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28th, 2026 and this is the Commerce Rift brought to you by the CPG guys. 10 minutes of the news stories that matter in commerce this week. I'm your co host pvsb. I'm joined as always by paparazz, the father of pop stars co founder of Think Blue Consulting Sree. How's the week been treating you?
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It's a long week in the northeast. You know, you and I got to work together and up in Connecticut. I gotta go to my, I wanna call it my alma mater hometown of Stamford, Connecticut which is the first place I lit that up while working for iri. My first job after college. And then we hosted a dinner which was very nice for product win. Locals from Stanford. Stanford area came by which is pretty cool. A bunch of CPP brands. How was your early weekend? Saturday morning all good.
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Took Naida dance class. Let's not forget we also had dinner with our dear friend Anna Mayo from Nielsen iq. That was wonderful. Little sojourn at our favorite restaurant, Italian Sienna. They treated us extremely well so it was great treat. All's good here. Let's kick things off in the beverage aisle because Keurig Dr. Pepper had a strong week. So let's unpack the numbers. KDP reported first quarter 2026 net sales of just under $4 billion, up 9.4% year over year and ahead of analyst expectations. What's the headline? Well, cold beverages actually carried the quarter. US refreshment beverages grew 11.9% to 2.6 billion, driven by 7.2% volume mix growth and nearly 5 points of net price. Realization International was up nearly 20%. The offset was US coffee, which slipped 2.3% on softening Keurig Pod volumes. But that tracked with guidance and the company reaffirmed its full year outlook. Now let's talk about what's actually driving the cold side of the business. SRI Energy is the engine. Ghost, which KDP majority acquired in late 2024 and has been rolling into its direct store Delivery Network through 2025, is clearly contributing. You also have C4 Black Rifle Energy Bloom. KDP has been intentional about building a portfolio of complementary energy brands targeting distinct consumer occasions. It appears to be working. The company has gone from essentially zero energy market share three years ago to over 6% today with a double digit share goal ahead. Here's the CPG strategic lens. KDP's Q1 result is a proof point for the portfolio diversification thesis. A company that used to be primarily defined by its coffee platform is now generating outsized growth from a cold beverage engine built on DSD distribution scale in shrewd minority stake M and A the Ghost acquisition framework 60% now, 40% in 2028 at a performance based valuation is exactly the kind of disciplined deal structure that lets an acquirer get distribution leverage before paying the full growth premium. The question for CBG peers How many of you are watching energy at 6% share and still treating it as a challenger category because KDP is acting like it's already won? Watch the shelf. The DSD network is about to get a lot more crowded and a lot more competitive. SRI
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all right, we'll move from there to a consumer behavior story that is funny on the surface and alarming underneath for anyone the alcohol hospitality of brand beverage businesses. Indeed, the Wall Street Journal this week put numbers to something Anyone who has been out recently already knows in their gut drinks are expensive that grown adults are pre gaming again, like what they did in College. Remember those $1 pictures of Killian's red back in college? Peter on game day? Here's the data. Nearly a third of the 1,000 people surveyed by Zappy Zappy, a consumer insights platform, said they pre drink before going to bars or concerts, specifically to avoid paying for overpriced things at venues. The numbers justify the behavior. Tall Clan of Black Cherry White clawed a Massachusetts concert venue 20 bucks. Cocktails at Madison Square Garden 25 bucks and up. National Spark in Washington D.C. $15.40 here at Fenway nearly 11 bucks. The cheapest MLB beer you can find in the country right now is Coors Field in Colorado. And brands have noticed. Diageo and Kendall Jenner's 818 Tequila have both started packaging in airplane sized bottles specifically optimized for on the go pregame consumption. Now this is more than a quirky cultural moment, it's a structural signal about where the alcohol purchase the patient is migrating when a third of consumers are deliberately shifting their drinking dollar from on premise to at home, from the bar to the living room, from the venue to the parking lot that has real category implications for CPG alcohol brands. This is a moment of opportunity, but only during the right format, the right price tier and the right retail channel. The consumer is pre gaming at home is buying at the grocery store, at the convenience store, at club. They're price conscious, but they're spending. They want their brand a choice at a size and price point that makes the math work before the show starts. And for retailers, the off brand is channel just became even more critical to capture beverage alcohol wallet share. The venue has priced itself out of the first drink. The drink is now yours to win at the shop. If your assortment, your promo architecture and your shopper media appointing at the right consumer at the right moment AKA the first moment of truth. Now Peter, let me append to that. Here's our viewpoint from the CPG Gas alcohol consumption has changed over Covid last few years. The younger generations are drinking less. That is a reality that has to be dealt with. If you're in the alcohol business, we invite you here on the CPGUI to come talk to us. Tell us what's on your mind. If you are in one of those categories and a brand leader. Over to you Peter.
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Yes Sree. And also thanks to our dear friend Laura Cooper who penned the article in the Wall Street Journal that inspired today's story that we just covered. Now let's talk about something that isn't a CPG story on its face, but has more implications for the industry than most people are giving it credit for. This week Microsoft announced a voluntary retirement program targeting approximately 7% of its U.S. workforce, roughly 8,750 employees out of 125,000. First time in the company's 51 year history it has done buyouts at this scale. The program uses what it calls a rule of 70. Eligible employees are those at senior director level and below who combined age and years of service equals 70 or higher. Full details go to the eligible employees and their managers on May 7 with 30 days to make a decision. Stated context is cost management. Amid a massive AI infrastructure build out, Microsoft is spending tens of billions of dollars on data centers, GPUs and AI development. The workflow force math has to evolve to fund that investment. They are not alone. Amazon, Google and Meta have all been trimming headcount while simultaneously expanding capital expenditure on AI infrastructure. The pattern is clear. The era of the large technology workforce is giving way to the era of the large technology compute infrastructure. So why does this matter for CPG and retail? Because Microsoft is effectively the operating system for a significant portion of enterprise. Cpg, Office Teams, Azure, Dynamics, Copilot, the tentacles are everywhere. SRI and the employees being offered buyouts are the senior experienced layer. The people who are built and manage those enterprise relationships, who customize implementations, who support business critical workflows. There's also a talent implication. When the experienced operators leave a technology company voluntarily, many of them don't disappear. They will go into consulting. They'll go into CPT companies directly. They'll go into agencies and solution providers. Talent circulation that follows Microsoft scale voluntary separation program seeps into the entire ecosystem over the ensuing 12 to 18 months. And the macro signal is simply this Even the most valuable technology company on the planet is reconfiguring its human capital model for an AI native future. If you're a CPG or retail organization that has not started asking hard questions about where AI replaces labor and where it doesn't, Microsoft just put a very large clock on the wall.
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SRI closes out hey Peter, thanks for the notification on Microsoft and the retirement that they're offering. One thing I want to point out, they publicly announced, Peter, that they are rolling back Copilot in a big way and moving funding towards AI. I thought Copilot was AI, but it looks like the money is going to go into the compute infrastructure versus the actual software programming. And that announcement shook some waves earlier this week. But let's end on a story that sits squarely at the intersection of our niche retail media brand safety and the ongoing challenge of making social advertising actually accountable. Because TikTok has a consequential week on the measurement Front. This week TikTok expanded its partnerships with Integrated Ad Science and Zephyr, bringing campaign measurement and brand safety capabilities to four additional ad formats, including TikTok search creation tools for smart plus traffic, TikTok Live in the US and DMV Max in the US separately, double verify became the first measurement vendor to receive Media Rating Council accreditation specifically for TikTok video viewability covering impressions, viewable impressions, viewability metrics, and sophisticated invalid traffic filtration. I want to put that in context. TikToks is expected to capture nearly 5% of global digital advertising revenue in 2026, reaching an audience of 136 million unique U.S. users. That's not a niche platform that's considered a mainstream media vehicle, but it's carried a trust deficit with serious brand advertisers, particularly due to the ownership and regulatory complexities that played out over the past 18 months, partly because the measurement infrastructure simply hasn't kept pace with the scale of the opportunity. With this week's announcement, what it represents is TikTok systematically closing that gap. IAs defer double verify, they're not fringe players in the measurement space. They are the currency that institutional advertiser communities relies on across digital channels. Getting MRC accreditation for TikTok we believe through double verified kind of third party credentialing and move the platform from test and learn and betas into a media plan to the committed investment line in a media plan for CPG brands. It matters in a very specific way. TikTok's GME MAXAT format, which is now getting brand safety and measurement coverage in the US Is a commerce integrated placement engine to drive direct purchase. The fact that IIS measurement will now be available within GMV MAX at launch means brands can finally deploy against TikTok commerce inventory with the same accountability framework they would expect from a performance channel on the open web. But here's our CPG guide state TikTok is no longer asking brands to trust their own faith, it's presenting the receipts. Indeed, the measurement infrastructure being built out in 2026 is the foundation for TikTok becoming a serious recurring line in CPT media plans, including, especially in the context of retail media and social commerce. Question is no longer whether TikTok is a legitimate advertising vehicle. Question is whether your brand has created the content strategy, the commerce integration to compete on TikTok at scale. And I'm going to beg to differ here. Brands aren't ready they were using measurement and regulatory compliance is an excuse that's
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a wrap on this week's Commerce Riff. Reminder Catch up on a recently released episodes first one featuring Shelley Zalas from the Female Quotient and of course the one we recorded at Shop Talk, Patrick Nominson from, of course, TikTok, which we just discussed. If any of this sparked a thought, drop it in the comments, send us a message. We read them, and if you're not already following us on LinkedIn, Instagram, TikTok, Facebook, and YouTube, now is the time to do so. We'll see you next week.
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