Case study - Pepsico: Overcoming barriers for snacks

Sometimes a product just seems to have reached saturation in its market. For no obvious reason, it’s just not clear how to encourage people to consume more. This was the situation for PepsiCo in Brazil where per capita consumption of salty snacks was one of the lowest in Latin America. They partnered with the local team at Kantar to identify new ways to grow.

The resulting piece of work was a deep dive into the motivations for purchase and feelings about the salty snack sector across the country. There were several hypotheses about the reasons for not purchasing such as affordability, availability and health concerns. The quantitative research identified some reasons that were rather different to what had been expected and led to the launch of two innovative new products.

THE NEED
IDENTIFYING CONSUMPTION BARRIERS
The team wanted to really get into the specific reasons for consumers’ choices in this category in order to map and understand the consumption barriers. There were a number of hypotheses to test out across different types of user in what is a very large and diverse market.

THE APPROACH
UNDERSTANDING A DIVERSE MARKET
Through its household panel, Kantar was already providing detailed information about Brazilian consumers’ purchase behaviour. To really tap into people’s motivations and attitudes, an additional questionnaire was addressed to a sample of panellist using LinkQ, Kantar’s questionnaire service. This way both types of data were captured from a single source, which allowed a completely integrated analysis to get the full picture.

The project was divided into two phases. The first phase segmented panellists into Light, Medium and Heavy buyers of salty snacks and also non-buyers. Every segment was very accurately explored in terms of demographics and shopping behaviour.

During the second phase, panellists in each segment were interviewed face to face to better understand habits, attitudes and to identify potential barriers. The survey revealed very promising new product development opportunities for PepsiCo to offer alternative healthier salty snacks.

THE IMPACT
RESPONDING TO UNTAPPED NEEDS
PepsiCo has vision of Winning with Purpose and clear goals for food nutritional enrichment and portfolio expansion to be met by 2025. As a result of the insights gathered about their target consumers, PepsiCo created two new products – both of which were true innovations in the country. They sought to answer the previously untapped need for a healthier salty snack product.

• Fandangos Integral is the very first wholemeal salty snack in the category in Brazil. It’s roasted rather than fried offering a healthier option to consumers.
• PepsiCo also launched a new version of Elma’s Batata Palha – a popular type of crisp in Brazil in the shoestring (shape of small matchsticks) segment. This new version was without salt, the first product of its type to do this.

Both launches were very successful and contributed to the overall strong performance of PepsiCo’s innovations. Across the salty snack market, 92% of successful innovations (475,000 buyers or more) are from PepsiCo, more than double that of any other company. Fandangos Integral was the third most incremental launch in the last two years in the entire Salty Snacks category. It achieved a 1% penetration across the country within the first nine months. To put this into context, Kantar data reveals that only 1% of global launches achieve this in their first year in market.