Amazon is ending its Prime Invitee program, which allowed members to share benefits outside of their households. The program will officially end on October 1. Amazon is relying on a tried-and-true tactic to boost memberships. While the retailer has several irons in the fire, including investments in rural delivery and grocery that it expects will increase Prime’s stickiness, it will take time for those initiatives to bear fruit. But an immediate account-sharing crackdown pays off right away.

Consumer packaged goods (CPG) companies are in turmoil as shifting food trends, cuts to government benefits, and inflation challenge their share of grocery spending, while organizational headwinds compound the pressures. The strain is forcing bold actions and inviting scrutiny. Kraft Heinz’s breakup makes clear that size and brand recognition alone are not enough to ensure consistent growth—even for a company whose portfolio contains such household staples as Kraft Mac & Cheese and Heinz ketchup. While cost cutting is paramount as tariffs add millions to companies’ operating costs, CPGs must balance efficiencies with product innovation to recover some of the sales lost to private labels.

The news: Modelo Especial and Corona maker Constellation Brands cut its full-year forecast, blaming weak consumer demand in a difficult macroeconomic environment. The slowdown has been most pronounced among its core Hispanic demographic, who are cutting back on high-end beer. Our take: At the start of the year, Hispanic consumers looked like a growth engine—they accounted for one-fifth of the US population, $2.8 trillion in purchasing power, and outsize influence in categories from consumer packaged goods to food and beverage. But the Trump administration’s tariffs and mass deportations have chilled this momentum, with roughly 1 in 5 (21% of) Hispanic consumers report having felt unsafe in their local market due to their ethnicity, per The Asian American Foundation. Companies that banked heavily on Hispanic spending may now find that bet falling short.

Kraft Heinz will split into two companies, spinning off its slower-growing grocery unit—home to Oscar Mayer, Kraft Singles, and Lunchables. The remaining business will focus on faster-growing products such as Heinz ketchup, Philadelphia cream cheese, and Kraft Mac & Cheese, along with its sauces and condiments. Kraft Heinz’s breakup shows the risks of CPG megamergers, especially given how quickly consumers’ tastes can change. Once prominent brands like Lunchables and Kraft Singles are rapidly losing value as more shoppers avoid ultra-processed foods and artificial dyes, while the company’s bloat has made it challenging to stay current with food trends.

The news: McDonald’s will reintroduce Extra Value Meals on September 8. The combo meals will deliver about 15% savings compared with buying items separately. Our take: While McDonald’s delivered better-than-expected results in Q2, including 2.5% same-store sales growth, most of its gains came from higher prices. To build momentum, the brand must shift consumer perception, not just raise prices. Bringing back the Extra Value Meal is a step in that direction.

Nike, H&M, and Louis Vuitton will see their share of the global apparel market fall this year, according to a report by GlobalData. Meanwhile, adidas, Shein, Uniqlo, and Skechers will be the biggest winners as shifting trends and tariffs reshape the apparel industry. This year’s apparel winners share two key traits: agility in responding to consumer trends and the ability to offer products that are either affordable or that shoppers deem to be worth the expense. These factors are emerging as critical competitive advantages, especially amid economic and tariff pressures.

US beauty shoppers are becoming more price conscious, even as overall spending continues to increase. The lipstick effect may have lost some of its punch, but it continues to support steady beauty sales. We expect US cosmetics and beauty sales to grow a relatively sedate 2.4% this year on strength in the hair and skincare categories.

The trend: Retail layoffs have surged 249% in the first seven months of the year, according to Challenger, Gray & Christmas—and more cuts are likely to come as tariffs squeeze margins. Our take: Layoffs at large prominent retailers like Nike, Kroger, and Best Buy are a clear signal of what’s ahead. Staff cuts at these industry leaders suggest the sector is bracing for weaker consumer demand and persistent margin pressure. If the strongest players are retreating, weaker chains are likely to follow. These moves may prove the canary in the coal mine for a broader retail reset.

The situation: Dollar General, Amazon, and Walmart are on a collision course as each races to speed up rural ecommerce deliveries and win loyalty in a market ripe for growth. Our take: Dollar General, Amazon, and Walmart are pushing hard into rural ecommerce because the growth potential is too big to ignore. The retailers that can pair speed with convenience will be best positioned to lock in lasting loyalty.

The situation: Best Buy’s comparable sales rose 1.6% in Q2, its fastest pace in three years, driven by gains in gaming, computing, and mobile phones. A major boost came from the high-profile launch of Nintendo Switch 2, which pushed June sales up nearly 10%—the retailer’s best month since March 2021, per Bloomberg Second Measure, which tracks US debit and credit transactions. Our take: Best Buy is experimenting to reignite growth. Earlier this month it rolled out a third-party marketplace to broaden its assortment and began testing a store-within-a-store partnership with Ikea, positioning its appliances inside Ikea kitchens and laundry rooms. While neither move is likely to be a game-changer, in today’s tough environment, even small wins matter. Still, to spark lasting growth, Best Buy may need to augment these moves with bolder bets in services and subscriptions.

The US consumer is in good shape, according to the CEOs of Dick’s Sporting Goods and Urban Outfitters—despite a recent dip in confidence and tariff fears. Urban Outfitters’ and Dick’s Sporting Goods’ confidence in the health of the consumer shows that despite the strain of tariffs and uncertainty, shoppers remain willing to spend on products that they feel are worth the investment.

The backdrop: The EU’s two largest economies face different but converging risks. Germany’s economy contracted 0.3% in Q2—worse than the preliminary -0.1% estimate—as manufacturing slumped after a temporary surge in US orders aimed at dodging tariffs, per Destatis. French Prime Minister François Bayrou will seek a vote of confidence in the National Assembly on September 8, a move likely to topple the government and inject fresh uncertainty into an economy heavily reliant on consumer spending. A political crisis could even push France into recession, Carrefour SA CEO Alexandre Bompard warned, per Bloomberg. Our take: While German households are pulling back amid economic gloom, French consumers have so far kept growth afloat. But if political turmoil erodes confidence, the two largest markets could synchronize into a broader slowdown. That would leave retailers with limited room to offset weakness, forcing many to lean on discounting, cost control measures, and/or value-driven formats to sustain sales.

Shoppers’ search for value is steering them to budget-friendly retailers—off-price chains, dollar stores, and other discounters—that benefited from a surge in sales and traffic in Q2. Value is top-of-mind for today’s consumer, regardless of income level. That’s good news for discounters and dollar stores, which are ideally placed to benefit from consumers’ financial anxieties. However, risks such as renewed tariffs or dips in consumer confidence mean retailers need to carefully manage their assortments and pricing.

Abercrombie & Fitch reported record revenues in Q2 as soaring demand among Gen Z teens for Hollister offset weakness at its namesake brand. Abercrombie is navigating the current environment as well as any retailer—especially one with considerable tariff exposure—could. While minimizing tariff costs remains a key priority, Abercrombie’s sharp focus on the fundamentals—delivering products that people want—will help guide it through uncertainty.

The news: Fanatics launched Fanatics Advertising, a division that will oversee the company’s ad and brand partnership strategy across its commerce, collectibles, gaming, and events businesses. Our take: Fanatics is taking its swing at the fast-growing commerce media space. Commerce media represented 18.0% of US digital ad spending last year, and we expect its share to keep climbing—hitting nearly $1 of every $5 spent on digital ads (19.7%) this year and close to $1 in $4 (24.8%) by 2029, the end of our forecast period. Sitting at the crossroads of sports fandom—merchandise, collectibles, betting, and live events—Fanatics has a brand position few, if any, rivals can match. If it executes well, Fanatics Advertising could be a home run by turning its unmatched access to fans into an equally powerful ad play.

Kohl’s reported a better-than-expected Q2 profit as it controlled expenses and reintroduced phased-out product assortments, hinting at early signs of traction despite sales declines. The retailer is taking steps to stabilize, but it faces a mammoth challenge to move sales to growth—not just lessen the declines. As shoppers scrutinize every dollar they spend, Kohl’s needs to show it can deliver the right products at the right price—and find ways to stand out in an increasingly crowded field by bolstering loyalty perks, leaning more on personalized offerings to consumers, and communicating clearly what it wants to be known for. That won’t be easy for a retailer whose core shoppers remain heavily reliant on coupons and discounts.

Lego continues to outperform the toy industry by delivering products that appeal to both children and adults while expanding brand awareness in Asia. While we expect US toy and hobby sales to grow just 2.0% this year, Lego is increasingly in a league of its own. The company’s all-ages appeal, IP partnerships, and brick-and-mortar strategy are working in tandem to drive sales and encourage lasting loyalty.

The situation: Williams-Sonoma is raising prices on select items after its incremental tariff rate doubled since May—from 14% to 28%—due to higher duties on goods from China, India, and Vietnam. More pressure may be ahead after President Donald Trump recently signaled plans to increase tariffs on furniture imports. Our take: Despite operating in the sluggish furniture and home furnishings category—which we project will grow just 0.4% this year—Williams-Sonoma is well-positioned to weather macroeconomic headwinds. Anchored by a diverse brand portfolio that resonates with affluent consumers across life stages, its multipronged strategy—price increases, cost discipline, supply chain improvements, and AI-driven efficiencies—not only will offset tariff pressures but also lay a durable foundation for sustained growth and market share expansion.

The Q2 performances of Amazon, Walmart, and Target illustrate the retailers’ diverging fortunes as shoppers reassess their spending priorities. While uncertainty is funneling more dollars toward Amazon and Walmart, customers are steering clear of Target—due both to a lackluster assortment and frustration over its diversity, equity, and inclusion (DEI) flip-flopping. Walmart and Amazon are pulling ahead as their relentless focus on value—in the form of speed, selection, and convenience—make them the first stop for shoppers buying everything from essentials like groceries to discretionary items like beauty and apparel. That leaves Target’s new CEO, Michael Fiddelke, with the unenviable task of having to turn the retailer around just as tariffs threaten its bottom line and undermine its core discretionary business.

The luxury industry has a counterfeit problem. Counterfeits pose a serious challenge for brands and the growing number of secondhand platforms that specialize in luxury resale. The more convincing these superfakes get, the harder it will be for companies like LVMH to justify their high price points—and harder still for platforms like Vestiaire and The RealReal to keep fake goods off their marketplaces.