Hey Friends,
The mega-merger trial begins today between Kroger and Ablertons and the Federal Trade Commission. Merger talks have been going on since 2022 but the FTC is seeking a preliminary injunction in federal court to delay the merger while they conduct a more thorough review. Kroger and Albertsons have agreed to sell 579 stores to address competition concerns, but the FTC remains unconvinced. If the court grants the injunction, the merger may face significant delays or could be abandoned. If the injunction is denied, the merger could proceed, though state courts in Colorado and Washington may still challenge it.
We’re already talking about the holidays and peak season retail news is never in short order……..Adobe Analytics reports that 53% of online sales during the upcoming holiday season are expected to occur on mobile devices, with mobile shopping predicted to consistently surpass desktop by 2025. From January to July 2024, mobile consumer spending increased by 10.2% year over year, reaching $280.4 billion, making up nearly half of all online sales. Mobile purchases are particularly dominant in personal care (77% of online sales), groceries (68.2%), and apparel (60.8%). Last year, mobile sales overtook desktop for the first time, with 51% of online holiday sales, peaking at 63% on Christmas Day. Additionally, FTI Consulting forecasts a 9.8% increase in U.S. online retail sales, reaching $1.2 trillion in 2024.
Amazon has announced its annual October Prime Day event, Prime Big Deal Days, although no official date has been set. The event is set to take place in 19 countries over a 48 hour period.
Reporting season is upon us. While we always cover the full retail roundup, for the upcoming earnings reports from major retailers, expect a mix of results influenced by consumer behavior and economic conditions. Key factors include:
Inflation: Retailers may report pressures on margins due to higher costs, though some could offset this through price increases.
Consumer Spending: Shifts in consumer spending, with some focusing on essentials over discretionary items, might impact sales growth.
Inventory Management: Watch for comments on inventory levels, as retailers continue to navigate supply chain challenges.
Digital Sales: E-commerce and digital innovations remain crucial growth drivers.
Overall, anticipate cautious optimism with varied performances across sectors.
The Shein vs. Temu battle is heating up. Shein has filed a lawsuit against Temu for copyright infringement, accusing the competitor of frequently stealing its designs and alleging that a Temu employee stole confidential trade secrets. Shein also claims that Temu engages in trademark infringement to compensate for the financial losses it incurs on each sale.Shein’s lawsuit against Temu, filed in Washington, D.C., federal court, comes as Shein faces similar allegations from various brands and independent artists, including Levi Strauss and H&M. To me this feels a bit comical given the nature of both Shein and Temu’s business.
Last Week, Yahoo DSP (Demand Side Platform) announced new partnerships with Rippl, a co-op of regional grocery and convenience store chains including Wegmans and Giant Eagle, and PF Media, launched by Planet Fitness. These partnerships will add approximately 70 million grocery shoppers and 20 million gym-goers to Yahoo's addressable audience pool.
IKEA is testing a peer-to-peer marketplace called IKEA Preowned, where customers can sell secondhand furniture to each other. This initiative, aimed at competing with platforms like eBay and Craigslist, is currently being tested in Madrid and Oslo, with plans for a global rollout. CEO Jesper Brodin highlighted that this move aligns with IKEA's digital transformation, which includes expanding online sales, opening stores in city centers, and offering services like furniture assembly.
Wayfair’s Perigold brand announced plans to open its first brick-and-mortar store in West Palm Beach, Florida, in fall 2025. The store, located in the CityPlace shopping center, will cover nearly 30,000 square feet across two floors and is the first of several stores the company plans to open next year.
Stop & Shop announced it will stop selling cigarettes and tobacco products at its 360 stores by August 31. This decision aligns with the retailer's commitment to community wellness across its locations in Massachusetts, Rhode Island, Connecticut, New York, and New Jersey
Amazon has expanded its grocery delivery subscription service by introducing an annual plan for Prime members and offering a discounted subscription to all Prime Access members. This move follows the successful launch of the service in April, which has seen strong customer sign-ups and positive feedback. The subscription offers unlimited grocery delivery on orders over $35 from Amazon Fresh, Whole Foods Market, and other local retailers, and is available in 3,500 U.S. cities and towns.
Walmart has partnered with Burger King to enhance its Walmart+ subscription program by offering new dining benefits. Starting Thursday, Walmart+ members can receive a 25% discount on Burger King digital orders daily, and beginning next month, they can get a free Whopper every three months with any purchase. This benefit, aimed at saving members time and money, reflects Walmart's strategy to cater to busy lifestyles. The collaboration with Burger King is part of Walmart's broader effort to attract members, as it competes with Amazon Prime. Although Amazon Prime still has a larger subscriber base, Walmart+ is growing rapidly.
Peloton is cracking down on equipment purchased on the secondary market……They will begin charging a one-time $95 activation fee for new subscribers who purchase used hardware on the secondary market, such as from Facebook Marketplace. This move comes as Peloton sees a significant increase in new members who acquire second-hand Bikes or Treads. The company highlighted that this segment of their market grew by 16% year over year in their fiscal Q4, ending June 30. The fee applies to U.S. and Canadian subscribers and reflects Peloton's recognition of the secondary market as a key source of new customers.
Another cool story I’m tracking….the QR code is making its way into sports. Oklahoma State football is making history by becoming the first college football team to wear QR codes on their helmets during regular season games. These 1.5-inch square QR code decals, featuring each player's name and number, are designed to enhance players' NIL (Name, Image, Likeness) earning potential. Although the codes might not be visible to fans in the stands, they are expected to gain attention through broadcast close-ups and social media, boosting the team's NIL value. Additionally, QR codes will be used on players' bag tags, stadium coasters, and signage to further promote NIL efforts. Fans can access a link to the fund through Oklahoma State football's official social media channels
As TikTok Shop gains momentum, YouTube is expanding its partnership with Shopify to onboard more brands into its YouTube Shopping affiliate program. This expansion allows creators to access thousands of new brands to tag in their shopping videos, up from the current few hundred. Eligible Shopify Plus and Advanced merchants in the U.S. can now join the program, offering creators a way to earn money while helping their audience discover new products.
This move positions YouTube to better compete with TikTok, which is rapidly growing its TikTok Shop U.S. business. YouTube also introduced a Chrome extension for affiliate program creators to easily save and tag products in their videos. This expansion is part of YouTube's broader e-commerce push, which has gained traction as digital advertising slows. In 2023, YouTube saw a 25% increase in watch time for shopping-related videos, with over 30 billion hours of such content viewed. The program benefits both creators, who can earn more, and brands, which can reach new customers.
That’s all folks. Have a great week.