice! brand now costs $1.99 (was $2.79). For kids, the price of a 16-inch Squishmallow plush toy has increased from $24.99 to $20.
“Walgreens understands that our customers are under financial pressure and are struggling to purchase everyday necessities,” said Tracey D. Brown, Walgreens’ retail president and chief customer officer, in a press release. “We remain committed to our customers by reducing prices on over a thousand more items, which we have been doing since October 2023.”
Walgreens Boots Alliance (WBA)’s latest earnings report, released in March, showed that the retailer’s second-quarter sales beat expectations, but its full-year profit outlook was lowered due to a “difficult retail environment in the U.S.”
Shares have fallen 40% year-to-date, and the next earnings report isn’t expected until June. Meanwhile, numerous other retailers are releasing results on Thursday, including Dollar General and Costco.
Savings for buyers
Many major retailers are cutting prices to lure consumers into stores and online, giving them more freedom to purchase essential goods such as groceries, as well as non-essential items such as new clothing, home decor, arts and crafts or hobby kits.
Retailers are nervous after raising prices in recent years due to inflation. But now households aren’t shopping as much as they used to, and high prices are forcing Americans to choose between wants and needs. In the battle between stores and shoppers, stores seem to be finally giving in.
This represents an ongoing challenge for the entire American economy, about two-thirds of which comes from consumer spending.
Shoppers have been pulling back for a year as prices have risen 20 to 30 percent from three years ago and incomes have failed to keep pace, says Sarah Wyeth, managing director of retail and consumer at S&P Global Ratings.
This is leading consumers of all income levels to seek out bargains. “Consumers simply have less money to spend,” Wyeth said. The challenge for retailers now is to get consumers out of this frugal mentality, she added.
–CNN’s Parija Kavilanz contributed to this report.
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