Global tools, local insights, smarter decisions

Ryan Barry:

Hi everybody. Welcome to this episode of Inside Insights. My name is Ryan and I'm joined as always by my friend and cohost Patricia Montesdeoca. Patricia, happy Friday.

Patricia Montesdeoca:

Happy Friday dude. We've been wanting this since Wednesday, I think we were talking about. 

Ryan:

We have. I'm going to tell the same joke that I told you two in the pre recording. I usually love my job and I'm never looking forward to the weekend. It's budget season and I'm ready for the weekend. And one of my coworkers, Wojciech said, "There's nothing that ruins a Friday more than realizing it's Wednesday." And it made me laugh my ass off. So I wanted to share it with you folks.

Patricia:

Absolutely.

Ryan:

And I'm ready for Halloween. We have... I won't say the brands because then I'll piss off all of our clients. By the way, we do business with all y'all guys who make candy, so sorry. But anyways, the amount of candy in my kitchen at the moment is insane and I keep eating it. And that's problematic for so many reasons but it's really good. I have three kids, they're all going to be trick or treating this weekend. We got costumes, backup costumes, backup backup costumes.

Patricia:

Us too! Are you getting dressed up?

Ryan:

Yeah, I'm going to be a Ninja Turtle.

Patricia:

We're all going to be, so my daughter's boyfriend wanted all of us to dress up. So we're all dressing up as The Incredibles family, including the dogs because we have the two dogs.

Ryan:

The dogs.

Patricia:

Everybody's dressed up as The Incredibles family. And we forbade anyone from buying candy precisely for that reason. So we're going after work today, all of us, to buy gazillions of candy because we've got an elementary school a block down there. So you know how full this is going to be, we can't wait.

Ryan:

Oh yeah, it's getting weird. So by the time this episode ships, it will be past Halloween. So everybody will have an extra cavity and a headache from eating too much sugar and they'll be so mad at the kids. And they'll be anxious talking to their spouses like, "How do we get rid of all this damn candy in the house?!" Just chill out everybody. Eat the damn candy and have fun.

Patricia:

Give it away if you don't want it. There's so many people out there or eat it.

Ryan:

All right. So let's go there, favorite Halloween candy? Go.

Patricia:

Snickers.

Ryan:

Snickers. Kelsey, you've never actually appeared on the podcast. Get off mute home girl. What's your favorite Halloween candy?

Kelsey Sullivan:

KitKat's all the way.

Ryan:

Great choice. Mine are Reese's Pieces and-

Patricia:

That was my second choice.

Ryan:

I love Reese's Pieces but KitKat has come out with a mint KitKat this year, dude.

Patricia:

Amazing.

Ryan:

Shout out the KitKat for coming out with that. And again, for all of my candy company customers that I'm offending by not mentioning you, I love all of your candy and I love helping you make better things but it's Halloween. 

Thanks everybody for listening to Patricia and I, we're having a little fun on this freaky Friday or this spooky Friday. But people, we got a big interview today.

Patricia:

Oh my God, do we ever.

Ryan:

We're interviewing Stephan Gans. He is the Chief Insights and Analytics Officer at PepsiCo. He's not only a visionary but he is also a pragmatist, which you don't usually see in the same person. He's a good man. Somebody I'm proud to call a friend. And he's somebody who has had a vision that I've been fortunate enough to help shape and be a part of for many years. But this is the year that things have started to actually move needles within PepsiCo's business, around his vision.

 And so I know you've probably heard him speak, whether it be at conferences, SMR, client summits, what have you. We're going to go a little deeper today and we're going to get under the hood of what Steph's been doing at PepsiCo with his incredible team. And then Patricia's going to do what she always does, which is recap it. Let's get into this thing.

Patricia:

Let's do this.

[Music transition to interview]

Ryan Barry:

Stephan, thank you so much for taking the time to join the podcast today. I really appreciate it.

Stephan Gans:

Great to be here, Ryan. My pleasure.

Ryan:

This is a conversation long overdue, I think. You and I keynoted a conference three years ago, I think, or three and a half years ago in Atlanta. It must have been interesting for a Pepsi guy to keynote in Atlanta. But we had a lot of fun, and we painted what we thought at the time was a vision to change the entire insights game. I think we've made a lot of progress, but what I wanted to do today was talk to you about what that vision was at that moment? What you've learned along the way, but also what's ended up happening?

Because I think, we're four years into a pretty cool journey together, and the impacts are starting to be pretty material for my business but also know more importantly for yours as well. So, it's been quite a journey these last four years. I vividly remember walking into your office, and you said to me, "I'm not an insights guy. I'm a marketer, and this is what I'm trying to do with the function." And you had a piece of paper printed in front of you. Take me through quickly because I know you've done this with a lot of other folks, but what was that initial vision? And then we can go on to what's actually happened in the last four years.

Stephan:

Yeah. Great. I remember that too still, Ryan. I got appointed into my role now four and a half years ago, so I head up consumer insights at PepsiCo and of course, the previous 10 years, I worked as a marketing consultant, and before that I was in brand management and marketing at Unilever. But with that background, what felt very logical for me to do as the first step is to just go around all the key insights leaders in PepsiCo and ask them like, "Yeah, how's it going? And what keeps you up at night? And what are the top three things that you would change if you could?"

And of course, I came there with a briefing. I was hired by PepsiCo to basically raise the floor and the ceiling for the insights function and to make sure that we were, as an insights function, having a lot more impact on the PepsiCo business and do that much more efficiently than then PepsiCo was used to at that point. Right?

And so, I got there. I had all these conversations. And PepsiCo is your typical Global CPG matrix company. Right? But the thing with PepsiCo is that... Let's say the M of matrix is with a capital and it's bold, right? So one of the core strengths, I strongly believe of PepsiCo is culture, and the way we organize the business is this fierce focus on being locally relevant. And local relevance is more important than say efficiency or global leverage necessary and certainly in marketing methods. But in that context, talking to all those insights leaders from Asia and from Latin America and from North America and Europe and Southern Africa, what I found was a couple of things. First of all, everybody needed better, faster, and cheaper tools to do their work. That's one.

Everybody was eager to work together with their colleagues around the world, but didn't really know how. Let alone, I didn't know how to leverage scale better. And thirdly, everybody just felt, without saying it explicitly but I really got a strong sense quickly of the fact that everybody felt very dependent on the big suppliers out there, like [Neilsen 00:04:04], Kantar, IRI, and whatever. So if I asked, "Why is this tool not good enough? Why is this tool not doing it for you?" They said, "Oh, well, I've told those guys every year for the past five years and it's not changing."

And so, back to your question, Ryan. What was the vision? The vision was to deal with all that. The vision was to bring my function together so we could leverage scale, to empower insights people in all those business units across the world to do their work faster, better, and cheaper. And to sign our own, let's say, declaration of independence from the powers to be in the global insights world. Of course, as PepsiCo, we have the scale to just say, "We're going to do this our own way."

Now, I had a colleague that I worked a lot with at that point, he's still a colleague, by the way, Tim Warner. He had started more or less, yeah, as an experiment. He just took one type of test. A simple survey-based concept test for innovation. And he was working with a startup, and he was trying to create a superior solution. And that went very slow. It didn't really go that well. And we jointly came to the conclusion like, "Look, why don't we set our ambition higher? If we can do a concept test and design our own test and make it completely digital and standardize it for the world. We should be able to do that with every survey-based piece of market research, every survey-based tool."

And then we went into a phase line of half a year or so. Talking to different parties out there, and among those were you guys. And then we decided to start this journey with you guys. We started with that one particular product, right, testing a minority concept for innovation. But that was really proof of concept. No pun intended because it was a proof of concept for the bigger vision that while we were working on it really unfolded. And that then became what we now refer to as Ada, which is a digital platform that I describe as the operating model on your iPhone, the iOS on your iPhone, on which a bunch of apps sit. And every app is a different test.

So a lot of components of what's... I could pretend that the vision now with a lot of components of the benefits then became clear over time, because if you stand the power of globally, leveraging your scale through standardization of the way you work is not to be underestimated for a company our size. So the benefits extend much broader and much deeper than frankly, I envisioned four and a half years ago. We are now, not at the end of the journey, but four years into your point. And we're doing what we call meta-learning studies or deep-dive studies...

Because we have standardized ad testing now also all over the practical world, on our own platform using our own test, we can learn things about how to best test around a soccer game no matter where you are in the world. We can test... We can derive meta insights from the breakfast occasion opportunity and the advertising that is geared towards that. That serves our Quaker brands, for example. And so the power of that is immensely bigger than I had originally envisioned. And we're incredibly happy with the journey we started.

Ryan:

Yeah, it is funny. I think your outcome was probably more clear than you give yourself credit for, right? You want it to be faster, better, and cheaper, remove your dependencies, get your teams collaborating, and the impact or the outcome is what you've seen, but perhaps maybe not as profound. And obviously, everybody always thinks of the line to disruptive innovation, which is what we've done. And obviously, other parties are linear. It's not been linear, has it? It's probably been more like a rollercoaster. A fun one, it might have been.

Stephan:

Yeah. It's a rollercoaster, but it's not only a roller... Because to take the metaphor literally, a rollercoaster, you know where it's going to end.

Ryan:

Yeah, exactly.

Stephan:

The rollercoaster always ends where it began. This is a rollercoaster that also changed a destination. Because another example, I mentioned meta-learning. Here's another example of a benefit that I didn't see coming until say two years ago through standardizing the ways of working pretty, well, drastically. Something we talked about four years ago was that insights people were spending a ton of time figuring out how to do their tests in Manila or in Berlin or in Santiago de Chile. And they would go back and forth on the questionnaire with their local vendor, and they would do all this work that you don't need to do if you standardize a solution. Right?

And so, a lot of time is now given back to insights professionals all over the PepsiCo world that they can use to just be better business partners and sparring partners for their internal clients. And yeah, let's say Tim and I talked about that in the early conception of this whole idea, but I now see it materialized. And it's significant. It's really significant in terms not only the time it unleashes, but also the mental bandwidth it unleashes with people to just have another relationship with the marketeers or the R&D professionals that you work with in your business unit.

Ryan:

That point really motivates me because I remember when I was... So I was employee five at Zappi and I was working at Kantar at the time and said, "I want to... I really think this industry needs to be disrupted." Fast forward, seven years later, my hair is a lot more gray. One of my hypotheses was if you could let technology do the heavy lifting but embed the greatness of marketing, science, psychology, consumer behavior into it, insights people, marketers, whoever would spend more time being creative.

I'll be honest with you. The first many years of my journey, it's not actually what happened. We perpetuated the people and process problems that plague a lot of companies. So, I'm sure you've heard this movie before. "The ads going to air Monday, we can't change anything, but I heard you can test it quickly."

And I remember in our early days, I'd get those emails and be like, "That's not the point of this." So, to hear you, and obviously, you and I talk a lot, but we don't actually give ourselves the credit of reflecting because we're always driving the bus forward to reflect on the fact that insights people are actually being afforded the opportunity to think and engage in strategic work while using software to do their jobs is a really important impact, I think. 

Stephan:

It's a crucial impact, Ryan. And also, I like to talk about the fact that I grew up in a world, you know, when I started my career 25 to 30 years or something ago as a marketer. When I grew up, it was still a linear world, right?

Ryan:

Yeah.

Stephan:

So you had this process and then you did a test, whether it's for an innovation or for an ad or a print ad or whatever, then you did a test, the test was basically, yeah. A traffic light, it was red, yellow, or green. And then, if it's anything other than green, the shit really hit the fan because there was no time. Right? And then, you made a couple of tweaks, and then you went either on TV or whatever. Today's world is, of course, not linear anymore.

Linearity is a luxury of the past if you want, if you could call it that. All these processes, whether it's a product development process, whether it's a test market for an innovation process, or just an innovation testing process or an anti-development process, they're iterative and they're circular. And so, you need tools that support that. You need a testing tool for an ad, for a piece of communication that you can do four times if you want to, or six times, or maybe only once. But the role of the tool is that of a coach to help you get to a better outcome, not a traffic light that tells you, "You're good to go," or, "Go back." And now, you can develop the technology. And we have certainly developed tools rooted in technology that can play that role, but then you have to change the culture, right?

That's the long tail of change is to change the culture in the teams to start working differently and to be comfortable with shooting a rough idea out there into a test and wait what the feedback is. And then hear back that there may be something there, but it's still far off in many other aspects. And then be comfortable with that feedback and steer it in the right direction. That is a major cultural change, both for insights people, as well as for marketeers. I call that the long tail of change that is at least of this change that we're making. We're in the middle of that. But man, is that powerful. If we're able to do that, then the culture becomes a much more agile, iterative, on the go, flexible, and frankly, modern way of working that is required to succeed in today's marketplace.

Ryan:

Yeah. You're absolutely right. And I've had the pleasure of chatting with some of the 3000 plus marketers that work at PepsiCo. So the scale of your long tail is not a small one, right? But we had Fernando Kahane on this podcast last season. He was talking very much about using Ada to inspire creativity, but also to give him confidence in the decisions he was making. And I think that's the point of marketing research can't be to grade homework, right? It's to help creators be more creative. And I think, having those proof points and seeing those advertisements sell more things, but also build a brand. I imagine that helps you on your journey to drive the behavior change that you need to.

Stephan:

Just to connect what you just said to your very first question, Ryan. I think at the end of the day, thinking back about the vision. The world of marketing has changed a lot over the last couple of decades. And as a result, those things that constitute a competitive advantage for a company are different now than they were in the past. So in the past, it was completely fine to totally outsource capabilities like this, consumer testing. Why? Because there weren't a lot of aspects of that you would leverage for propelling your business at an accelerated pace further. It was not only fine that it was outsourced. It was actually fine that all your competitors were using the same bloody test also, right?

Ryan:

Right.

Stephan:

Right. Today, my Ada platform creates data every time we do a test, and we do a test like thousands of times a year, right? Every time somebody in PepsiCo does a test, the data feeds the data in the database, the whole of PepsiCo as a result gets smarter. And not just smarter in a vanilla type of way, but smarter in our specific categories and subcategories for our specific brands. And that today is a competitive advantage because I can link that to my actual sales results in the market, and as a result, have a closed-loop ecosystem that enables me to keep improving the predictive algorithms that keep improving the ability of Ada to say, "This is going to work. This is not going to work," or, "This is going to work. On a scale of one to 10, this is going to be an eight, and that's going to be a six, put your money on the eight." Right?

Ryan:

Yeah.

Stephan:

We closed that loop. No external party can close that loop. But it's because of the availability of data and our ability to turn that data into value. That wasn't there 25 years ago so it was fine to ask another company to do all this work. That's just simply not fine anymore. I, as PepsiCo, need that to build competitive advantage.

Ryan:

You're absolutely right. And in your world, there's always the tension of brand building versus top-line revenue growth. And what I think is really cool about what you say is your team and my team, specifically, has the results, as it relates to advertising. We spend a lot of time and money figuring out what questions, in what order are going to unlock the best diagnostics, the best ways to improve, but also, that correlate back to market mix models or sales or whatever.

And I remember that about two and a half years ago where we cracked that nut. And it was roughly 1.7 to 1.9 times as predictive as any other survey tool. And to hear you say, it's getting smarter. That's pretty cool. I mean, so it's like you're already cooking with gas, right, and to see that sort of thing get bigger and better. But you're right though that wasn't possible. And forget 25 years ago, that probably wasn't possible 10 years ago. I mean, Murphy's law has taken over. Technology can do a lot more for us.

Stephan:

But it's also not possible today if you continue to outsource this capability. Talking about competitive advantage, that really gets me going also because we can link these tools also to what we call our brand mind share tools. So our take on brand health. Right? Those tools are completely in sync. So we have brand health, we have actual sales data, and in the middle, our testing tools and they are all looking for the same mental and physical availability drivers. That's a powerful set of enablers for helping the business take consumer-centric decisions. Right?

Ryan:

It really is. Well, the other thing too, that you say, right? So obviously, you've done quite a bit of iterating testing, learning discussion to then say, "This is our standard." But there's quite a bit of local nuance and category nuance. There's so many different brands with so many sub- variants in each country. And so, there's an objectivity component of this is the best way to do it but then a subjective component which is, "You know what? For Gatorade, this is the right nuance or for Doritos, this is the right nuance." And I think that's the other part of insourcing the analytics side, which is that every business even if you're in the same category is slightly different. It has its own subjectivity, its own shareholder dynamics, management team dynamics, what have you, that you've actually accounted for within Ada?

Stephan:

Yeah. But we like to say, global tools, local insights. Right? And so, the biggest enemy of strong consumer insights work in a big company is vanilla, right, as a metaphor, not as a flavor. And thanks for asking that because I need to clarify that when I say meta-learning, I mean the opposite of vanilla. But I mean bringing to life, also some of the cultural nuances between... I don't know how to best communicate around the sports events between Europe and the US on Instagram. Right? That's the kind of stuff. And then within Europe, it's very different between Switzerland and Spain and the UK. And we're incredibly aware of the fact that, well, we should never fold the trap of thinking there's such a thing as global consumer insights.

I mean, there isn't really. I don't believe in that at all. Yes. We're all human beings so there are similarities. And depending on how you look at it, the similarities are bigger than the differences, right? But that is not the level of insights that helps you sell more potato chips or Pepsi. The granularity is local and it needs to come from the markets. That's why these tools do nothing but empowering local talent to do amazing work. That's really what these tools are for.

Ryan:

Yeah, exactly. And the fact, and even in the local levels that they're getting the ability to be more strategic. I mean, it's really incredible. I think one of the detailed design parts of the thinking that we've got on Ada is it's local within the country. But if you look at where we are. We're both on the East Coast of the United States recording this. The nuance, even within a country, the subgroups, the different types of people... 

I mean, one of the things I think your team did very intelligently with Ada is, you know most companies will test an ad and be happy with 150 consumers. You're talking to 600, and you're cutting it by a pretty robust set of subgroups, whether they be early adopters or demographic subgroups. Because even within a country, right, there is nuance. And I think PepsiCo's done a really good job of capturing that. Because not all your brands are for mass consumption.

Stephan:

It's also completely aligned with how brands grow doctrine, that we subscribe to in a big way, right? Our brands need to talk and walk in ways that appeal to broad audiences. We don't have brands that can afford to talk to niche audiences. The first ambition is always to appeal to a broad audience. And then within that, it's super interesting and important to know how we're doing versus more specific audiences.

But the overarching ambition is, is the broadest definition of our consumer, that actually consumes our product or our category I should say. Is she or he interested in what we have to say, or what we plan to sell him or her? And that's the first point of call. And then within that, okay. You look at subsets, that's super useful. But to your point, yeah, we need a big sample set. So actually, these tools that we've built, they have two to three times more respondents than the typical tool you would buy out there in the marketplace for exactly this reason.

Ryan:

And thank you, technology, because they're usually still cheaper, which is always good. So, I want to ask you a little bit about impact. So we've talked to people, they've elevated. We've talked about the fact that you've got this continuum of testing, that you can now do this ability to integrate it into other systems, one constant threat of measurement. I think I know the answer to this, but has the creative performance improved over the four years? I mean, have you seen the ad results, the sales results improve alongside the work that you've done? I know you said you've been attributing a lot of this.

Stephan:

Yes, I dare say that's where we have made and still are making progress on that. I mean, we've had an incredible disruption since almost two years now in COVID.

Ryan:

Yeah. Good point.

Stephan:

COVID the disaster that it is for so many people has actually led to accelerated growth of a lot of our categories. Right? And then as a result of that, it's slightly challenging to separate the impacts of increased consumption as a result of the fact that people were staying more at home, and the increase in e-commerce buying as a result of that as well. And then the advertising and other marketing that we did. And then the fact that the NFL and the NBA were suddenly heavily compromised in terms of their normal schedules and what have you.

So there were all those impacts that make it a little challenging for me to say, "Oh, yes, this is so many points improvement." However, I think the strongest direct evidence that we have is twofold. First of all, the numbers look very good. And secondly, any marketer that works with Ada that you would want to talk to in PepsiCo will sing praises of the fact that these tools are simply enabling them to make better advertising. And by the way that goes not only for TV advertising but also for digital advertising. And now, the tool kit continues to grow and hence elevates its impact.

Ryan:

Yeah, that's right. I mean, and you're absolutely right about the climate. But from what I've seen in the data, the ads are improving and there's a lot more early, often evaluation and optimization. And then to your point with digital, it's been a big point of focus for Ada this year. And I think she's done a wonderful job. And I guess, how do you see the blurring of channels going, right, for a business that was one of the main TV advertisers, I think there's obviously a big percentage of spend now going to digital assets. And so, how does Ada sort of balance the ever-changing media placement dynamics that PepsiCo's experimenting with?

Stephan:

Yeah, in many different ways. It's a big question that you're asking because, of course, the landscape is changing so much. PepsiCo globally spends about 40% of its marketing investment dollars on digital media. So Ada has a TV testing tool. It has an online testing tool. But it also has a tool that is completely integrated with our global digital asset database. Right? So everything that gets posted on Facebook, Instagram, and YouTube, what have you, gets posted in a centralized repository within PepsiCo.

Before you can send it into that repository, it goes through Ada, right?

Ryan:

Right.

Stephan:

And so, it gets checked against the 10 basic golden rules for impact on whether it's Facebook or Instagram or whatever, TikTok you name it. So Ada becomes... The toolkit grows and the tools get heavily integrated in existing processes. Right?

Ryan:

Mm-hmm (affirmative).

Stephan:

Which is super powerful because that is ultimately, of course, one way to drive effective change. So back to your question, so what do we do to keep up, right? So the toolkit is broadening. The toolkit is getting integrated in all the different processes that lead to content. And over time, of course, TV advertising is going to look more and more like online advertising, right? And so, we're going to approach this from both angles and then, you've got the growth of one-to-one advertising and communication, which also has a huge opportunity for our categories, which is, of course, something that Ada will have to evolve to as well. And that's something we're thinking through as we speak. 

Ryan:

Perfect. Good answer. I threw a hard one at you. We were making fun of baseball earlier. So I guess that was my fastball. But I'm just thinking out loud, right? One of the benefits of having what you know so clearly available across 3000 marketers, however many hundred insights people, is that you can also experiment with new territories, right? 

So in a world where one-to-one marketing and programmatic marketing, and there's different digital partners or boutique agencies on the advertising side, knowing what you know means you can test new assumptions, I think, in a creative construct. And I'm curious to see how Ada helps with that as we go forward. And I know there's been a few examples, which we're not going to share here that I've seen within the business of someone experimenting, it worked. We then made it better on Ada and then put it into the mainstream, which is pretty cool.

Stephan:

There's a lot of different aspects of marketing that we can extend, and we will extend into with Ada. Innovation testing is an obvious one and beyond just concept testing.You've got your concept testing, then at the end of the road, you've got your in-home use testing. But in between, you've got your simulated test market type of testing which is... PepsiCo and a lot of other companies spend a lot of money on that. The predictive value or the value of the predictions is quite low, I think, compared to what the money we spend on that. Right? 

And so, I think Ada can do a much better job at that if we apply the same thinking we've applied to advertising testing to that type of innovation testing. That's something we're looking into now.

Ryan:

Yeah. And a new horizon for us. You're right though. I mean, I used to do a lot of home-use testing in a previous life. It's so much of why that stuff is expensive is logistics and operations and processes. And so, yeah, presumably technology can do that work. I think, maybe we'll look back in 20 years and say, "We picked the hardest thing to do first because we're evaluating creativity with machines." So we've figured it out. You and I can laugh about it. But you know, perhaps we should have had our head examined a few years ago. Who knows?

Stephan:

With a lot of that type of testing that I just refer to, the feedback you always get is like, "Yeah, yeah, no. The prediction was very off, but you change the input." 

Ryan:

Yes, of course.

Stephan:

And so, you spend lots of advertising and the distribution is more and this and that. But that's linear thinking bumping into today's reality, right? The world is not linear anymore. So we need tools that allow us to constantly, even on a weekly basis, on a daily basis, if the business needs to, that constantly changes the input parameters and that can deal with that, and so we can just run the model a thousand times if we have to.

Ryan:

It's such a good point. It's going to change, period. It's constant in the world we live in so we have to be able to adapt to it.

Stephan:

Yep.

Ryan:

I have two more questions for you. You've been very generous with your time, my friend. I appreciate you. So on surface, better, faster, cheaper, insights people that are not programming surveys all day, check. People are collaborating in Ada because they're beginning to look at global nuggets that could potentially be tested and applied locally or vice versa. I won't put words in your mouth, but it does read like you've exponentially reduced your dependency on major suppliers and I imagine you've repurposed that dependency for other things that they're good at. Is that fair?

Stephan:

Yeah. That is starting to be fair. Absolutely. We're working hard on that. And, yeah. True.

Ryan:

You've sort of check, check, check on the original vision, not the linear path that you probably weren't expecting because you're a wise man. So you're talking to you four years ago and who you're talking to is somebody listening to this podcast saying, "God, I'm at the beginning of this journey." What are some pieces of advice you'd give to folks?

Stephan:

Yeah, my advice is really... It boils down to very basic change management type of advice. Right? I think the one thing that we did really well, four and a half years ago when the journey started for me at PepsiCo was that we got the 15 insights leaders together also physically by the way, which also helped, which is more challenging today.

Ryan:

Yes, it does.

Stephan:

But from all over the world, all those senior insights folks. And all of those people, by the way, have and had at that point, a career in insights. Right? That's an important thing because that means they're complete rock stars in their fields, but they're also used to working in certain ways.

That's why, and I'm bringing that up because it was even more important to collectively come to those conclusions of the change that we wanted to drive. Because if we wouldn't do that as a collective, it would just completely break down because every change is difficult and people that make a career in insights are, I think, if not necessarily talking about my own colleagues in PepsiCo, but they're not the most changed minded people because they're often... So much is at stake, right?

Ryan:

Right.

Stephan:

They're often looking at it like this. It's a bit like a culture of accountants. It's like, you don't want to mess up the books. That's just the bottom line. You don't want to present wrong data, flawed information, faulty test results. That's like a nightmare. So experimenting and consumer insights are not necessarily each other's friends. Anyway, I digress a bit. Because of all that, it's super crucial that as a leadership team, we said, "These are five things that we really want and that we really want to change."

And then we got to work, and what I found, and that is something that makes my job so great because I work with people who are once you've landed on a joint vision. I work with people who are incredibly eager to contribute. Whether their day job is to run a big part of the insights agenda in the vast North American markets, or they are the other side of the world running 34 different markets from an insights perspective. People stepped up and said, "Hey, I'd like to help on this." Or even, "I'd like to own this initiative."

It was never a global thing. It was never a thing the global team did. It was a thing that the collective function did. And when I say global team, by the way, I mean the head office team. So it was never a head office initiative, it was a truly global leadership ambition and piece of work. That is really inspiring to me.

Ryan:

Well, just the other thing too, I just remember this day, whilst you're talking, it was leadership that was bought into principles, which I think, you know you hear a lot about slow no's. You never got a slow no with Ada, I think because you bought into principles. But I remember, we're going back probably two and a half years ago. It was December in Boston and I hosted 40 PepsiCo employees. None of them were executives. They were all dialed in to say, "How do we make the future of advertising better?" And so, my point is that democratization then went through the organization. I vividly remember having a white-boarding set of meetings with those 40 people. All of them were extremely bright, bought into the principles, but we are putting ourselves 10 years in the future, and thinking what advertising is going to look like.

And actually, I wish I still had those post-it notes because it was an inspiring day. But just to say, I think that lesson in getting the local teams to own it is so important and everybody always misses that step. But I'm giving credit because I've actually seen in practice that the local affiliates are actually owning the change at this point, which I imagine some of them makes your job a little easier, but it's the right way to do it.

Stephan:

I guess I came to this role with two things. First, 15 years of experience as a marketer in a similar company, right, Global CPG. And secondly, what I learned from my days as a consultant is that in marketing, it's really about building the global might for the local fight. That is what people have... All my colleagues are sick and tired of hearing me say that. But that is in my view, and I've seen it work now also in the team. That is an inspiring way of looking at the potential role of a global function, right? It's about, how can you leverage your... How can you create a global mind for your local in-market fight? You are in Boston, say you are responsible for your local brands and local businesses in the Northeast of the United States. How can I make your job easier and more effective? And that is the global mind for the local five. That is inspiring for a lot of people. And that's why you get those responses that you just referred to.

Ryan:

Well, it's partly, probably inspiring because it's right. As you said, yes, we're people underneath it, but our cultures, our behaviors, I mean, they're just so different in local environments. Even though we're sitting in the US. I mean you go to different parts of the United States, it's a completely different culture. No, that's fantastic. All right. I'm going to sneak in an extra question because we've got time. My second to the last question, you have a fictitious open role for an insights manager. What are the attributes that you're looking for a future proof insights professional?

Stephan:

Yeah, okay.

Ryan:

Mindset, attributes, skills, DNA, just paint a picture of that ideal profile from where you sit.

Stephan:

We've done a lot of work on that but let me keep it simple. And this is something that I also like to talk about a lot. So, I'll try to keep it short.

Ryan:

Take your time. It's important.

Stephan:

What we need are people that are curious, courageous, and inspiring. Right. And so, let's start with curiosity, right? I mean, no. That's pretty darn obvious I think, right? I mean, if you're not curious, you should go and do something else. I mean, you shouldn't work in marketing and then certainly not in consumer in any sense. So curious really about why consumers do what they do, curious about, are there better ways, more interesting or more exciting ways to grow our business? So insights people, if you look at PepsiCo, there's 275,000 people at PepsiCo. There's less than a thousand people in the global consumer insights function.

99% of those 275,000 people are involved with making, moving, and selling our products. Those people are not necessarily constantly looking outside thinking, "What should we be selling? And how should we be building this brand? And is our communication really effective?" And some of them are to their credit, right? But they have very busy day jobs making general products. So you need consumer insights people that are incredibly curious, that's one.

Then you need those same people to be incredibly courageous as well. Because if they come out, if they see something, if they find something or if they develop an opinion that goes against the way stuff gets done at the moment, they need to speak up. Another example or another dimension of this, they need to be able to insert themselves in commercial discussions that they feel are not sufficiently consumer-centric, right?

So you need courageous people that, with the power of the whole functional family behind them, that they're to step up and step in. So you need curious people that are courageous. And then thirdly, inspiring. Because if you're not inspiring, who's going to listen to you. 

Ryan:

Right.

Stephan:

And so, you need people that are able to really understand. That's part of the inspiration for me, really understanding your stakeholders, really being able to step in the shoes of the marketer you work with, or the R&D professional, or the design team member that you work with, and really figure out what it is they need to do their job. And that really enables you to be inspiring. You need to be able to keep things simple because there's always too much information and too many data points. So that is a driver of inspiration, et cetera. So curious, courageous, and inspiring. Those are the three things that I would be hiring for.

Ryan:

I love that. I love it. I probably should have done a whole episode with you about this because I'm underrepresenting the amount of time you and your team have spent on this topic because it's people, it's process, and it's technology that drive change. And I think you folks are equally focused on all three, which is really important.

Stephan:

Yeah, that is right.

Ryan:

So maybe next season, we'll get you on and we'll talk just about people because they're really important. Oh, there's so many more questions I want to ask you, but we're short on time. 

So I'm going to decide on the last question. All right. Here's my last question. I consider you a great business partner. We've always been open and direct with each other through good times and bad. You have a lot of people, I'm sure that call you, and want to partner with PepsiCo. I imagine a lot of those people don't see themselves as vendors. What does partnership mean to you, and what does an ideal partner look like from your perspective?

Stephan:

Yeah, that's another big theme, right?

Ryan:

No softballs on the Inside Insights show Stephan, only fast talk.

Stephan:

I actually have a session with Babita from your team at Zappi about that. And what does outstanding partnership look like? I'm not starting with the most important thing. I'm starting with something that comes to mind. Yeah. So first of all, a selling partnership obviously includes that you're bringing an inch wide, mile deep capability to the party, to me, to my business, to my colleagues, that is worth considering. So I mean that speaks for itself.

Ryan:

The table stakes, right? You're bringing something of value.

Stephan:

Secondly, you come out, you knock on the door, and you bring something of value. You have to have empathy for my role in PepsiCo's operating model. I like to talk to you about my role, and I'm not even joking. I'd say, "I've got a big responsibility and zero authority." And so, that's not the case anymore. That was certainly so in the first couple of months or so in my job. But on paper, I've got a big responsibility and zero authority because two-thirds of the insights people in PepsiCo don't report to me, or they're part of my function.

They're a part of the local BUs, business units all over the world. So the reason I bring this up is that if you come to me with a plan, I can only really do something with that if I can figure out with you a way in which I can make it relevant for business units from day one. That's why we pilot so much in PepsiCo. Okay. Let's try this out in Argentina. Let's try this out in Egypt. Let's try this out in Vietnam, and then we'll take it from there, right?

And this is personal, but I want to work with partners that bring in a brutal outside-in perspective. I don't want people to bend over backwards and completely necessarily adjust to the way things are done in PepsiCo. You and I are a brilliant example of that when Ada got going. I literally remember, two and a half years ago or so, we were at the rollout of the first tool. I was over the moon with how that was going, and you called me, you said, "You guys are driving us nuts. We're getting thousands of purchase orders in the last four months. I don't hire people to do bloody purchase orders in the system. You got to make it simpler for us." And we did.

Ryan:

And I do remember that.

Stephan:

Yeah, and I'm grateful for that. Because that was a huge simplification effort. So, I don't want to work with partners who just hire 150 people to deal with my bloody purchase orders. That feedback that you gave was an opportunity for me to drastically simplify our internal processes, right?

Ryan:

Yeah, absolutely.

Stephan:

Aligned incentives. That's one of the things I like. I like the way we work. You and I are... If Ada's doing well, you're doing well and I'm doing well. And that sounds simpler than it is in real life. Right? The negative example is if you join a gym, they're very incentivized to sign you on, and then they're very incentivized to make sure that you never show up because they sign on much more people than they can handle. So, that's horrible. Right? I wanted the other way around.

Ryan:

You would see a lot of campaigns in April to work out.

Stephan:

There you go. So, yeah. And finally empathy with me also as an individual and as a leader, it helps. Sometimes there's parties that just come to me and for example, either they have zero empathy with me in my role.

So, they expect that I can just buy something and roll it out to 175 markets for them. Okay. So I talked about that just now. But also it's got to be material. Right? And I mean, I never get an email from somebody or hardly ever, who says, "I got this thing. It's a widget that can do this and that. If you could just tell me who to talk to, then I would be very grateful." I hardly ever get that. I mean, and it's so logical, right? People are always trying to sell to me. I have zero budget. Right? I don't buy stuff.

Ryan:

Right. I just buy.

Stephan:

Anyway, partnership is about all those things.

Ryan:

I will abruptly get you off the phone because I've told you to budget for 45 minutes. I really appreciate your time, and your open and honest answers. The question I didn't ask you was where's Ada going next. But we're going to give PepsiCo a little competitive advantage, and not let him answer that question. And you folks will just have to wait and see where Ada goes. But I heard she's a rockstar employee, and she's going to keep doing her thing, which is a beautiful thing. Stephan, thank you so much for your open, thoughtful, and provocative points here today. On behalf of my audience, I can't thank you enough for taking the time to share with us.

Stephan:

My pleasure, Ryan. Always good to talk, and we'll be in touch, yeah?

Ryan:

All right. Sounds good, buddy. Bye, everybody.

[Music transition to takeaways]

Ryan:

So Patricia, we ran out time with Steph. I always run out of time.

Patricia:

You always do, you always do.

Ryan:

I think I'm going to start booking more time. Because I, we have some cool guests on our podcast and they have really great things to share.

Patricia:

They're amazing.

Ryan:

But yeah, you're right. I run out of time every single time. So means we have to start making this a 75 minute interview. Patricia-

Patricia:

Then we have to do 12 or 15 bullets instead of 10.

Ryan:

Yeah, that would be stressful. And then both you and Kelsey would be like, come on this is a lot. And then we'll keep it to 60 minutes. I'll just get better at interview-

Patricia:

I think we should just invite people for a second shot. I mean, there's nothing wrong with coming back next season.

Ryan:

That's true. By the way, I know we're in season three, season four is going to be fire.

Patricia:

Hot. Yeah.

Ryan:

Can't wait, can't wait. We're just getting started here at Inside Insights. We got, we're breaking the algorithms. We're getting more viewership. We're getting more ratings. And so we're psyched, thank you. Give us some feedback though, enough about us. 

Patricia:

Today was really cool for me because I listened with a couple of different hats on. I listened with a vision of digitization, I can never say that freaking word and I work in this industry.

Ryan:

Digitalization. Buzz words.

Patricia:

I need another glass of wine for that. So wait, let's get serious. I looked at it, I listened to it thinking about the vision of digitized insights. I also listened to it on how to get your vision off the ground because I found both of those angles just so valuable. All of us want to know about digitized insights with the future. It's this and that and the other and see how I slurred that word right there. But many more of us, I think, have a vision and haven't had the chance to look at it. So whether you're listening to my top 10 bullets summary with your eye on the digitalization, or you're looking at it to help you get your own vision off the ground. Here we go.

So Stephan and team, including Ryan, had a vision four years ago, right? Four plus years ago. And they just wanted to change the entire industry. They wanted to change the whole entire insights game. And they've made a lot of progress in the past four years and they wanted to stop and think about the progress that they've made. So this is what happened. 

Number one, they had a vision, he wrote it down. He scoped it out. He dreamed big. He found a partner who shared the vision and had complimentary, very important, competencies. But he wanted to know exactly who he was so that he could find people who did what he didn't do well, right? But make sure that the people who have complimentary competencies also share your vision. Because if not, it's going to be harder than it is good. Right? The vision in this case was raising the floor and the ceiling of the insights function and making sure the insights function had a lot more impact in the PepsiCo business, much more efficiently than it was today.

Number two, get to know the environment, know where you're going to be playing. Yes, he was already in the industry but got to know it deeper, better, the nuances, everything, the people, the culture, the business, the needs. And what did he do? He went and he listened to all the people who were going to be his stakeholders. And he found out that Pepsi was fierce on their focus on global and local, not just global. Number one, the two, they wanted the team, everybody without a fault said they wanted better, faster, cheaper, right? They wanted to work together but they had no idea really how and they felt so dependent on the big suppliers. And actually they said that they felt dependent and trapped by the big suppliers. And that's kind of sad, right?

Number three, revisit your vision. After he talked to all these people he revisited the vision. He clarified it. He made sure it was spot on. He tweaked it. And then he said, let's make it bigger, let's make the ambition higher, let's go bigger. And then he said, let's just deal with all the needs. And I'm like, okay! So what is he going to deal with? He's going to deal with this, this is a quote that you said that was absolute fire Ryan. Usually I don't quote you because you're not the interviewee but you just floored me today. The point of marketing research can't be to grade homework, it's to help creators be more creative. Drop the freaking mic Ryan Barry. That was amazing. That's the biggest ambition, right?

Bringing the insights function together so they can leverage scale, right? To empower insights people and then signing their own. He, this was Stephan getting crazy, signing our own declaration of independence from the powers that be in the global insights world. He got so excited about that. It was great because he's Pepsi and he has the power to say, we're going to do this my way. I love that.

Number four of my top 10, get to work and find an enabler, right? Not just partners. There are partners who help you. But there are people who make things happen for you. And he said something really cute. Don't underestimate any company because of its size. He chose to work with Zappi, we're little and he didn't underestimate us. And now, right now, four years later, they're leveraging scale through standardization. Their benefits are exceeding what they expected in how broad and deep they're going. They're going crazy with meta learning and deep dive studies. And they talk about meta, their definition of meta is cool. Bringing data to life and showcasing nuances. He's such a romantic. You wouldn't think that Stephan was a romantic at heart but listen to the way he talks, it's great. I think he's a writer.

Number five, understand the path is not linear or smooth. It's a roller coaster. Actually it's not a roller coaster, he said, because it doesn't end where it began. Linearity, this is one of those drop the mic quotes, Kelsey I hope you're listening. Linearity is a luxury of the past. Cool, right? The ride does not end. Most processes are iterative and circular and we need the tools to support the long tail of change, which is basically the culture. So that was number five in the middle of the list that was like, just made my jaw drop. It's all about things that happened extra along the way, meta wasn't part of the original vision. And now they're doing that. They're better business partners and they're better sparring partners for their clients. They're mentally and physically, because he talked about mental and physically, unleashed to have more relationships with people, how they're not tagged or tied. And they're letting technology do their heavy lifting.

Number six, develop a competitive advantage by facing the tensions in the business. Don't ignore the big stuff, tackle it, face it, iterate and learn, develop the things that you need to develop so you understand that the tool that you're building has to evolve with time. Because, as I said in number five, the journey doesn't end. This is all about, he said that he added brand building versus top line revenue growth. You guys talked about brand health management. You talked about predictability and forecasting and category nuances and having global roots but local insights. And then you said, avoid vanilla there's no such thing. I think it was you or, I don't remember. Was it you or was it Stephan that said avoid vanilla? I like vanilla ice cream.

Ryan:

I like vanilla too. I don't think it was me.

Patricia:

Oh then it was probably Stephan because, but I'm sure he wasn't talking about ice cream. I like vanilla ice cream. It goes best with all my toppings and with crumpled up Snickers and Oreos. Just saying, now that they're-

Ryan:

Just saying, it's Halloween weekend no big deal everybody.

Patricia:

Moving right along. Number seven, roll with what life sends. We had two years of COVID the past two years have been very difficult. Roll with it but always look for the problems to solve, help the tool solve, not dwell on the problems. And he said something that I thought was great. Think outside the box but also think inside the box because sometimes the solution is staring you in the face, right? And he said, to do this you have to be sensitive to human needs and just to climate, move with it, adapt. Number eight, we're getting close to the end guys. You asked him, what did you snuck in three last questions. Did you realize that? Three, three. 

Ryan:

And you know what? I actually had more questions for him. We're going to need to bring him back next year. But yeah, I was going quick at the end.

Patricia:

The first of the last questions, which is my number eight. What is your advice to others? And he said basic change management type of advice. And I thought that was so simple. He said, gather the team all of it at the same time. Lay out your vision, lay out your plan, let them go at it, answer all of their questions, don't be defensive, right? Make them partners/owners of the solution. He did this with Pepsi and he got people to step up afterwards and say, hey I'd like to help with this, I'd like to own this. It was never a global thing, he said, he said he took no credit. It was a collective function that did it, that was great.

Number nine, you asked him what are the attributes that you're looking for, for a future proof insights professional. And he was tried and true. This was, I mean, I was so glad he said this. Curious, courageous and understanding, right? He wants people who are curious about what the consumers do, courageous enough to speak up and are really able to understand, empathetic, really able to understand their stakeholders. I thought that was beautiful.

And last but not least. What does a real partnership mean to you? What does an ideal partner look like for you? And this was really brave of you Ryan because you are his partner, right? But he said, bring an inch wide and a mile deep capability. I love that. Bring something of value but he made it very visual for us all. He also said empathy for my role and for my upbringing. I live in my life, know what I'm, what I live and breathe every day, right? He said, bring in a brutal outside-in perspective. And align the incentives. Make sure that your team and my team are both getting rewarded for the same things. So that we're all pushing in the same direction. Amazing. It was amazing, you could hear in my voice how passionate I was about this interview.

Ryan:

Yeah it was really cool. It was cool for me to reflect outwards too. I mean, I remember, I think, I don't know if I said this exactly in the interview but I vividly remember walking into his office when he had a piece of paper.

Patricia:

Yes, you said that in the interview.

Ryan:

He had pen marks all over and he is like, this is what I'm trying to do. And I remember being like, my god this is the first time I've met a brand who wants to do what, what I want to do. This is so wonderful.

Patricia:

Yeah and he said that, that was his first point. Have a vision, write it down.

Ryan:

Yeah, exactly. So our next interview is not about insights and you want to know why? There's a constant thread through our conversations of elevating our leadership, of not being linear, of growing. And let's all face it, we're sick and tired of being on zoom. We're trying to struggle with all these tensions, societal tensions, health risks, dealing with change at our jobs because nothing's linear. We're not sure if we're going back to work, how we're going back to work. And I think it puts an emphasis on the world of actually one of our core values at Zappi, which is leadership inside and out. Leadership isn't just for people in positions of power because I think that's bullshit. Everybody is leading something in their world and everybody needs to develop the skills to lead and influence others because functional lines of management aren't how the world's going to change.

So next week we're going to interview my Executive Coach and my friend and a psychologist, Dr. Nora Infante. She is a wonderful human being who has made a profound impact on me personally. And I wanted her to share some of her secrets with all of you because there's a constant thread in these interviews of elevating our game, of being more empathetic, of being curious, of being better at storytelling. A lot of that requires confidence and empathy and emotional intelligence. So Nora and I are going to break some of that down for all of y'all. Got a few episodes left. Whether it's our last episode or our second to last episode, I can't remember. But we're going to flip the script on Inside Insights. Patricia's going to be doing, taking my seat. I'm going to be taking Patricia's seat coming up soon. Please stay tuned.

But as I said, we're starting to think about season four already because it's that time of year. If you want to be interviewed, if you got something incredible that you're doing that you want to talk about. If you know somebody that we should talk to, hit us up. You can find us a million different ways. I'll tell you some of them. You can hit us up on LinkedIn. You can email Kelsey, you can email me, you can send a bat signal or a raven or a smoke signal. We are really good at that. If you got value for Inside Insights, please rate us a five star on the app store. It actually really helps us get more value to more people. To those of you who are friends of ours that listen, thank you for having our back. To those of you who don't know yet, I look forward to meeting you.

Patricia, don't eat too much candy this weekend but eat a lot of it.

Patricia:

I will balance..

Ryan:

And both Kelsey and Patricia I will bring in, next time I see you two, I will save two mint KitKat's for you so you can pick up.

Patricia:

Ooh all right. I'll see you in the office.

Ryan:

Alright sounds good. Bye everybody. Be well, be nice to each other.

Patricia:

You too.

To listen to the winning advertising episode Ryan and Stephan mentioned, click here.