In a keynote session at NRF 2022: Retail’s Big Show, Steven Williams, CEO of PepsiCo Foods North America, discussed his company’s experience during the past two years and what lessons it has learned. Joining him for the conversation was Peri Edelstein, managing director and partner, Boston Consulting Group.
Discussing his career journey, Williams said that as the youngest of nine children, he found no shortage of role models and guides, including his parents. He grew up in in a small town in Oklahoma, where he began working part-time in the local grocery store at 13. He worked his way through college in supermarkets and has essentially spent his life in retail. He’s been at PepsiCo for 25 years.
And how, asked Edelstein, has his leadership style evolved over these 25 years? Specifically, how has it been affected by the pandemic?
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“One thing we knew we had to do immediately,” said Williams, “was put our people at the center of everything. Of 70,000 employees in our company in the U.S., 60,000 either make, move, or sell something. Without healthy people, we don’t have a business model.”
While the pandemic drove many changes for the industry, Williams said that on a fundamental level it will stay the same. “The retail model has been around for many, many years. It’s sustainable.” So, he added, are local supermarkets, whose position has become if anything stronger during the pandemic.
“They’re typically in the community, they’re familiar, and they did a good job of having things people needed. Not in the quantities they wanted, particularly in the early days, but they had something on the shelf.” Going forward, Williams said, there will continue to be changes at supermarkets— more emphasis on fresh, an expanded role for store/ecommerce hybrids like BOPIS—but the stores will still be there.
As to ecommerce, in PepsiCo’s view, the dramatic increase sparked by the pandemic is here to stay. “People couldn’t go to work, so they took their meals at home—and they liked it. That’s sticky. They’re also having their snacks at home.” Creating an ecommerce equivalent of the office vending machine required some fast footwork; Williams said Frito-Lay designed and launched snacks.com in about 40 days.
But being a big brand is about more than just making and selling products. “We’re in 94 percent of all U.S. households. We have a responsibility to build trust,” Williams said. The company is trying to do this is several ways, he added. “One is to make safe food. Another is how we talk to consumers about justice.”
Take a look at other upcoming NRF retail events happening this year.
He shared an example around Aunt Jemima syrup and pancake mix. “The brand had some troublesome associations. We deliberated, we talked to consumers, and we decided to change it to Pearl Milling Company,” he said, noting that Pearl Milling Company had been the original supplier of the pancake mix. “We thought the majority of people who bought the product and loved the product would understand and would want us to change.”
On another front, he said, PepsiCo is heavily committed to sustainability. “We spend a lot of time with our farmers, making sure we’re doing it the right way. One hundred percent of the ingredients that go into Frito-Lay products are sustainably based.” The company has also introduced a line of vegetable-based snacks called Off the Eaten Path that come in compostable bags.
The last couple of years, Williams said in closing, have been difficult. “I worry about fatigue. How much longer will people sustain themselves?” Nonetheless, referring to himself as a “tough-minded optimist,” he sees better days ahead. “People have gotten a lot closer. I’m optimistic about things both individuals and companies are doing to make the world a better place.”
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