S3 E3: General Mills’ Kitchen of the Future – With Jay Picconatto and Michael Stich

FIVE: Innovation for Marketers

Jake discusses the innovative thinking behind some of the most recognizable, most iconic packaged food brands with Jay Picconatto, Global Media and Commerce Lead at General Mills and Michael Stich, General Partner and CEO of Services at Court Avenue.

When you think of innovative companies, you’d probably reel off a long list of companies before you’d name a packaged food company that’s been around for 150 years. General Mills’ longevity and durability are a testament to their think-forward culture and the innovation going on behind the scenes.

General Mills brands are likely part of your childhood memories and on your kitchen shelfs right now. And, even if the kitchen looks totally different in the future, General Mills plans to be there too. But how does a company sustain proven long-standing brands while also staying innovative enough to thrive in a fast-changing world?

Jake and his guests explore five aspects of innovation at General Mills:

Jake’s FIVE List:

1. Shaping consumer experiences in the changing world, including General Mills’ forward-looking initiative, The Kitchen of the Future.
2. How General Mills goes from identifying a consumer problem to implementing an innovative solution
3. How they structure for success today and balance that with visionary change for tomorrow
4. The challenge of personalizing messages and brand experiences in the era of privacy and an industry where retailers own the point of purchase.
5. The future and impact of sweeping changes as digital and physical grocery become more and more intertwined.

You can talk to any time-stressed parent and go, “What is one of the biggest pain points you have in your day as it relates to meals?” And, they’re going to say, “Deciding what’s for dinner.”
– Jay Picconatto on consumer decision fatigue

Host Jake Moskowitz and guests Jay Picconatto and Michael Stich talk about the kitchen of the future and what it takes to build brands and personalize brand experiences in the packaged food industry. Along the way, Jay shares some of the fascinating challenges and cultural nuances of the business, including the very real problem of 5:00pm decision fatigue and the future of front-of-house grocery stores as show places, rather than stores of stocked shelves. And, he muses about the old days when a great TV ad could make his year. Michael shares thoughts on the nature of their partnership (based on innovation) and points out some little-known developments occurring in the tech world that will change the nature of personalized marketing.

Some other stuff said by Jay and Michael during the conversation:

“Every part of that journey needs to be shoppable in the future, needs to drive conversion instantly.

– Jay Picconatto on the customer journey

“We’re going to get to a place where you’re going to be able to walk down the street, take a picture of whatever you want and it’ll be delivered to your house in, you know, a day.”

– Jay Picconatto on the customer journey

“You know this is not just five o’clock this is the course of the entire day. And, the role of that home hub really evolves from what we need it to do for us when we wake up through to the end of the day.”

– Michael Stich on the kitchen as an evolving hub of the home

“If you really fast forward 5 years from now and you take a look at things like semiconductor technologies and content evolution, what we see is the opportunity for us to anticipate increasingly predictive and intelligent and assistive experiences that overlay on top of the tasks that consumers have through the course of their day.”

– Michael Stich on personizing experiences

“I think the way we’re going to build brands in the future is through performance marketing and today we bifurcate them.”

– Jay Picconatto on the changing nature of performance vs. brand marketing.

“Merchants are starting to feel if we’re doing great online but not in store. it’s much more of an omnichannel sales discussion to have versus what’s selling in store, versus what’s selling online as it relates to assortment and availability, shelf space, display space et cetera.”

– Jay Picconatto on the evolving dynamics of CPG commerce.

“The value of a brand in this age of a hyper amount of information has never been more important and that brand must be modern. It must be rooted in purpose and appealing in terms of its base value proposition to us on a human level.”

– Michael Stich on building brands that matter.

Additional episode resources:

Learn more about Emodo and the Emodo Institute: EmodoInc.com

Guests: Jay Picconatto, Michael Stich

General Mills’ website: generalmills.com

Court Avenue’s website: courtavenue.com

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Transcript of S3 E3: General Mills’ Kitchen of the Future – With Jay Picconatto and Michael Stich

Jay:

What we see is the opportunity for us to anticipate increasingly predictive and intelligent and assisted experiences that overlay on top of the tasks that those consumers have through the course of their day.

Jake:

Let’s talk innovation. Welcome to FIVE, the podcast that goes deep into marketing innovation, the big ideas in marketing and the marketing of big ideas. This is episode three, General Mills kitchen of the future. I’m Jake Moskowitz. Last episode we explored the innovation behind the rise of grocery commerce. In this episode, we’re going to venture directly onto those grocery shelves and look at the innovative thinking behind some of the most recognizable, most iconic packaged food brands.

General Mills is an institution in the consumer packaged goods sector with products known and loved around the globe. Brands like Betty Crocker, Green Giant, Pillsbury, Haagen DAAS, Nature Valley, Progresso, Yo Play, and of course, some of the world’s most iconic cereal brands, including Cheerios, Checks, Kicks, Tricks, Lucky Charms, and the breakfast of champions, Wheaties, which recently celebrated its 100 year anniversary. 100 years! And the company’s been around even longer.

Odds are General Mills brands are part of your childhood memories and on your kitchen shelves right now. And even if the kitchen looks totally different in the future, General Mills plans to be there too. But how does a company sustain proven long standing brands while also staying innovative enough to thrive in a fast changing world?

That’s what this episode is all about. When you think of innovative companies, you probably immediately think technology, the companies that build new gadgets, develop software apps, cloud based services, maybe a few automotive brands. You’d probably reel off a long list of companies before you’d name a packaged food company that has been around for 150 years. This episode of FIVE is likely to change that. You don’t stay that relevant for that long without continual introspection and a culture of innovation.

General Mills longevity and durability are testament to their Think Forward culture and the innovation going on behind the scenes. Behind the scenes is a key point. As consumers, we tend to think first of the innovations that we experienced directly in our daily lives rather than those that invisibly improve the ways we select and access the things we need. Don’t get me wrong, General Mills is creating innovative brand experiences for their consumers, no doubt about it super interesting things like brand NFT’s, social community apps, AR games. There’s even a Lucky Charms album promoted on Spotify.

But inside General Mills walls there are all kinds of visionary ideas in motion to help ensure that your favorite food products are available, conveniently accessible and magically delicious years into the future. At General Mills, there’s a different kind of prize inside every iconic box of cereal, the kind of prize that will make it even easier to keep your cupboard stocked and good food on the table. That prize is innovation.

In this episode, I talk with two guests, longtime friend of the pod Michael Stich of Court Avenue, and Jay Picconatto, a 22 year veteran of General Mills. Jay’s global purview at the CPG giant includes both media and commerce. Michael and Jay or their companies have a partnership that’s more intertwined and deeply rooted than your typical agency client relationship. It’s a partnership based on innovation. I’ve really been looking forward to this conversation with Michael and Jay. I know it’s going be really insightful, but there’s only so many things we can cover in so much time.

So I’m going to focus on five. How General Mills goes from identifying a consumer problem to implementing an innovative solution, how they structure for success today and balance that with visionary change for tomorrow. The challenge of personalizing messages and brand experiences in this evolving era of privacy and within an industry where retailers own the point of purchase. And we’ll discuss the future and impact of the sweeping changes as digital and physical grocery commerce become increasingly intertwined.

But first, I want to know more about how they envision consumer experiences in their changing world. Three years, four years, five years out for General Mills that world is the kitchen. So we’ll start with General Mills’ forward looking initiative, the kitchen of the future. Michael, it’s always great to talk with you.

Michael:

Thank you. Let’s talk with you again, Jake, as well, thank you for the invitation.

Jake:

And we also have Jay Picconatto, global commerce and media lead at General Mills. Jay, it’s great to meet you and have you here on the pod.

Jay:

I appreciate it.

Jake:

So global commerce and media sounds like a big job, can you give us a little flavor for what that means in terms of your day to day focus and responsibilities.

Jay:

Certainly, on the media side, it is ultimately responsible for the media investment that General Mills runs, the commerce site is a little bit more bifurcated. I have sort of three streams under that and kind of the day to day one of them is really about commerce capabilities for the globe. How do we support our ambitions in the world of connected commerce and really getting after E commerce in a meaningful way. I also have our loyalty and rewards team as part of that. And that’s really about how do we drive differential advantage from leveraging our portfolio to get after loyalty platforms and loyalty execution across the marketplace, and then have a little bit of focus on our data strategy. And as we think about the role of first party data in the future is cookies diminish and the need to have a strong plan on both acquisition, housing and then actually application of that data.

Jake:

That sounds fabulous. And I understand that the two of you are working on some really innovative ideas in the packaged goods space. And I wonder if we could spend the first couple of minutes touching on those.

Jay:

I want to visualize my plan in a different way. So as I show out a roadmap for what I’m trying to accomplish in the world of data strategy, but actually how that comes to life, from a commerce lens. How do I bring it to life in a way that’s not just a PowerPoint? And that’s what I started with Michael, the General Mills is a 150 year old food company. And we know a boatload about product and we know a boatload about consumer interests. And when it comes to really understanding and going deep into what we think the world of the kitchen, and how people are going to interact with their kitchen and device is going to be in the future, we don’t spend a ton of time thinking about it. And so that’s where I really pushed on Michael, to help me go, Hey, let me see A how I visualize what I know I’m doing today, but then B how do I actually think about what the future of a kitchen is going to be? How people are going to interact with their devices, and where a brand can play a role within that, to start to bring the life where a roadmap from an innovation standpoint on the commerce team needs to be, that’s really where Court kind of stepped in and took the reins.

Jake:

So I love that concept of a kitchen of the future. Are there a few core things that have risen to the surface as being real game changers for your space?

Jay:

I think, you know, when we’re talking about connected devices, internet of things that’s going to be living in our homes, and frankly, how phones have to sort of become the lifeblood of how we do anything today. That has been a big part of the unlock. We’re a huge portfolio company that has a really good breath to drive solution. And so it’s how do you marry that solution, whether you’re talking about meal planning, pet, how you interact with your veterinarian, how you connect with retailers, it’s all going to be at a hub of a home in the future. And we know, we’ve driven a lot of E-commerce growth over the last 12 months with the pandemic. But the reality is, it was moving there anyway. And that’s just accelerated it. And so as we think about how devices are going to be able to start to talk to each other and place your orders and ultimately start to drive your fulfillment. It really comes from this solution orientation that we have. And as we get into the further discussion on innovation, I think innovation really spawns from a deep empathy of consumer needs, and ultimately delivering solutions against those needs. And if we really are talking about the oh shit moment mom has at five o’clock when she’s trying to figure out what’s going to be for dinner, and we have a solution that’s baked into her connected home. And that’s perfect. And that’s going to be fulfilled in a way that I think General Mills can deliver.

Well, people don’t necessarily understand the solution they’re looking for, they can pretty regularly articulate the pain they’re feeling. So let’s pick decision fatigue. And decision fatigue is very real. You can talk to any time stressed parent and go what is one of the biggest pain points you have in your day as relates to meals? And they’re gonna say deciding what’s for dinner. They don’t know what the solution is, like, is it a meal planning app? Is it a recipe, similar houses at the dark ages that are producing food for them on a daily basis? I don’t know what the solution is yet that’s gonna fulfill that need. But that pain point is real. And people are pretty good at articulating where they’re feeling pain.

Jake:

I’d love to walk through the process of how you go from that’s really like the problem that you want to solve, starting to touch on what are the solutions that could maybe answer that problem? But then from that point, how do you implement those solutions? What’s the process of getting that through your organization to the point of full implementation? How do you think through that process?

Jay:

So you’re now on this notion of what we would call connected commerce. But we truly understand consumer journeys at a personalized level. That’s the connected part. How do we get that consumer empathy well enough to understand personalization, use data to drive that, but understand consumer journeys, and then the commerce component of that is simply every part of that journey needs to be shoppable in the future. It needs to drive conversion instantly. We’re going to get to a place where you’re going to be able to walk down the street, take a picture of whatever you want to take a picture of, and it’ll be delivered at your house in a day. And so how do we get to really understanding people’s journeys where you can disrupt those journeys, and then ultimately drive to commerce. So it starts with that kind of that mindset and that framework for people to understand what we’re actually even talking about, in terms of then driving the ideation there is mainstream, straightforward, brand, building, marketing, personalization ways in to solving that idea of connected commerce and consumer journeys, and ultimately paying that off.

That’s where we have a structure of our brand team and instilling them the mindset of this, but also just letting them go do what they do with that sort of lens on top of it, that’s not going to get it some of the stuff that we were describing in terms of connected device and really moving the needle. So we had to sort of structure teams to do that. We had to go, and we’re going to carve out a strategy and growth group that’s going to be about disruptive growth. What is the 3,4,5 year plan to get after truly difference making growth, because our brand teams job while it will be tied to this idea of connected commerce, their job is to make earnings for the next quarter, their job is to deliver the plan here, we need to have some some space some structure to actually deliver five years from now, without the pressure of delivering for the next earnings call. We have a 301 investment on you get after external innovation, but make sure that we are partnered in the right ways and driving some investments in there to have differential advantage on the future.

We have an internal incubator its called G works, where it’s all about how do we get after transformational innovation. That is not what a brand team or a operating unit could do today. And so we’re looking at different sorts of artificial intelligence tools, what would a different business model look like for in this example, I shared a meal solution phone app, how would we actually do that where it’s going to drive based on your preference based on your purchase based on your kitchen and based on the devices that you have customized meal planning for folks. But a different business model. This isn’t about selling Betty Crocker biscuits, this is about selling advertising or it’s about selling a subscription or it’s something else that we’re going to kind of go incubate on. So I do think you have to figure out how you stream it into different parts of your organization, it starts with that passion for a consumer understanding and pain points, and then actually making sure that that’s kind of first, and it can find its way through traditional marketing and how we think about different levers of personalization there, but then also through some structure that allows some space teams to get after three years out, not just next week.

Jake:

What I gathered from what you said was true innovation sometimes has to live outside your current structure. And maybe true innovation has to take on a solutions mindset that requires new cross team groups to think in a new way. So I’d love to ask you to comment on it. And also, Michael, I’d love to find out if you have any thoughts around how you’ve worked with Jay to do that kind of thing. To implement this kitchen of the future.

Jay:

I would agree with you in terms of transformational innovation, I don’t think transformational innovation, at least at General Mills can live within our traditional brand building process. I think the motivations of those teams, what really needs that, you know, kind of be their short term focus gets in the way of 3,5,7 year innovation. And so we have to sort of bifurcate that out.

Michael:

We’re very thankful for the relationship that we have with Jay and with General Mills, are really credit people who are very deep on innovation planning, and, if you will, human centered design to help put those two trains of thought together. On the innovation side, it’s really, you know, what are the innovations that are coming down the pipe, and we try to understand what they’re good for, and map them back to known consumer needs that we can be aware of, especially in General Mills case around the kitchen. So you know, this is not just five o’clock, this is the course of the entire day. And the role of that home hub really evolves from what we need it to do for us when we wake up through to the end of the day.

And if you really fast forward five years from now and you take a look at things like semiconductor technologies and content evolution, what we see is the opportunity for us to anticipate increasingly predictive and intelligent and assistive experiences that overlay on top of the tasks that those consumers have through the course of their day. And from there, it’s really brainstorming and ideating and applying those technologies and those capabilities down into, if you will better, more vibrant, more intelligent, more intuitive, more simple experiences for the consumer, and then really just sort of sparking the conversation around how might we create those kinds of solutions, what might that look like and how my General Mills not only play a role, but really drive that into reality over the course of the next few years. So that’s sort of how we like to partner and think about this with them.

Jake:

When you’re talking about upgrades in semiconductors, it sounds like you’re suggesting that over time, we’re going to see more and more metadata that will allow us to feed into models to do a better and better job of fitting in automatically into people’s lives.

Jay:

Well, what I love is Jake, the notion that we got a massive amount of additional sources of data that are coming up because of the expansion of sensors and controls, and for that matter, the accelerated integration of those sensors and controls into increasingly small footprints, we have faster networks, which you and Emodo and Ericsson know better than anyone around sort of the acceleration of transmission speed of that data. We have the rise of pattern recognition that exists within that data on both a supervised and unsupervised basis. And then the expression of information and content expressed through immersive screens and increasingly immersive ways to look at different kinds of interfaces with that information. So all of those are happening at the same time, which makes the next few years really exciting.

Jake:

I wanted to ask you a question, Jay, about how widespread is the right skill set for innovation? So when you’re putting teams together to do what you’re calling transformational innovation, do you find that you have to pick the particular people who lean toward that skill set? Or do you find that there’s a wide range of people that if you put them in the right context, and you give them the right framework, that, you know, a wide range of people can be innovative.

Jay:

It’s more of a ladder, the skill set and frankly, on those teams, we bring multiple backgrounds with a variety of different skill sets. And so if you’re talking about do I think everybody at Mills can kind of go into that transformational type of motive right tools. I think their skills can but I don’t think their mindset can. We are a slow and steady company, this space requires a lot of failure, this space requires a lot of agility, this good enough is good enough to move forward, not the perfection by which we’re going to go move a $2 billion business and make sure that that decision is right.

Jake:

You mentioned your internal incubator, which I believe is called G works. And an external investing arm, which I believe is called 301 Inc, for a traditional company like Mills, what’s the right way to do that? Do you proactively go out looking for something? Or is it more about reactiveness and just seeing what comes to you and keying off of the best things that you hear?

Jay:

There was a point in time, where our communications outwardly to innovators, to r&d development talent was, we’re not interested in your call, please don’t send us a note, we will hit delete, which is absolutely absurd. And we have a great r&d community and a great innovation community. But the idea that we can invent everything ourselves is absolutely absurd, and that we’re missing out on the millions of r&d talent that are in the marketplace. And we started this kind of free thinking incubator, and it was really around an investment arm against products. How do we start with early stage products that we may have a desire to acquire down the road or have some sort of differential licensing agreement with down the road. And that’s kind of what the business has been built on with regard to that investment arm.

So think of small startup boot companies that we are partnering with. And we bring some r&d talent, we bring some logistics and we bring some marketing talent. We bring a whole lot of swagger to this type of an organization besides just dollars. And so the push right now is how do we think through what is the marketing tech investment fund that we should be getting after, what is the fulfillment investment arm we should get it, what is the supply chain investment arm that we should be getting after that can still support our business and do the same things, but maybe with a little different end game. And so we’re evolving that team to kind of thing and be a little bit more that way as well. Because I just think there’s been a miss there. On the internal side, we’ve really pushed those teams to be obsessed with finding a problem.

And wonderful sort of sketched out process we have for those groups to go you’re going to spend your first quarter as a co founder team, finding us a really, really good problem within one of the opportunity spaces that we’ve decided are important for us and some of those opportunities today, sir, I mean, ridiculously broad health, ease in the kitchen, ease of prep, food joint rarely. So the big, big broad areas, but go help me find a problem. And that’s, you know, as a team that I work directly with, in the space of ease, they spent three months to really unpack and find the problem around decision fatigue for time stressed parents. So what is your kind of core problem you’re going to get after for us? And then we start working through a process of okay, come up with ideas, come up with ways we can get after solving that problem. And even in this example, the team came up with a technology solution that is completely foreign to what General Mills has historically done. So let’s start to incubate and build that tested, proven, scaling. And maybe they’ll become a point where we’ll go stop, pause, great. I want you to go back cycle back to the problem and come up with a new solution that’s maybe closer, or I want a new solution that’s further out something I can do in a year versus three. How do we keep kind of pushing those teams on just that intimate knowledge of that problem? And a problem that we feel like has a big runway?

Jake:

Do you ever find the problem, put your finger on where you think the solution might reside, but decide, hey, we shouldn’t be building us ourselves? We should go find out what external folks are building and invest in them.

Jay:

You’re hitting probably way too close to home, Jake. We are at a point with a solution that I don’t believe anymore General Mills has any right to go create. Because I think we have to go back to what is General Mills uniquely capable of providing proprietary gifts to and what can General Mills kind of bring to the table to solve this problem? I love your problems don’t like your solution anymore. Because it’s gone too far afield from what I’m capable of. That could be my one answer to your question. The other could be more but you just, hey, I don’t like this anymore. Internally, I need you to go investigate what the external partner that would take this on for us could be and I don’t mean, accenture that’s going to go build what we tell them to build. I mean, like, I want to partner with a third party that actually wants to buy this from us. we’ll partner with them. But they have to actually go build. How do we think through the evolution of these things in that regard? We’re a 100 year old food company that’s exceptional at making Cheerios, we’re probably not the best at cobbling together a solution that Salesforce can provide tomorrow. Right? So how do we kind of lean into a little bit more of external thinking, and especially in the world of technology?

Jake:

Hey, Michael, is that something you faced other times like this thing about a company that historically has a perspective that we can build it ourselves? And how do you evolve that to be able to be innovative at a faster pace and more effectively?

Michael:

Yeah, I think the good news about cloud and the good news about the advent of microservices architectures is that we can start to have conversations around things like dynamic content, or atomic content architectures that allow for us to absorb, condition and repurpose and express different kinds of content, different kinds of experiences through different channels and different screens through different combinations to different audiences all off of a common approach. And that sounds great, it’s really hard in practice, and companies are sort of putting in place their own vision of that, or their own roadmap towards that in their own ways. You know, the good news is, I think we’re in a place now where there’s a lot more modularity and ability to architect entire enterprises based upon micro services that allow for more flexible combinations of content and data.

Jake:

Yeah, so it’s not about a set of decisions. It’s about a mindset shift, to be constantly deciding and evolving and changing.

Jay:

That’s right. And to not lock down on, we’re gonna need this data for these audiences and to hard code anything but to allow for the flexibility of change over time. And I would say, it’s not only a mindset shift, it’s also a commitment to creating open architectures, and then the managerial challenges. What are we going to close? And what are we going to open? And what are the principles underneath that and why?

Jake:

You guys have had some new brands that have been wildly successful pretty quickly recently. Do you find that that mindset is becoming more prevalent?

Jay:

Yeah, I think the whole notion for us of the future of marketing is led through data decisioning, and how we’re going to actually need to be much more agile and personalized is forcing that whole viewpoint. So now we have to pick your own. How do we even in our marketing day job, think through agility and performance based marketing differently, that’s also going to have an impact on how we think about agility and risk management as relates to innovation.

Jake:

Yeah, I’m going to ask you this question, because you mentioned earlier that one of your focus areas is on the future of ID. So you talked about personalization, personalization is critical. It is the wave of, you know, the digital world, and especially the future as we have more metadata available. But at the same time, we’re facing the situation where the traditional means of personalization, meaning tracking a particular user, knowing about that particular user, and then using that information to personalize messages to that particular user is challenged because IDs are changing, they’re being deprecated. They’re being changed from opt out to opt in. There’s just less ability to track individuals at mass scale and use that for personalization. While at the same time, there’s a lot more metadata available. I was wondering if you could speak for a moment about how you see that dichotomy. And how you see like personalization changing?

Jay:

First of all, it is paramount in the way that the directory is going that we have much stronger and many more one to one relationships with our consumers. How do we make sure that we are building tools, platforms, whatever to be able to have that direct relationship versus feeling like the only way we’re going to personalize a message is through audience segmentation on a national media plan. So we’re building tools and capabilities and platforms like our boxtops for education platform, or buddy’s platform, which is an app for pet team. We probably need to figure out a first party acquisition strategy differently than we ever have thought about in the past. And so that’s really where you’re seeing General Mills, where we are pushing aggressively.

And then the other challenge within that is how do we stitch all of this stuff together. So even when I’m trying to understand, I have an email address for you, I have an engagement with you on a weekly newsletter, I have whatever, but I don’t necessarily know if you’re the same person that’s calling the hotline, or that’s logged into boxtops.com or has downloaded the buddy’s app, I got to figure out how to stitch all of that stuff together to have a more holistic view of how we’re going to go and talk to people. What concerns me the most in all of this is we’re wired by performance measurement in order to drive our next dollar spend. And we are also a CPG company that their primary outlet for selling our stuff is through others, so there’s gonna be a huge direct to consumer business. And so we’re gonna go through the Walmarts of the world, the Kroger’s of the world, the Instacarts of the world and is their experience become over and more and more personalized, and the fact that when you go shopping on Instacart, you’re not gonna see the same thing that I see when I go shopping on Instacart based on buying history, based on linger time, based on clicks based on whatever their algorithms gonna do. I don’t know how to measure my performance, right? And so now all of a sudden, I don’t know what I’m putting in your marketplace where it’s working, why it’s working in order for me to actually understand where I should continue to invest or not invest. And that is a place that we have to figure out. Because in a world of hyper personalization, while I think I will build platforms and tools and capabilities on my own, that I can talk to people directly, when most of my sales are going to run through a third party. I don’t know how to analyze performance and tools and levers, when it’s going to be a hyper personalized experience.

Jake:

Yeah, that’s interesting. And you know, in general around performance measurement, I come from a measurement background. And I think that the impact of this changing ID world on measurement is actually even larger than it is on targeting people talk about targeting personalization, but measurement is a massive impact as well.

Jay:

I need to have the marketing mix assessment before I’m putting the next dollar. So your point there is spot on, that’s going to prove very, very difficult.

Michael:

And Jay, I would say that your comments around this sort of the conventions that exist on a massive scale on an industrial basis around budgeting against known measurement conventions, like market mix modeling, are being challenged. So there is if you will, a clash of measurement systems, that as marketers, we have to try to navigate, try to reconcile and help everyone else, especially decision makers over budgets, try to figure out.

Jake:

There’s so many changes going on in the grocery space right now, measurement is obviously one, but I wanted to ask the guys about another one, in this case, the intertwined nature between physical and digital grocery shopping. Our most recent episode went really deep into grocery and the uniqueness of that channel, and how that impacted its evolution online. And it was slower to adopt online because of its uniqueness. But now that it is achieving some online success, and you referenced some of the channels earlier, like Instacart, that it’s now influencing back into the store. And now the store is evolving based on what the industry has learned from selling online. So I wanted to touch for a moment about how you see the interconnectedness Jay between E commerce and physical retail for the General Mills portfolio products.

Jay:

Yeah, so I think I’ve talked about it in two stages, the close way and then where I think that’ll likely take us five years from now. But I think the connectedness today is the idea that people absolutely want to make sure that they’re able to get whatever they have an available and access in store they’re able to get that into whatever fulfillment way they want. And and as our business becomes closer and closer to 20% through an online purchase that’s fulfilled at store or delivered at home, we are able to talk to and sell and leverage the fact that the online sale is driving our store shelf placement and the amount of real estate that we are getting because of the concerns of out of stocks and the light that merchants are starting to feel if we’re doing great online but not in store. It’s much more of an omni channel sales discussion to have versus what’s selling in store versus what’s selling online as it relates to assortment availability, shelf space, display space, etc. And that’s kind of the close end stuff. So we are talking about the way it’s going to really disrupt where we go into stores is such big fulfillment centers that I believe we’re on the front offices is going to be much more of a showcase than it’s going to be a place you go purchase.

How do you think about grocery as a way to drive inspiration and solution when you walk through the aisles? People still like to walk through the aisles, people still like to get inspired and have that showcase but they’re probably going to still be purchasing online. So it becomes much more of a boutique, a showpiece than they’re going to be the fulfillment arm and the fulfillment arm is going to be the back of the house that’s really kind of doing the fulfillment order in a different fashion. And it’s really going to start to change then what display means, what merchandising means, how we think about showcasing our products, there’s going to be a big, big switch. Right now we’re working on how do you actually merchandise online? Right? How do you make sure that the navigation and browsing behavior exists the way consumers kind of think and shop and we’re dealing with wonderful, exceptional partners like Instacart, that’s an outstanding technology company.

But for a long time doesn’t really understand how people navigate in the decision trees that consumers make when they’re buying a category. You know, this category shopped by size first, then flavor, then variety counts, like this category shot by flavor before anything else, and then it’s going to get to size. Yet their sites or merchandise in their navigation is identical regardless of category. So that’s some work we’re trying to help and understand in the shorter term. And over time, that sort of same concept is going to go to what does a store actually look like, as a boutique in a showpiece for solutions versus shelves that we got to stock?

Jake:

Beautiful. Now at the end of each episode, we try to get through some real quick hitting questions. We call it the Fast Five. So I’m gonna ask you some real quick questions. How do you see brand versus performance marketing changing?

Jay:

I think the way we’re going to build brands in the future is through performance marketing. And today, we bifurcate them, we have a bit of a marketing team that’s focused against purpose marketing, we have won this against performance marketing, and we have one that’s against commerce marketing, and on any individual brand with distinct functions doing different tasks there. I think the future is performance marketing, and if that marketing is, and we’re gonna have to figure out how we build brands in that ecosystem.

Jake:

One thing we haven’t really touched on, but I think is a big change in the future is immersion and more immersive experiences for consumers. How do you plan on if at all, involving these types of experiences in marketing at General Mills, like augmented reality as an example?

Jay:

First of all, I think experience is kind of the key. And experience doesn’t necessarily mean augmented reality, it might mean sponsorship, it might mean doing sampling exercise, it might be all sorts of things. But we’ve actually even just to build that culture, we’ve changed our title, from brand marketing to brand experiences. That is what our function is called at General Mills. How do you think people are going to shop, behave, do things differently are their expectations about how they’re going to visualize a shelf or their expectations about how they’re going to shop and fulfill is going to continue to evolve as the opportunity in the space of technology evolves, sort of sort of figure out how to play. And then Michael has been a great help for us of the periodic play in that, frankly, the visualization of the kitchen of the future was a augmented reality experience online to try to showcase again, my plan in a fun visual way versus my plan in a PowerPoint way. And we’ve started to do that on retailer platforms, because I think that’s how people want to shop and experience products. But it’s been getting going to be all about what is the best medium to drive experience in a solution.

Jake:

If you’re a senior marketer at one of the largest packaged foods companies, from that perspective, what is your number one concern?

Jay:

Well, we touched on a big part of it as an organization that is so wired against performance measurement, and the idea of my point of future marketing can be all around personalization and connected commerce in that way. And that scares me, I don’t know how we’re going to reconcile that. I also don’t know how we’re actually going to get people to understand how you build brands in a world of hyper personalization. We are baked on the back of brand building is required to drive irrational love of businesses. That’s what our brand building does. Not that we think our products are better and superior and all that been really marketing brand buildings about building that irrational, potentially somebody’s irrational love for your brands, that gets really different. And when you’re starting to talk about hyper personalization, you’re starting to talk about winning on that vector. And so how do we make sure that we’re teaching our organization that you can build brands and do this at the same time, and that’s how the future of your build brands is actually going to be? The idea of building brands in a different way than a 30 second TV ad is still hard for us to get our heads around. And we have to figure out how to do that.

Michael:

The value of a brand in this age of a hyper amount of information has never been more important. And that that brand must be modern. It must be rooted in purpose and the sort of appealing in terms of its base value proposition to us on a human level. And you can go to some of the Gen Z and younger audiences and see which brands are starting to get off the ground with the youth, especially the United States. And they have sort of this modern appeal, this cause or this purpose related to them. That is not hyper personalized, it is universal. And yet, when those brands come to the point of purchase, we see that’s where hyper personalization is really valuable. You know, that sort of challenge of moving from universally appealing to anyone, all the way down to ready to buy, and wanting to hyper personalize that offer, that’s sort of the marketing challenge is to do both of those well. And I don’t know that those are necessarily contradictory. It’s just that we have to manage to both outcomes simultaneously.

Jake:

Yeah, but at the same time, from Jay’s perspective, it sounds like you’re being pulled in both directions. Because there’s the goal to personalize, there’s the effort to always be measuring, but and there’s all this new metadata becoming available. But at the same time, as Jay said earlier, General Mills will probably always be a company that sells through other companies. And you know, those places, of course, are masters of personalization at the point of purchase, but that dichotomy is, you’re like you’re being pulled in both directions.

Jay:

That’s right. That’s right. It’s a fun time to try figure this out.

Jake:

And what’s your favorite cereal?

Jay:

Crunch,

Jake:

I was gonna say exactly the same thing.

Jay:

Me too. This stuff is fantastic. It’s addictive.

Jake:

And in fact, I recently found this cashew butter that includes honey and cinnamon. And the reason I love it so much is because it tastes exactly like some of those crunch. Do you think General Mills is innovative compared to other companies in the space?

Jay:

I think we are advanced and highly innovative in the world of what we play in. I think we are relative in our E commerce development relative in our Innovation Development relative to how we think about the world from a CPG Food Company, I think we are top tier, top 10% When you talk about even just maybe broader CPG EG of the world? I don’t know. Right, we started to fall off a little bit. And so we have a ways to go.

Jake:

Jay, I really appreciate you being here. It was really great to meet you. And Michael, thank you so much for bringing Jay and thank you for joining us again.

Michael:

Thank you for the invitation. And thank you very much, Jay for joining as well.

Jay:

Yeah, it’s wonderful to meet you. Thank you very much for the invite.

Jake:

So there you go. A glimpse behind the scenes with Michael Stich of Court Avenue and Jay Picconatto of General Mills, a partnership built on innovation, so many fascinating challenges, ideas and insights, personalization, culture, structure, identity, retail, the kitchen of the future. I could talk with those guys for hours. And just on the side here. Can I just say one of my favorite things about that discussion was Jay’s honesty and openness. All senior marketers have to work through difficult puzzles, right? Jay shared openly a few times that he doesn’t have all the answers. That’s the hallmark of a true innovator: curious, thinking forward and in search of answers. I mean, how can you discover new roads, if you’ve convinced yourself, you’ve got it all figured out. It’s also a reflection of a true culture of innovation, the freedom to say we’re still working it out.

Next time on FIVE, we’re going to go deeper into the notion of brand experiences and the most exciting new ad formats out there. We’re going behind the scenes and directly into the scene, the AR scene, and how augmented reality is making its way into advertising. And why it’s sparking a rethink of the metrics that matter. If you’re a new listener, thank you for giving the show a shot. We feel honored every time a new listener subscribes. If you’re loving it and you want more FIVE more often be sure to check out our two previous seasons each a timely insightful series unto itself. 5G and its impact on advertising and the power of AI in marketing.

Discover more at emodo.com slash five. Hey, and in the meantime, if you like the show, please write us a comment and give us a rating on your favorite podcast listening platform, especially Apple and Spotify. We’d be super grateful. It helps more people discover the podcast. For now I’m gonna go grab myself a bowl spoon and milk and dive into a box of Cinnamon Toast Crunch. Thanks for joining us. The FIVE podcast is presented by Ericsson Emodo and the Emodo Institute and features original music by Dyaphonic and the Small Town Symphonette. Original episode art is by Chris Kosek. This episode was edited by Justin Newton and produced by Robert Haskitt, Liz Wynnemer and me, I’m Jake Moskowitz.

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