The Goods (U.S. Edition) – The Great Cloutdoors
Welcome back to The Goods! This week we’re discussing the latest on tariffs, the unexpected buyer of one suburban mall, and elevated cannabis paraphernalia that doubles as home décor.
Waiting all day for Sunday night… table tennis. As football season comes to a close, CBS Sports will now air Major League Table Tennis (MLTT) matches starting this Sunday at 8 p.m. ET. MLTT gained in popularity during the Paris Olympics and is one of America’s fastest-growing sports on digital platforms, with viewership on YouTube growing more than 1,200% from its first season into its second.
What’s In: This Week’s Trends
- Trade War Whiplash: A 10% tariff on all Chinese goods took effect this week, while President Trump agreed to pause his threatened tariffs against Mexico and Canada for 30 days. Along with the China tariff, Trump has also suspended the “de minimis” trade exemption used by online retailers like Shein and Temu that allows shipments worth less than $800 to come into the U.S. duty-free. Then, with minimal explanation on Tuesday, the U.S. Postal Service said it would suspend inbound services from China and Hong Kong – only to reverse the decision hours later. The agency said that it is working closely with U.S. Customs and Border Protection “to implement an efficient collection mechanism for the new China tariffs to ensure the least disruption to package delivery.”
- A Lease of the Action: Following an increase of retail bankruptcies in 2024, real estate executives are eager to pounce on the spaces left behind by chains like Big Lots and Party City. Empty retail space has been a rare commodity, holding at a 4.7% availability rate in 2024 – the lowest since commercial real estate brokerage CBRE started keeping track. Planet Fitness and Burlington are among the retailers ready to seize space to continue their growth, each opening 150 new gyms and stores last year, respectively.
- High-End Finishes: Home design is being taken to new heights as brands have begun offering elevated cannabis paraphernalia that doubles as décor. The legalization of recreational cannabis in many states has transformed once-hidden accessories into fashionable elements of décor, with products such as vintage vases being repurposed into bongs and people placing fake potted cannabis plants in their corners. Sackville & Co. is one of many brands that seeks to destigmatize cannabis through using design to create a sophisticated experience.
Cash or Card: Consumer Behavior
What’s going on with the consumer these days? This week we talk about the luxury outdoor aesthetic, the social conundrum of drinking less, and consumers buying as they binge their favorite shows.
- The Great Cloutdoors: Cushy interiors are no longer the only sign of a luxurious lifestyle – consumers are now in the pursuit of aspirational experiences in the great outdoors. From sleep fire pits to high-performance activewear, people are investing in products that make their time outside as comfortable and curated as possible. As a result, they are turning to brands that provide durability, utility and responsible production. Brands like Moncler, RAINS, and Keens are finding success by blending technical performance with chic design, while Solo Stove has turned the simple fire pit into a high-end experience.
- Double Edged Pour: Amid rising inflation and declining nightlife, a majority of drinks in the U.S. are being poured at home rather than at a bar – and this is taking a toll on America’s social life. While the U.S. Surgeon General warns of increased cancer risks tied to alcohol, the health authority has also cited an “epidemic” of loneliness in America. It’s estimated that social isolation raises the risk of premature death by 29%, about the equivalent of smoking 15 cigarettes per day. As we leave dry January behind, consumers are now faced with the conundrum of swearing off happy hour forever or taking a possible “risk” at the local watering hole.
- As Seen on TV: Entertainment platforms like Netflix and Roku are increasingly integrating features to capitalize on consumers’ attention through shoppable videos and branded merchandise. While these platforms were not originally built for commerce, they are leveraging their influence and eyeballs to drive retail sales. Netflix Shop sells licensed products from its hit shows like Bridgerton and Stranger Things, Roku enables viewers to purchase products directly from Walmart, and NBCUniversal is experimenting with a shoppable ad format that would allow viewers to shop items featured on Peacock TV shows.
Making Moves: Industry Transformations & Innovation
ICYMI, even industry icons need to reinvigorate their brand presence through unique and creative ways. Here are some new brand moves that you should know about:
- Meet Your New Landlord: In an interesting turn of events, Walmart bought a mall. The big-box retailer confirmed that it bought the Monroeville Mall, just outside of Pittsburgh, for $34 million. The move comes as shopping malls across America are being repurposed for use as apartments, distribution centers and even hockey rinks. Walmart has not confirmed its specific plans for the 186-acre location, but said it “is very interested in being part of any future redevelopment of this site.”
- Unlock My World: Nothing can come in between you and your shaving cream, at least in select CVS locations. The drugstore chain is piloting a new app that will allow consumers in three New York City stores to open security cabinets themselves. CVS hopes the app-based solution will continue to prevent retail theft, while addressing growing complaints about the locked up products creating long wait times. Only registered loyalty members connected to store Wi-Fi with Bluetooth enabled devices can use the feature.
- More Latte, Less Late: As many customers have reported frustrations waiting for their cappuccinos, Starbucks is testing a new algorithm to “smooth out” the morning mobile order rush. The chain will separate mobile and for-here orders, sequence mobile orders for timely pickup, and provide an option for customers to schedule their pickup time. The move is the latest installment of new CEO Brian Niccol’s plan to make the storefronts places where customers want to linger.
Capital Markets Corner
What consumer news is moving the market this week? Our investor relations experts break down this week’s trends and headlines.
- A Perfect Primer: In an effort to bolster its balance sheet, L’Oréal has agreed to sell $3.1 billion of its stake in Sanofi back to the pharmaceutical company. When the deal closes, the French beauty giant will still possess 7.2% of Sanofi’s share capital and 13.1% of its voting rights. The transaction will provide L’Oréal with much-needed liquidity, after the Group purchased a $1.74 billion minority stake in Swiss skincare company Galderma and acquired luxury-beauty brand Aesop for $2.5 billion last year.
- Immunity Booster: While private equity firm Sycamore Partners explores a potential acquisition of Walgreens, the U.S. pharmacy giant suspended its quarterly dividend, ending a 92-year streak of shareholder payouts. Walgreens management said the decision was intended to increase liquidity as the company struggles with thin prescription reimbursement, rising costs, persistent theft, and price-sensitive shoppers. While Bloomberg Intelligence analyst Jonathan Palmer argues that a leveraged buyout of Walgreens would offer little return for Sycamore, the PE firm has seen success reviving retailers such as Staples in recent years.
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