The Store Is the Strategy: What Greg Foran’s First Month Signals for Kroger’s Commercial Partners

Four weeks into his tenure as Kroger’s chief executive, Greg Foran had not yet outlined a formal strategy. He had toured stores, walked distribution centers, and moved through manufacturing facilities across Kroger’s network. That choice of sequencing, emphasized during Kroger’s Q4 2025 earnings call on March 6, says more about his operating philosophy than any strategic document would at this stage.

Ronald Sargent, who steadied the company during nearly a year of interim leadership following Rodney McMullen’s resignation in March 2025, opened the call by welcoming Foran and noting that his priorities align with work Kroger has focused on over the past year, including centering the customer, moving with urgency, strengthening e-commerce, accelerating media, and improving productivity to fund lower prices.

What those priorities mean in practice for suppliers, CPG commercial teams, and brand marketers working across Kroger’s network is the more useful question.

The Operational Lens

Foran is, above all, an operator. During his five years leading Walmart U.S., he helped revive the company’s growth by raising in-store standards, sharpening operational discipline, and elevating the end-to-end customer experience, according to his Kroger biography. Walmart recorded 20 consecutive quarters of comparable sales growth under his leadership. His approach was specific: wider aisles in food departments, sharper fresh food presentation, wage increases that reduced associate turnover, and an in-house training program that built consistent store-level execution across more than 4,500 stores. He did not develop a new retail model at Walmart; he found what was underperforming and brought it up to standard.

His stated posture at Kroger follows the same line of thinking. Identical sales without fuel increased 2.4% in the fourth quarter, consistent with 2024’s results, while e-commerce sales grew 20% and topped $16 billion for the year. Sargent noted that Q4 marked Kroger’s strongest share performance since 2021, which he attributed to price investments made throughout the year, along with improved shrink and productivity supporting margins. Foran’s message is that the foundation is sound; the work is in executing against it more consistently.

He told investors that closing small consistency gaps is how the format stays competitive, and that doing so requires investing more aggressively in the customer experience. He identified sourcing, procurement, and direct import structures as areas where margin is being left on the table, and described technology and workflow processes in need of updating. Any savings recovered, he said, would be redirected back into the business through lower prices and better associate support.

CPG commercial leaders should read that framing carefully. A CEO focused on margin recovery through procurement and operational efficiency typically brings scrutiny to every cost line in the commercial relationship, including trade terms, slotting structures, and co-investment expectations. Foran has not signaled any specific changes to those commercial mechanisms, and his assessment is explicitly still in progress. His background suggests those conversations will grow more disciplined as his evaluation concludes.

The E-Commerce Equation

Kroger arrives at Foran’s tenure carrying a significant e-commerce restructuring that preceded him. In November 2025, Kroger announced it would close three automated fulfillment centers in January, leaning further into store-based fulfillment and expanding partnerships with third-party delivery providers, targeting approximately $400 million in e-commerce profitability improvement for 2026. The company incurred $2.6 billion in impairment and related charges in its fiscal third quarter as a result. Those closures affected facilities in Pleasant Prairie, Wisconsin; Frederick, Maryland; and Groveland, Florida, all built in partnership with Ocado under a strategy that predated Foran’s arrival by nearly five years.

Kroger paid Ocado $350 million to exit obligations, and five remaining automated fulfillment centers continue to operate. The pivot is toward store-based picking and third-party delivery, and Foran endorsed it on the earnings call. He described e-commerce as a key growth engine and confirmed the expectation that the digital operation will reach profitability in the first half of 2026. The third-party delivery partnerships with Instacart, DoorDash, and Uber Eats are projected to generate over $1.5 billion in combined sales this year.

The profitability case for e-commerce at Kroger is not purely operational. CFO David Kennerley said during Kroger’s Q3 earnings call that the media business, and specifically the media-sharing opportunities created by the third-party delivery partnerships, are a meaningful component of the path to online profitability. That connection between fulfillment partnerships and retail media revenue is structurally important for CPG brands allocating budgets across Kroger’s network. When a brand’s products move through an Instacart or DoorDash order fulfilled from a Kroger store, that transaction feeds attribution data back into Kroger Precision Marketing’s measurement infrastructure, which supports both the media network’s measurement capabilities and its commercial pitch to advertisers.

The KPM Reorganization

Kroger spent much of 2025 restructuring Kroger Precision Marketing into a more integrated commercial platform. In July, Kroger unified its retail media, consumer insights, and loyalty marketing functions under a single KPM team, incorporating 84.51°’s data scientists, engineers, strategists, and sales leaders. The stated rationale was to reduce friction between functions that CPG brand teams had previously navigated as separate relationships.

Three months later, KPM expanded into managed-service programmatic capabilities for brands lacking dedicated teams: programmatic audio, programmatic connected TV, and dynamic creative optimization for display, with all formats measured against retail sales outcomes including return on ad spend, household penetration, and unit sales impact. This was the first new capability rollout under the unified structure.

By November, KPM had introduced AI-powered weekly performance summaries delivered directly to brand users each Monday, with consolidated dashboards and self-service data ordering capabilities announced for early 2026. For mid-sized CPG companies that have historically found Kroger’s data and media capabilities harder to access than those of larger network partners, these tools lower the operational barrier to activation across the network.

Foran acknowledged retail media as a strategic priority on the earnings call, consistent with Sargent’s framing. Kroger’s alternative profit businesses, which include its advertising and financial services arms, contributed $1.5 billion in operating profit for full-year 2025. That figure positions KPM alongside Amazon Advertising and Walmart Connect as a high-margin revenue line that cross-subsidizes price investment and store operations. Senior brand commercial teams that have treated KPM primarily as a media activation platform should increasingly consider it a commercial relationship with direct implications for how Kroger resources investment in their categories.

The Complexity Foran Inherits

Kroger’s business is more structurally complex than Walmart’s U.S. division was in 2014. The company operates dozens of regional banners, most accumulated through decades of acquisitions, each serving distinct consumer populations at different price positions and store formats. Fred Meyer, Ralphs, Harris Teeter, King Soopers, and Mariano’s, among others, compete in meaningfully different environments. That variety has no direct equivalent in the uniform supercenter fleet Foran managed at Walmart U.S.

Brand teams managing Kroger as a national account know this complexity from experience: planogram consistency, promotional execution standards, and category management alignment have long varied across banners. Foran’s emphasis on closing execution gaps signals that store-level consistency is an early focus, which could eventually produce more uniform expectations for in-store commercial programs and promotion compliance across the banner portfolio.

Kroger guided 2026 identical sales growth of 1.0% to 2.0%, adjusted FIFO operating profit of $5.0 to $5.2 billion, and adjusted EPS of $5.10 to $5.30. CFO Kennerley noted that guidance includes an approximately 130 basis point headwind from the Inflation Reduction Act’s impact on pharmacy reimbursement rates, and said Q1 identical sales are expected to come in near the low end of the full-year guidance range due to continued egg price deflation, with trends expected to improve as that headwind eases through the year.

Foran told investors he plans to share a more complete strategic picture by year-end. His appointment as Kroger’s first external CEO hire in decades followed a year-long board search after McMullen’s departure, with the stated goals of bringing fresh perspective to e-commerce profitability, digital innovation, and store execution. The interim period under Sargent also included operational simplifications beyond the e-commerce restructuring: the announced sale of Vitacost and the planned closure of approximately 50 underperforming Little Clinic locations were part of that effort to concentrate the business on its core strengths.

Foran has now made one public statement about his priorities, and the throughline across all of them is the same: recover margin from procurement and operational inefficiency, and put it back into the customer experience. The $1.5 billion that Kroger’s alternative profit businesses generated in 2025 means the media network is already doing some of that work. How much of the operational recovery follows will be clearer when he addresses investors again later this year.

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