PepsiCo Putting it all together for Britain’s wholesalers

In our interview in October with Matt Goddard, Wholesale Trading Director at PepsiCo, he spoke about the company’s market leading snacking portfolio, with its Walkers core brand, currently celebrating its 70th year and the Sensations and Doritos sub brands. This time Matt Goddard talks to Wholesale Manager about PepsiCo’s overall portfolio, including juices with Tropicana and breakfast products with Quaker.

“PepsiCo’s power brands,” says Matt, “are essential consumer purchases week in week out, all year round, with high levels of awareness and offtake boosted by high profile advertising and promotional activity. It means PepsiCo is much more than a major supplier to wholesalers and cash and carries, it’s a trusted business partner.”

Matt Goddard heads up PepsiCo’s UK wholesale commercial department and is the person ultimately responsible for how they support wholesalers. He explains the company’s approach:

“It’s important to give our customers in this sector the right products in the right packs at the right price, backed by promotions and visibility. We work with them to give our brands prevalence in depot, online, across the board.”

A key part of Matt’s role is making sure PepsiCo’s products are relevant for wholesale and impulse customers: “As a classic example, we recently moved our case count from 48 to a case to 32, which is better for independent retailers’ stock rotation.”

Matt admits he isn’t very good at sitting behind a desk: “I do my head office bit at the start of the week and the rest of the time I’m on the road talking to customers. Inevitably I get drawn on Walkers but try to include juice and cereals, as both are growing in wholesale and are affected by the foodto- go trend.”

Matt and colleagues work with national customers’ central office buying teams and local depots, as well as regional specialists: “We work with all the UK wholesalers, as far afield as the Shetlands and Channel Islands. We also have field sales teams, who work with our customers’ customers.”

PepsiCo continues to develop its wholesale business, says Matt: “Our wholesale account team is bigger and more experienced now, but impulse has always been a huge part of our business heritage.”

PepsiCo spend a lot of time understanding the market, customer and consumer for their varied brand offering: “Wholesale is a very complex supply chain, with lots of different lenses you can see it through. Pulling out the specifics, in crisps and snacks a key driver is ‘Better for You,’ which is the fastest growing area and where we’re focusing our NPD, for example Sunbites, relaunched this year and Walkers Oven Baked, the biggest snack brand in ‘Better for You.’

“In juices and breakfast, usage is increasingly influenced these days by food to go trends and the move to grab and go. We’re selling more instant consumption packs, for example 300ml Tropicana and Quaker Porridge to Go. There’s an increasing move to consumption on the go generally, and I’m seeing it in my own life.”

PepsiCo are doing a lot to help consumers make healthier choices across their portfolio. Matt picks out some examples: “We have reformulated the Quaker range, taking out a hundred and seventy-five thousand kilos of sugar over a year. In juices there’s a job to be done by us and the wholesalers. Our new Tropicana Essentials range offers more functionality, with very different ingredients, including blueberries and carrots. It’s had a great year since we launched it, but it’s hard to get wholesale customers to go into the chilled room and we need to work in partnership with the wholesalers. Smoothies are in double digit growth, but the challenge there is how to get the wholesalers and their customers on board.”

With the lines blurring between wholesale and convenience and multiple grocers, Matt says it’s “increasingly difficult to define what volume and revenue sits where. But it’s more important than anything to have products that are right and relevant for each operation, and we need to invest in achieving that across the business.”

Matt says snacking, juices and breakfast are all growing and there is momentum and brand growth in all three, particularly at the moment: “Christmas is a very important period for us. This year there’s strong confidence coming out of the exceptional summer sales period we’ve had but in general as the weather gets lousy people eat more porridge, they trade up on Tropicana and crisps and snacks are strong right through to the Christmas break, when sharing bag sales are bigger than ever.”

Speaking of sharing, despite our busy lives and more of us eating on the go, says Matt, sharing is still the biggest segment of snacking overall and Walkers have three of the top four sharing packs.

Turning to Tropicana, consumers were originally attracted by its healthy proposition, but recently the audience has widened:

“We now appeal to a broad spectrum, and chilled is ahead of ambient. Commuters drink Tropicana to be healthy on weekdays and are more relaxed about how they consume it at weekends. Not from concentrate and freshly squeezed are growing but it’s hard to do ‘freshly’ from a supply chain viewpoint. Juice consumption is still heavily skewed to breakfast and purchase varies between on the go and convenience, including top-up shopping for the next day.”

Similarly, the majority of Quaker consumption is breakfast through to lunch, says Matt. On the go is expanding and spreading over the morning, with the category forecast to grow by 18% in the next year: “The biggest fluctuation is of course the temperature, but people are eating porridge all year round now, rather than the spikes we used to see with cold snaps.”

Quaker has been expanding its on the go offering with Protein products joining Quaker Oat Drinks, which are seeing continued growth in ‘OTG.’ One of oats’ big attractions is the health aspect, which is drawing in a new generation into overnight oats.

Going back to snacking, this is Walkers Crisps’ 70th year, and PepsiCo has been celebrating in style: “The seventieth birthday campaign has gone really well. We started with taking a moment to thank the British public and the past products we brought back created loads of excitement.”

2018 then saw the Walkers regional flavours execution across the trade, and now PepsiCo are giving Christmas the full Walkers experience with a Christmas flavour range, including Brussels Sprout crisps, plus TV ads and full trade support.

“We haven’t invested in Christmas for a couple of years,” says Matt, “so this Christmas is exciting for us. It’ll be interesting to see how consumers pick it up.”

Looking at the wider picture, wholesale is an exciting sector to be in, says Matt: “We have access to the largest possible number of points of sale. Going forward we need to look at how to attract interest in food-to-go sales in foodservice as we do in retail. Looking at other ways of growing the market, digital is here to stay. It’s not easy to harness it but the only way is to maximize on digital and get involved. The biggest risk would be to ignore it.”

Matt sees the structural changes taking place in the industry as a spur to further success: “No-one’s seen the impact of the Unitas merger yet, but all this changing and merging makes wholesale is full of potential. In a period of uncertainty people need to be efficient and stay focused on incremental sales, increasing demand and driving revenue to wholesalers and suppliers.”

Matt stresses that PepsiCo is set up as a simple company for customers to work with, supplying them as one business across the categories, with one account manager per customer as far as possible. His advice for wholesalers about category management is equally straightforward:

“You need to concentrate on the core range, particularly in snacking. Wholesalers tend to stock a plethora of lines and we need to focus on working with them at local level, helping them on ranging for the bestsellers. Sixteen percent of category growth has come from NPD in the last twelve months, but you must stock the right NPD!

“Going back to the core range wholesalers need to focus on signposting it, making people aware of where the product is. From a wholesale perspective, we’re seeing thirty-eight percent year on year growth in the ‘Better for You’ segment, so depots need to signpost these products. This has not changed!”

Finally, as he ends our conversation, Matt remains elusive about what PepsiCo have in store for 2019: “We’ve always got exciting new plans coming down the line. No-one would have expected Quaker Oats in a drink. Historically we created the snacking category with Walkers and Doritos and come up with lots of firsts, so yes, there will be more surprises.” We shall keep you posted.