The Goods (U.S. Edition) – The Slice is Right
Welcome back to The Goods! Welcome back to The Goods! This week we’re discussing the cost of European vacations, why fast-casual restaurants are betting big on loyalty programs, and how much consumers are shelling out for their summer cookouts.
A zebra – nicknamed Ed by the internet – went on the adventure of a lifetime this week that ended with a scenic helicopter ride. After escaping from his owners and being on the run for more than a week, Ed was finally found about 45 miles south of Nashville and airlifted by helicopter back to a waiting animal trailer. Multiple agencies including the Tennessee Highway Patrol and the Tennessee Wildlife Resources Agency were involved in the operation.
What’s In: This Week’s Trends
- The Slice is Right: Could changing pizza habits give us insight into the state of the economy? Price-sensitive, low-income consumers once accounted for a large portion of sales at pizza chains. But gone are the days of the dollar slice, the average large pizza now costs about $18, up nearly 30% in 5 years, and major chains like Papa John’s and Pizza Hut are seeing sales drop. On the other hand, higher-end pizzerias where the average meal costs $31 to $50 per person saw a 43% increase in the number of diners in the first three months of 2025, according to reservations app OpenTable, showing there’s still appetite among a certain cohort of Americans. Still, the pizza wars aren’t over yet, as imported flours, tomatoes, and cheeses from Italy are right in the tariff crosshairs.
- Penny for Your Bots? When Target announced plans to roll back its DEI (Diversity, Equity, and Inclusion) initiatives, hashtags like #BoycottTarget and #CancelTarget spread online like wildfire. However, a large portion of this online backlash was driven by fake accounts, according to a study by cyber-firm Cyabra. The study analyzed 2,226 social media accounts which generated 3,379 posts in negative sentiment against Target, and found that 27% of the surveyed accounts were fake, and that those fake accounts generated over 1,000 posts. The study raises alarm bells over fake accounts and their ability to create viral narratives with real-world financial outcomes.
- No Name, No Shame: Could private label brands be a secret weapon for retailers against tariffs? No longer the generic knockoffs of the past, store brands are a “destination driver” for many retailers, and because the products are exclusively sold at one retailer, company executives can more easily negotiate production costs and efficiently adjust supply chains. Private-label products are about 20% cheaper than national brands, and the price gap has widened 38% since 2019. One big winner in this arena is discount grocer Aldi, who sells 90% store brands and says only 4% of its assortment is impacted by tariffs.
Cash or Card: Consumer Behavior
What’s going on with the consumer these days? This week we talk about the business of beauty dupes, not-your-grandma’s compression socks, and Gen-Z’s commitment issues at bars.
- I’ve Been Duped! Spending on luxury skincare has dropped, with shoppers increasingly turning to dupe products formulated to deliver the same results as high-end brands at a fraction of the cost. A 2025 survey revealed that 28% of global consumers have knowingly bought dupes, and 53% are open to buying them. Apps like Brandefy have capitalized on the popularity of dupes, allowing users to share and compare their favorite product alternatives. Consumers getting the most value for their money is the number one theme shaping the future of the beauty industry, and this has driven more than 500,000 users to Brandefy since its launch in 2018.
- Hot Girl Socks: Once thought to be hot commodities at the nursing home, Millennial and Gen Z consumers are dipping their toes into compression socks. Compression socks help increase blood circulation, lower inflammation, and decrease muscle stress, making them popular among health-conscious consumers who are wearing them for everything from Pilates to long-haul flights. These aren’t your grandma’s compression socks, though. Brands like Bombas offer TikTok-worthy styles every season and has seen 231% category growth over the last three years.
- A Tab in the Dark: Gen Z drinkers are purchasing fewer alcoholic beverages than their parents, and much to the dismay of bartenders, they also prefer one-and-done transactions rather than open bar tabs. This generation has become accustomed to single transactions with a simple tap of their phones, and consider purchasing drinks at a bar to be no different from buying a coffee at a cafe. Not only do individual tabs curtail consumption, but they also help younger drinkers stay budget conscious, simplify bar hopping, and reduce the risk of forgetting credit cards. However, more transactions equate to higher fees for bars to bear.
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:
- Cost in the Sauce: In a bid to boost sales, Chipotle is launching its first new dipping sauce since introducing queso blanco in 2020. The new Adobo Ranch is a spicy take on the classic, made from adobo peppers, sour cream, herbs, and spices. Chipotle shares have fallen 12% this year, and in the first quarter, the chain reported its first same-store sales decline since 2020. The company hopes that the sauce, which costs an extra 75 cents, will help bring cost-cautious diners back to the table. According to NIQ retail sales data, ranch has surpassed ketchup in U.S. sales, while mayo remains in the top spot.
- Credit Where It’s Due: Walmart’s majority-owned fintech startup OnePay is rolling out two new credit cards – one for general spending and one for Walmart-only purchases – through a fresh partnership with Synchrony. While the program’s rewards haven’t been announced yet, perks like buy now, pay later and broader credit accessibility are expected to sweeten the deal. OnePay is focused on creating a smoother, smarter, and more user-friendly experience for the company’s millions of customers.
- Come in and Spend Awhile: Retailers are adding amenities to stores hoping customers will linger and buy more merchandise. Brands like Canada Goose and Coach are investing in their store ambiance, offering everything from coffee and cocktails to VIP lounges and comfy custom furniture. Time spent lingering in stores has declined in recent years, although it has begun to pick up in certain sectors. Apparel and beauty experienced rises of 4% and 2%, respectively, in the first 20 weeks of this year compared with the same period in 2023.
Capital Markets Corner
What consumer news is moving the market this week? Our investor relations experts break down this week’s trends and headlines.
- Word on Mall Street: Amidst a gloomy earnings season, Lululemon, J.M. Smucker, and Designer Brands were the latest names to report struggling sales and declining profits.
- Last week, Lululemon cut its full-year EPS outlook, citing potential supply chain impacts from recent tariffs. Looking ahead, the company plans to strategically raise prices on a small share of products to protect margins.
- This week, J.M. Smucker also posted a loss for Q1 and missed Street estimates on revenue as the company’s recent price hikes have suppressed demand for its dog treats and baked goods.
- DSW store operator Designer Brands also struggled this quarter, reporting a net loss of $17.1 million and an 8% decline in revenue. The company attributed its lackluster results to “an unpredictable macro environment and deteriorating consumer sentiment.”
Tariffs, Ands or Buts
Prices for canned foods like beans and tuna may rise up to 15% due to President Trump’s proposed 50% tariff on imported steel, a critical material for tin-coated food cans. Current estimates suggest that the price of a $2 can of food could increase by 18 cents.
With the end of the de minimis exemption, Chinese online retailers like Temu and Shein are turning their focus to the European market. However, Europe may prove just as challenging, with new anti-fast fashion policies and increased scrutiny of e-commerce. To curb their rapid growth, the EU is proposing a €2 customs fee on each small package sent from the online retailers to slow the expansion of their low-cost cross-border commerce.
At FTI Consulting, we help clients think comprehensively about the problems they face, understand their exposure, assess and mitigate risks, and manage change needed. Learn more about our Tariff Mitigation Advisory Solutions. Reach out to our experts Cory Fritz, Jackson Dunn, Ana Heeren, and John Whitcomb with any questions.
For more information about FTI Strategic Communications Retail & Consumer Products sector service offerings and expertise, please contact [email protected]
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