When it comes to earning credit card rewards on grocery purchases, many shoppers wonder if Walmart is considered a grocery store. After all, Walmart is known for its low prices and wide selection of products, including a substantial grocery department. However, the answer is not as straightforward as you might think.
In this comprehensive guide, we‘ll explore how credit card companies categorize merchants, dive into Walmart‘s sales breakdown, and examine specific credit card issuer policies to help you understand whether you can earn grocery rewards at Walmart. We‘ll also provide expert insights, compare Walmart-specific credit cards, and offer tips for maximizing your rewards.
How Credit Card Companies Categorize Merchants
Credit card companies use merchant category codes (MCCs) to classify businesses based on the types of goods and services they primarily sell. These four-digit codes help issuers determine which purchases are eligible for specific rewards categories, such as groceries, dining, or travel.
MCCs are assigned by payment networks like Visa and Mastercard, not by the credit card issuers themselves. Merchants are responsible for selecting the most appropriate MCC that describes their primary business. However, payment networks have the final say in approving or changing a merchant‘s MCC.
Walmart Supercenters are typically assigned an MCC of 5310, which is classified as a "Discount Store" or "Supercenter." This broad category includes retailers that sell a wide range of products across multiple departments, not just groceries.
Walmart‘s Sales Breakdown
Despite being known for its low prices on groceries, Walmart‘s grocery sales account for only about 56% of its total U.S. revenue. The remaining 44% comes from other departments, such as electronics, home goods, apparel, and health and wellness products.
Here‘s a table comparing Walmart‘s sales breakdown to other major retailers:
| Retailer | Grocery Sales (% of Total) | Other Sales (% of Total) |
|---|---|---|
| Walmart | 56% | 44% |
| Target | 20% | 80% |
| Costco | 62% | 38% |
| Kroger | 77% | 23% |
Sources: Company annual reports and investor presentations
As you can see, Walmart‘s grocery sales percentage is lower than dedicated grocery stores like Kroger but higher than diversified retailers like Target. This mixed sales profile is one of the primary reasons why credit card companies do not classify Walmart Supercenters as pure grocery stores.
Credit Card Issuer Policies
Let‘s take a closer look at how some of the major credit card issuers treat Walmart purchases:
American Express
American Express does not consider Walmart Supercenters as grocery stores. However, purchases made at Walmart Neighborhood Markets, smaller stores focused primarily on groceries, are eligible for bonus rewards on grocery purchases.
For example, the American Express Blue Cash Preferred Card offers 6% cash back at U.S. supermarkets (on up to $6,000 per year, then 1%), which includes Walmart Neighborhood Markets but not Walmart Supercenters.
Chase
Like American Express, Chase does not classify Walmart Supercenters as grocery stores for its credit cards that offer bonus rewards on grocery purchases. However, Walmart Neighborhood Markets do qualify for grocery rewards.
The Chase Freedom Flex℠ card, for instance, offers 5% cash back on activated bonus categories each quarter (on up to $1,500, then 1%), which often include grocery stores. Purchases at Walmart Neighborhood Markets would be eligible for this bonus, but not those at Walmart Supercenters.
Discover
Discover does not include Walmart Supercenters in its grocery store category. However, the issuer occasionally offers temporary bonus rewards for purchases made on Walmart.com, including grocery pickup and delivery orders. Walmart Neighborhood Markets are generally considered grocery stores by Discover.
The Discover it® Cash Back card offers 5% cash back on everyday purchases at different places each quarter, like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Walmart.com purchases have been included in these bonus categories in the past.
Bank of America
Bank of America credit cards do not offer bonus rewards for grocery purchases made at Walmart Supercenters, as they are not classified as grocery stores. However, Walmart Neighborhood Markets are typically eligible for grocery rewards.
The Bank of America® Customized Cash Rewards credit card allows cardholders to choose their 3% cash back category from a list of options, including online shopping, dining, travel, drug stores, or home improvement/furnishings. Grocery stores are not currently an option for the 3% category.
Visa
Visa credit cards issued by various banks generally do not consider Walmart Supercenters as grocery stores for bonus rewards purposes. However, some Visa cards may offer grocery rewards at Walmart Neighborhood Markets.
For example, the Capital One SavorOne Cash Rewards Credit Card offers 3% cash back on dining, entertainment, popular streaming services and at grocery stores (excluding superstores like Walmart and Target), plus 1% on all other purchases. While Walmart Supercenters are excluded, Neighborhood Markets would likely qualify for the 3% grocery rewards.
Walmart-Specific Credit Cards
If you frequently shop at Walmart and want to earn rewards on your purchases, including groceries, consider applying for a Walmart-specific credit card.
The Capital One Walmart Rewards® Mastercard® offers the following rewards:
- 5% cash back on purchases at Walmart.com, including grocery pickup and delivery
- 2% cash back on in-store purchases at Walmart (including groceries), as well as at restaurants and on travel
- 1% cash back everywhere else
While the 2% cash back rate on in-store Walmart purchases is not as high as some dedicated grocery rewards cards, it can still be a good option for frequent Walmart shoppers who want to earn rewards on both online and in-store purchases.
Another option is the Walmart Rewards Card, which can only be used at Walmart stores, Walmart.com, and Murphy USA gas stations. This card offers:
- 5% cash back on purchases made at Walmart.com and the Walmart app
- 2% cash back on in-store purchases and at Murphy USA gas stations
- No annual fee
However, the Walmart Rewards Card‘s limited acceptance and lack of a sign-up bonus may make it less appealing than the Capital One Walmart Rewards® Mastercard® for some shoppers.
Comparing Walmart Supercenters and Neighborhood Markets
Walmart Neighborhood Markets are smaller stores that primarily focus on grocery items, with a limited selection of general merchandise. These stores are more akin to traditional grocery stores, which is why many credit card issuers classify them as such for rewards purposes.
Here‘s a comparison of Walmart Supercenters and Neighborhood Markets:
| Feature | Walmart Supercenter | Walmart Neighborhood Market |
|---|---|---|
| Average store size | 178,000 sq. ft. | 38,000 sq. ft. |
| Primary focus | General merchandise | Groceries |
| Grocery selection | Extensive | Limited |
| Other departments | Electronics, home goods, apparel, etc. | Minimal |
| Typical MCC | 5310 (Discount Store) | 5411 (Grocery Store) |
| Eligible for grocery rewards | Usually no | Usually yes |
Sources: Walmart corporate website and credit card issuer policies
As you can see, Walmart Neighborhood Markets are much smaller than Supercenters and focus primarily on groceries, which is why they are more likely to be classified as grocery stores by credit card issuers.
The Impact of Walmart+ Membership
In September 2020, Walmart introduced Walmart+, a membership program designed to compete with Amazon Prime. For $98 per year or $12.95 per month, Walmart+ members receive the following benefits:
- Free same-day delivery on orders of $35 or more (including groceries)
- Fuel discounts of up to $0.05 per gallon at Walmart and Murphy USA gas stations
- Mobile scan & go for in-store shopping
- Early access to select deals and promotions
While Walmart+ does not directly impact whether Walmart is considered a grocery store for credit card rewards, it does offer some attractive perks for frequent Walmart shoppers, particularly those who rely on grocery delivery or pickup services.
By using a Walmart-specific credit card in conjunction with a Walmart+ membership, you can maximize your rewards and savings on grocery purchases and other everyday essentials.
Tips for Maximizing Credit Card Rewards on Groceries
If earning credit card rewards on your grocery purchases is a priority, here are some tips to help you maximize your earnings:
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Choose the right credit card: Look for cards that offer high reward rates on grocery purchases, such as the American Express Blue Cash Preferred Card (6% cash back at U.S. supermarkets, up to $6,000 per year) or the Amazon Prime Rewards Visa Signature Card (5% back at Whole Foods Market and Amazon Fresh).
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Shop at eligible stores: Make sure to shop at stores that are classified as grocery stores by your credit card issuer. This may include traditional supermarkets like Kroger and Safeway, as well as specialty stores like Trader Joe‘s and Whole Foods.
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Utilize grocery delivery and pickup services: Many credit card issuers consider purchases made through grocery delivery and pickup services as eligible for grocery rewards. For example, using your eligible credit card with Instacart or Amazon Fresh can help you earn bonus rewards on your grocery purchases.
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Take advantage of bonus categories: Some credit cards offer rotating bonus categories that change quarterly, such as the Chase Freedom Flex℠ and the Discover it® Cash Back. Keep an eye out for quarters when grocery stores are included as a bonus category and activate your bonus to earn 5% cash back on your grocery purchases (up to the quarterly maximum).
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Combine rewards with loyalty programs: Many grocery stores have their own loyalty programs that offer additional discounts and rewards. By combining your credit card rewards with these loyalty programs, you can stack your savings and earn even more on your grocery purchases.
Here‘s a table comparing some of the best credit cards for earning rewards on groceries:
| Credit Card | Grocery Rewards | Annual Fee | Key Features |
|---|---|---|---|
| American Express Blue Cash Preferred Card | 6% cash back at U.S. supermarkets (up to $6,000 per year, then 1%) | $95 (waived first year) | 6% cash back on select U.S. streaming services; 3% cash back at U.S. gas stations and on transit; 1% cash back on other purchases |
| Amazon Prime Rewards Visa Signature Card | 5% back at Whole Foods Market and Amazon Fresh | $0 (requires Prime membership) | 5% back at Amazon.com; 2% back at restaurants, gas stations, and drugstores; 1% back on other purchases |
| Capital One SavorOne Cash Rewards Credit Card | 3% cash back on dining, entertainment, popular streaming services and at grocery stores (excluding superstores like Walmart and Target) | $0 | Unlimited 3% cash back on dining, entertainment, popular streaming services and at grocery stores (excluding superstores like Walmart and Target); 1% cash back on all other purchases |
Sources: Credit card issuer websites
By choosing the right credit card and following these tips, you can maximize your rewards on grocery purchases and save money on your everyday essentials.
FAQ
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Is Walmart considered a grocery store for credit card rewards?
Walmart Supercenters are generally not considered grocery stores by credit card issuers, as they sell a wide range of products beyond groceries. However, Walmart Neighborhood Markets are often classified as grocery stores and are eligible for bonus rewards on grocery purchases. -
Can I earn credit card rewards on grocery pickup and delivery orders from Walmart?
It depends on your credit card issuer and how Walmart codes these purchases. Some issuers, like Discover, occasionally offer bonus rewards on Walmart.com purchases, including grocery pickup and delivery orders. Using a Walmart-specific credit card, like the Capital One Walmart Rewards® Mastercard®, can also help you earn rewards on these purchases. -
What‘s the difference between a Walmart Supercenter and a Walmart Neighborhood Market?
Walmart Supercenters are much larger stores that sell a wide variety of products, including groceries, electronics, home goods, and apparel. Walmart Neighborhood Markets are smaller stores that focus primarily on groceries, with a limited selection of general merchandise. -
How can I maximize my credit card rewards on grocery purchases?
To maximize your rewards, choose a credit card that offers high reward rates on grocery purchases, shop at eligible stores, utilize grocery delivery and pickup services, take advantage of bonus categories, and combine your rewards with store loyalty programs. -
Do I need to have a Walmart+ membership to earn credit card rewards at Walmart?
No, you do not need a Walmart+ membership to earn credit card rewards at Walmart. However, a Walmart+ membership can provide additional benefits and savings, such as free same-day delivery on grocery orders and fuel discounts, which can complement your credit card rewards.
Conclusion
In summary, Walmart Supercenters are generally not considered grocery stores by major credit card issuers due to their diverse product mix. However, Walmart Neighborhood Markets are often classified as grocery stores, allowing you to earn bonus rewards on purchases made at these locations.
If you frequently shop at Walmart and want to earn rewards on your purchases, including groceries, consider applying for a Walmart-specific credit card or using a credit card that offers bonus rewards on grocery purchases at eligible stores.
By understanding how credit card companies categorize merchants, choosing the right credit card, and following the tips outlined in this guide, you can maximize your rewards earnings on grocery purchases at Walmart and beyond.
As a picky shopper and retail and consumer expert, I recommend always reading the fine print and understanding your credit card‘s rewards program before making any purchases. By staying informed and strategic about your credit card use, you can save money and earn valuable rewards on your everyday grocery purchases.
