Dive Brief:
- Whole Foods has partnered with startup Packed Party to stock its stores with an array party supplies, decorations, cupcake kits and drinkware, Fast Company first reported.
- All of the items from Packed Party are recyclable and share a colorful, bright aesthetic. The six-year-old startup, based in Austin, Texas will begin supplying Whole Foods with its products later this month.
- Packed Party’s price point is higher than typical party supply brands, with items like a $38 confetti bucket bag and a $16 stack of cups listed on its website, according to RetailWire. The site noted an exclusive line of plastic cups for Whole Foods will retail for $5.
Dive Insight:
The party supply category isn't an obvious one for Whole Foods to add. The chain is primarily known for gourmet and all-natural food, and some industry observers believe it's compromising its identity by continuing to expand beyond its core assortment.
"Nothing quite as tone deaf as selling plastic party supplies at a health food store," Paula Rosenbloom, managing partner with RSR Research, wrote on RetailWire.
On the other hand, adding a party supply aisle alongside its large wine selection, from-scratch bakery and deli department could round out Whole Foods' status a one-stop shop for party planners.
And Packed Party's high-end, recyclable products do fall in line with Whole Foods' standards. The expansion into party goods could help the grocer differentiate from competitors with a product line that offers a look and feel distinct from standard party products.
"While the retailer has previously offered a smaller range of party supplies, the partnership with Packed Party should help it create a larger impact with the category," analysts with research firm IGD wrote in a note this week.
The party business is a big one. According to T. Rowe Price’s 11th annual Parent, Kids and Money survey, the average family spent $288 in the last year on kids birthday presents and parties alone. With Whole Foods' affluent customer base, that number could be even higher, and offering a full suite of food, beverage and supplies to its shoppers could drive sales gains.
Amazon's influence is showing with this latest move. The online retailer is, of course, a go-to destination for people shopping for just about anything, including party supplies. The addition is unlikely to create any major battles with direct competitors, but it could be something for retailers to watch, especially a company like Target, which has a wide selection of trendy party supplies and is also hard at work expanding into grocery. It will also be interesting to see if Packed Party eventually has its products cross-promoted or sold directly on Amazon’s site.
