CPG

Introducing Cacti Jack

When Travis Scott burst onto the music scene less than 10 years ago, few suspected the rapper would become a business mogul. Several successful ventures later, he’s now onto the next: an agave spiked seltzer, Cacti, released today in partnership with AB InBev.

• Cacti is available nationwide at retailers IRL and online, though AB InBev couldn’t tell us which retailers. But partnering with the world’s largest brewer will help with widespread distribution.
• Scott and his Cactus Jack creative team worked with AB InBev on “everything from liquid creation to creative and marketing,” Lana Buchanan, marketing VP at AB InBev’s Beyond Beer unit, told Retail Brew.  

La Flame’s cultural influence—especially among millennials and Gen Zers—gives legs to anything he attaches his name to. McDonald’s took note of this in September, and it paid off: Scott’s limited edition McDonald’s meal led to ingredient shortages.  

• The Travis collab has allowed AB InBev to “rethink what a typical celebrity alliance could look like,” Buchanan said. 

Authenticity sells: Cacti’s aesthetic aligns with Scott’s image as an artist, which is uncommon for many celebrity-backed booze brands, according to Andrea Hernández, author of the CPG newsletter Snaxshot. 

• “It’s his personality slapped into a can,” she said. Meanwhile, with “Kendall Jenner’s 818 Tequila Brand…you could have told me that anybody would have launched that brand.” 

Seltzer, you should try it 

Travis Scott and hard seltzer have two things in common: 1) They both skyrocketed in popularity, and 2) young people were largely responsible. In 2018, hard seltzer sales reached only $400,000, but hit $4.1 billion in 2020. An August 2020 YouGov poll found 9% of millennials purchased White Claw in the previous 30 days, just behind Bud Light and Corona at 11%. 

A spiking segment: While White Claw and Truly are still hard seltzer kingmakers with a combined 75% market share as of last June, new brands are staking their claims. 

• Michelob’s Ultra Organic Seltzer has attained 3.83% market share since its January launch, per IRI. 
• And Bud Light’s Seltzer reached 10.4% market share in its first year. The company believes seltzers can attract younger drinkers to other Bud Light products, VP of Marketing Andy Goeler told Retail Brew. 

The takeaway: The alcohol market is increasingly inundated with new seltzers and generic celebrity-backed liquor brands. Thoughtful and deliberate collaborations like Cacti could feel refreshing to consumers in more ways than one. 

SUPPLY CHAIN

Protester Pressure vs. Profits

Pro-democracy protesters in Myanmar are grabbing the fashion industry’s attention, and unionized garment workers in the country are demanding more support. It’s the latest example of fashion brands needing to respond to sociopolitical issues in supplier countries.

Pressing pause: H&M and Benetton have temporarily suspended distribution from Myanmar, where tensions have escalated since the Feb. 1 military coup. 

• Around 45 of H&M’s ~850 direct suppliers are in Myanmar, where the retailer has sourced for seven years. 
• 2% of Benetton’s suppliers are located in Myanmar.

Garment workers, who have now become the face of the protests, make up a large portion of the country’s workforce. In Myanmar, clothing accounted for 31% of $4.59 billion in 2018 exports, per the NYT. 

• Workers are insisting brands including H&M, C&A, Mango, and Zara owner Inditex not fire workers for joining the pro-democracy protests; numerous firings have been reported.

Zoom out: Brands that employ factory workers in Myanmar, Bangladesh, Cambodia, the Philippines, and Ethiopia have fallen short on pay. From March to May of last year, millions of workers—mostly women—didn’t receive between $3 billion and $5 billion in owed wages, according to the Clean Clothes Campaign. 

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E-COMM

365 Days of Order Confirmations Later...

In a new report shared with Retail Brew, Adobe Analytics predicts 2022 will be the first trillion-dollar year for e-comm. It’s not because Amazon’s finally cracked luxury fashion. 

It’s a new New Normal. One year after the first round of store distancing, digital momentum’s building. Online spending for the first two months of 2021 increased 34% YoY to $121 billion, and Adobe Analytics expects online sales this year to reach up to $930 billion.  

How we got here: You’ve likely lived the story. The pandemic (temporarily) closed physical stores and highlighted pixelated ones last year, sending online spending to $844 billion between March 2020 and February 2021. 

• $183 billion in extra spending poured in as quarantine sent shoppers online, per Adobe Analytics. 

Pivots → lifestyles: A year and change into the pandemic, retailers’ adjustments are sticking. Buy now, pay later adoption is up 215% YoY for January and February; curbside pickup increased 67% YoY last month. 

Bottom line: We know shoppers aren’t ready to quit clicking and collecting, but the categories they’ll choose in 2021 are still a question mark. Good thing Retail Brew has something special in the works on this exact topic.

WHAT ELSE IS BREWING

• Office Depot's owner turned down another Staples acquisition offer.
• Toys R Us stores will return under the company’s new owner, brand management firm WHP Global.
• Nintendo expects record Switch device sales this year.
• Amazon is cooking up at least 28 new Fresh grocery stores.
• Peloton has a new activewear partner: Adidas. 

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HOT TOPIC

At the mall, it’s where band tees are the only tees. In Retail Brew, it’s where we invite readers to weigh in on a trending topic in retail.

Stimulus szn is back again. As $1,400 checks make their way to shoppers this week, retailers hope the extra funds are spent and not saved. 

• After past stimulus deployments, major retailers noticed small sales lifts—but consumer surveys found shoppers were more likely to send payments toward necessities like rent.
• This time around, rising consumer optimism could = rising sales. US consumer confidence hit its highest level in a year this month, following promising vaccine news and a fresh relief package.

We want to know: Will the third stimulus be the charm for retailers? Cast your vote here. 

Mask the question: Last week, we checked in on retailers’ mask policies in states where government mandates have lifted. 80% of voters said stores like Target and CVS should keep asking patrons to cover up; 17% disagreed. 

SWAPPING SKUS

The post-pandemic, hybrid remote world is coming. Some retailers will make changes to their own HQs, while others will try and profit from the shift.   

• REI sold its newly built headquarters in Washington as the company looks to institute a more flexible work environment. (CNBC)
• Tech companies are using online furniture marketplace Clear Office to trim down their offices. (Also CNBC)

ICYMI

Catch up on the Retail Brew stories you may have missed.

• Walmart’s Latest Omnichannel Push Includes Dark Stores and Ghost Kitchens
• Adidas Is Shifting Its Focus to DTC
• For Retail Startups, Team Building Is a Top Priority