Commerce Riff with Sri & PVSB - October 27, 2026

0:00Sri: Brand marketing has one plan. Key account managers have another. The field team is doing something else entirely. Sound familiar? Our sponsor, Salesforce, can help. You can't win at the shelf if your internal systems are fighting each other. With Consumer Goods Cloud, you finally connect trade promotions, retail execution, marketing, and service. Everyone, including your AI agents, is working off the exact same data. And the best part? No massive IT headache. Keep your ERP. Keep your data where it is. Keep working in Teams, Claude, or Salesforce. Drive growth from warehouse to checkout with Salesforce at salesforce.com slash consumer goods.

0:50Sri: that's salesforce.com slash consumer goods welcome to the commerce riff from the cpg guys the weekly look at what matters in commerce i'm pvsb joining me as always is my co-creator father of pop stars they call him papa raj to me he's the man known as shri shri what's shaking i hear you're being treated rather royalty you might be in queens as we speak what's going on just another

1:18PVSB: week in the Raj family. The kids were performing at the Victoria's Secret concert. Mama Raj was there. The MTV UK post of her went viral. Rhea released her debut single at the Victoria's Secret concert, Dream Girl. I was at DC watching Cat's Eye yesterday. I'll be at Queens. And I, can you tell us who's joining me at Queens? Somebody special.

1:39Sri: Well, I'll be there, but I'm not the special person. You're not the special one. it's my daughter nadia she's joining us for the concert she is so excited tree she's got her cat's eye jersey i'm bringing my my sharpie my cpg guy sharpie from our good friends at newell maybe i'll get a couple of signatures after the show you got the right color of the sharpie oh yeah it's nice and black it'll contrast well with the the jersey all right uh four stories This week, Coca-Cola finishes its global marketing review and splits the media business between Omnicom and WPP. Kroger lays out its plan to become America's favorite grocer with big bets on value, private label and retail media.

2:22Sri: Salesforce agrees to buy Braze for about$5.7 billion. Boston Beer posts another quarter of low profit and revenue as beer demand keeps falling. First up, Coca-Cola. On Thursday, the company announced it had completed a global marketing operating system review with the goal of building what it calls a world-class marketing ecosystem powered by data, technology, and wait for it, Shree, AI. Here's the outcome. WPP OpenX stays as Coca-Cola's media partner globally, except in North America, Japan, and South Korea. In North America, Coke selected Omnicom as its media partner, and Omnicom will work closely with WPP Studio X.

3:06Sri: Dentsu continues to handle media in Japan and South Korea, which weren't part of the review, and WPP OpenX remains global creative partner, which also was not part of the review. Quick disclosure for our listeners, I work at Flywheel, which is part of Omnicom, so weigh my commentary on this one with that in mind. That said, Manolo Arroyo, Coke's chief marketing and customer commercial officer, said the review was about making sure Coke had the right partners, capabilities, and operating model for a fast-changing landscape. He praised WPP's performance in the reviews, citing its media tech and data capabilities, and pointed to its open intelligence data solution, which builds on results from Koch's FIFA World Cup 2026 activation.

3:56Sri: On North America, the reasoning is specific. Koch says bringing media, data, CRM, loyalty, and creators together in one connected ecosystem lets the North America operating unit move beyond channel-based execution towards more integrated consumer experiences. The new structure rolls out in phases beginning December 1st. What's our look at it? Well, Koch isn't picking one agency model. It's picking by market. global scale from WPP, Japan and Korea with Dentsu, and an integrated data CRM and loyalty plan North America. The question for brands is no longer just who buys the media, it's who connects the data, and it fits a pattern we've been tracking.

4:39Sri: PepsiCo's moved to Publicis back in episodes 48 and 49 of The Rift, DoorDash naming WPP Media its global partner in episode 52. Agency reviews are being decided on data and integration. Shree, what's going on in Cincinnati?

4:54PVSB: What a different world of agencies we live in. And speaking of just advertising, story two, and it has Kroger right in the middle of it. It had its annual 2026 investor update in Manhattan, New York on October 28th. It was CEO Greg Forn, who of course has been there on about a year, a year and a half or so now. under the banner, building America's favorite grocer. The strategy has three pillars, win with the customer, of course, drive profitable growth, and modernize how Kroger operates every single day. The financial framework, roughly 3%, comparable sales growth in 2029, excluding fuel and pharmacy, of course, adjusted EBITDA growth of 3 % to 6 % a year from 27 % to 29%, and adjusted EPS growth of 7 % to 11%.

5:34PVSB: That actually excludes the important giant eagle acquisition, which Kroger expects to close only in 2027, and it's also pending regulatory approval, so that adds up. Now does Kroger pay for this? A$4 billion structural cost stakeout, which it calls its largest ever, that includes sourcing more directly, taking sourcing from under 1 % today to over 10%, buying smarter and cost of goods, cutting indirect spending, and scaling a new capability center in Bengaluru, India, with about 3 ,000 corporate roles impacted over time. That funds a$5 billion self-funded investment in value paired with fewer promotions.

6:13PVSB: Kroger described it as moving dollars out of complex promotions and into better everyday value. Early results, of course, in rollout market show visits up to 200 basis points over the first two quarters, and the rollout reaches about 250 stores by the end of 2026 and about 700 stores by the end of 2027. Also, private label is, of course, a big piece for Kroger. Their own private label brand called Our Brands is about 40 billion business today as it is. And Kroger wants to grow it from 35 to 40 % of sales with its premium tier targeted 15 % plus annual growth through 2029. And it plans about 110 new stores by 2029.

6:53PVSB: On the digital side, which is important for us to cover on the CPG guys, Kroger has about $18 billion in an e-commerce business, yet only one in seven of its shoppers buy online through Kroger. The target is an additional$500 million of e-com, EBITDA by 2029, not counting media, of course. Its new shopping assistant, AI-based, is showing about 11 % higher spend from repeat adopters. Now let's talk about retail media. Kroger points to 65 million households, 95 % of sales tied to a loyalty card and a 2025 BNN ROI rocket survey in which advertisers ranked it number one for accuracy and transparent reporting.

7:33PVSB: Retail media monetization is also named a value driver in its connected store plan alongside labor, productivity, shrink, etc. Digital shelf labels grow from about 1 ,100 stores today to more than 2 ,400 by 2029. That also includes robotics and RFID with expansion plans there. Kroger targets about$500 million in waste savings by 2029. What's our lens here on the CPG, guys? Pretty straightforward. That means we should anticipate fewer promotions, more private brand, our brands, and a bigger in-store media footprint add up to a different deal for suppliers, CPG vendors. Expect trade dollars to shift towards EDLP, more everyday low price, and retail media to become the place you own visibility in the app and on the shelf.

8:18And none of it, the shopping assistant,

8:20PVSB: the connected store the retail media works without of course clean consistent product data underneath and that particular word was it by a recent guest neda nia chief product and growth officer at stebo systems that's the current episode running now on cpg guys look at for one of the cpg guys share groups to make a visit to kroger in cincinnati early in 2027 for those of you don't know peter and i recently announced we're expanding not only are we adding a new podcasts on the rise. We're also now going to do two share groups and a whole lot about all of that covered later on the CPG guys.

8:56Sri: Peter, over to you. Thanks, Sheree. Let's go to story three. Salesforce signed a deal to buy Braze for about$5.66 billion, including debt, adding a customer engagement platform to its portfolio. Braze shares get$47.50 in cash per share, a premium of roughly 58 % to Braze's Monday closing price of about$30. Salesforce expects the deal to close in its fiscal 2028, which starts in February 2027, pending Braze shareholder and regulatory approval. Salesforce described Braze platform as optimized for high volume, real-time B2C engagement. Think personalized messaging across mobile apps, websites, and email driven by live customer behavior.

9:46Sri: Salesforce says Braze's real-time engagement and AI decision will complement its Data360, Customer360, and AgentForce layers and strengthen Marketing Cloud. Braze serves roughly 2 ,770 customers. For perspective, the exact target deal that built Marketing Cloud back in 2013 was$2.5 billion. So this is more than double that. Our look, well, this is a bet that in the next phase of marketing is real-time, agent-driven, and built on first-party data. We heard about this directly from a recent guest, Devin Kunis of Salesforce, who talked about AI agents and CPG sales execution and what tasks could be automated versus what still need people.

10:34Sri: CRMs need to be effective, fast, and quick, ready to work with AI while teams are in the field live. put it next to Kroger's loyalty data and Koch's push to combine CRM loyalty and creators. And you see the common thread going on here, right, Sri? Whoever owns the customer relationship and can act on it, they win in real time.

10:57PVSB: That is big. Sri, close us out. So the last story tonight is with Boston Beer, the company behind Sam Adams and Truly, who was just posted lower profit and revenue in the third quarter as demand for beer continues to fall. Profit was$43.2 million or$4.21 a share compared with$46.2 million or$4.25 a whole year earlier. For context, let me just state the second quarter showed the same pressure. Depletions fell 6%. Revenue fell 3.3 % to$568.3 million with declines in Twisted Tea, Truly, Sam Adams, Hard Mountain Dew, and Dogfish Head. partly offset with some minor growth in Suncruiser and Angry Orchard.

11:41PVSB: Pricing and product mix soften the blow, but volume tends to be the issue in this category. What's our lens on this? When a category is shrinking, price and mix can only carry you so far. And I know that story pretty well from my alma mater. The growth has to come from new brands, new occasions, a portfolio reset, and winning more of the shelf. And of course, you have to be the boss of digital today. with AI entering shopping in spectacular ways. If you're not an e-commerce champion, you actually don't stand a chance with AI. Yes, you heard it here first on the CPG guys. It's the same dynamic behind Kroger's value reset.

12:18PVSB: Shoppers are asking for simple, visible value. Suppliers in softer categories are the ones that are going to feel that pressure first. Go ahead, Peter.

12:28Sri: That's it for today's Commerce Riff. A reminder to catch up on our recent episode, Salesforce's Devin Kunis. on AI agents and CPG sales execution and Stebo Systems' Neta Neha, their chief product and growth officer. Links are in the show notes. If anything we covered today sparks a thought, drop in the comments. We read each and every one of them. If you're not already following us, please do so on LinkedIn, Instagram, TikTok, Facebook, and YouTube. Now's the time. We'll see you next week.

13:04Sri: The content in this podcast episode is provided for general informational purposes only. By listening to our episode, you understand that no information contained in this episode should be construed as advice from CPG Guys LLC or the individual, author, hosts, or guests, nor is it intended to be a substitute for research on any subject matter. Reference to any specific product or entity does not constitute an endorsement or recommendation by CPG Guys LLC. The views expressed by guests are their own, and their appearance on the program does not imply an endorsement of them or any entity they represent.

13:40Sri: The views expressed by CPT Guys LLC do not represent the views of their employers or the entity they represent. CBT Guys LLC expressly disclaims any and all liability or responsibility for any direct, indirect, incidental, special, consequential, or other damages arising out of any individual's use of, reference to, or inability to use this podcast or the information we present in this podcast.