“You need an insights function that is really focused on being a catalyst for growth in an end-to-end way.”

For many years, the insights industry has desired a ‘seat at the top table’, influencing decisions at the most senior levels of their organisations.

There are few insights professionals as senior and influential to their businesses as our guest on this episode, Stephan Gans, Senior Vice President of Insights and Analytics at PepsiCo.

Stephan shares the steps PepsiCo’s insights team has taken to move from order-taking to being a true catalyst for business growth, why our thirst for insights has never been greater, and the three critical roles he says insights teams must play in any future business.

We also talk about the skills that will be most valuable in the future as we enable our insights functions with AI.

This is a must-listen for anyone working in insights.

CHAPTERS:

(00:00) Introduction

(04:13) A Unified Approach

(07:55) Balancing Short-term and Long-term Goals

(14:12) The Role of AI in Insights

(19:42) Future Skills for Insights Professionals

Episode transcript:

Stephan: Bringing all those drivers for growth together in one construct is essential really to make sure that marketeers and also insights people take that end to end perspective in commercial decision making. You need an insights function that is really focussed on being those catalysts for growth in an end-to-end way.

Adam: Hello, Laura, how are you?

Laura: Very excited. How are you?

Adam: I am thrilled to be back inside this fancy studio. This isn’t our living room for anyone that’s wondering.

Laura: I know it’s not filled with Crayolas and toys everywhere, so it’s definitely not our homes.

Adam: I’m super excited about today. We have got a fantastic guest joining us.

Laura: As close to a celebrity in our world as you’re likely to get.

Adam: I think that’s true. So one of our clients, Stephan Gans, the Senior Vice President of Insights and Analytics at PepsiCo is joining us to talk to us all about the future of insights at PepsiCo and how PepsiCo is charting its course over the next 10 years.

Laura: Yes, huge shout out to Kirsty for asking the question on our behalf and really an exciting and engaging conversation I think.

Adam: Absolutely thrilled to have Stephan with us today.

Stephan, you had quite an interesting journey to becoming the Head of Insights at Pepsi,  having been agency side and also a marketing background. Can you tell us a little bit more about what drew you to the role leading the insights function at Pepsi?

Stephan: I spent the first 15 years of my career as a marketer and always felt drawn to, let’s say, the consumer centricity side of that work.

So worked a lot with, when I was leading the marketing function for one operating company of Unilever at some point, I spent a lot of time with the insights team. And more or less through a coincidence I stumbled upon this role at PepsiCo. And what attracted me to the role was in part also the fact that PepsiCo realised that it didn’t necessarily need it, let’s say an insights expert at that point in time for the role. They needed somebody who could say, galvanise a global team and transform that global team, transform that function into what it needed to be to become a competitive advantage for the business.

And my background was actually quite a good match with that. Not only my background as a marketeer, but to your point also my background as a consultant for about a decade also.

Laura: And Pepsi is famous for marrying insights into commercial realities for bridging that gap.

So, you know, sometimes it can feel like there’s some companies where they have wonderful insights, but they’re not necessarily leading to growth. And then there’re some companies which are very manufacturer led, very successful, but don’t necessarily have the success with understanding consumers.

It feels like you have managed to create an insight function that truly influences the business. What’s your perspective on that?

Stephan: It’s great, that’s great to hear it looks like that from the outside. I mean from the inside that is a constant push and pull to be honest, right? I mean in an organisation as large as the one that I’m part of, you’ve got to be really careful that work doesn’t become too siloed.

And so the insights work isn’t skewed, let’s say too much to the marketing agenda alone or that insights work in the commercial sphere, so in revenue management and shopper insights isn’t disjointed from the other parts of the insights function, which are more about, let’s say, creative excellence and innovation.

It’s only in the last two years really that we came up with a PepsiCo way to bring all of that together in something that we call growth navigator, right? Where that is really from end to end, from the proposition itself and the brand,  the availability all the way to the value you are able to create for the business through pricing and shelf optimisation, et cetera, and bringing all those drivers for growth together.

In one construct it is essential really to make sure that marketers and also insights people really take that end to end perspective in commercial decision making and that consumer centricity is not a disjointed exercise that is done in different little buckets, but it is really woven throughout the commercial decision making to make that happen. I mean, you need an insights function that is really focussed on being those catalysts for growth in an end-to-end way.

Adam: One of the big challenges I can imagine is around culture and mindset. And how do you go about changing the culture of the organisation to embody this growth capitalism kind of mindset?

Stephan: Yeah. That’s a million dollar question, right? Because that is exciting and hard to do and takes time. But it is best approached as a proper change management challenge. PepsiCo is renowned for its entrepreneurial spirit and also for its independent, local, super competitive culture and mindset in all the markets that we operate in across the globe. That’s a historic strength. And that is still a core strength that we leverage. We are working very hard to couple that strength with some, let’s say, PepsiCo way of doing fundamental things that we know drive better and more effective marketing. And the only way to do that is to really look for ways to leverage your skill so that, for example, if we test a certain campaign for Gatorade in Vietnam, that we don’t only get smarter in Vietnam, but everybody who works on Gatorade in PepsiCo gets smarter, for example.

Or that when you have a certain position in the market, in terms of market share,  in a certain category, that  80% of your growth will be defined by the extent to which you’re able to grow that category. Okay so that applies equally to our business, say in Mexico, as it does to our business in the UK,  for certain brands.

And so how do we make sure that those markets, where relevant, learn from each other? So I can easily talk an hour about all the things we’re doing, you know, with examples to get to answer your question, basically.

There’s really three key roles that the insights function plays.

I like to talk about, identify, enable, and optimise, right? So that’s really about identifying growth opportunities and making sure the team realises what those opportunities are in the context of what I said earlier. So what are the jobs that we need to do to drive growth? Should we be focussed on the category? Well, yes. Okay. And then what does that mean for the opportunities that we identify in the market? Now Identify is also about not just trying to predict the future, which is kind of impossible to do but it is about really thinking through,  let’s say what the future is it that you want for your business, right?

Laura: How do you keep everyone oriented on wisdom? Still asking the right big questions, not being too reactive to things. What’s the secret sauce there?

Stephan: There’s no secret sauce there because the reality is of course, like I think everywhere is that, let’s say the level of activity and the thirst for understanding and insights has never been as high as it is now. Right? What typically, I think, you know, what applies to, let’s say, regular consumers like you and me with our sleep monitors and our Strava, apps and all that stuff applies to business people as well. We want to know exactly how we’re doing,  all the time and we want to understand why we’re doing it that way all the time.

And it’s possible. Why do people want that? Because it’s possible. And so back to your question, I mean, there’s no secret sauce. There’s a lot, you know, if you survey insights people in PepsiCo, I think you’ll find a lot of people that feel,  no matter where they are, whether they’re in business units somewhere in the world or in my global team, a significant number of people will feel constantly overwhelmed with the amount of work they need to do to explain short term swings in business or looking for short term answers. And that is often possible to do and very often not that value add to be honest, right? So, a key thing to do is also to make sure that we not only keep the insights people, but also the business leaders and the marketers focussed on the right things. So not just, this is the volume we shipped from the factory, but this is the household penetration and how it’s developing in that particular market or cohort or subcategory.

And,  those are often slightly slower moving measures, but much better indicators to how your business is doing, let’s say next month than necessarily an explanation for why our business is doing what it’s doing today. At the end of the day, you need both. But the trick is to find that right balance.

Adam: I wanted to pick up on one of the things you said a moment ago about it’s not just about seeing, predicting, foresighting the future, it’s about deciding where you want to be and creating that. That I think is easier said than done in some ways. And we see lots of businesses who have great foresight teams, have got really good ideas about where things are going, but then don’t actually make it happen and the 12 month reporting cycle kind of gets in the way of true growth there. What do you see as the kind of principles for making sure that those transitions happen in the way that you want them to?

Stephan: Yeah, another great question. And I wish we had 12 month reporting cycles, but they’re typically quarterly.

So I think again, there’s no secret sauce here, but there’s a fundamental, let’s say a division of labour that is important to leverage here, right? So for example, in our key categories, we will have in-market teams very focussed on, let’s say, horizon one delivery and we will have a global team that is helping the key local businesses with their phase one delivery and helping to connect them with each other so they can leverage each other’s best practices, et cetera.

But at the same time, a team, a global team that is focussed on the longer term horizon two and three initiatives. A key set of design criteria for making that successful are difficult to give because it depends very much on the phase that categories and teams are in. But what is very important, of course, is that the team, the more centrally oriented or globally oriented team that is focussed on longer term horizon two and three growth doesn’t lose touch with what is actually the reality of the business in the markets. Right?

And so it’s important to make sure that the right people in the right markets, typically the bigger markets, do stay involved with those global initiatives so there’s no risk of this becoming siloed off or ivory tower type of innovation work. 

S we have, like every big company, we have our infrastructure for that. We have our processes for that. But that is ongoing art and science. And that is also in that I feel incredibly confident that with all the talk about AI and the role AI can play in making marketing more effective and efficient, right? This is not something that you can ever easily automate because this is not thinking from the future back and trying to see then deciding what role you wanna play in that future as a company, and then deciding on what the, let’s say no-regretted moves are to make on the short term. That is highly strategic work, there is a blend of art and science, that we’re constantly trying to get better at. I’ve never read a book or met a person that’s got that all figured out.

Laura: And it’s interesting you mentioned the AI because I think in the past you’ve talked about how there’s been a lot of focus on efficiency, and perhaps then a bit of panic about the role of insights.

But what you are really talking about is a much more sort of strategic visioning of the future that sits outside of the current AI capability.

Stephan: Yeah. And I think we’re thinking and talking a lot about the opportunity we have with AI to further elevate our marketing and innovation game. I think it’s also the mind of people and also of partners and potential partners, really all too easily goes to efficiency, right? We can create campaigns much more efficiently. We can create innovation concepts much more efficiently. And I think while that is in and of itself,  that is interesting to do. Useful to do. It’s only, let’s say a fraction of the opportunity that we have.

Obviously, and this is no secret that the success rates of innovation in consumer packaged goods are low, right? So a lot of the products that we launched this year won’t be on the shelf anymore in two years time. And that is the same for all our peers in the industry as well. I don’t think AI is in and of itself going to solve that. But there are huge opportunities in improving the effectiveness of innovation for sure. And maybe a combination of AI driven understanding of what really drives consumer needs and predicting about what is and isn’t going to be successful in the marketplace- that may be able to play a role there. I’m more interested in that than in the efficiency side of things, more interested in terms of it’s a bigger nut to crack.

Adam: Yeah. I think we’re at that classic stage, aren’t we? At the beginning of a new technology where we’re working out how it can make us do our existing jobs faster or better but actually what we haven’t even begun to consider is what those future jobs might be that we can do with it. Or what we can do with the freed up time. Or how we can unlock that human potential.

Stephan: Exactly! Over the weekend, I read up on a metaphor that I’ve come across years ago and I wanted to dust off my memory on it, and it’s the metaphor of electrification about 125 years ago. And it’s a well known, well worn example, I think, but it’s so powerful if you read that.

I mean, it took 50 years for, from the invention of electricity and from the first factories adopting electricity to electricity, really finally delivering on its promise of dramatically increased productivity and effectiveness. That took decades, and the reason it took decades is that people, you know, they took the new, let’s call it tool, or the new energy source -electricity in over steam, but they didn’t change the way they worked. And it’s only when people started to dramatically change the layout of their factory floor, that suddenly factories were able to dramatically increase productivity.

That’s exactly the risk that I see with AI. Right? I mean, it’s very simple to come up with all sorts of ideas on doing faster and maybe even better focus group research or one-on-one interview research with all sorts of digital twins or other AI driven or gen-AI driven capabilities. It’s interesting to do and I’m sure we can do it and  look into it and probably adopt it to a certain extent. But the other question, how should we reorganise ourselves to meet consumer needs better,  10 years from now, five years from now and next year?  That requires fundamental rethinking that I’m very excited about.

Laura: That leads us nicely into thinking about what kind of skills you think insights professionals need to focus on in the future? What kind of talents and capabilities do you think people want to nurture over the next five to six years?

Stephan: Yeah, it’s a great question because two weeks ago I was – my younger son studies computer science in Europe. And, he and his buddies, they’re 3rd year computer scientists, that’s what they think about every day, right?

It is like, okay, I’m learning this but is this useful to know still? And if so, why? And if not then what do I need to do? And of course their university is trying to figure that out with them as well. But nobody has the answer, right? And yeah, for sure the same will go for insights and professionals.

I published a book last year with three other co-authors called the Consumer Insights Revolution. And in that book we talk about the three stages of work. We talk about the work before the work, the work, and the work after the work. And, the work before the work is really understanding the briefing very well. The work is doing the work, doing the consumer test or the market segmentation and the work after the work is making sure that the organisation is actually using the work, right? And by and large people spend way too much time on the work. Too much time in the sense that they don’t have enough time left to really question a brief. Right? The work before the work and or to really be that strategic business partner that works with the innovators and the marketers to make sure that the insights and the learning really lands.

Now I see huge opportunities to shrink the amount of time that people spend on the work. So enabling them to spend more time on the work before the work and the work after the work now. So yeah, sorry for the super simple metaphor, but for me it works.

Laura: No, it’s perfect.

Stephan: And it’s, so what are the capabilities that you need to be a really good strategic business partner that is not just an enabler or a, let’s say, not just an order taker, but that that is really a strategic business partner with whom you get to a perfect, super sharp brief for either an agency or an innovation team? Or with whom you can really objectively get to the bottom of why something is growing and some other thing isn’t. And what is happening in the marketplace and why is a competitor faster or more successful at something than we are or whatever the question is.

So that is a different set of capabilities, what the different set of capabilities is I don’t exactly have the answer yet. I think the earlier capabilities about being intentional, being brave, and keeping things simple, they’re not gonna go away.  But they’ll show up in different ways, but there’s going to be additional capabilities. One of them for sure is going to be somebody’s ability to use all that new machinery, all those new tools in the most efficient way. Right? And that is something that all of us literally, all of us should lean into. Not just because it’s exciting, but also because it’s going to be essential for the future of our business and the future of our careers that we know how to make the most out of those capabilities.

Laura: It feels like a great call to action for agencies as well, doesn’t it?

Adam: Yeah. I was going to say the same thing,

Laura: To actually find a way to add value outside of the remit of the task.

Adam: Yeah. What specifically would you be advising agencies at this point? Like where do you think the biggest gaps are for them?

Stephan: If I think about what digitalisation did for consumer insights over the previous 15 to 20 years. The benefits of that, it took a long, long time for the benefits of that to be really passed on to the customers, way too long. Right? The big insights houses, the big insights players in all the oligopoly that is that market, they’ve been reaping the benefits of dramatically increased speed and efficiency behind closed doors, while the costs of doing big market research,  studies for companies like mine did not come down. Okay. So now it’s not all about cost, of course, but I think what agencies can do is making sure that we don’t lose another decade or a decade and a half with the benefits bein shared with your customers. That’s one.

Secondly, to my earlier point about all these point solutions, I’m really interested very much in talking with agencies, consultancies, tech partners that understand this necessity and the opportunity of this end-to-end thinking. And so all these different point solutions providers that literally crowd my inbox every single bloody day with, oh my God, we now have an AI driven way of coming up with a new name or a new this or a new that – I’m honestly not interested because sure, maybe one day we’ll use it, but it’s not going to drive a dramatic impact for my business. What’s driving dramatic impact for my business potentially is partnership that helps me reimagine where our added value as humans sits and how we can leverage technology in the best way across all these value drivers go to market in the most effective way.

Adam: Yeah. I mean, at a point in time when we’re going through such disruption, I think, I guess what you’re saying here is let’s share the learnings. Let’s partner our way through them. Let’s not kind of run away, build some competitive advantages, use it as a way just to charge clients more money, but actually help clients kind of work through some of these big problems that they’re facing. I really like that.

Stephan: Yeah. And let’s also not get too overexcited about the technology. Right? At the end of the day, we just did a massive exercise with updating our, we call it demand maps, so like for part of our business around the world .And what consumer needs are 20 years ago, today, or 20 years from now are not fundamentally changing.

What is obviously changing is the way we cater to those needs. And so there’s a lot to learn from that. But we should not forget that when you really try and think human-centric about a business, people will in 2035 still want to come together and have a great time and have a party, celebrate somebody’s birthday, watch a soccer match or go out on a hike, work out, take good care of themselves, take good care of their loved ones.

All those things will still, we’re homo sapiens. That’s not going to go away and so we also need to keep the eye on the prize in that sense and not get overly distracted with smarter, faster ways of crunching data that even though I see a lot of opportunity for it, that the core of it all needs to remain. The human and her or his needs and wants, which is why we are in the business that we’re in.

Laura: I think that’s a perfect note to finish on talking about human centricity in an interview with you. So grateful to hear your insights and thank you so much for sharing with us.

Stephan: Well, thanks for having me. It was a pleasure.

Adam: Thank you, Stephan. That was enlightening. I really, really enjoyed that. Great to have you.

Stephan: Cheers.

Laura: Thank you very much.

Adam: Laura, I absolutely love that. He said one of my favourite things, which is this idea that it’s not just about seeing the future and predicting where things will be, or having a great foresight department that can give you a trends report, but it’s about creating that future for your business. And I think so many people, so many businesses fall down on that part.

They get great foresights work but don’t turn it into real decisions that are going to drive their businesses forward

Laura: A hundred percent. And understanding where your brands will play a role in that, because otherwise, you know, how would you earn that distinctively? I think that’s really interesting.

The other thing I loved was essentially pointing out for all this conversation about everything moving a lot faster and new capabilities, human insights do remain the same. And actually that’s where the end-to-end thinking becomes very interesting because often it’s things like sustainability or digital or new capabilities that are kind of coming in and the way that people service their needs is going to change, but people aren’t suddenly becoming different kinds of human beings.

So I think that was a really interesting, lovely, timely and timeless thing to touch on as well.

Adam: Yeah. And we’re gonna have to report back on The Forge the tips for agencies and make sure the right people in the business have heard those.

Laura: No pressure.

Adam: If you enjoyed that conversation with Stephan, I think you’d really enjoy the conversation that we had with Fenny Léautier at Phillips. It was a conversation all about how Phillips is going through a revolution in insights, developing its insights function in the world of AI.

Fenny: I think as an insights function, this is the golden age because suddenly, you know, we were working project by project and we are trying to get the knowledge there. And as you say, the insights, people usually are longer in the roles than marketeers. They, you know, rotate a little bit more often. Gen-AI gives us the opportunity to become more of that kind of knowledge partner, so you know what people need, right? Because the needs are not changing day by day or year by year. It’s the way you can solve them and the way you connect to people that’s changing basically.

Making it culturally relevant, being on top of, okay, what is driving that need? If you apply a Gen-AI first mindset, it is about- what do we know already in terms of insights? And we will have our Gen-AI tools, either internally, either with a supplier, to really mine everything that we have. Get the right insights, the human insights, the functional insights, so how to start it even. And that means that you will be that partner with the marketeer to uncover those insights.