PepsiCo goes for digital transformation

In the last one year, snacks and beverages maker PepsiCo India has gone all out to develop “collective digital skills” within the organisation.

Among various other measures, the company has tied up with Facebook and Google to train and certify its employees on digital skills.

The company already has a nine-member ‘Y-Comm board’ that represents the millennials or Generation Y that works closely with the senior management. The board has now been tasked to develop the “collective digital skills” in the company as well as “reverse mentor” seniors.

The company has also founded a corporate consortium for digital transformation in collaboration with companies such as Godrej, Nestle and Diageo. The consortium is working with IT expert Ram Nidumolu and his associates to build digital capacity in their organisations.

Recognising that the company may not have enough in-house capability for training, the company has also roped in academicians to conduct classroom and online sessions to sensitise its employees about digital models being used in developed markets such as the US.

“Digitisation is going to be one of the biggest disruptive forces for the industry in the coming years. At the first level, we do ‘social listening’ on a daily basis to see what consumers are saying about our brands on social media. This data is shared with everyone in the organisation. At the second level, I believe the company needs to develop digital capabilities as a collective skill in order to prepare for the future and that’s what we are doing for the past 12-18 months through these initiatives,” said D Shivakumar, Chairman & CEO, PepsiCo India. At the same time, the company is focusing on end-to-end digitising from sourcing to selling in a bid to build efficient cost and inventory structures.

Talking about the company’s e-commerce strategy, he said, “For e-commerce, we are clearly led by the principle that we will do things right and it should be profitable for us. We have not spread ourselves too thin, we work with very few partners,” he said. The company is also increasingly using e-commerce as its testing platform to gain consumer feedback for new product launches.

The company’s e-commerce partners include Amazon, BigBasket and Grofers. Shivakumar believes that consumers are expected to increasingly opt for subscription models for categories like FMCG in the future. A large chunk of the company’s online sales are driven by its nutrition-led brands such as Tropicana and Quaker.

In terms of its engagement with consumers too, the company is shifting tracks keeping in line with its digital transformation strategy.

“I think brands and consumers are looking for “sources of authority” instead of just celebrities. For instance, we have Vikas Khanna, who is not just a celebrity chef but also a huge source of authority, associated with Quaker. Consumers believe it is worth listening to his recipes. So we are pushing engagement strategies and brand content in that direction, instead of just plain advertising,” Shivakumar added.

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