the secret behind successful f&b product development – the customer andrew spencer, director...
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The Secret Behind Successful F&B Product Development – The Customer
Andrew Spencer, Director Customer Insights DNC
Todd Kaplan, Brand Director Mountain Dew
Being Focused on Customer adds Value
Kickstart by Mountain DewTodd Kaplan - Director of Brand Marketing
There are no new ideas…
Innovation Overview
…yet we are living in an era of perpetual innovation
Why do some succeed?
Innovation Overview
…and others fail?
Innovation OverviewWe know it isn’t as easy as...
LANDING ON A KEY INSIGHT
LETTING THE PROPOSITION
SELL ITSELFGOING WHERE
NOBODY ELSE IS
HAVING A GREAT TASTING PRODUCT BEING FIRST
GETTING A NEW LOOK
1. KEY CONSUMER INSIGHT
2. PRODUCT DEVELOPMENT
3. PROPOSITION AND IMAGE
4. MARKETING PLAN
5. EXECUTION
We will continue to learn, try new things, and evolve as we go through the innovation process at PepsiCo
Looking at products that have done well, the stars have generally been aligned around 5 core elements…
Innovation is HARD
1) Unearthing a Key Insight
Key Considerations:• Know the consumer • Understand the true need • Understand the barriers• Recognize the current
landscape
• Opportunity exists to revive morning occasion at C-Stores• 2nd largest occasion• Trips and $ per trip declining
• Millenials not satisfied with current morning offerings• Millenials + Gen X make up more than half of morning occasion• Hot Coffee and Juice account for more than half of occasions• Millenials under-index on hot coffee and juice
• CSDs under-index on AM occasion
2) Getting An Optimal Product
Key Considerations:• Taste• Efficacy• Ingredients• Calories• COGS• Testing
Kickstart Formula:• Dew + 5% fruit juice • Caffeine > Dew• Vitamins C & B• Mid-Calorie (80/can) • 2 Flavors:
• Orange Citrus• Fruit Punch
3) Nailing the Proposition and Image
Key Considerations:• Cannibalization• Occasion• Package Type• Package Size• Brand Hierarchy• Name• Role of Ingredients• Graphics
Creating a Sub-Brand:• Position around AM occasion• Establish role of name / Dew• Rigorous Consumer Testing
• Dew users significantly interested in trying KS
• Strong projected repeat• Projected incremental to
LRB and CSD category
4) The Marketing Tidal Wave
Key Considerations:• Awareness• Trial• Creative • Media Mix• Timing• PR
Integrated Campaign:• TV, OOH, Digital• PR: Over 500MM+
earned media impressions
• March Madness Promo with ESPN
• Mike & Mike Integration
• Over 2MM+ samples• Digital ‘Dawn Patrol’
5) Executing with Excellence
Key Considerations:• Distribution• Pricing• Bundling• On Shelf Execution• Equipment• Value• System Focus
Getting it on Shelf:• Line Priced with 20oz• Over 65 ASPs • Multiple IRCs for trial• Meal Deal Partnerships• Right Equipment / Tools • Precise System
Communication
The Results
• Kickstart is the biggest PepsiCo beverage launch in the last 10 years!
• #1 LRB Category Innovation in 2013• Projected to reach over $180MM in Year 1
• Achieved its distribution targets across all channels in first 2 weeks
• In C&G Kickstart dollar sales are bigger than Coke Zero 20oz and 6x bigger than Dr Pepper 10
• Among highest repeat rates of any recent beverage launch – 48% vs. 32% avg• 153 index to LRB, 137 CSD
• Highly Incremental:• 85% incremental to TM Dew• 75% incremental to PEP CSDs• 43% incremental to CSDs• 10% incremental to LRB
Kickstart your Night…
…coming soon in 2014!
Where do we go from here?
Questions
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DNC Tools for gathering Voice of the Customer data
Delaware North is investing in processes and systems to capture more VOC more
efficiently
Internal
Integrating Multiple Sources- Primary Research- Social- POS- Insights and Trends
Total Listening™ process provides us with 360⁰ degrees of gathering customer insights
Delaware North using community panel to talk directly with NHL fans
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750
198
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212NashvilleColumbusBoston
652 NHL Panel Members
• Understand challenges and problem areas
• Understand Site by Site what is missing
• Direct Feedback on Concepts, food preferences and local optionsFast Flexible
Focused
Total Listening™ Community Panel
Highly flexible tool to gather insights...
“Transporting can be tricky, so I take that into consideration when purchasing my food. Food vendors on the first level, while they have a better variety of food, transporting to get the condiments or to find a place to sit can be tricky.”
- Nashville Female STH
What is most inconvenient about ordering or buying food/ beverage at the arena?
43% of STH Under Spend Budget
…and create innovative packaging that solves the problem and captures more of
the budget
Two Andrew Spencers at DNC
Andrew Spencer
Andrew Spencer (CORP)
Contact:Andrew Spencer (Corp)[email protected] 858 5127
Thank you very much Todd & Pepsi!