PepsiCo Focuses on 'Better Together' Strategy
NEW YORK — PepsiCo Inc. will continue to leverage the benefits of coordinating its snack and beverage businesses through its "Better Together" plan, company officials said Feb. 20 at the Consumer Analyst Group of New York (CAGNY) Conference.
"The promise of Better Together is realized when we innovate for these common or complementary needs, position our brands as a portfolio to meet different needs, and drive co-merchandising and co-promotional support," stated Brian Cornell, CEO of PepsiCo Americas Foods.
Cornell cited the pairing of a limited-edition Doritos gamer pack and Mountain Dew game fuel as a past successful example of the company's co-promotional efforts. Buying each product allowed consumers to earn points and the chance to win an Xbox One.
Currently, PepsiCo plans to leverage and pair together its Tropicana, Naked and Quaker brands in the morning; Starbucks beverages and Frito-Lay multipacks throughout the day; Doritos and Mountain Dew for young, hungry customers; and Pepsi carbonated soft drinks and Tostitos chips and salsa for fun occasions.
"Our foundational demand space insight helps us better understand how to position our brands to meet these common or complementary needs. These insights also drive new innovation, as well as the promotions we design," Cornell said. "Understanding how to best fulfill these common or complementary needs is the basis for our approach to Better Together."
Two years ago, a major investor called for PepsiCo to divide its snack and beverage units, but the company remains committed to doing the opposite. "Our focus right now from a North American standpoint is how we optimize our volume, profit and share and operating cash flow as one PepsiCo company that is in both snacks and beverages," Cornell said.
Overall, PepsiCo's strategic playbook is anchored on four key priorities:
- Building its brands;
- Driving consumer-led innovation;
- Enhancing execution; and
- Continuing to deliver productivity.