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- [00:02]
A
Hello, it's February 3rd, 2026. Welcome to this week's episode of the Commerce riff with the CPG guys. Our weekly short segment, bite size. 10 minutes of content, audio and video. I hope you enjoy our curated stories. I'm of course your co host, pbsb. I'm joined by Paparaj, father of pop stars, co founder and CRO of Think Blue Consulting. Sree, how you doing?
- [00:25]
B
Good, Peter. Of course, at the time of this recording, we don't know if Cat's Eye will win a Grammy or not, but it's. They just, they would have performed at the Grammys last Sunday and the Grammy parties that I got to go to left and right. I met so many artists from Zara Lawson, Sabrina Carpenter, Charlie xcx, Shabousi. That list is too big, Peter, for me to go on. But more importantly, I want to know what's going up going on with Nadia and you. Since a lot of travel this week, we had to bear for to present at the national sales meeting as a keynote.
- [00:54]
A
Yeah, just working, working some moments in to spend time with Nadia. She's getting geared up. It's her birthday in a couple of weeks. It's the day after we get back from the Cagney conference.
- [01:06]
B
We want a birthday reveal. What's the party?
- [01:08]
A
The party theme is Sanrio. And most notably, it's not hello Kitty, her favorite character. No, no, it's Kuromi. So it's, it's a Kuromi themed Sanrio birthday party. Sree. All right, let's get on with our story, shall we? On January 27, 2026, Amazon confirmed what many analysts had quietly anticipated. Amazon Fresh and Amazon Go store banners are being shuttered across the US Ending a decade of experimentation in brick and mortar grocery retail. At least ones that they started on their own. According to Amazon, all 57Amazon Fresh stores and 15Amazon Go locations are slated to close imminently as the company pivots to prioritize Whole Foods, its acquired brick and mortar business, and of course, online grocery delivery services and partnerships it's created with regional grocers. Combined, these closures marked the end of two major branded retail plays in the grocery space that despite bold ambitions and technological innovation, never achieved the scale or economics Amazon had hoped to capture. Toxic things Amazon struggled with in operating these grocery stores. Number one, low grocery margins versus tech heavy cost structures. Two, undercutting Amazon brand pricing expectations. Customers honestly expect an Amazon level price leadership. Instead, many fresh items, including private label products, were priced higher or inconsistently compared with competitors like Walmart. Or Kroger everyday offerings hurting value perception. Analysts noted Amazon's grocery pricing strategy quote doesn't compute unquote for many mainstream shoppers. 3. Confusing brand and delivery ecosystems. Amazon operated multiple grocery touchpoints, Amazon Fresh stores, Whole Food Stores, prime delivery and online grocery checkout experiences with different fees, thresholds and of course, shopping flows. Industry observers highlighted how this fragmentation created customer confusion rather than seamless integration. Number four, Limited physical footprint speaks for itself. Number five, Technology isn't a grocery substitute. The highly hyped Amazon go just walk out cashierless tech drew attention but didn't become a mainstream draw for grocery formats it provided. Or rather it proved easier to scale in small, convenient formats and licensing than as a core grocery differentiator. I will also add sri. You know when we went into the Amazon Fresh store in Woodland Hills, California, after you go through the checkout line, if you try to walk out of the store with the dash cart, someone practically tackles you because you're not allowed to take it out of the store. That's enough friction to disrupt the entire experience. And number six, Execution inventory challenges three operational execution, from stockouts to reliability and fresh delivery and in store assortment was a recurring complaint from consumers. Critiques range from inconsistent pricings to inventory reliability issues which undermined repeat shopping behaviors. Subreddit volumes on fresh store operations often highlight inconsistent stock or canceled orders. Shame. SRI over to you.
- [04:44]
B
Yeah Peter. So Whole Foods is also getting rid of its palm based checkout. Your hand. You could put the palm on the reader. That's going away. So tech is definitely not a substitute. Gen Z is rewriting the rules of holiday shopping. Deloitte projected that Gen Z's 2025 holiday spending would drop 34% from the previous year, with an emphasis on budgeting and deal hunting. And while the numbers are still coming in and still being gathered, we should know shortly the mandate for retail leaders is clear. Adapt to Gen Z's evolving preferences or miss out on a powerful consumer base. There's no doubt that Gen Zers navigated this holiday shopping season with the shop iron value, but they're also far from tuned out. Despite a more conservative consumer approach, the generation is the age group most optimistic about the financial outlook heading into the new year. Gen Z still showed up this holiday season just on their own terms. And let me tell you what those are. The challenge for retailers was keeping up with the generation's rapidly evolving expectations, especially in stores and all year round. For many retailers, AI offers a missing link between this year's performance and then this upcoming year 2026 improvements lessons from the 2025 holiday season as a 2025 holiday shopping season winded down, most merchandising and promotional strategies had already wrapped up. While that limits the types of enhancements retailers can make, there's still so much more to learn and reflect on during that stretch of time that we learned, and ways to apply insights moving forward. Whether you're reading this at the end of the holidays, whether you're learning about this one month in like we are talking about this show, or sometime that has passed by a good month, think of the 2024 holiday season as your test case and data source, especially when it comes to Gen Z. How did Gen Zers discover products in stores? How did they engage with the brand? Did they gravitate towards retail experiences that were curated and intentional? Or did they introduce entirely new behaviors that we hadn't seen before? The information that you gathered in the last month will shape not only next holiday season's execution strategy, but your everyday retail operations. Go forward as you review and reflect. Let me give you three trends that we observed and learned. They likely shaped your source performance over this past holiday season a month ago, good and bad, so analyzing them now can help you start the rest of this year correctly and spotlight the biggest gaps in your current AI capabilities. Number one Real time shopping habits Product discovery amongst younger shoppers is digital, dynamic and happening in real time. According to Deloitte's holiday retail survey, 43% of Gen Z used AI tools to help them shop this holiday season, and 3/4 turn to influencers and social media for inspiration. No surprise. And while their searches may start online, 81% of them still get inspiration from in store displays. What captures Gen Z's attention online must translate quickly to physical store experiences and product availability. When in store experiences reflect what Gen Z is excited about in real time, stores feel current, culturally fluent and worth engaging with. Trend number two Value Added in store experiences Gen Z didn't base their holiday shopping choices on convenience alone. According to recent research from JP Morgan, less than 45% of Gen Z's in store purchases happen within 10 miles of their home, compared to over 50% for other generations. Like you and me, Peter, Gen Z is comfortable traveling to shop, but for stores that deliver a worthwhile experience to be noted. Number three localized offerings according to PwC, Gen Z shopped with greater intention this past year, favoring gifts and brands that felt personal, thoughtful and aligned with their values. Broad brush holiday campaigns fell short on this front. Completely snow covered window display might have resonated in Chicago, but likely feels irrelevant in Phoenix or right here in Los Angeles. When stores ignore regional shopping preferences, product trends, weather or cultural cues like popular events, they risk losing their emotional relevance for Gen Z. So do pay attention. What's next?
- [08:37]
A
Peter Fascinating, Sree all right, effective February 25, 2026, TikTok shop is killing seller shipping. That's the option where you handle your own labels, your own carriers, your own logistics. Gone. Every US Seller on the platform will now be required to fulfill orders exclusively through TikTok shop logistics services. And here's the kicker. For any seller onboarding on or after February 9th, seller shipping isn't even available as an option anymore. The door is already closing. If you've been running A3PL and managing TikTok fulfillment through your own warehouse, that workflow is changing. Even if you're still shipping from your own building, your fulfillment software now needs a direct integration with TikTok's updated APIs to generate labels and handle tracking right back through their system. If your tech stack isn't wired for that, you've got a problem and you've got weeks, not months, to solve it. Here's the interesting angle. The policy levels the playing field in one way and tilts it in another. Brands that can move inventory into FBT fulfilled by TikTok TikTok's warehouses get shielded from a bunch of seller side performance penalties. Orders fulfilled through FBT are excluded from on time delivery rate calculations and certain return metrics. That's a significant competitive advantage on the platform's algorithm. The brands that adapt to FBT fastest aren't just compliant, they're positioned to win more visibility. As for the Amazon comparison, Rather, let's call it what it is. This is TikTok's version of the Amazon Playbook. Centralized fulfillment control the logistics ecosystem Own the data on how your sellers are performing from warehouse to doorstep. Amazon took years to build that model. TikTok is compressing it into a four week window. That's either bold confidence or a sign that they know exactly how department sellers have become on the platform's traffic. The bottom line? TikTok shop is maturing fast, and this fulfillment mandate is just one of the clearest signals yet that they're building for a marketplace infrastructure, not just a content to commerce app. For CPG brands that treat TikTok shop as a serious channel, this is a forcing function. Get your fulfillment strategy locked in before February 25, or risk getting squeezed out during what's still one of the fastest growing commerce services in the country. Big deal.
- [11:11]
B
Sri Huge as part of its global restructuring plan, Pinterest plans to cut less than 15% of its workforce and reduce its office space. According to a filing with the U.S. securities and Exchange Commission, the company streaming its staff and office footprint to reallocate resources towards AI focused positions and teams, prioritize AI driven products and capabilities and shift its sales and go to market strategy. The move is expected to cost Pinterest between 35 and 45 million dollars. The company anticipates completing the plan September 30th of this year pending local law and consultation requirements. Similar to a recent layoff by Amazon, Pinterest is reducing its employee headcount amid a broader AI push as the company lays off some of its staff in the short term. It noted in its SEC filing that it plans to reinvest in key development areas and strategic ops. In recent months, the company has harnessed AI and its own data to make its platform more intuitive for sharpers. Last September, the company announced its where to buy links on image ads, which connect users to retailers with products in stock. Through its preliminary testing, the company found that its where to buy links catalyzed higher used user engagement and stronger performance compared to campaigns using external where to Buy landing pages. The following month, Pinterest debuted multiple AI powered product discovery features, while the make it your Stab provides fashion and home content and product recommendations. The More ideas tab recommends similar pins in other categories such as beauty and art. The company also debuted its Style for you feature which uses AI driven fashion collages from saved pins to help shoppers create and purchase brand new looks. During the 2024 holiday season, Pinterest leaned into its internal data to curate gift cards for shoppers, and the company tapped experts, celebrities and internal data to create gift guides across categories such as home, fashion, tech and beauty. Over to you Peter to close us out.
- [13:02]
A
Thank you sri. As we wrap up, a reminder to catch up with our recently released episodes featuring Kurt Monk from Tracy Locke, part of Omnicom, who gave a great recap of CES and some of the food and health technology innovation that was available on display at the show. And of course we also have an episode on the FMI Midwinter recap we did with our friend Parag Shah, Sri's partner for Think Blue, who was there with us both down in Chula Vista, south of San Diego. All right folks, that's our take on relevant commerce happenings from so many announcements this past week. We thought these were particularly meaningful. We couldn't pass up on a riff we hope if you enjoyed it, please do click like our posts on all platforms LinkedIn, Facebook, Instagram, TikTok and of course now YouTube. See you next week.
- [13:51]
C
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