Commerce Riff with Sri & PVSB - October 6, 2026

PVSB 0:40

It's October 6th, 2026, and this is the Commerce Rift, brought to you by the CPG guys. Ten minutes of news stories that matter most in commerce this week. I'm your co-host, PBSB, and I am joined by my dear friend and partner, Papa Raj. Shri, how was your trip to Las Vegas? Fabulous.

SPEAKER_01 1:00

Gotta see, as you can see, the shirt, Metallica live at the sphere. I gotta tell you, it's Metallica, so the energy was amazing. But the visuals of the sphere, some notes, Peter. How was your golf game yesterday with Nadia?

PVSB 1:13

Well, we putted around the putting green for about an hour, went in and grabbed a meal at the club, and managed to dash out just as the rain was starting. It was, from my perspective, a perfect night. All right. This week, McCormick shows what a value conscious shopper does to the spice rack. Amazon goes agentic with its ad platform. Kroger finds that it can predict which ads will convert before it spends a dollar, and Albertsons folds its retail media network into marketing. I'll kick this off. McCormick beats expectations, but value-seeking shoppers are trading down in the spice aisle. McCormick reported fiscal third quarter results on Thursday, and the headline number looks great. Sales up 17% to $2.02 billion ahead of the $1.98 billion Wall Street was expecting. But read one line further. Most of that jump comes from the company's acquisition of a controlling interest in McCormick de Mexico earlier this year. On an organic basis, sales rose just 1.9%. The segments tell the same story. Consumer segments, sales were up 25%, but only 1% organically. Flavor Solutions, the business that sells into food manufacturers and restaurants, was up 8% or 3% organically. Profit fell with net income at $97.6 million or 36 cents a share versus $225.5 million or 84 cents a share a year ago as higher input and freight costs hit. Adjusted earnings of 86 cents a share did beat the 76 cents analysts polled by facts that expected, and productivity initiatives helped protect margins. JP Morgan analysts said the results were better than many feared. CEO Brendan Foley didn't sugarcoat the consumer. Shoppers are, in his words, incredibly conscious of value, and when they're paying more for things like seafood and beef, they're buying fewer spices and seasonings to go with them. McCormick's response, optimize the portfolio, use selective pricing and promotion, and step up marketing, including scaling high growth platforms like finishing salts and sugars to create new usage occasions ahead of the holidays. Shares rose about 3.9% in pre-market trading to $48.20, though the stock is still down nearly a third this year. And in the background, McCormick reaffirmed its outlook and said integration plans for its proposed combination with Unilever's food business remains on track. That's the big one to keep watching. Sri.

SPEAKER_01 3:52

Peter was just at Unboxed. And what do we learn from the great Amazon event? Amazon used its unboxed 2026 event on September 29 to Amazon Amazon Ads Agent, the new name for the Unified Demindside platform, an ads console it introduced last year, now powered by Agentec AI, of course. It brings three campaign types together in one place. Sponsored ads, display, video, and audio, and a new one called Full Funnel Campaigns. Finally, advertisers can build manually, let Amazon's AI optimize for them or mix a combination of both. Full funnel campaigns is the headline. One campaign combines sponsored ads, display, video, and streaming TV. Advertisers provide a budget, products and creative, and Amazon's AI handles planning, execution, and ongoing optimization. The pitch is shared signals across formats, so upper funnel spend helps lower funnel ads perform, and built-in creative tools can turn existing product pages into TV quality video and display images with advertiser approval before launch itself. Reporting ads new to brand and long-term sales metrics along impressions, clicks, and sales, all available now to all US advertisers. Then there's TVA Plus, which rolls what used to be sponsored display, sponsored TV, programmatic campaigns into a single buying experience. Powered by Brand Plus and Performance Plus, it uses Amazon shopping, browsing, streaming signals to place ads across streaming TV, online video, display and audio on Amazon properties, and guess what? The open internet. Advertisers pick a goal, whether sales, traffic or awareness, add products and creatives, set a budget and launch. Experienced programmatic buyers get an advanced settings mode with control over targeting deals, supply sources, frequency caps, and bidding. DVA Plus begins rolling out in late October this year. The conversational layer is getting an upgrade to media planning, plain language AI, targeting, natural language analytics, and one-click optimization recommendations for sponsored products, all rolling out over the coming months. Amazon says advertisers who use natural language to apply targeting recommendations last year, saw more than a 25% additional unique customers and more than 10% lower cost by impressions as an average 10. So's Jason O tool said it's strategic, can spend less time on execution mechanics and more time on insights and creative, therefore. The takeaway for brands, Amazon is telling advertisers, hand over your goal budget and creative to me and let the machine do the rest. That's convenient. But it also raises the question of how much transparency and control you can hold on to as a brand. Over to you, Peter.

PVSB 6:21

Thank you, Shri. Kroger can predict which ad creative will convert with 81% accuracy before launch. Same with AI, here's one that matters to every brand that spends on retail media. Kroger, working with creative firm VidMob and the Trade Association MMA Global, found that predictive creative scoring can forecast e-commerce purchase conversion before a campaign even launches. Marketing Dive reported the results on September 30th. The study used AI to analyze more than 1,900 video and image assets from Kroger campaigns across Meta and Google's DV360, scoring variables like messaging, narrative structure, branding, and on-screen human interaction. The headline: 81% accuracy in forecasting conversion. Wow. Creative that follows the recommendations averaged a four times improvement in conversion rates, and shifting media towards higher scoring creative could generate more than twice as many conversions from the same budget. What's different here is the outcome measure. An earlier Calanova effort with VidMob and MMA Global tied creative decisions to view through rates as a proxy for sales. The study forgoes to proxy and connects creative to actual sales. VidMob founder Alex Colmer's point is that marketers have long treated creative as non-working spend and media as working spend, even though everyone says creative drives 50 to 70% of results. And with the generative AI and creators driving a 10 times or even 100 times expansion of the number of assets, getting a signal before you spend becomes essential. Comer also flagged that when everyone is using the same AI tools, the tools are no advantage. Proprietary creative performance data is what differentiates. Shri close us out.

SPEAKER_01 8:18

Thank you so much, Peter. Finally, there's a shakeup in retail media that we anticipated in a letter to supplier partners stated Friday. Albertson's company's chief merchandising officer, Michelle Larson, announced that effective immediately. Albertson's Media Collective now reports to Chief Marketing Officer Emily Turner, who reports to Larson herself. That brings media and marketing together under one leader inside the same organization as merchandising. The letter also confirms that Brian Monahan has left Albertson's company's Larson credited him with building the media collective into an important growth driver and establishing the foundation that made this next step possible in the first place. The pitch to supplies are straightforward, faster decisions, closer coordination between the campaigns you fund and how Albertsons engage customers, and a more connected experience from planning through measurement. Media remains part of a joint business planning with merchandising. Campaigns, plans, and agreements continue without interruption, therefore. The move follows the ACI Ed strategy Larson outlined in July, which includes Merch United and a new regional operating model. The signal is that retail media is no longer a standalone business at Albertsons. It's being integrated into how the whole retailer markets and merchandises expect other retailers to be asked the same question. Peter, please take us home.

PVSB 9:32

That's a wrap on episode 51 of the Commerce Riff. If you haven't caught up on recent episodes, go back and listen to our grocery shop conversation with Mondeleese International's Rick Schumann and InMarket Stan Turk. This episode is well worth your time. If anything we covered today sparks a thought, please drop it in the comments. We read all of them. And if you're not following us on LinkedIn, Instagram, TikTok, Facebook, and YouTube yet, well, now is the time. Thanks for riffing with us. We'll see you next week.