How PepsiCo is leveraging digital with its big data platform

The company started experimenting with big data a couple of years ago, and has now created a platform it calls Pep Worx.
8 October 2018

How’s PepsiCo doing in the store? Source: Shutterstock

Do you think that PepsiCo randomly places its products at a supermarket? It doesn’t.

The multinational food, snack, and beverage company owns Pepsi, Lipton, Tropicana, Gatorade, Aquafina, Frito-Lay, and Quaker among many others — and pulled in revenues that summed up to US$63.53 billion last year.

Much of its phenomenal market performance is a result of a proprietary big data and analytics platform that it has developed. It helps retail chains such as Kroger and Dollar General understand which items to stock, where to place them, and what kinds of promotions to offer.

Dubbed Pep Worx, the cloud-based data and analytics platform helps the company and its retail partners make more informed decisions on PepsiCo product assortments and merchandising by identifying valuable shoppers by location.

According to Supermarket News (SN), Pep Worx helped PepsiCo identify 24 million households from a dataset of 110 million US households that it felt would be the right audience for Quaker Overnight Oats, a single-serve cup of dry oats soaked overnight in milk or yogurt in the refrigerator to provide a healthy, cold breakfast cereal by the morning.

The company mapped these households against shopping venues — both brick and mortar and online — where these consumers were most likely to shop.

“We were able to launch the product using very targeted media, all the way through targeted in-store support, to engage those most valuable shoppers and bring the product to life at retail in a unique way. These priority customers drove 80 percent of the product’s sales growth in the first 12 weeks after launch,” Jeff Swearingen, Senior Vice President of Marketing at PepsiCo told SN.

And although this is a great victory, PepsiCo didn’t get here overnight.

For several years now, the company has been working with a variety of vendors and experts in order to transform how it handles data.

In fact, before helping retailers, the company turned to big data to understand the billion-odd customers it served and transform its supply chain in the 200-odd countries it operated in. The company definitely collected a lot of data, but up until it decided to leverage its data, it spent most of its time arranging the data into manageable reports.

It was only when the company began thinking about the value locked away in the data that it started thinking of ways to free up time to analyze and interpret the data — and use it to make better forward-looking management and business decisions.

Truth be told, getting started with big data might not be easy (or glamorous, as compared to AI and IoT), but it’s something that can, over time, help make a big difference to the business. In fact learnings from big data analysis tend to create opportunities for outsized returns — as PepsiCo did with Pop Worx.

The future belongs to companies that get excited about and started with big data today. It’s not a competitive advantage anymore, it’s a business need. The sooner that businesses understand it, the better.