This episode of the RETHINK Retail Podcast was recorded live at Groceryshop 2022 on Sept. 21, 2022.
On the mic this week is guest host Jeff Roster, who is joined by Leslie Vesper, Vice President of Brand Marketing at Frito-Lay, to discuss product innovation and trends in CPG, as well as what it means to be consumer-centric in 2022.
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Jeff Roster:
Hello everyone, I’m Jeff Roster, analyst at Third Eye Advisory and co-host of This Weekend in Innovation. I’m here at Grocery Shop and I had a chance to catch up with Leslie Vesper, VP of Brand Marketing, Frito-Lay North America. Leslie.
Leslie Vesper:
Hi, how are you? Good to be here.
Jeff Roster:
Fantastic. Thanks for joining us. Hey, a couple questions for you. The grocery CPG marketplace has changed a lot in the last few years. Can you talk about some of the trends that you’re seeing in the space right now and maybe even what you’re seeing at the show today?
Leslie Vesper:
Yeah, I’d love to start with some trends and then I’ll talk a bit about what we did today because I think it was a really good conversation in how we’re thinking through the macroeconomic situation that’s happening now and how we can overcome that.
The first trend I would talk about is just grocery, and then because of what grocery’s doing, how retail or how brands have to pivot. Grocery trying to be a part in retail, trying to be a bigger part of consumers share of stomach and wallet.
The example I would give for that is some really interesting stuff that Kroger is doing. I know Walmart is getting to the game as well around ghost kitchens. Bringing ghost kitchens actually into their stores and so when consumers are shopping, maybe they don’t feel like cooking that night, they can go and pick up a meal and it keeps them in the store. It keeps them in their dollars and cents versus having to go home and order Uber, DoorDash, whatever they want to do. That’s a really big trend. Even locally where I live in Texas, there’s an incredible retailer called HEB who have put barbecue restaurants in their grocery stores.
Jeff Roster:
Fantastic.
Leslie Vesper:
I’m not talking, I’m talking high end barbecue snob approved-
Jeff Roster:
How long is the wait because I want to go to Franklin’s Barbecue, but I’m not sitting in line two hours.
Leslie Vesper:
Much shorter, much shorter weight. Again, it’s all about getting more of that share of wallet and share of stomach from consumers.
The other one that I would say we are seeing everywhere is expanding omnichannel presence. Retailers obviously, and this started I think even before COVID, but it was accelerated by COVID. Retailer, they have their normal brick and mortar store, but now they have to do ecom, now they have to do delivery. Maybe now they need a value secondary brick and mortar that they need to have that’s a smaller footprint. As they expand and get into more places and spaces, the CPG world and brands have to then deliver more propositions, more products to fit and tailor to those different channels. It’s interesting, puts a lot of pressure on us to have different innovations and different products available, but that’s another one that I’m seeing a ton of.
Jeff Roster:
Fantastic. How’d your panel go today?
Leslie Vesper:
The panel was great. We were opened up by Bill Aull from McKenzie and he really hit on the importance of innovation. Like I said, even during an inflationary period, consumers and I think they did a study with consumers and they said consumers will pick a brand for three reasons. The first of which is do they have healthier options available for them? The second one is purpose. Do brands or a retailer, are they offering a purpose that consumers can support and get behind? The third one was innovation. We talked a lot about how you need to continue to accelerate innovation and be an innovative company during a time of, again, consumers are concerned about the value of things and how much they’re spending on things like grocery, but they are not going to turn away from innovation. We delve deep into how you continue to be innovative and how it’s so important for consumers today so it was a really good session.
Jeff Roster:
Well what’s interesting about that point is I’ve covered the retail industry, not so much CPG, but the retail and CPGs part of it forever and I’ve never heard the word innovation used more in the last year than I have in the first 30. It’s just amazing the energy and the need. COVID, no one wanted COVID, but I think that clearly was an accelerant for all things innovation. Definitely in retail and CPG too.
Leslie Vesper:
For sure. We talked about, what I loved about our conversations, we talked not just about product innovation which I think is what the first thing people think about when they hear innovation. Certainly CPGs are continuing to accelerate how much product innovation that they do, but also I would say brand and marketing innovation. I’ll give you an example of something I shared. How do you refresh a brand that maybe has been around for a long time that consumers don’t have top of mind to bring it top of mind again? The brand example I used was Cracker Jack. Cracker Jack is a bit of-
Jeff Roster:
My youth.
Leslie Vesper:
Yeah, it’s a bit of an older brand. It’s been around for I think over 125 years. It’s very connected with baseball obviously. Earlier this year, we took a twist on Cracker Jack and we actually launched Cracker Jill. The whole notion was we need to give women and girls a stronger voice in sports and really celebrate the ability of women and girls that they’ve made on sports, the impact they’ve made on sports and their ability to break through barriers.
We launched five new packages featuring different women and girls on the packages, so no product innovation was needed. We launched five new product packages and then we did a donation with Women in Sports Foundation, again to give back and help support women and girls in sports. The point of all of this is you can do something very innovative and get your brand top of mind without having to spend millions of dollars on R and D and all of the work and effort that requires. It was super successful. We got over eight billion impressions and we hope to come back and do it again next year.
Jeff Roster:
You know what I love about what you just said because as an analyst that studied technology and how technology is deployed, a lot of people think it’s expensive. We always have the Amazon. Well, Amazon has $13, 14 billion in R and D, Walmart. Innovation is a mindset.
Leslie Vesper:
It is.
Jeff Roster:
It’s a passion. Probably most importantly if you’re going to be an innovator, you have to be willing to make a mistake or take a risk and you have to, at least I hope, I’m a cheerleader for this, but hopefully your senior leadership says if we made a mistake because we’re being innovative, that’s a good thing and let’s not fire people for trying something new. That’s exciting. It’s an exciting time, I think to be in this industry. Hey, talking about yourself, what does your journey looked like at Frito-Lay?
Leslie Vesper:
I’ve been very blessed. First of all, I’ve been in CPG for 20 years so I’ve had a great career. I started at General Mills, I spent some time at Keurig Dr. Pepper, and now I’ve been at Frito-Lay for about nine years and I’ve had eight roles so I’ve moved around a ton.
I like to tell folks it’s so important to get a lot of different experiences under your belt because when you get to the point of being a vice president or more, you’re going to feel lucky that you had those experiences and those unique opportunities. Eight different roles. I’ve worked across kind of traditional retail. I’ve gotten to work in away from home, which is a really unique and fun space. Ton of innovation during my time at Frito-Lay. I also had the privilege of working on the Doritos brand for two years, get to work on a couple Super Bowl campaign so that was very fun.
Jeff Roster:
Those were amazing.
Leslie Vesper:
Very fun. Then as of late, I am now leading up some of our brands. They’re all about driving share within their categories so think of Tostitos or Dips Business, Smart Food popcorn. Some really fun brands that I get to be part of.
Jeff Roster:
Fantastic. I do a lot of work with some of the colleges and kids always ask me what do I need to do to be successful? I’m curious, what skills do you use today do you wish you would’ve paid more attention to back in college?
Leslie Vesper:
Wow, that’s a great question. I have a bit of a unique background for a marketer. I actually, I call it the dark side. I came from finance and accounting.
Jeff Roster:
Whoa, wait a minute, wait a minute. Okay.
Leslie Vesper:
I know.
Jeff Roster:
Literally you’re the only person ever and by the way, I have an accounting degree too.
Leslie Vesper:
I love it, I love it.
Jeff Roster:
I think that’s why I’m studying technology.
Leslie Vesper:
I started actually my career at P&G on the accounting side and it inspired me to pivot to marketing because of the incredible work that they did at the time. This was the late nineties and they were doing all this incredible brand stretch and breakthrough innovation. Think about things like Swiffer, Crest White strips. Just some really cool stuff that I think today as consumers we take for granted because they’ve been around for so long.
Jeff Roster:
I’ve used that Swiffer a lot with my dogs when they have little accidents. That is the best product.
Leslie Vesper:
It’s the best.
Jeff Roster:
It’s the best ever because it’s immediate and solves the problem immediately.
Leslie Vesper:
It’s the best. The point of this is I’m really blessed and grateful that I have that finance and accounting background as a marketer because I think sometimes, especially if you talk to maybe kids that are in college, they think, oh, marketing’s like the fluffy stuff. Marketing is the creative stuff. I think that’s super critical, but I think people that have both sides of their brain firing and can do the analytics as well as the creative side are the ones that are really successful as marketers.
Jeff Roster:
Wow, fantastic. How do you see Frito-Lay growing over the next few years? What’s your strategy and all of your secrets, if you could tell us that.
Leslie Vesper:
I’m going to tell you all the secrets. No, not really.
Jeff Roster:
I’d be shocked.
Leslie Vesper:
I would say the role that I just came out of, I had the privilege of running our innovation team for the last two years and I actually got to stand up the organization so that was an incredible opportunity. The whole point of restructuring innovation and doing things differently was to deliver more growth. Our goal was how do we drive double the growth from innovation over the next, call it five to seven years.
I think the first thing is being as consumer centric is possible and making sure that everything we do is rooted in what consumers want. If you start there, we did some really incredible analysis kind of in the middle of COVID talking to consumers and understanding how they consume products, but not just our products, all products across all eating occasions.
What we found was there’s so many different eating occasions throughout the day that we’re not a part of. We’ve been on this journey of how we take our brands and extend and expand them beyond traditional salty snacks. Can we stretch our brands into more meal occasions? Can we stretch our brands into day parts they’re not in today? I think that’s where we’re going to deliver a lot of growth. We’re going to address consumer needs, but it’s also going to be highly incremental to ourselves and our organization, which is also a good thing for the finance side of me.
I’ll give you an example. We recently launched a product called Tostitos Toppers. I work on Tostitos, great brand. We’ve been around for decades. We have an incredible tortilla chip product, we have salsas, but it’s a brand that consumers use when they’re making their taco night or when they’re making different products on the side. How do we move the brand into more center of plate? We launched a line of toppers that consumers can use to put on top of their tacos or enchiladas, their nachos. It’s just pulling the brand into more of those center plate meal occasions. It literally just hit grocery store shelves this month so we’re super excited about it. It’s delicious, go out and try it. I would highly recommend the hot version. Very good with a steak taco. There’s my hot tip for the day.
Jeff Roster:
Fantastic. Well Leslie, thank you for joining us. I appreciate all your insights.
Leslie Vesper:
Thank you for having me. I really appreciate you having me here and look forward to the rest of the show.
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