QuickWit Weekly (8/16) – Top Retail News of the Week & Google on Privacy

There has been a lot of talk about privacy and the future of cookies, and while we know things are going to change it’s very interesting to hear how “Big Tech” is presenting the change. After all, wasn’t it going to be the “big guys” who were going to get hurt the most?

In a recent article, published on thinkwithgoogle.com, we see Google positioning themselves to be the experts on helping companies understand how this will work and inviting all who are interested to their “Privacy Sandbox” – a web community set up to collaborate on developing privacy-first alternatives to third-party cookies.

Google then identified three strategies that preserve privacy:

Instead of tracking individuals across the web to find out what each person might be interested in, people can be put into large groups with similar interests.
Instead of measuring how people respond to ads in a way that could reveal their identity, individuals can be kept anonymous by limiting how much data can be shared about them.
Instead of having companies collect people’s information in the course of showing them ads, that information can be kept on each person’s device so it stays private.

While this feels like a radical change for the industry, Google thinks it should feel relatively seamless from the advertiser’s experience. “We’ll do most of the work behind the scenes, switching from third-party cookies to these privacy-first alternatives, so you’ll still be able to buy and sell ads on the platforms you rely on today — but through technology that is private by design.”

It feels like we aren’t talking about the downside, about what is going to be missing right? There is no way this is going to feel the same in a cookie-less world, something has to suffer. Is it the targeting? The measurement? Both??

Google does give some tips on what we should do today as the sandbox technologies get up to speed:

Look for opportunities to build direct relationships with customers. These relationships should be supported with a comprehensive first-party measurement solution for your website that has the appropriate tagging and consent infrastructure.
Take advantage of solutions that use automation and machine learning to help identify trends and model results when there are gaps in your data.

We are already seeing a lot of companies building direct relationships with customers, including Amazon who are allowing sellers better direct access to those buying their products. Long term this might be a better solution for consumers, as it should allow better direct relationships to form and ultimately a better experience when shopping. But as this transition continues, it’s going to be fascinating to see who maintains their importance and who gets lost in the shuffle.

It’s going to be a big week for earnings this week, as the following retailers will all have earnings calls over the next few days. Certainly more to come on these retailers as we learn more about their latest quarter of performance.

Walmart
Home Depot
Target
Bath & Body Works
Macy’s

As for the other top news of last week, here are the stories we were talking about:

PepsiCo exits one category to become a player in another. In the last week we saw PepsiCo first sell off its juice business and then announce a partnership with Boston Beer Co to make Hard Mountain Dew.

Target unveils new private label pet food—Kindfull. Moderately priced, sustainability-focus dog and cat food is a recipe for success. Speaking of, Target has a great track record with launching private label brands, with Good & Gather becoming a billion dollar brand (their 10th) in a year.

Wakefern pilots micro-fulfillment for ecomm. They’re partnering with Kardex for a pilot. Add another feather to the MCF model’s cap, who has the backing of Walmart, Instacart, Albertson’s, and more. Kroger, with Ocado, is one of the few retailers operating with a CFC.

Wendy’s expands their ghost kitchen game. Opening 700 ghost kitchens by 2025, Wendy’s is responding to growing delivery demand that aggressively eats margins. They’re partnering with Reef Technology and (hope to see) operational efficiency generate a positive ROI. Shares rose +3.7% beating expectations in their latest earnings report.

CVS enters the future of digital health with Aetna Virtual Primary Care. In a word: telehealth. A slew of benefits for the consumer, CVS is raising the bar on virtual care. This omnichannel approach is the future, especially in the face of COVID-variants, for patient adherence and ease of access.

Ahold Delhaize Q2 results beat expectations. While they faced YOY decline in ID sales (-1.5% US), two year stacked was up +19.1%. AHD raised full year earnings and operating margin guidance.

Walmart names Publicis Groupe as new Media Agency. Walmart and Publicis have been working together for quite some time, and Publicis will now own both creative and media capabilities. Walmart, with their investment in retail media, ecomm, and omnichannel offerings, will benefit from having a single agency overseeing both areas. Publicis has also been investing in capabilities that made them a strong contender, including their purchase of CitrusAd.

Giant Eagle pioneers PayPal and Venmo as in-store payment methods. It’s been part of a growing trend we’ve seen, where alternative payment methods (particularly cryptocurrency) is starting to gain traction. From a customer standpoint, there’s interest in utilizing a digital wallet and contactless payment—brought on by the pandemic. Whether it’s a trend that sticks, however, remains to be seen.

A new study finds COVID delivered a hit to food and beverage brand valuation. Brand Finance, an independent consultancy, took a look at CPG portfolio’s and measured the change YOY. Customers, who perhaps had their habits disrupted, looked for healthier alternatives while locked down, and are changing habits towards health in general, shook up the category.

Three Universities are rolling out robot food delivery for students, who can use the service via their campus meal plan.

In yet ANOTHER sign that Halloween is going to be big this year, Party City announced they will open four times more pop up stores than they did in 2020.

Albertsons names a new CFO, Sharon McCollam, who had retired from Best Buy in 2016 where she served as EVP, chief administrative and CFO.

Nestlé Health Science has successfully completed its acquisition of The Bountiful Company’s core brands, including Nature’s Bounty, Solgar, Osteo Bi-Flex, Puritan’s Pride, Ester-C, and Sundown.