Issue #97: Can Kroger Win On Price?

For those in the NYC tech scene, you probably saw that this past week was tech week. There were hundreds of events across tech, AI, and a plethora of subjects. Despite all the love and buzz CPG is getting, it still felt like there was a fraction of attention given compared to what these industries deserve. People are still sleeping on consumer, CPG, and retail.

I, for one, am excited to keep working to change that. Later this month, the CPG and retail worlds are descending on NYC for Fancy Food, a conference where brands display their latest products. Before that, you are obviously going to need some fuel (coffee and breakfast), so I partnered with a couple of other awesome folks and companies in the CPG / Retail world to put this on. Monday, June 29, from 8:00 AM - 10:00 AM in Midtown. Hope to see you there!

Founded by Bernard Kroger in 1883, in Cincinnati, the supermarket bearing his surname has grown to over 2,000 locations across multiple different banners, like Harris Teeter, and is listed as a publicly traded company included in the S&P 500. In 2025, Kroger did a touch under $150B in revenue. However, it has been a rocky couple of years for Kroger. In 2022, it attempted to merge with fellow grocer Albertsons to create a grocery behemoth. After two years of back-and-forth lawsuits with various governments, it was blocked/cancelled. Simultaneously, not at the same scale, Kroger was trying to expand its eCommerce business by partnering with Ocado to have automated fulfillment centers separate from its walk-in stores. In November 2025, that was cancelled too, and Kroger shut down most of those automated fulfillment centers.

Fast forward to February 2026, Kroger decided to shake things up at the leadership level and bring in outside help. It hired Greg Foran, who worked his way up from stocking shelves to be the CEO of Woolworth’s, an Australian grocery chain, and was also president of Walmart US. Foran succeeds Ron Sargent, who served as interim CEO since March 2025. Sargent spent most of his career at Staples, so bringing someone in with a grocery background makes sense. Sargent is still remaining on the Board of Directors for the time being.

As part of the transition, Foran wanted to focus on five key pillars. Here are the details from his introduction call in March:

On the aggregate, nothing earth-shattering in terms of strategy. As you can tell by the title of this piece, #1, price, is where I want to focus. Pricing is where you can have the biggest impact right away, positive or negative. However, Kroger already invested in lower prices on thousands of items in 2025, and got significant press around it. So what went wrong there? What did they learn from that move? In the introductory call, those questions were not answered, and they indicated that their price perception was improving. What was answered is that, in addition to lower prices, they want to spend more on promotions. Plus, they don’t want to be the lowest price in town because they feel like they offer a superior service. Makes sense, value isn’t solely based on price! Experience, convenience, and a host of other factors play a role, too.

Unsurprisingly, fast forward three months to now, and what was laid out on the call is no longer the strategy. Kroger is about to do a price test in its central division for the next three months, involving:

After not trying to be the lowest in the market, it sure seems that they are trying to be the lowest in the market, or at least they are trying it. In order for this strategy to work, it is going to be tough since their product and operating costs are higher than most others in the market. As great as this is to deliver value in this sense, they should be focusing on internal efficiencies first so they can actually deliver to customers. If their supply chain can’t get the goods on the shelf all the time, the lower prices won’t help. To answer the original question, can Kroger win on price? The answer is most likely no, even if they were able to make major strides on the operations side. I would focus on other parts of the experience that would allow them to round out the full value equation. Value isn’t just price.

AI is transforming the world as we know it, but in a world of physical goods like retail or CPG, it lags behind. Still, I hear from founders, especially those with more limited headcounts, how powerful leveraging AI and the recent AI-based tooling can be. This week, I came across a fascinating role, which shows the way the industry is moving. Fishwife, the tinned fish brand that is part of the revival of the pantry, is hiring a Technology & Systems Lead. This role fuses a traditional IT role with systems and business enablement. This person will be building integrations and automations that make up the piping behind many CPG brands. Too often, under the hood, not much exists. The more internal tooling and data that are available to the brands, the more tactical they can get with the action. I don’t see it stopping here, though. I can see brands starting to hire a dedicated software engineer to build their own tools once they advance from vibecoding. Have you seen any other interesting roles like this?

Glen Powell may be known for his roles in Spy Kids and Top Gun, but lately, he has been smashing it in the CPG world with Smash Kitchen, his better-for-you sauce (and more) line. It started as cleaner alternatives to your regular sauces (ketchup, mayo, BBQ sauce, etc.) and has expanded to over 60 products, including oils, chips, dips, and salad dressing. Last April, Smash launched exclusively in Walmart, but has expanded to over 15,000 stores, like Target, Sprouts, and Albertsons. Kroger launches next month. What I love about what they are doing is that it is not just a celebrity brand. Many celebrity brands rest on the laurels of being celebrity-founded, and that's it. Unfortunately, that is not enough to build an enduring business. One example of what Smash is doing to push the envelope is to partner with American Airlines to be the in-flight condiment, enabling people to try the product without committing to a full bottle. Another example of their excellence is in launching new products. They logged all the users who were commenting on their Instagram posts, requesting an organic buttermilk ranch dressing. When it came to launch, they mailed a bottle plus a care package to those users. It is no surprise to see these types of actions and mindsets level up to $100M in retail sales (that is not actually their revenue, that is the revenue of the retailers selling their products. Smash revenue is probably closer to $50-60M). I am very excited to see what they do next!

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