PepsiCo adapts online

03 May 2011

NEW YORK: PepsiCo, the food and beverage giant, is embracing strategies such as "social listening" to acquire a deeper understanding of consumers.

Speaking to Econsultancy, Joshua Karpf, the firm's senior manager, digital media communications, argued new models are increasingly essential given changing popular behaviour.

"We understand that our consumers are younger and for them digital is a valuable part of their day-to-day lives," he said.

"As tools and platforms like mobile and tablets become more mainstream, we're asking what can we do that is simple, but drives the business?"

PepsiCo's evolving approach was demonstrated by a partnership with geo-location specialist Foursquare and Hess gas stations, providing exclusive offers to customers "checking in" on wireless devices.

This extended an initial offline-only promotion, and delivered a 20% improvement in effectiveness for PepsiCo, and greater numbers of "check ins" for Hess.

"We validated that if we created the right deal we could drive business," said Karpf.

Elsewhere, the owner of Tropicana and Frito-Lay has recently ran a scheme, PepsiCo10, asking start-ups to submit promising ideas surrounding social media, mobile, gaming and place-based retail.

It received over 400 entries, reduced to 80 organisations which presented their suggestions to PepsiCo directly, before ten were finally chosen.

"For us it is getting to see technology we wouldn't necessarily see otherwise and to try it out in a low-risk way with the object of expanding on the successes," said Karpf.

"For the companies, they get a case they can use to help grow their businesses. It's a win-win."

So impressed was it with the results of this enterprise, PepsiCo now plans to introduce versions for Europe and India in the near future.

"At the corporate level, our point of view is on the emerging side, let's identify companies where we can run programmes, learn from those, and have room to fail and learn," said Karpf.

"Of these, maybe one or two will actually work at a bigger level. We consider it R&D. It is an imperative for us."

Regarding individual brands, Gatorade has been an early adopter of many social media techniques, and even boasts a dedicated "Mission Control" which tracks internet buzz.

"We started it because we knew a lot of our consumers are talking about sports and nutrition online 24/7," said Karpf. "We've really used it to gain an understanding of our consumers."

Staffed by a mixture of PepsiCo's marketers and agency representatives, Gatorade's Mission Control monitors Facebook and Twitter, using both "listening" software and in-house technology.

"We are looking at rolling this out, but everything is not a big consumer megabrand that people are talking about 24/7," Karpf added.

"Our point of view is that all brands need social listening. Sometimes it's enough to use off-the-shelf software."

The Pepsi Refresh Project, allowing web users to vote for proposals hoping to rejuvenate local communities, has also engaged shoppers in a unique fashion.

"Consumer response was unprecedented in terms of ideas generated and the scale at which the programme impacted communities," said Karpf.

"People were lobbying and using their network to better their community, schools promoted ideas to improve their world. Pepsi was the enabler."

Data sourced from Econsultancy; additional content by Warc staff