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How PepsiCo’s Vikram Somaya Leverages Data to Predict the Future

Lisa Johnston
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Vikram Somaya
Vikram Somaya

It’s not that consumer behavior has changed as a result during the pandemic — it’s that it’s changed so fast.

Vikram Somaya had been in his role as chief data and analytics officer at PepsiCo for just over six months when the pandemic struck. But while he may have been new to the consumer goods industry, his diverse background has proven to be a unique and valuable resource for the No. 3 publicly owned CG company.  

Having spent several years in data, analytics and operations roles at ESPN, Thomson Reuters and The Weather Channel, the exec has drawn from these experiences to help PepsiCo intensify its connections with consumers and develop the systems required to evolve along with them.

It’s precisely what he did in his previous gigs, where his goal at all three companies was to gain a more intimate understanding of consumer behavior and build systems that could quickly adapt to their changing needs. During his tenure, they not only expanded understanding of how consumers act in “real life,” but also harnessed massive amounts of data to predict their future behavior.

This was particularly true at The Weather Channel, where Somaya and team became adept at understanding how external weather signals immediately impacted consumers’ decisions about such things as what to wear and when to run errands, as well as other daily weather-based decisions.

As they learned that there was significant uniformity in how people in particular geographies reacted when the weather changed in a predictable way, the company worked with retailers and consumer goods brands to create better fulfillment algorithms and other use cases beyond marketing.

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This background naturally translates to his role at a food and beverage company, and organically informs his approach to leading data and analytics at PepsiCo, Somaya says, noting that it enables him to tap into a broad array of consumer interests and explore the potential catalysts for consumers to behave or interact differently.

“PepsiCo’s brands similarly use a lot of these components to grow their global footprint,” he adds, “That’s why we’re constantly growing our ecosystem of data and analytics to empower all parts of the company to better anticipate how our consumers behave.”

Leveraging Data and Analytics To Understand Today's Consumer

As an example, PepsiCo is currently building better predictive algorithms to ensure supply and demand are maximizing revenue and margin. While the pandemic made nearly all historical data essentially irrelevant, the company can understand and react much more quickly than before.

“It has allowed us to really look out towards the future,” Somaya says, “because we needed to build new ways to predict how consumers would behave, and that depended on us building better systems and creating better insight models and understanding consumers in the here and the now.”

While there isn’t really one particular behavior change that’s surprised him during this time, it’s rather the speed and permanence of change that’s most striking. The company witnessed movements toward direct-to-consumer purchases from demographics that were historically not prone to DTC consumption, and they don’t expect this to slow or return to pre-pandemic behavior.

“The combination of the speed and permanence of these shifts, while not entirely unexpected, has certainly been more emphatic than we would have surmised,” he says.

Consumers are also becoming more conscious and sophisticated in understanding how personal data is used for their benefit — including more relevant and personalized experiences — as well as more comfortable exploring and adopting IoT-based experiences to interact with brands.

“Their level of maturity around data will undoubtedly endure post-pandemic,” he says.

Democratizing Data  

Looking ahead, PepsiCo seeks to deepen understanding of its consumers by working closely with its retail partners and digital experiences team. The company sees a significant opportunity for open data sharing across the industry, in part thanks to the increasing maturity of clean-room environments.

As a result, the data and analytics team is increasingly collaborating with the PepsiCo DX and other business teams to survey the market and align on a core set of prioritized approaches to data sharing using innovative clean-room technologies.

This ensures the privacy and safety of its consumer data remains paramount, Somaya says, as well as glean insights about consumers without having to sacrifice very specific levels of fidelity.

"We’re constantly growing our ecosystem of data and analytics to empower all parts of the company to better anticipate how our consumers behave.”
Vikram Somaya, PepsiCo

As part of its digital transformation journey, PepsiCo has embraced raising data and analytics culture and literacy across the enterprise.

“Today, consumers demand more relevant, personalized and streamlined experiences as they quickly move in and out of brick-and-mortar stores, restaurants, gas stations, e-commerce destinations, streaming video, social channels and everything in between,” he says. “These highly dynamic consumer behaviors require a high level of proficiency and understanding of data and analytics across all functions and levels of the company to compete and pave the way forward.”

To achieve this, Somaya’s team has engaged top decision makers across all of PepsiCo in a master class-like session that share relevant business case studies and open up new dialogue around data and analytics.

Leaders in commercial, finance, marketing, supply chain, HR and others have participated in sessions, advancing their goal to establish a common language and vision around a data-informed culture. The next step includes broadening the literacy initiative to the rest of the company.

Looking ahead, Somaya points to artificial intelligence as pushing the CG industry to new heights, noting that PepsiCo is already planning and implementing automation and AI across the value chain to generate greater visibility into business operations. This includes providing decision support to its workforce while simultaneously increasing efficiency and productivity.

“The increasingly deeper understanding of the consumer, unlocked by emerging AI technologies, will allow us to anticipate rather than react to consumer needs and bring our supply chain into a much tighter loop,” he says. “I have no doubt these initiatives will accelerate our ability to create agility in the system and upskill our workforce to allow us to operate more like a nimble company.”  

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