Posted onOctober 7, 2014
CMO One-to-One: PepsiCo Trains to Tackle Digital Challenges
AN INTERVIEW WITH: Bonin Bough,Senior Global Director of Digital and Social Media,
December 14, 2011
Pepsico: Senior Global Director of Digital and Social Media
IPG & Weber Shandwick: EVP and Director of Global Interactive, Social and Emerging Media Practice
Ruder Finn Interactive (RFI): Founding Member and SVP
Net Revenue for 2010: $57.8 billion (PepsiCo)
US Total Ad Spend for 2010: $1 billion (Ad Age’s “100 Leading National Advertisers”)
AUS Measured Digital Ad Spend for 2010: $35.3 million (Ad Age’s “100 Leading National Advertisers”) (excluding search)
NOTEWORTHY TWITTER POST?
“I think the Steve Jobs [dying] news was pretty interesting, because it was a strange moment that you didn’t know whether it was true or not. The whole conversation went from confusion to despair to a very emotional time. I grew up with and have spent my
entire life with computers and Apple. And this guy was an icon, who represented so much in terms of everything from second chances to following your gut to creating cultural movements. It got me really nostalgic. I went back and watched the Steve Jobs
video interview at All Things D … and it brought tears to my eyes.
That all started from the power of that tweet.”
In this series, Question interviews CMOs and other top marketing executives who are leaders in the digital space.
[Editor’s Note: In early February 2012, Bough was named vice president of global digital and consumer engagement at Kraft Foods.]
Question: Fortune magazine placed you on their “40 Under 40” list.
Obviously, that’s got to be a big plug for your personal brand. In today’s digital social world, what do you think is the role of the individual brand within the company brand?
Bonin Bough: I think that the individual brand has a greater obligation to really believe in the mission of the organization that they’re a part of. I feel very lucky every single day to wake up to work for not just a leader and leaders who I believe in, but also an
organization that I believe is actually changing the world. I think it goes back to kind of the central ethos by which PepsiCo runs their business, which is performance with purpose.
So, how are we creating or rethinking how we’re delivering sustainability back to people and the planet in a way that creates entirely new revenue models for us, but also new models that can help shape the industry and be leaders? That, to me, is super exciting.
While I personally stand for things and belief systems, the majority of my day is spent helping to move an organization forward, and so that’s really what I represent.
Question: You run a digital fitness camp at Pepsi, which is about educating executives about their participation in digital and social media in particular. In two years’ time, what would you like decision making executives at Pepsi to understand about social media that they don’t currently get?
“If we want to be a leading organization, then we have to be the most digitally fit organization in the world.”
Bough: If we want to be a leading organization, then we have to be the most digitally fit organization in the world. This is so far beyond just marketing and communications—this stretches from everything from supply chain to sales. If we want to win, one of the components of winning will be continuously educating our global organization on how to use, leverage and think about digital in every aspect of their job.
That’s the reason why we called it “fitness”—because this is not about one time. It’s the same way you get physically fit. It requires commitment. It requires rigor. It requires a continual regimen and pushing yourself past the point of where you want to say no. How do we make this a continuous commitment to changing at the pace at which innovation is occurring today? If we don’t, we’ll miss an opportunity to leverage one of the biggest platforms that we have for innovation—digital.
Question: Thinking about Pepsi as a global leader in social media, can you tell us about a couple of initiatives in China or another emerging economy that are particularly innovative or interesting?
Bough: We’re doing things that are spectacular in every one of our regions. But some of the work that we’re doing in Brazil is probably some of the best work I’ve ever seen. In the U.S., digital is part of an industry. In Brazil, digital is actually a part of youth culture, and it shows what I believe is going to be a trend across the globe: Digital is now culture.
In these emerging markets [digital] has now leapfrogged a lot of things and become a part of mainstream culture. The same way that you see celebrities being held up as kind of the beacons of culture or music, you are going to now see digital operate that same way in these emerging markets. I think that’s the most interesting thing that I’m seeing as I walk around the globe. Our ability to identify that early and start creating programs that take advantage of that growing youth digital culture is huge.
Question: If you think about the world and how we’re all connected, social media is often seen as the glue that holds everything together.
What are some of the challenges that you face as a global company that’s trying to market to different places around the world?
Bough: I call it “borderless brands.” In a world where brands have no borders, what does it mean to operate? What does communication really look like? What does it mean to be a global brand? What does it mean to communicate messages that resonate globally but at the same time can connect at a local level? It’s really extremely difficult.
While we might be kind of advanced in our approach to it, I don’t think that anybody really has the answer yet.
“There are only a few global players—media companies that actually have global reach—and most of them actually sit in the digital space.”
There are only a few global players—media companies that actually have global reach—and most of them actually sit in the digital space. I would argue that most organizations aren’t even set up to manage global relationships. We’re not just finding that we have to change as an organization, but all of our partners are going through transformations, and we’re actually helping push them.
The short answer to your question is that it creates a number of challenges. It creates tough questions that you have to look at your organization and say, “Do we actually have the organizational muscle to be able to deliver against this?” And if you look at a lot of the changes in our organization, you will see that we are going to global structures. We’re rethinking what it means as an organization to be able to deliver against this new consumer imperative.
The last piece is do you have the right tools, infrastructure and communications in place to actually be able to decipher and connect on a global level? When you think about organizations like ours, we are also massive data companies. Do we have the ability to understand and provide analysis of global data? And data is only going to increase
as consumers start telling us what their location is and what product they actually purchased.
Question: Pepsi is in the midst of a big social campaign around “The X Factor” TV show, and apparently there’s been a huge lift in consumer awareness around Pepsi’s commercials. Is that lift the measure of your success, or are there other measurements that you use?
Bough: The measure of our success is how is the business doing at the end of the day. Everybody looks for a silver bullet measurement for digital, and I actually think that it’s a lot simpler than that. It’s about going back to the basics of business objectives and business outcomes and then aligning to that. The leading indicators are things like greater awareness. And when we’re using companies like Bluefin (the social TV analytics company), which are spectacular and outrageously smart, to help understanding, we’re actually transforming what it means to measure our media efforts in traditional and digital channels all at once.
Question: It sounds like you’re in some ways correlating exposure or impression-based messages to some kind of brand-health measurement and that, in turn, leads to bottom-line sales results.
“We have a ton of learnings: What does it mean to engage with people during TV spots? What does it mean to track engagement based on TV awareness?
Bough: We have a ton of learnings: What does it mean to engage with people during TV spots? What does it mean to track engagement based on TV awareness? What does it mean to engage with people at launch? We have a ton of learnings that we’re now pulling out to use to maximize our digital efforts across other parts of the business. We
also, quite frankly, have learned a lot, including, What are true leading indicators that can be identified using digital?
Question: Would you say that you have mastered the impossible, which is to measure the return on investment on social media efforts ?
Bough: No, I don’t think we’ve mastered the impossible. I think what we have is an understanding of how our business can best utilize [social media] tactics. I don’t think anybody has mastered that. But I think there are a lot of marketing efforts where ROI is elusive anyway, and I actually think that ROI is closer in with social media. What you’re
going to see is a massive transformation as the industry starts investing even more in the space and we start connecting it even closer to redemption and consumer actions that are tied even closer to the business.
The reason why I would say I don’t think we’ve mastered it is because I actually think we have a long way to go. I mean, Facebook is 5 years old. How can we have mastered anything? These are very, very young tactics. But we do see the impact that [social media has] had in various places in the business. These channels will help us
revolutionize consumer engagement. The consumer is already being revolutionized by it.
Question: Do you factor in the consumer learnings that you get from social media monitoring?
Bough: That’s why I would say that nobody’s mastered it yet, because we don’t even know how to value that. With Mission Control (a PepsiCo consumer-listening center that monitors, reacts and engages with consumers), the goal was to get real-time insights and real-time engagement to bring those two things together. So we’re learning: What is a real insight? What is a product insight? What is a communications insight? What are insights that can be derived from this? And we’re doing that with some of the best and brightest minds in the entire marketing space, which is super exciting.
Or when you look at the stuff that we’re doing on PepsiCo10, our open call for emerging technologies, which we ran years ago in the U.S. and we ran in Europe, and we’ll be launching again next year in some of the emerging markets, two years ago we were running pilots and understanding how we can use second-screen technology to
transform consumer engagement. What you’re seeing now come out in programs where we are using second screen is based on the learnings that we started [getting] two years ago, and we’re doing that globally. I don’t even know how to value that quite yet.
Question: You must place a big value on experimentation.
“No longer are we going to be on the back foot when a new technology like Twitter comes out.”
Bough: Oh, it’s huge. What’s great about PepsiCo10 is that it’s not the digital groups that are activating it. We work directly with the brand, so the brand leaders are activating this with emerging technologies that are less than 2 years old. Some of them have never even drafted a PowerPoint but are on the cutting edge of consumer engagement technologies. No longer are we going to be on the back foot when a new technology like Twitter comes out—we’re going to have seen it. And even more than seeing it, we’re going to have experience understanding what impact it can actually deliver to the business.
Question: What do you see as the next frontier beyond Facebook and Twitter in the digital space?
Bough: Mobile still needs to be addressed, but I think that the space in and around the couch is going to be revolutionized. Every single manufacturer who creates TVs has one that’s connected to the Internet. Eventually the “App Store on TV” is going to open up. It’s going to be a really exciting and fun time, and, I would argue, a time that is going to require a lot of deep thinking and rethinking about how you engage in that environment.