Retail Unwrapped from The Robin Report

Think You’re in Control Shopping for Groceries? Wrong!

Phil Lempert — Tue, 03 Feb 2026 05:01:00 +0000

You think you’re in control of what you choose in a supermarket? Well, sorry to report, but you’ve been played. You don’t decide what you buy at the grocery store. An algorithm does. Welcome to the brave new world of the Agentic AI shopping experience. Your grocery trip is an experiment—and you’re the test subject. You’re not in control and here’s why.

Pricing and promotions are manipulated just for you. You think the electronic shelf price is the same for everyone? The offers hitting your phone, your inbox, and your app are tuned into you—your income bracket, your brand loyalties, your preferences and soft spots. And you gave it all permission. That’s the promise of AI, as long as it doesn’t terrify you.

Think about it. You signed up for loyalty programs. But they aren’t just about rewarding you—it’s a brilliant way to deliver exactly what you want based on what the data has recorded. It’s a win-win if you think about it. You provide access to your personal data, and your local store becomes your personal shopper.

Every scan of your card, every clipped coupon, every “substitute” you accept when something’s out of stock is recorded. You’re not just earning points; you’re teaching the system how to give you what exactly you want.

This is not a bad thing if you want a seamless, stress-free shopping experience. The more you let AI know, the more your local shopping experience can make your life easier. We’re just entering this new world on steroids where AI data accelerates the information you give it to deliver an experience that makes you the most important priority.

Is this creeping you out? Don’t panic. You can limit what AI can access and control the world curated just for you. If it does creep you out, be aware, be informed. But when you think about it, we’re entering a social contract with Agentic AI that can make our lives easier. That’s not so bad.

Costco: The Robin Report Retail Miss of the Week, 1.31.2026

Warren Shoulberg — Sat, 31 Jan 2026 05:01:00 +0000

Yeah, you’re reading this right, the do-no-wrong-best-retailer-in-the-business Costco might have just screwed up. A proposed class action lawsuit has reportedly been filed in San Diego claiming that Costco’s labeling on its famed $4.99 rotisserie chicken contains “No preservatives, MSG, gluten, artificial flavors, or colors” is…foul (fowl?). The suit alleges that the chickens contain “additives sodium phosphate and carrageenan.” We have no scientific definition of what those are, but they sound suspicious. On the best-retailer-we-know plus side, Costco now says it will remove the “no preservatives” signage and explains that these substances “support moisture retention, texture, and product consistency during cooking. Both ingredients are approved by food safety authorities.” OK, Ok, although watchdog consumers don’t want you to have to read the small print. This has to count as a blemish on a company that has just about the best reputation in the retail world, not to mention the most loyal customer base. We’re fans of their chicken, by the way, and this misstep isn’t going to stop us from getting just about the best bargain out there. But Costco has clearly lost a game of chicken with its customers.

If You’re Not Watching Grocery, You’ll Miss the Future of Retail

Chris Walton — Thu, 29 Jan 2026 05:01:00 +0000

According to Brick Meets Click’s Grocery Shopper Survey which it conducts in partnership with Mercatus, “Monthly U.S. online grocery sales experienced a dramatic acceleration in November, with total sales surging 29 percent year-over-year (YOY) to finish the month at $12.3 billion.” Wait, what? During a period of tight budgets and inflation? How can that be true? Ah, but it is.

“Online share of weekly grocery spending in November 2025 ended the month at 17.1 percent, climbing 340 bps versus November 2024,” the survey reported. Moreover, all three fulfillment options that the survey tracks –delivery orders (aka orders from third-party services like Instacart), pickup orders, and ship-to-home orders (aka direct orders from Walmart and Amazon) – increased across the board. Ship-to-home sales increased 12 percent over the prior year, pickup gained 11 percent, and delivery brought up the rear at a still remarkable 8 percent increase year-over-year.

But again, how can this be? How can a consumer that is reportedly so budget-constrained be purchasing his or her groceries in a relatively more expensive way across the board? Albeit pickup doesn’t cost more, ship-to-home and delivery certainly do, especially when one factors in shipping and membership fees.

How is the K-shaped income disparity feeding the grocery business? And the answer is: Customers who are more open to agentic AI commerce, pragmatic shopping, time as currency, and values-based consumption.

The Haves, the Have-Nots, the Have Everythings

So, what on earth could be driving it? Well, the answer comes down to two words: rich people. A Brick Meets Click press release stated that “The (online) share expansion was fueled largely by higher spending rates in large metro markets, by the 30-44 age group, and by households earning $100K or more annually,” a fact later confirmed to me by Brick Meets Click Partner David Bishop. And that data point adds all the context one needs to understand the full impact of what this report could mean, both now but also in the future. Or, said another way, seismic change is coming to the grocery industry, and these latest survey results likely are just the beginning.

Now, before anyone gets their pitchforks out, let me clarify something. When I say, “rich people,” I’m not talking about yacht owners and trust fund babies. I’m talking about households earning $100,000 or more annually (i.e., households that earn more than 60 percent of the U.S. population). In many large metro markets, that’s a dual-income household with kids, a mortgage, and maybe enough left over for a Costco membership and a family vacation once a year.

These aren’t the 1 percenters. These are the people who need convenience but still care deeply about value. And that’s what makes this data so fascinating. Because here’s what’s really happening: The 30- to 44-year-old group, aka the core users, posted the strongest increase in order frequency, surging over 20 percent compared to last year. They’re placing an average of 3.1 orders per month. That’s a record high. These aren’t people experimenting with e-grocery. These are people who have fundamentally changed how they buy groceries.

The Value Equation That Makes e-Grocery Work (For Some People)

So why are higher-income households driving this surge? Four principal reasons could explain the increase.

The time-value equation.When you’re a dual-income household in the 30-44 age range, you’ve likely got kids, careers that demand constant attention, and maybe aging parents. The hour you can save by ordering groceries online isn’t just leisure time. It’s the hour you need to make dinner, help with homework, or actually see your family. For these households, paying $10-15 extra per week to reclaim that time is a value-laden trade-off.
The price transparency and loyalty program effect. When you’re reordering the same items week after week from a place you trust, like Walmart or your local grocer, you develop loyalty. Platforms like Walmart+ with their cash-back incentives make that relationship even stickier.
What’s actually happening in stores right now. The in-store grocery experience has degraded significantly. Staffing shortages. Out-of-stocks. The general chaos of trying to navigate a crowded store with kids in tow as you try and elbow your way around an Instacart driver. When you order online, you know immediately what’s available and what’s not. No wild goose chases down the aisles. No asking three different employees where something is. For busy professionals, that certainty alone has to be worth something.
Younger high-income households are simply acclimated to buying everything online.For these consumers, ordering groceries from an app is as natural as ordering an Uber. There’s no psychological barrier to overcome. And they have relatively more disposable income to make the behavior stick.

But What About Everyone Else?

If higher-income households in large metro markets are driving the e-grocery surge, what happens with everyone else? What happens to the budget-constrained families in smaller markets who can’t justify the premium? What happens to the traditional grocers who built their entire business model around serving those customers?

Here is where the story gets really interesting … and also complicated. The data suggests that we’re witnessing the beginning of a bifurcation in the grocery market. You’ve got one segment, affluent, tech-savvy, time-starved, rapidly moving online. And you’ve got another segment that’s still shopping primarily in-store, either by choice or by economic necessity. This is another K-shaped economic ecosystem.

And the uncomfortable truth is that the segment going online is the one with the most purchasing power and the highest lifetime value. They’re the customers every grocer wants to retain. But they’re also the customers who are learning to shop in ways that fundamentally challenge traditional grocery economics.

Take a box of Kraft macaroni and cheese. There’s no difference between buying it at Store A versus Store B, all things being equal, particularly when the price is the same. The product is identical. So, what happens when we layer agentic AI on top of this existing behavioral shift? That is the question the industry needs to be asking itself.

The AI Acceleration That’s Coming (Whether You’re Ready or Not)

If we’re already seeing this kind of explosive growth in e-grocery with today’s technology, just imagine what happens when agentic AI enters the picture. We’re now talking about far more than incremental improvements. We’ve got consumers who are already comfortable ordering groceries online. We’ve got loyalty programs that understand their purchase patterns. There’s greater price transparency online. There’s the time savings. Now add an AI agent into the mix that can scan every retailer’s prices in real-time, then apply a consumer’s preferences, factor in dietary restrictions, optimize for a budget, and automatically reorder staples at the best possible price across multiple retailers. All of a sudden, every income demographic is jumping into e-grocery. That’s not science fiction, either. That’s all coming in the short-term, like in the next one to three years. Open the pod bay doors, HAL.

The Ultimate Irony: Grocery Pioneers Agentic Commerce

David Dorf, Head of Retail Industry Solutions at AWS, recently mentioned that UBS is predicting grocery will be the first industry hit by agentic commerce. Grocery, the category that was supposed to be the last frontier for ecommerce, the holdout, the one format that would always need physical stores because people wanted to see and touch their avocados, is now predicted to be the first industry disrupted by AI agents.

It’s the complete flip side of how ecommerce developed. Back in the 1990s and 2000s, we sold books, electronics, and clothing online while everyone said grocery would never work. The margins were too thin. The logistics were too complex. Customers would never trust someone else to pick their bananas.

But now? Now Dorf believes (and I agree) that the infrastructure to support e-groceries is different, and, most importantly, we are also dealing with new customer behaviors and desires. In other words, grocery shopping brings with it the perfect conditions for agentic AI to amplify what’s already working, with a little more budget and time savings sprinkled in for good measure.

David Bishop from Brick Meets Click put it well: “The online grocery customer pool continues to expand, order frequency has steadily grown for over a year, and spending remains resilient, which shows that e-grocery is evolving from just a convenient option to the preferred way to get groceries for many.”

Not just convenient. Preferred. Right now, it’s predominantly high-income households in large metro markets driving this behavior. But behavioral patterns established by early adopters don’t stay confined to early adopters. They diffuse. They spread. They become the new normal. The question isn’t whether e-grocery will expand beyond high-income households. It will. The real question is what happens when it does, and whether traditional grocers will still be around to compete when that day comes.

The Seismic Shift Hidden in Plain Sight

In my now almost 30 years of retail experience (yes, I am getting old), I have learned that you can take one simple idea to the bank – by the time a behavioral shift becomes obvious to everyone, it’s too late to catch up. The infrastructure investments, the technology platforms, the loyalty programs, and the customer data, all take years to build. You can’t flip a switch and suddenly compete with Walmart’s fulfillment network or Amazon’s delivery infrastructure.

So, yes, relatively more well-off people are driving e-grocery growth right now. But they’re not the endgame. They’re the early warning signal. They’re showing us where the entire retail market is heading. Moreover, if Dorf and UBS are right about grocery being first in line for the agentic commerce revolution, then that future is coming faster than most people realize. Seismic change isn’t just coming. It’s already here. 2025 November’s numbers may just be the tremor or foreshock before the earthquake, revealing an ignored fault line.

Editor’s note: This is a modified reprint from Omni Talk.

It’s Walmart 4,606, Amazon 1

Warren Shoulberg — Wed, 28 Jan 2026 05:01:00 +0000

Is Amazon ever going to get its physical retail right? We have written for years about its Achilles Heel: lack of experienced retail leadership. Our namesake founder Robin Lewis always made the point that Amazon’s big problem was that they didn’t have any merchants, only tech wonks. So they could never figure out how to operate a retail business…much less physical stores. It’s why they open stores and then close them. This week, all Amazon Go and Fresh stores are being shuttered. It’s an Amazon roller coaster made possible by deep pockets and the willingness to fail.

And now there’s all the hoopla about Amazon’s plans for a new giant store in the Chicagoland market that is expected to lean heavily on grocery and online fulfillment as a billboard for a direct challenge to Walmart’s dominance in physical stores. But please, let’s not forget one thing: this is ONE friggin’ store. Walmart has 4,606…as of this morning.

And just to put a finer point on that discussion, it is yet another attempt by Amazon to find the right formula for physical retailing. Up until now, those efforts have been pretty dismal with more dead ends than a suburban residential development. Why should anyone think this one will be any different? Maybe the fulfillment part of the store will save it, but it’s another gamble.

Can Amazon ever make it in its own physical stores? And the answer is: Unlikely.

The Big Store

This new Amazon store, when it opens in 2027, is, in fact, big: 230,000 square feet. It’s twice the size of the typical Walmart and even more compared to other category competitors like Costco and Target. You can forget about supermarkets like Kroger or Jewel-Osco brands, which are perhaps a third or a quarter the size. Located in the Chicago suburb of Orland Park (about 25 miles southwest of downtown), the store will devote about half its space to conventional retail, dominated by the grocery sector, although there will also be general merchandise. The rest of the space will be used as a fulfillment center for digital orders, either placed online or in the store itself.

The model follows other retailers like Target and Walmart that use physical stores as online fulfillment depots. The difference in Amazon’s case seems to be that online orders will be picked and packed from the warehouse side of the building rather than from store shelves. That also follows Amazon’s strategy of setting up fulfillment centers closer and closer to where its customers live rather than just having giant DCs on the outskirts of towns. So far, so good for a plan.

But Then There’s This…

Amazon always seems to have plans that have failed for expanding into physical stores. Whether it’s been small and mid-size grocery stores under a dizzying assortment of banners, general merchandise outlets like its Four Star or bookstores, or any number of pop-up locations with a variety of merchandise mixes and assortments. To repeat, the only constant has been that most have failed. By one estimate, Amazon has shut down at least 100 different stores, and now it will add to that total with the closing of its Fresh and Go locations, about 70 in total between the two nameplates. It plans to convert some of them to Whole Foods.

This circling the wagons around the Whole Foods name would seem to be long overdue, rather than this bizarro brand fragmentation strategy the company has pursued in the grocery business. Amazon bought the upscale foodie in 2017 and now operates about 530 locations, with a track record of having opened and closed stores along the way. This was supposed to be Amazon’s ticket to the grocery sector, as a learning curve to master the business and serve as its base to become a big player in food. It hasn’t worked out quite as they envisioned. Amazon has clearly spent a lot of time, resources and money trying to find the right hook for groceries.

Wouldn’t you love to see how much money they’ve lost trying to figure out the store business? One of the few times it said anything publicly was in 2022 when it posted a $720 million “impairment charge” for store closings in its fourth quarter. All together, what they’ve lost has got to be a lot more… and a lot more than a rounding error, even for a guy like Bezos.

And now this focus on the Whole Foods name would seem to run counter to plans for this new ginormous store in Chicago. Why restart the Amazon name in food when clearly it hasn’t worked, and you’re now saying Whole Foods is your meal ticket in grocery? Are we missing something here?

Do the Math

Amazon is believed to control somewhere around 40 percent of the entire ecommerce sector; food has been anointed as the holy grail of expansion. Along with fashion, it’s the only category that will provide the size and scale it needs to move its $635 billion needle further to the right. Adding another frying pan or a pack of batteries is just not going to make that revenue grade.

Across the retail landscape, Walmart is pursuing its own strategy. With in-store revenues growing at a slower pace than in its heyday, the Boys from Bentonville see ecommerce as the way to build its total sales. To be fair, Amazon has had its struggles in physical retail; it’s taken Walmart quite a while to figure out its online strategy with its own collection of dead ends and wrong turns—anybody remember Bonobos or Moosejaw? Once Walmart finally figured out that it was grocery where it should be putting its digital emphasis, things began to click…literally. Still, it is miles behind Amazon in ecommerce with its market share still roughly in single digits.

At its current rate of digital growth, it will take Walmart years—decades, in fact—to get close to Amazon in ecommerce. In fact, projections are that Amazon will pass Walmart in total corporate revenues, although this does include AWS web services, Prime streaming and whatever else is in the company’s bag of tricks. Then again, Walmart also has an increasingly bigger business in non-retail sectors like online advertising, so comparisons are getting harder and harder to judge.

So, it’s a moving target, and that’s the problem Amazon faces in the grocery business. Even if this new Chicago store is the absolute best thing since sliced bread, and sells a ton of it every day, it has a daunting task to catch up to Walmart, or even smaller players like Kroger or Costco. How long? If by some crazy push, Amazon opens 30 or 40 giant supermarkets a year, that’s at least 100 years before it gets in Walmart’s league. See you in 2127 if you want to mark it in your datebook.

We get it that every retailer is going after market share and trying to expand into classifications where it is not a big player. That’s just good business. But before everyone gets bent out of shape on this new Amazon store, let’s remember their track record on new store formats. And let’s remember to have our calendars handy too.

We might have seen this movie before.

Will the New FDA Guidelines Change How We Shop for Food?

Phil Lempert — Thu, 22 Jan 2026 05:01:00 +0000

Big Shift: “Real Food” Circles the Aisles

The core message of the new Dietary Guidelines for Americans is to eat more whole foods, more protein, and fewer highly processed, sugary items. It aligns almost perfectly with how many shoppers already say what they want to eat. For retailers, that means the perimeter of the store (produce, meat, seafood, dairy, bakery) is now explicitly backed by federal guidance as the default starting point for healthier choices. But don’t expect these grocers to stop selling high-margin snacks, sodas, candies and ultra-processed foods…unless shoppers stop buying them. Retailers respond to two major things: consumer demand and manufacturer incentives and promotions.

Very few would argue against the explicit call to reduce added sugars and ultra-processed foods, which the USDA estimates make up 70 percent of the foods on our supermarket shelves. However, we are still awaiting a standard definition from the FDA, HHS and USDA for the exact definition of an UPF. Is it ultra-chemically processed, overly salty or sugary, high-fat, highly caloric, synthetic …what is it? Until that is finalized, we are unlikely to see a major shift in consumption behaviors any time soon.

How will the new dietary guidelines reshape the grocery store? And the answer is: The core of the store is officially on warning of a higher risk, according to the government.

The Slow Food Movement

Food manufacturers, for both national and store brands, don’t pivot overnight. Reformulating a product from swapping out artificial colors and dyes, reducing sugar, and removing artificial additives can take anywhere from several months to multiple years, depending on the complexity of manufacturing to the challenges of delivering taste, texture, cost and food safety. And who knows if consumer demand will even be there for these new products. PepsiCo is hedging its bets with the launch of Simply NKD Doritos and Cheetos, which have removed artificial colors and flavors, resulting in a pale yellow color (instead of the bright orange that we are used to licking off our fingers). The company is not replacing the originals, just offering these as an alternative, and to test whether or not a consumer will make the switch.

For most shoppers pushing a cart through the supermarket aisles, these new guidelines won’t change much, at least not right away. It’s important to note that these guidelines are not laws that stipulate what one can buy or what the supermarket can sell. The question is whether the Make America Healthy Again and related guidelines will have a downstream effect on store layouts and promotions.

Will the CPG companies reformulating products to healthier change shopping behaviors? We are likely to see more in-store signage and displays that promote meat, dairy, eggs and produce as “guideline-friendly.” We anticipate more CPG brands hurrying to reformulate products to avoid being thought of as “bad food.” Front-of-pack claims will likely promote “now with less sugar” and “made with whole grains.” Expect also to see “better-for-you” messaging ramping up on supermarkets websites, apps and in-store. Target, for example, announced that it is expanding its wellness assortment, including protein products and nonalcoholic beverages by 30 percent and holding ‘wellness week’ savings events. Is it optics and posturing or the real thing? Retailers and CPG never miss a moment to glom onto the next trend. For the health of the nation, we hope it’s not just confirmation bias.

Margin Opportunity vs. Message Risk

The elevation of protein, especially meat and whole‑fat dairy, creates clear sales opportunities, but also potential reputational and health pitfalls if the story stops at just eating “more protein.” Many nutritionists and health professionals are questioning these recommendations. Health organizations, including the American Heart Association, warn that emphasizing full‑fat animal products without equal focus on saturated‑fat limits and plant‑based proteins sends mixed messages, and retailers that lean too hard into RFK, Jr.’s “butter and beef are back” marketing messaging risk being seen as out of step with heart‑health guidance.

“Limit alcoholic beverages: Consume less alcohol for better overall health” is a big departure from the previous guidance of one drink a day for women and two for men – contradicting the Surgeon General’s 2025 Advisory on the link between alcohol and cancer risk. To hedge all the contradictory bets, supermarkets that sell alcohol might consider merchandising beer, wines and distilled beverages with non-alcoholic offerings integrated in their displays, especially since this market is booming among millennials and Gen Z who seek moderation and more innovative alternatives.

Will the Guidelines Take Hold or Will We Go Back to Donuts?

Dietary advice is a moving target. Eat fewer eggs, then a year later, hey, eggs are okay to eat. Fat is bad and will clog your arteries. Now fat is back. Carbs are bad, then carb loading becomes the trend. Research shows that while labeling and nutrition information can shift purchases, the effect is strongest when the “healthy” option doesn’t sacrifice taste. It’s not surprising that the consumer is mystified about what’s true, safe and sustainable. Aligning external signals with internalized food behavior is a science unto itself.

Only time will tell if PepsiCo’s Simply Naked line works when a shopper is faced with making the choice. Remember that starting with the boomers, our senses and taste buds have been trained on artificial flavors and colors. The TV dinners, CPG innovations in convenience and shelf life, transformed an entire generation’s palate.

The real test for these guidelines is whether the collective power of the grocery industry, retailers and manufacturers will take the healthier path, or the path of least resistance. My bet is that despite all the guidelines, logic and nutritional advice, the donut aisle will stay just as irresistible as ever.

Why Your Grocery Store Wants You to Be Lonely

Phil Lempert — Tue, 30 Dec 2025 05:01:00 +0000

Walk into any modern supermarket and you’ll see the opportunism loneliness offers. In-store cafés with community seating. Cooking classes. Wine tastings. Sushi bars. Oyster bars. Even full sit-down restaurants. Wegmans’ Manhattan location dedicates an entire floor to prepared foods and dining. This isn’t about service—it’s about dwell time…and spending extra money.

The data is clear: Lonely shoppers stay longer. They linger at those café tables. They browse. And they spend more money. A quick trip for milk becomes 45 minutes at the community table and $60 in the basket because that store felt like somewhere to be.

Now, I’m not saying these spaces are inherently bad. But when retailers engineer these environments to monetize loneliness rather than genuinely solve for human connection, we’ve crossed a line.

So, here’s how we get our resilience back.

First, recognize what’s happening. That café table is optimized to keep you in the store longer, not to build lasting friendships.
Second, create real community outside the supermarket. Join an actual cooking club. Shop farmers markets where conversations with growers matter. Host dinners at home.
And third, support retailers who build community spaces because they genuinely care about their neighborhoods—not just because lonely customers have higher basket sizes.

We don’t need stores that profit from our isolation. We need stores that help us overcome it.

Sprouts: Pioneer in Health and Wellness

Retail Unwrapped — Fri, 19 Dec 2025 05:01:00 +0000

Most grocery retailers are chasing a $1.6 trillion market but Sprouts Farmers Market is deliberately ignoring $1.3 trillion of it. Join Shelley and Nick Konat, President and COO of Sprouts, as they reveal why the retailer has a laser focus on the $300 billion health enthusiast segment. Marching to a different drummer, Sprouts is driving 8 to 10 percent annual store growth while competitors struggle with more conventional strategies. That alone makes Sprouts a 2025 Crave Retail Radical! Learn how the retailer is expanding from 23 states to coast-to-coast while maintaining a smaller, more intimate format that runs countertrend to the superstore orthodoxy dominating the industry. The company’s counterintuitive approach celebrates the fact that customers will shop elsewhere. Sprouts is banking on solving the friction points that plague being a healthy eater: limited access to product, high costs, confusing claims, and mediocre taste. Sprouts is a model in retaining talent with a 30 percent internal promotion rate, and its purpose-driven ethos translates into solid bottom-line results. Nick explains why Sprouts is perfectly aligned with the explosive growth in the health food category among Gen Z and millennials. This strategy isn’t about trends but rather about supporting longevity-focused consumption behavior that will reshape grocery.

Special Guests

Nick Konat – President, and Chief Operating Officer of Sprouts Farmers Market

Transcript

A Wake-Up Call for Big Food

Phil Lempert — Thu, 18 Dec 2025 05:01:00 +0000

Well, the gloves are officially off, and the food fight is on. San Francisco City Attorney David Chiu has filed a lawsuit against ten of America’s biggest food companies—we’re talking Kraft Heinz, PepsiCo, Coca-Cola, Mondelez, Post, Kellogg/Kellanova, Mars, ConAgra, General Mills, and Nestlé. For the first time ever, a government body is dusting off the old Big Tobacco playbook and aiming it squarely at ultra-processed foods. The accusation is that these companies knowingly designed addictive, harmful products and then hid that truth from all of us.

Here’s the uncomfortable truth the food industry doesn’t want to talk about: This lawsuit isn't a joke. It's backed by a mountain of research linking these foods to obesity, diabetes, heart disease, and even cancer.

Processed Food Reckoning

Make no mistake; whether this lawsuit wins or loses in court doesn’t really matter. It has already won, because it’s forcing the conversation. For food brands, the choice is simple: Change on your own terms now or be forced to change later by regulators and angry customers. For retailers, the question is just as stark: Are you going to be part of the solution, or are you going to get lumped in with the problem? For decades, the food industry has optimized for taste, shelf life, and profit. The next decade will be all about optimizing for something much harder, but far more important: our health.

The Big Tobacco comparison isn’t just for show. When Chiu brings up tobacco, it’s a deliberate and legally powerful play. The lawsuits against tobacco companies set a clear precedent—a company can be held liable if it knows its products are harmful, engineers them to be more addictive, and then misleads or lies to the public about it. This San Francisco AG lawsuit asks a simple question: Have food manufacturers been doing just that?

The stakes here are massive, with huge implications for both the brands and grocery retailers. To be clear, this isn’t about a handful of junk foods. FDA researchers estimate that a staggering 73 percent of the U.S. food supply is ultra-processed. The effect could well be removing almost three-quarters of the products off the shelves in San Francisco and just imagine if other cities or states do the same thing. The reality is that for adults, UPF foods make up more than half of our daily calories. And for kids, it’s even worse, a frightening 62 percent.

What makes this interesting to me is the strange-bedfellows alliance. On the one hand, there is a progressive city like San Francisco suing food giants, on the other is Robert F. Kennedy Jr.’s Make America Healthy Again Commission calling out ultra-processed foods for driving chronic diseases in children. This is not simply politics; it’s pressure from both sides that should have every CPG and retail executive sweating.

Course Correction

What does this mean for food brands? The era of tiny, incremental changes to veil the problem is over. Reformulating to reduce a few grams of sugar or salt while keeping the basic, ultra-processed structure of a product isn’t going to work anymore.

The industry is facing three hard choices:

First, they must get serious about radical reformulation. I’m not talking about removing a dye or preservative here or an additive there. It is time to go back to the drawing board and completely rethink how products are made. That means shorter ingredient lists with words shoppers can pronounce, and yes, it will mean higher costs and shorter shelf lives.
Second is transparency. The old “we didn’t know” defense that tobacco companies tried won’t work in 2026. Companies need to get out in front of this. They need to talk openly about the trade-offs they make and their implications for taste, texture and potential allergens, about how they design for “palatability,” and what their own research says about health. Staying silent looks like an admission of guilt.
Lastly, some products might just be indefensible. The smartest companies will start phasing out their most problematic foods now, before the government or the courts do it for them. They’ll get ahead of the story, control the narrative, and come out looking like heroes instead of victims. By-bye Twinkies.

Take Responsibility

The industry trade groups’ responses, which for years have been touting their “efforts to improve nutrition” while warning against “demonizing certain foods,” sound like they came from a corporate crisis playbook from 1965. It’s defensive, vague, and basically pats consumers and regulators on the head as if they’re just overreacting. We are just not going to accept that behavior anymore.

No question, grocers are caught in the middle of this, but they have a real chance to be leaders, not just sitting on the sidelines. Forward-thinking retailers need to take a hard look at center store. If in fact, 73 percent of our food supply is ultra-processed, that means your supermarket shelves are too. Figure out which products are the biggest liabilities. And when it comes to the fastest growing segment of your business, private label, you need to also be serious about expanding better-for-you options as well as reformulations. This lawsuit is going to make headlines and make shoppers more anxious and aware. Grocery stores that offer them affordable, less-processed alternatives will win their trust and their money. This isn’t about creating a tiny “health food” section; it’s about making better food the new normal throughout the entire store.

Smart retailers also know that more regulation is coming, whether it’s new warning labels or updated dietary guidelines. The ones who start adapting now will be miles ahead of those who wait.

Litigation Pressure

Here’s the uncomfortable truth the food industry doesn’t want to talk about: This lawsuit isn’t a joke. It’s backed by a mountain of research linking these foods to obesity, diabetes, heart disease, and even cancer; and has someone in the White House who (for better or worse) is unrelenting. The science may not be 100 percent settled, but the trend is pointing in a very clear, very scary direction.

Some nutritionists correctly point out that not every single ultra-processed food is evil—some breads or peanut butters, for example, have a place. That kind of nuance gets lost when you’re defending products that are basically just sugar, salt, and lab-made flavors. The industry’s argument can’t be “not all ultra-processed foods are bad.” That’s like saying “not all cigarettes will kill you.” It might be technically true, but it completely misses the point.

Even if this San Francisco lawsuit fails, the genie is out of the bottle, and as the saying goes, what starts in California spreads to the rest of the nation. Other cities and states are watching. Shoppers are getting smarter and more skeptical. And with RFK Jr. in the Trump administration, ultra-processed foods now have a target on their back at the federal level. CPG and retailers need to pay attention now more than ever.

What Will Pringles Think of Next to Sell More Chips?

Phil Lempert — Tue, 18 Nov 2025 05:01:00 +0000

Would you pay $19.99 for a can of Pringles and a trinket? Well, meet the Once You Pop Mystery Box—Pringles’ first-ever direct-to-consumer product. Inside each box, you get two cans. One contains a mystery flavor. The other? One of six collectible Pringamabobs. Not an original idea; remember the prizes in Cracker Jacks? These little crisp-inspired characters with names like Snaxolotl and Duckalips are bag charms that they hope tap directly into Gen Z and millennial collecting culture. They’re doing limited drops during November on the 7th, 14th, and 21st at noon Eastern time hoping to create buzz through scarcity and urgency. Of course, they’ve partnered with unboxing influencers. This isn’t just about selling or eating chips. It’s about creating community, conversation, and yes FoMO—the fear of missing out. Pringles is hoping that today’s consumers don’t just want products. They want experiences, stories, and something to share on social media. Will the mystery flavor be worth the hype?

Jack Sinclair Is a Retail Radical

Phil Lempert — Wed, 12 Nov 2025 05:01:00 +0000

In an era when most grocery CEOs are chasing the same playbook—bigger stores, more SKUs, omnichannel everything—Jack Sinclair, CEO of Sprouts Farmers Market, is doing something almost unthinkable in retail: He’s making stores smaller, cutting selection, and deliberately ignoring 85 percent of the market. And it’s working brilliantly. The net profit margin for Sprouts reached 4.9 percent in the recent fiscal year. According to the FMI Food Industry Facts the average net profit for food retailers in 2024 was 1.7 percent and Sprouts beats that by almost 3 times!

As Sinclair says, “Our marketing efforts center on new store openings and curated products are all focused on our target customer who represents $290B out of the $1.6T food-at-home market. We recognize that we can’t be everything to everyone, so we concentrate on areas where we can win. That’s why we position ourselves as a specialty grocery retailer, offering the fresh quality of your local farmers market, along with the widest assortment of specialty items to suit various specific lifestyles. We attract a particular customer who’s very choiceful and cares about their food—its tastes, its impact on their health and where it comes from.”

The Innovation Center, branded as the “New for You Destination” in each Sprout’s store started popping up in new stores in 2021 and serves as both discovery zone and product incubator, giving entrepreneurial food companies a platform to introduce unique products. For customers, it creates a reason to return frequently and give them the opportunity to be trendsetters by offering them new and unique offerings.

Iconoclast and Icon

Sinclair’s grocery path began in Glasgow, Scotland where he stocked grocery shelves and moved onto some of the biggest names in supermarketing—from Safeway PLC to Tesco and then headed across the pond to Walmart and 99 Cents Only Stores. He now serves as CEO of the publicly traded Sprouts which was founded in 2002 by the Boney family.

Not since Joe Coulombe founder Trader Joe’s in 1967 decided to stock just 4,000 SKUs instead of 40,000, have we seen a grocery executive so boldly zig while the industry zags. Sinclair’s contrarian approach is delivering extraordinary results—Sprouts’ stock has surged 240 percent over the past year, comparable store sales have grown 8.4 percent, and net income jumped 47 percent in fiscal 2024 to $380.6 million on sales of $7.72 billion. But these numbers tell only part of the story. What makes Sinclair a true retail radical is his willingness to fundamentally reimagine what a successful grocery chain can be in 2025.

Most CEOs dream of total market domination. Sinclair dreams smaller—intentionally. He his audacious strategy with characteristic clarity: “The grocery industry is worth about $1.4 trillion. We’ve said we’re just going to go after $200 billion, which means we’re ignoring $1.2 trillion dollars.”

Competitors scramble to be everything to everyone, Sinclair has laser-focused Sprouts on what he calls “health enthusiasts and innovation seekers,” roughly one in seven or eight Americans. As he puts it, ” Sprouts customers are health enthusiasts and selective shoppers. They seek differentiated, attribute-driven healthy products that cater to their various needs, be that organic, vegan, paleo, or keto. They enjoy exploring culinary trends and prefer fresh, quality options, viewing Sprouts as a trusted partner in their healthy eating journey.”

Shrinking to Grow

In retail, bigger has always been better—until Sinclair flipped the script. When he joined Sprouts in June 2019, the company was operating stores averaging 30,000 to 32,000 square feet. Today, new Sprouts locations are a streamlined 23,000 square feet—a 30 percent reduction that flies in the face of conventional retail grocery real estate strategy.

But here’s the genius: these smaller stores aren’t sacrificing product selection. Instead, they’re eliminating what Sinclair calls “inefficient spaces and costly decorative elements.” The result: lower construction costs, reduced operating expenses, faster profitability, and ironically, a better shopping experience. The format prioritizes what matters to Sprouts’ customers: Produce is placed at the heart of the store, there are robust vitamins and supplements sections, expanded bulk offerings, and innovative specialty items. What’s been cut? Elaborate service counters and decorative flourishes that looked impressive but didn’t drive the business.

This de-risking strategy is paying dividends. Smaller stores hit profitability at lower revenue thresholds, making Sprouts’ aggressive expansion plan—currently 478 stores in 24 states with plans to exceed 1,400 locations. The company opened 33 new stores in 2024, plans to open 35 in 2025 and projects continued double-digit unit growth.

The Treasure Hunt

Perhaps no tactic better exemplifies Sinclair’s radical approach than his “treasure hunt” merchandising strategy. Sprouts rotates approximately 7,100 new items annually meaning roughly 35 percent of the assortment changes each year. He explains, “We created a foraging team of merchants who explore the world for new and unique products and flavors. To enhance the shopping experience, we have created our ‘New For You’ innovation center, which highlights the latest innovative products that often make their debut at Sprouts. This center is updated frequently to show the newest and most distinctive products not sold elsewhere, keeping our customers coming back for more. We also form partnerships with both small and large entrepreneurial companies whose values and lifestyles align with those of our customers. Additionally, we have a three-year pipeline of innovation with Sprouts Brand products. Many of these exclusive products rotate seasonally, ensuring that we continually bring back our customers looking for both new and old favorites.”

Sinclair adds, “Our team is our greatest asset, and we are committed to fostering a culture that supports their success and continued innovation. Looking ahead, we’ve got some exciting initiatives underway that will further propel our innovation. These plans include showcasing even more ‘New For You’ products in our stores, expanding our loyalty program nationally by the end of the year, strengthening our advantaged supply chain for fresher products and building exceptional stores that are enjoyable to shop in. To sustain this innovation, we integrate departments as much as possible, opening the doors for communication, ideation and ultimately, even more innovation!”

The Anti-Technology Technologist

In perhaps his most contrarian stance, Sinclair openly questions the industry’s technology obsession. “I’m not super excited about technology within a food store. I think a food store should be about what it sells, not how it sells it.” This isn’t Luddism—it’s prioritization. While Sprouts uses Instacart and DoorDash for ecommerce (which grew from 2 percent to 11 percent of sales), and runs data pilot programs in Nashville and Tucson, Sinclair refuses to let flashy tech distract from the core mission: curating exceptional products and creating an engaging in-store experience. Where Sinclair does embrace technology is in data analytics and AI to better understand Sprouts’ specialized customer base. “The thing that AI will do, and is already doing, is significantly improving the context of how you can understand the data,” he explains.

Purpose Driven

Sprouts has a purpose-driven culture. The company’s values—Care, Love Being Different, and Own It—emerged from conversations with 5,000 employees. “We’ve been very articulate about the purpose of our business,” Sinclair says. “That can be a galvanizing factor for the team. It’s based on the DNA of the people, the Boney family, who started this company in 2002. The premise of that DNA is if people eat a bit better, they’ll be a bit healthier and they’ll live a better life.”

Sinclair’s approach to sustainability embodies what he calls “doing good by doing good;” initiatives that benefit both the planet and the bottom line. New distribution centers in California, Colorado, and Florida have eliminated approximately 1.5 million miles of road transport. The Fullerton, California facility features an innovative solar energy system that manages costs while reducing environmental impact.

“What I love about Jack Sinclair is that he makes retail feel human again. He’s not chasing scale or flash; he’s using data and instinct to actually understand people—sometimes better than they understand themselves. That’s what great leaders do. They make the complex feel simple, and the simple feel worth caring about. That’s real retail radical energy,” says Matthew Cyr, Founder & CEO, Crave Retail.

The combination of radical business strategy married to genuine purpose is why Jack Sinclair is a Robin Report 2025 Retail Radical. He’s proving that in an industry obsessed with scale and sameness, the real revolution comes from clarity, courage, and an unwavering commitment to serving a specific customer exceptionally well. He says, “We want to be different, and we encourage our teams to constantly innovate in the grocery sector. We love that we are at the forefront of a health and wellness movement and helping people live and eat better.”

Sinclair adds, “I’ve certainly been lucky, and retail has given me a rewarding career. I encourage young people entering the industry to ‘dance in the middle of the dance floor.’ Grocery retail is so important to customers, and you have an opportunity to make a difference in people’s lives. Focus on what’s in front of you rather than what’s way ahead; love the challenge of meeting customers’ expectations every day.”

About the Retail Radicals

The 2025 Crave Retail Radicals Awards include Le Bon Marché, Build-A-Bear Workshops, Pacsun, SKIMS and Sprouts. For the past seven years, we have identified radical thinkers and doers (innovators and entrepreneurial leaders) driving major transformations within their respective retail brands. In a marketplace that is defined by transactions and risk-avoidance, these five retailers have bucked the trend and are helping to transform the industry by rewriting the rules of retail by being bold and brave. Each is a role model for keeping retail relevant and vibrant, and exceeding expectations experientially and financially.