Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.

Retail Brew

Jeena Sharma

retailbrew.com

Martha Stewart in garden apparel line for Tractor Supply

Martha Stewart joins forces with Tractor Supply

Tractor Supply has joined forces with Stewart for an apparel line featuring eight items that you can, yes, buy. 

Why is Martha Stewart selling garden apparel for a farm supply company?

Andrew Adam Newman

Should retailers make shoppers buy additional items to get one that’s in high demand?

Plus, you weigh in on whether working from home should preclude promotions. 

Hot Topic: Should retailers make shoppers buy additional items to get one that’s in high demand? 

Low income fast food consumers pull back on spending

A quarter of consumers making less than $50,000 a year said they were eating less fast food: survey.

Fast food joints face uncertainty as low income consumers pull back on spending

Stores

Alex Vuocolo

Sally Beauty is teaming up with DoorDash for a 

 in New York City this week from Thursday to Saturday. The event highlights the brands’ partnership to make beauty products available for on-demand delivery—something that is becoming more common across the industry. Earlier this month, Sephora 

 with Uber Eats to make its stores available on the platform.

Here’s what else is going on in retail this week:

Weeks after other major retailers reported their quarterly earnings, Costco is on deck to report its 

 on Thursday. The membership store just reported its August sales numbers, which showed an 8.7% increase from the year before. This tracks with the 8% sales increase it saw in the previous quarter.

GROW, a platform for direct-to-consumer retail brands, technology providers, and investors, is hosting a 

 in New York this week for the industry to learn and network. Topics on the agenda include personalization, profitability and supply chains, as well as a heavy focus on artificial intelligence. Speakers include executives from Steve Madden, Dr. Squatch, and Branch Furniture.

 Monday at 1pm looking at changes in the credit industry. According to the event description, “consumers are divided into two camps: planners who map every purchase for rewards or liquidity, and impulse spenders who swipe reactively.” The event is aimed at helping retailers understand how processors and issuers are developing new products aimed at each camp.

Costco earnings and GROW conference 

Plus, PYMNTS hosts a webinar on credit card trends.

This Week in Retail: Costco earnings and GROW conference 

Target said 20,000 new items—“twice as many as last year”—will be available to customers this holiday season, as the retail giant tries to lure customers with “more new, on-trend, and affordable gifts.”

The company created a Target Deals page where shoppers can explore the latest promotions. The page organizes deals by category, such as “Halloween” or “household essentials,” with sections for special deals available only to Target Circle members.

The landing page comes as Target seeks to freshen its holiday assortment.

Rick Gomez, chief commercial officer at Target, said in a statement that new items will be dropping each week, and that more than half of its assortment is exclusive this year. That includes pop culture exclusives, such as toys and collectibles based on the final season of Netflix’s 

 sequel, as well as apparel and affordable beauty products.

While affordability and newness have been priorities for Target since at least the 2024 holiday season—when the company said it was offering 50% more new items than 2023—its focus on newness in particular appears to be sharpening. The company has 

 its go-to-market time for new products and, in a recent earnings call, attributed sales gains in key categories such as food and home to more newness.

“When we deliver newness that’s on trend,” Gomez told shareholders, “the consumer reacts and we drive sales.”

Whether the strategy helps Target out of its current doldrums remains to be seen, however. The company reported a 1.9% decline in comparable sales in the second quarter, and foot traffic 

 for the seventh straight month in August. The retailer is also in the middle of an executive shake-up, with COO Michael Fiddelke set to replace longtime CEO Brian Cornell on February 1.

Target highlights newness and affordability in holiday offerings 

The retail giant is touting the arrival of 20,000 new items on shelves this holiday season, with thousands starting at just $5. 

, Walgreens is spinning off into a private standalone company, and new CEO Mike Motz is purportedly bringing a “renewed focus on retail.”

 from private equity firm Sycamore Partners—which 

 Walgreens’s parent company for $23.7 billion in August—hints at what could be a significant strategic pivot for a pharmacy chain whose retail business had arguably 

The disparity was starkly presented in the company’s last earnings report as a public company earlier this year. While pharmacy sales grew 11.8% in the third quarter, retail sales were down 5.3% due to weaker demand in key categories such as grocery, household, beauty, and health and wellness.

“Walgreens has not been tremendously successful at retail,” Neil Saunders, managing director and retail analyst at GlobalData, told Retail Brew. “It has, in fact, neglected retail, and that has created a lot of problems.”

Walgreens’s problems mounted in recent years, forcing the company to go on a cost-cutting spree that culminated in 2024 with a footprint optimization plan to close 1,200 locations over the next three years.

But financial struggles aren’t unique to Walgreens—just ask former rival Rite Aid, which has 

 since 2023. The entire retail pharmacy industry has struggled to find its footing in the current retail environment.

“Let’s be frank; it’s a model that’s under pressure,” Chris Krese, SVP of congressional relations and communications at the National Association of Chain Drug Stores, said. “Over the past eight years, we’ve seen about 10% of pharmacies close, and right now they’re closing at a rate of about four pharmacies per day, which is a pretty shocking number.”

 But when asked about the role of retail in reversing this situation, Krese continued to tout the pharmacy side of the business, pointing to the expansion of pharmacy services as a “tremendous opportunity for the profession and for the industry.”

He also gestured toward the importance of food offerings, and how “the increasing recognition of food as medicine” calls for the “integration of the total store in the pharmacy,” but otherwise didn’t provide a clear statement on how the industry is thinking about retail.

“To be quite blunt, most pharmacy chains in the US are absolute garbage as far as retail is concerned,” Saunders said. “They’re all as bad as each other.”

Outside of the US, however, there are some bright spots. One is the UK-based Boots pharmacy chain, which Walgreens acquired in 2014. That company distinguishes itself in the beauty and wellness categories, with a selection of premium products and a strong in-store experience—and yet in Saunders’ view, Walgreens never applied these lessons to its US businesses.

“It was always extremely surprising to me the extent to which they had a template within the group that they never really utilized in the US,” he said.

 The challenge for pharmacy chains is giving customers a reason to show up other than picking up a prescription. Traditionally, Saunders explained, the reason was convenience, but this business case has been diminished due to increasing competition from dollar stores, mass retailers, and e-commerce giants.

The alternative, he said, is picking a category—such as beauty in the case of Boots—and really standing out in that area, though even that route has become more challenging as specialized retailers such as Ulta have gained market share.

“A lot of the routes that would have been possible, or [where] you could have emulated Boots, for example, they’re more closed than they were,” Saunders said. “They’re not open pathways.”

A Walgreens sign outside one of the chain's retail locations.

Walgreens spin-off promises ‘renewed focus on retail’ 

The pharmacy chain is now a private standalone company, but can it make up for lost time when it comes to its long-neglected retail business?

Walgreens spin-off promises ‘renewed focus on retail,’ but the path forward is unclear 

Back in 2014, while most of us were still swiping our credit cards or rifling through our wallets for cash, Apple was plotting to take over digital payments.

“From the outset, we envisioned a world where you could use your iPhone to seamlessly pay for everything—from groceries to train tickets, in person and online, across the globe—all while keeping your personal and financial information safe and private,” Jennifer Bailey, Apple’s VP of Apple Pay and Apple Wallet, wrote in a blog post in 2024.

In retrospect, Apple’s sweeping vision seems justified. The iPhone-based digital wallet is now available in 84 markets and through 11,000 banks, and penetration has grown from 3% of US retailers accepting Apple Pay to 85% in just over a decade.

That is a “lightning speed” transition in the world of payments, Christopher Uriarte, payment expert at Glenbrook Partners, told Retail Brew. But it didn’t happen by accident. The explosive growth of Apple Pay was made possible by a combination of well-timed technological innovation, changing regulations, and clear incentives for consumers, banks, and merchants.

 Giving Apple Pay momentum early on was a separate but related change in the country’s payment infrastructure. In 2015, Europay, Mastercard, and Visa issued a 

 mandating the adoption of EMV chips, the gold squares on your credit card that look like little circuit boards that allow you to tap rather than swipe.

The significance for Apply Pay was that when merchants started updating their POS systems to communicate with these new chips, many saw an opportunity to add another technological capability called 

 (NFC). This technology is what mobile devices use to communicate with each other and it also happens to be the backbone of Apple Pay.

“Once they looked at these strategies for replacing their terminals, that’s when they said, ‘Well, listen, it doesn’t really cost that much to add this NFC technology as well,’” Uriarte said.

Once that technology was embedded, he added, your iPhone was as good as your credit card. There was no additional work required of merchants. 

with the winds of technological change blowing in its favor, Apple Pay still had to get banks on board, and in typical fashion for the tech giant, it came out of the gate with backing from some of the biggest financial institutions in the world. At its launch, Apple Pay was partnered with banks such as Capital One, Chase, Citi, Wells Fargo, and Bank of America, which together represented 83% of credit card purchase volume in the US.

Where Apple was particularly bold though, according to Uriarte, was in going to banks and asking them to pay for the service per transaction. “That’s still the prevailing model in the US today,” he said.

The way Apple justified this model is by offering better fraud protection than credit cards. It offered stronger know your customer (KYC) checks to sign up, and the built-in benefit of every iPhone requiring biometric authentication to process a transaction, Uriarte explained.

“It very much has paid out positively for the banks,” he said. “There is very, very little fraud when it comes to Apple Pay transactions.”

In addition, wide adoption among consumers soon made it hard for any remaining banks to wait on the sidelines. “What eventually happened was the banks that didn’t want to support Apple Pay didn’t want to be that bank that was known for not supporting Apple Pay,” Uriarte said.

And for consumers, the appeal came down to convenience. Apple commissioned a survey from Morning Consult, which found that 90% of users cited “ease of use” for why they adopted Apple Pay; 88% said “the privacy it provides”; and 87% “cited the security of the service.”

“There’s really only two ways that you can get customers to change their behavior and how they pay,” Uriarte said. “The first is they have to have some sort of big financial incentive, or there needs to be sort of a big uplift in convenience, one or the other.”

How Apple Pay became ubiquitous at retailers

In just over a decade, Apple Pay has increased its penetration from 3% of US retailers to 85%. Here’s how the tech giant pulled it off. 

 is coming to Chicago this week, and Retail Brew’s Vidhi Choudhary will be in attendance to report back on the latest trends. C-suite executives from Sam’s Club, The Home Depot, and H&M, to name just a few, will be speaking on topics ranging from product curation and brand identity to AI-powered retail intelligence.

The Commerce Department’s monthly retail sales data is dropping on Tuesday. The report will cover retail sales in August and provide a high-level look at how the economy fared through the back-to-school shopping season and how the ongoing tariff situation impacted consumer spending. In July, consumer demand showed some resilience, with sales growing 0.5% from the month before and 3.9% from a year earlier.

NRF is headed across the pond with the debut of its Big Show Europe. The industry gathering aims to combine both the European and North American retail markets, with a speaker lineup featuring some of the biggest global players. Topics on the agenda include unified commerce, logistics and supply chains, and store design and technology.

 on Tuesday showcasing its latest retail media innovations, products, and partnerships, and CEO Corie Barry and Best Buy Ads President Lisa Valentino will be in attendance. For background, Best Buy Ads recently launched a new offering called Social+ that allows brand and agency partners to automatically track the performance of their social media campaign with its first-party audience.

Finally, the Federal Reserve is set to announce its latest interest rate decision on Wednesday. The announcement has taken a political turn, as President Donald Trump has urged Fed Chair Jerome Powell to 

August retail sales and Shoptalk Fall

Plus, NRF heads to Europe, and Best Buy talks retail media 

This Week in Retail: August retail sales and Shoptalk Fall

Erin Cabrey

CPGs may have some commitment issues, because it’s suddenly splitsville for a number of food and bev giants.

 its 10-year relationship is dunzo, splitting up barbecue sweethearts Heinz ketchup and Oscar Mayer, among others, into two separate companies.

The conscious uncoupling is the latest in a string of recently announced spinoffs across major CPGs that includes Keurig Dr Pepper and Unilever, and follows the Kellogg Company’s separation in 2023. The spinoff strategy isn’t necessarily new—if you look through Kraft Heinz’s family tree, you’ll see it was created through a previous spinoff that ultimately created Mondelez—but it’s one that’s recently been picking up steam.

The volume of spin-offs might be making your head spin, so we’re breaking down the breakups—what’s going on, why they’re happening, and if we can expect even more CPGs to part ways next.

Over the past few years, many CPGs have broken up on largely similar grounds (no, not irreconcilable differences).

Earlier this month, Kraft Heinz said it’s splitting into one company focusing on sauces, spread, seasonings, and shelf-stable meals like Heinz ketchup and Kraft Mac & Cheese, and another on grocery staples like Kraft Singles and Oscar Mayer. The move, the company said, will help “more effectively deploy resources” between the more high-growth sauces and slower-growth grocery categories.

The recently announced split comes a decade after Kraft Heinz was created through a merger between H.J. Heinz Company and Kraft Foods Group (the latter of which was formed after Kraft Foods 

 its snack unit in 2011 to become Mondelez when its growth was being hampered by its grocery biz). The 2015 merger’s goals were essentially the exact opposite of its recent breakup—promoting “synergies” and “increased scale” by combining, the company said in a statement at the time—but that move “didn’t turn out to be a brilliant idea,” investor Warren Buffett 

The Kraft Heinz split is the latest in a series of CPG divorces. Last month, beverage giant Keurig Dr Pepper (KDP) shared its plans to buy Maxwell House owner JDE Peet’s for ~$18 billion and subsequently split itself in two, with one centered around North American beverages and one on global coffee. Similar to Kraft Heinz, KDP said the move will help its portfolio brands “win in their respective markets by leveraging operating models optimized to unique category dynamics” and is also set to untangle a recently formed tie-up, as Dr Pepper Snapple and Keurig Green Mountain merged to create KDP in 2018.

And last year, Unilever said it’ll spin off its ice cream business to become The Magnum Ice Cream Company, stating that the category has a “a very different operating model” than others in its portfolio, like Hellmann’s to Dove. (Unilever-owned Ben and Jerry’s, meanwhile, has been 

Then, of course, there’s Kellogg Company. In 2023, it broke into Kellanova, encompassing snacking, international cereal, and frozen foods (bought by Mars last year), and WK Kellogg Co, a cereal company that Ferrero said this summer it plans to acquire. CEO Steve Cahillane 

 at the time the split was intended to keep categories like its “high-growth” snack biz from competing for resources with its cereal biz, much like KDP and Kraft Heinz.

 According to Stephen Zagor, a Columbia University business school professor with a focus on food businesses and restaurants, the spinoff strategy is “accelerating” as CPGs face a flurry of headwinds. Consumers are becoming more judicious. As inflation soars, the grocery store is a “battleground of pricing,” he said. At the same time, younger shoppers are turning away from processed foods offered by many big CPGs, opting for healthier options and interesting flavors.

All these shifts have required CPGs to do something a bit more “drastic” than divesting a brand here or adding a new product there, Zagor said. Now, a “new strategy of appearing small but being big” has emerged, he added, as major CPGs are stepping back to take a look at their portfolios and realizing the potential of breaking down into smaller parts (smaller, in this context, still means multi-billions in net sales, of course).

“It’s hard when you’ve got 200 products to treat each product like a total entrepreneurial business and have all of the resources, the financial and all the things required to make it work well together under a large culture,” Zagor said. Now, they can separate the trendy or profitable segments from ones that might be harder to grow, and even open themselves up to more noteworthy acquisitions.

 “I definitely think every major CPG company is looking at Kraft Heinz,” Zagor said. “If they haven’t already thought about breaking or divesting or we’re getting rid of, I’m sure they are [now].”

It’s breakup season for CPGs

From Kraft Heinz to Keurig Dr Pepper, food and bev giants are seeing splitting up as their path to success. 

 at a steady clip, and the latest from Deloitte predicts retail sales will increase between 2.9% and 3.4%, down from 4.2% growth in 2024.

The research firm is expecting disposable personal income (DPI) to drive sales, growing 3.1% and 5.4% over the holiday period and offsetting some of the economic uncertainty facing consumers.

“Steady growth in income can help offset some economic uncertainty, including any labor market weakness and the burden of high credit card and student debt on consumer spending,” Akrur Barua, economist at Deloitte Insights, said in a statement.

He also acknowledged that while inflation will likely weigh on volumes, it will be a tailwind for the overall dollar value of retail sales—which Deloitte expects to total $1.61–$1.62 trillion in holiday spending from November to January.

E-commerce sales are also on track to give holiday spending a boost, with the category set to grow between 7% and 9% year over year, per the report.

“Our forecast anticipates that e-commerce sales will stay strong as consumers keep leveraging online deals to stretch their spending power,” Natalie Martini, vice chair at Deloitte and US retail and consumer products leader, said.

 average holiday spending to decline 5% in the “the first notable drop since 2020.” That report found that a pullback from Gen Z may be one of the main drivers of the decline.