Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.
Speaker 1: This week on the podcast, I have a special guest.
Speaker 1: His name is Pedro Earp and he is the chief
Speaker 1: marketing officer at Beverage Giant a b in Bev. You
Speaker 1: know all of their products from bud Wiser to Stellida.
Speaker 1: They're just giant. They do billions and billions of dollars
Speaker 1: in sales and Pedro has this just fascinating career and resume.
Speaker 1: He's run their venture capital group. He was Director of
Speaker 1: Disruptive Growth, that was actually his title. Now he runs
Speaker 1: all of the advertisement and marketing for just an immense
Speaker 1: consumer product group. It's really just an astonishing role. And
Speaker 1: we talked about everything from how do you manage marketing
Speaker 1: during a pandemic lockdown? What do you do when sports stops?
Speaker 1: And what do you do when you have a product
Speaker 1: whose name include it's the word corona. It's really quite
Speaker 1: interesting and if you're at all a person who is
Speaker 1: fascinated by branding, marketing, advertising, you will find this to
Speaker 1: be just a fascinating conversation. With no further ado. My
Speaker 1: conversation with A b InBev's chief marketing Officer, Pedro Earp.
Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.
Speaker 1: My special guest today is Pedro Earp. He is the
Speaker 1: chief marketing officer at A b in Bev, one of
Speaker 1: the world's largest brewery with a hundred and seventy thousand
Speaker 1: employees in fifty countries, with two hundred and sixty breweries
Speaker 1: and thirteen thousand owned retail locations. Previously, Pedro was the
Speaker 1: former head of M and A and the former head
Speaker 1: of their venture capital fund. A b in Bev has
Speaker 1: such August brands as Budweiser, Corona Stella, dex Hoole, Garden, Modela.
Speaker 1: The list goes on and on and on. Pedro Earp,
Speaker 1: Welcome to Bloomberg. Hi Berry, thanks for having me. So
Speaker 1: your resume is really quite confounding and fascinating. You were
Speaker 1: you were head of M and A at a very
Speaker 1: large company at a very young age. Tell us about that.
Speaker 1: So I joined the company back at the Brazilian side
Speaker 1: of the company. You know a BI it's a combination
Speaker 1: of a Brazilian company of Belgium company and how's the
Speaker 1: bush in the US model in Mexico. So it truly
Speaker 1: became a you know, a globe organization. But I started
Speaker 1: on the Brazilian side, you know, off the company in
Speaker 1: the year of two thousand as a trainee. And then
Speaker 1: as soon as I kind of finished my training program,
Speaker 1: they invited me to join the you know, the marketing
Speaker 1: them and a department. And at the time, the brewers
Speaker 1: grow a lot, you know what's doing, was starting to
Speaker 1: do some some international expansion. So I thought it was
Speaker 1: a very good opportunity to to join them in the department.
Speaker 1: And then two years later, you know, my my boss
Speaker 1: ended up going to uh to an operation. We have
Speaker 1: this about going to headquarters and and also going to operations,
Speaker 1: and then I had the opportunity to have the division.
Speaker 1: So in a very very exciting time because we're expanding
Speaker 1: Latin Americas, a lot of things to do at the time.
Speaker 1: So you've had a couple of really interesting titles. One
Speaker 1: was chief disruptive Officer, another was head of the venture
Speaker 1: capital unit. Tell us about some of these jobs. Why
Speaker 1: would a giant beer brewery and distributor have a venture
Speaker 1: capital unit. Yeah, so we you know, we started that
Speaker 1: trying to accelerate our our innovation efforts. From two thousand six,
Speaker 1: two thousand seven one. You know, until then, the company
Speaker 1: relied a lot in in inorganic growth and en mn
Speaker 1: a uh and and then at some point in time,
Speaker 1: you know, we we became a very big organization, so
Speaker 1: and then they started being less lesser creative, and we
Speaker 1: really turned our focus into again and growth and innovation
Speaker 1: being a big part of it. But we, you know,
Speaker 1: we we didn't go as fast as we wish we
Speaker 1: we could go. You know, sometimes when we have a
Speaker 1: big organization, and especially an organization that is growing a lot,
Speaker 1: it's score business, it's very hard, you know to divert
Speaker 1: some of the focus on some of the of the
Speaker 1: people and some of the money, you know, to really
Speaker 1: focus on innovation. So, you know, our CEO and the
Speaker 1: board in thousand and fifteen, they decided to create you know,
Speaker 1: a separate unit to be fully focused on on innovation
Speaker 1: and the future. So this is kind of when when
Speaker 1: we started the z Expangers a group which is the
Speaker 1: kind of the innovation armongst ab I. And then when
Speaker 1: I was talking to you know, to Carlos Brittle, which
Speaker 1: is our our CEO, about the organization, he said, look,
Speaker 1: there's only one thing that that I would like to ask,
Speaker 1: you know, you to find the mandate and the areas
Speaker 1: that again is going to explore. But you know, I
Speaker 1: really like your title to be, you know, what the
Speaker 1: group to be called disruptive Growth group. And then I said, look,
Speaker 1: I know if you put it disruptive growth, I mean
Speaker 1: actually at the beginning he didn't even say growth, it's
Speaker 1: a disruptive group. And I said, people are just gonna
Speaker 1: think we're gonna get in rooms, you know, keep the chairs,
Speaker 1: you know, and and say some silly stuff. And so
Speaker 1: I convinced him on disruptive growth. But in a way,
Speaker 1: you know, he kind of asked me to to have
Speaker 1: that title to the group because he wanted to make
Speaker 1: sure that the message to the organizations that this group
Speaker 1: would be disruptive even within right, We'll try to do
Speaker 1: something that maybe it was not the best thing for
Speaker 1: a core business, could cannibalize our core business too, could
Speaker 1: create some you know, crazy disruption from with them. And
Speaker 1: that's why I had this kind of funny, funny title.
Speaker 1: We're gonna talk more about the VC Fund a little later.
Speaker 1: It's now over a billion dollars, but let's talk about
Speaker 1: the elephant in the room. Obviously, everything has changed with
Speaker 1: coronavirus and the lockdown and the pandemic. I know, I'm
Speaker 1: drinking a lot more than I was pre lockdown. How
Speaker 1: has COVID nineteen impacted your business? What is this done
Speaker 1: both for and restraining sales? Yeah, you know, it varies
Speaker 1: a little bit depending on the you know, the country
Speaker 1: that that you were in. In general, I know it
Speaker 1: has been it has been tough for the business. So
Speaker 1: we had a tough you know, second quarter off the year.
Speaker 1: We have a lot of exposure to emerging markets where
Speaker 1: the own trade you know, bars and restaurants are significant
Speaker 1: part of the business and because of lockdown, of course
Speaker 1: this this piece of the business was truly shut out.
Speaker 1: So it's been tough for business. Right The business wasn't
Speaker 1: oppression of the second quarter. We have seen improvement since then.
Speaker 1: When just think it is good news and always see
Speaker 1: a lot of markets reopening, but you know, I think
Speaker 1: it was it was. It was a very tough but
Speaker 1: great learning experience for us. You know, we had to
Speaker 1: really focus on people and focus on our on our
Speaker 1: consumer and I think we were going to come out
Speaker 1: of this crisis, you know, much stronger than than then
Speaker 1: we got in so so your title is chief marketing officer.
Speaker 1: How quickly can you change your marketing strategy or even
Speaker 1: your advertising in the midst of a lockdown? I know
Speaker 1: a lot of this stuff is done quarters in advance.
Speaker 1: How quick can you pivot once the lockdown starts? Yeah,
Speaker 1: I mean in our case was was really fast for
Speaker 1: two reasons. You know. The first one is that we
Speaker 1: have big operations in in China. You know, we have
Speaker 1: market share in China and and roughly six of the
Speaker 1: total premium via marketing in China. And we saw when
Speaker 1: he got started in China, so we had a verierly one.
Speaker 1: We had an indication of how we could look like
Speaker 1: in other in other places, and the seriousness of the
Speaker 1: of the crisis. You know, as soon as we saw
Speaker 1: things started in China two weeks later, we set up
Speaker 1: a global task force which allow us to react and
Speaker 1: puch faster. And and the second thing is that really
Speaker 1: I think the you know, the culture of organize the
Speaker 1: organization is a culture of of ownership. You know, our
Speaker 1: employees really they behave like corners and they fight for
Speaker 1: the business like if it was their own business. So
Speaker 1: it was you know, during the during the crisis were
Speaker 1: all hands on back, you know, everybody working seven to
Speaker 1: adjust the plans, change the plants, you know, scrap campaigns,
Speaker 1: you know, even I mean we uh you know internationally
Speaker 1: and globally we owned the Corona brand, right, so for
Speaker 1: especially for Corona, we had to make to make a
Speaker 1: lot of changes. So you know, it was it was
Speaker 1: tough times, but again I think was an opportunity for
Speaker 1: growth and the company is coming out are stronger. So
Speaker 1: you mentioned Corona earlier, the Corona the beer. How do
Speaker 1: you have to pivot in the face of a pandemic
Speaker 1: that has the phrase Corona in the first half of it?
Speaker 1: What what sort of adjustments do you have to make?
Speaker 1: And is that the same in it in every country?
Speaker 1: How do the translations effect If people are superstitious about
Speaker 1: the beer, what what do you do in response to that? Yeah,
Speaker 1: so the I mean the first thing of course that
Speaker 1: we paid a lot of attention, right is through social
Speaker 1: listening what people are talking about and if you're making
Speaker 1: associations or not with you know, with the beer, and
Speaker 1: mainly you know, there was little noise of association with
Speaker 1: the beer and the associations who are mainly people you
Speaker 1: know making fun of you know, things related to the
Speaker 1: beer and things like that, so we really didn't have
Speaker 1: you know, quite an impact. What we thought, given the times,
Speaker 1: you know, that we should be silent for a little
Speaker 1: while with the with the beer brand, not not to
Speaker 1: create even more confusion. So we uh, you know, we
Speaker 1: decided to be out for a little bit. We're coming
Speaker 1: back now, you know, with the court on a brand
Speaker 1: all over the world communication, but on all the other brands,
Speaker 1: we adapted, and I think the treat here was too
Speaker 1: to stop thinking a little bit about selling beer because
Speaker 1: that was out of the forefront of people's priorities, and
Speaker 1: see how consumers were changing, what were their immediate needs,
Speaker 1: and then what our brands had a role, you know,
Speaker 1: and how they could help, you know, people during the
Speaker 1: during the pandemics. So just to do nation to use
Speaker 1: some examples, you know, Nicola bol Train that you asked
Speaker 1: is our balanced lifestyle brand. Ready has like two grounds
Speaker 1: of carbs and it's for people that I have an
Speaker 1: active lifestyle and we at the very start of the
Speaker 1: of the crisis, a lot of people starting to exercise
Speaker 1: at home. So we created the Nikola Boltra movement, which
Speaker 1: every single week we had kind of homework out fashions
Speaker 1: that ended up with a headcur and n e J
Speaker 1: like Sibo Ioki for example, that we had and it
Speaker 1: was always a great success, and or Nikola Bolt. During
Speaker 1: the time, I had more engagement and views than than sports,
Speaker 1: you know, brands and and and treatness appeals and things
Speaker 1: like that. So you know, that's kind of one example.
Speaker 1: Another example, it's in Brazil. We had a huge relationship
Speaker 1: with country music singers and and of course because of
Speaker 1: the crisis, a lot of shows are canceled. You know,
Speaker 1: we use the fact that we had already this relationships
Speaker 1: and we had sponsorships and things like that, and we
Speaker 1: decided to do live streams and stead of having live concerts,
Speaker 1: and it was a massive, massive success. You know. So
Speaker 1: today the day out of the top ten most watch
Speaker 1: videos on on YouTube of all times, five of them
Speaker 1: for some of the our live streams, you know, in Brazil,
Speaker 1: we had more than to an app didn't views you know,
Speaker 1: on the live streams. Again, people were at home, blocked in,
Speaker 1: they were bored, but they still wanted to kind of
Speaker 1: enjoy themselves. So I mean it was a period of
Speaker 1: really trying to understand how consumers are changing, trying to
Speaker 1: live aside a little bit, you know, the the attempt
Speaker 1: to sell beer and too, you know, to grow the
Speaker 1: business in the short run, and it was more about
Speaker 1: understanding how what people needed and how our brands could
Speaker 1: create a meaningful relationship with them by providing what they
Speaker 1: needed the most. So historically sports has just been huge
Speaker 1: for marketing all sorts of things, certainly beer. You guys
Speaker 1: were the lead sponsor of the World Cup. How do
Speaker 1: you adjust when so many sporting events are canceled in
Speaker 1: March April May, and then what do you do now
Speaker 1: suddenly between the NBA and the start of the NFL
Speaker 1: and the end of the baseball season and we just
Speaker 1: finished the U S Open, how do you adjust to
Speaker 1: this sudden onslaught of of games played in these you
Speaker 1: know COVID bubbles. Yeah, it's uh, you know, the need
Speaker 1: for enjoyment and the passion for sports us still there,
Speaker 1: but again people are having to enjoy it in different ways.
Speaker 1: So again we didn't obsess about understanding, you know, how
Speaker 1: people are still trying to enjoy sports and see how
Speaker 1: we can help them. So to to mention a couple
Speaker 1: of examples, in some of all markets, we saw that
Speaker 1: people are because they were not going to the status anymore,
Speaker 1: you know, the pregame. People had more time to enjoy
Speaker 1: you know, the pregame. So for ex with some of
Speaker 1: our teams, you know that we're sponsored in a lot
Speaker 1: of countries, we start doing live stream off of the
Speaker 1: pre games in a lot of countries, you know, and
Speaker 1: we had a lot of people they used to go
Speaker 1: to the stadium, so they wouldn't watched, you know, any
Speaker 1: any of the pre games. They started tuning in and
Speaker 1: we had massive audiences you know, joining the live stream
Speaker 1: like one hour before the match, were half an hour
Speaker 1: before the match, something that didn't kind of an occasion
Speaker 1: that didn't exist before, right, So that there was kind
Speaker 1: of one one example. Another example, you know, you mentioned
Speaker 1: the NBA and what we what we try to do.
Speaker 1: We teamed up with with Microsoft, you know in the US,
Speaker 1: and we are basically providing people the opportunity to watch
Speaker 1: the NBA games. Right. We have we have a stand
Speaker 1: you know in the stadiums you know, Microsoft and ourselves,
Speaker 1: and we have expectators there and they are basically in
Speaker 1: a you know, in a virtual environment where they can
Speaker 1: not only watched the game from different angles, you know,
Speaker 1: as if they were watching it live, but they can
Speaker 1: also interact with other people that are on the understand
Speaker 1: and people that are watching the game on TV. They
Speaker 1: can see the people understand So again, there's kind of
Speaker 1: a new way for you to watch sports and and
Speaker 1: and that's what we we've been trying to do, you know,
Speaker 1: to understand that the passion is there, understanding that, you know,
Speaker 1: the behaviors might change, but then how can we adapt
Speaker 1: to this behavioral change. Yeah, the the NBA seems to
Speaker 1: have done a better job having live appearing fans through
Speaker 1: those screens on the sides of the basketball court as
Speaker 1: opposed to just putting cutouts and and some other attempts
Speaker 1: have not been as creative. I've been watching the NBA
Speaker 1: playoffs and it almost feels like they're real fans in
Speaker 1: the seats. Yeah. Again, you know, I think the physical interaction,
Speaker 1: you know, in the proximity off people, it's something that
Speaker 1: that of course everybody misses, right, And and that's something
Speaker 1: that technology is trying to to address, and I think
Speaker 1: it's getting better and better. So you know, we see
Speaker 1: that the quality of the of the interactions there you're
Speaker 1: having to zoom or through you know, Microsoft teams and
Speaker 1: and other things. That's getting better. But again I'm sure
Speaker 1: people you know, and time allows, and hopefully we're going
Speaker 1: to have more effective treatment and vaccines very soon. I'm
Speaker 1: sure people are going to be very eager to physically,
Speaker 1: you know, attend go to stadiums again. So I'm curious,
Speaker 1: how does a partnership like that come about. Do you
Speaker 1: pick up the phone and call the head of marketing
Speaker 1: and Microsoft and say, hey, I have a great idea
Speaker 1: how we can do something innovative at a at a
Speaker 1: basketball game. How how does a joint project like that
Speaker 1: actually happen? Yeah, you know, it starts with their relationships,
Speaker 1: not only the relationships with the teams, but also the
Speaker 1: relationship with other sponsors. Right in a way, in a way,
Speaker 1: we are all we're all on the same boat, you know,
Speaker 1: the leagues, the teams, the sponsors and everybody. And during
Speaker 1: this time, you know, the collaboration increased dramatically. You know,
Speaker 1: You're were in touch again all over the world in
Speaker 1: all types of sports, you know, not only with the
Speaker 1: teams in the leagues, but also other sponsors. See what
Speaker 1: are the things that we can you know, do together
Speaker 1: in order to to make sure that we continue to
Speaker 1: provide our customers with the experience they had before. And
Speaker 1: also from this collaboration. A lot of you know, things
Speaker 1: like that have happened during COVID, you know, and and
Speaker 1: it's the the usual thing you know that I think
Speaker 1: crimes like this, you know, bring people together to try
Speaker 1: to figure out what to do, you know, and that
Speaker 1: that's how these things came about. So Pedro, let's stay
Speaker 1: with the world of sports. You guys have been giant
Speaker 1: advertisers on events like the Super Bowl. How do you
Speaker 1: quantify your return on that sort of investment? What are
Speaker 1: you looking at? How do you measure if something is
Speaker 1: a success or not? Tell us about the thought process there.
Speaker 1: Over the years, I think we've been getting better and
Speaker 1: better and measuring, you know, kind of the returns of
Speaker 1: marketing activities. You know, we have we have an analytics
Speaker 1: center in India, you know that kind of collects everything
Speaker 1: that we do and then the consumer response and trying
Speaker 1: to qualify are the returns that we have. But some
Speaker 1: of these things and all there you have to take
Speaker 1: the bet. You know. Again, super Bowl is it's like
Speaker 1: probably the biggest sporting event, you know, in the world.
Speaker 1: You know, every single year, the number of vie balls
Speaker 1: that you have in there, and and that's one of
Speaker 1: the few you know events that that we have on
Speaker 1: TV that people actually stopped to watch, you know, the commercials.
Speaker 1: So of course, I mean we're always trying to measure
Speaker 1: the learning things like that. But in a way, you know,
Speaker 1: there's a lot of you know belief h that something
Speaker 1: like that has a very high engagement with people, and
Speaker 1: and and the reach that you get it it's a uh,
Speaker 1: you know, it's very hard to get to get somewhere else.
Speaker 1: What we've been doing, you know, for the past years
Speaker 1: has been to be a little bit more intentional about
Speaker 1: about what kind of brands we advertise, you know on
Speaker 1: Super Bowl. So in the past, we'll just advertising all
Speaker 1: kind of the biggest brands that we had, and again,
Speaker 1: these brands are the ones that probably have the most
Speaker 1: known brands, so I'm not sure the eyeballs, you know,
Speaker 1: it's really what the brand needs. So we started to
Speaker 1: for example, using more you know, premium brands like stell
Speaker 1: Us to our on Super Bowl. We started using more
Speaker 1: you know innovation like bloodlight celts or you know for
Speaker 1: Super Bowl. So we tried to be a bit more
Speaker 1: intentional on on how we how we go about it.
Speaker 1: But you know that I think there's a fundamental game
Speaker 1: that an event like that, with the level of engagement,
Speaker 1: the number of people, it's something that you know, we
Speaker 1: we should be doing. I have to ask what seems
Speaker 1: like a little bit of a wacky question, which is
Speaker 1: why on earth does a beer giant have a venture
Speaker 1: capital funds? What does a b in BEV get out
Speaker 1: of this? Yeah, that's a that's a good question there.
Speaker 1: You know what when when we started our adventure capital funding,
Speaker 1: Mad you know, an entrepreneur that he had basically a
Speaker 1: homebrewing business, but he was you know, a marine before
Speaker 1: and he he used to work on intelligence and he
Speaker 1: was explaining to me that one of the things one
Speaker 1: of the challenges they face for you know, big carriers,
Speaker 1: it's you know, the big career they were trying to
Speaker 1: assimulate will be the best way to think, you know,
Speaker 1: a carrier some sort of you know enemy was trying
Speaker 1: to do it. And at the end, you know, the
Speaker 1: carrier is kind of prepare, you know, to to I
Speaker 1: had another carrier, or to fight airplanes or to fight
Speaker 1: you know, len to see missilesand things like that, and
Speaker 1: they him to the conclusion that probably the most effective
Speaker 1: way of dominating and destroying a carrier would be to
Speaker 1: have you know, hundreds of pirate speed boats attacking the
Speaker 1: carry at the same time, because the carrier didn't have
Speaker 1: kind of defenses for that. And he was saying, that's
Speaker 1: kind of, you know, a good analogy towards startups are
Speaker 1: kind of doing two big CPGs, you know, the big CPGs.
Speaker 1: They are usually set up for scale and to kind
Speaker 1: of you know, compete in big markets with other big CPGs.
Speaker 1: And now you have all these speed boats, very nimble,
Speaker 1: very fast, you know, focus on on attacking niche markets,
Speaker 1: and they are kind of you know a little by
Speaker 1: little dominated big space, you know, dominated by by the
Speaker 1: big cpigs. As the pass and the way you know,
Speaker 1: the intelligence figured out on how to re prevent, you know,
Speaker 1: an attack like at is actually to also have speed
Speaker 1: boats in the big carrier, you know, and deploy speed
Speaker 1: boats as they were being attacked. That then you could
Speaker 1: count on the backup and all the intelligence that it
Speaker 1: would have from the big carrier. But then you kind
Speaker 1: of you know, have a more a more even fight
Speaker 1: and that's a little bit more what we are kind
Speaker 1: of we're trying to do. You know, I think if
Speaker 1: our company really believes that with the big number but
Speaker 1: limited number of brew masses that we have every queen
Speaker 1: create you know, more beers and and better beer than
Speaker 1: the thousands and thousands and thousands of craft brewers and
Speaker 1: blo masses that are all over the world today, I
Speaker 1: think they will be naive, you know. So what we
Speaker 1: are trying to do is basically to join forces. You know,
Speaker 1: there are a lot of people there that are passionate
Speaker 1: about beers and about beverages or about technologies to help
Speaker 1: beverages and beer, and then you know, what we're trying
Speaker 1: to do is to provide a platform that they could
Speaker 1: be a much more successful, you know, in their attempts
Speaker 1: and and and kind of trying to do something that
Speaker 1: works for both you know, us and and for other startups.
Speaker 1: So asymmetrical warfare and big consumer product groups are like
Speaker 1: carriers that that that's quite interesting. Let's talk a little
Speaker 1: bit about the technology that you're actually considering looking at
Speaker 1: thinking about how does technology help you track how effective
Speaker 1: your marketing is and what does it teach you about
Speaker 1: your customers. You know, we that that are kind of
Speaker 1: you know, in terms of technology that are too. Two
Speaker 1: big things you know that that we're doing. Of course,
Speaker 1: one is more on the Martek side of things, right,
Speaker 1: being able to to track your you know, your spend,
Speaker 1: passion and reagital and measure are ally and optimize and
Speaker 1: understand consumers, segment the audiences and do all all of that.
Speaker 1: I think that they know a lot of people are
Speaker 1: trying to do. But the other thing that we are
Speaker 1: we're also doing. It's too have more direct relationship, you know,
Speaker 1: with our consumers to really be able to measure you know,
Speaker 1: full funnel right from people getting to know your brain
Speaker 1: all the way to making a final final purchase. And
Speaker 1: we have businesses for example, in in in Latin America
Speaker 1: now in a lot of countries in Latin America that
Speaker 1: it can basically have your beier delivered you know, to
Speaker 1: your home and and tell me and it's like you
Speaker 1: would have you know, Amazon time in the in the US.
Speaker 1: So you know, that's kind of you know, a dual
Speaker 1: dual approach. One approaches you know, the technology in terms
Speaker 1: of marketing technology and how to how to measure and
Speaker 1: how to track things better. But the other one is
Speaker 1: how do you create technology special earn e commerce where
Speaker 1: you have you know, better data and better measurement by
Speaker 1: having a direct relationship with consumers. Quite interesting, consumer preferences
Speaker 1: seem to change so rapidly in spirits and beer, I mean,
Speaker 1: heart Seltzer. I don't even know if this existed ten
Speaker 1: years ago and then suddenly boom, it's everywhere. How do
Speaker 1: you use tech and big data to track what are
Speaker 1: the new trends that are bubbling up? How could you
Speaker 1: tell the difference between something that's a serious change in
Speaker 1: consumer habits or what is just a fad that's gonna
Speaker 1: very rapidly go away. Yeah, I think seeing the things
Speaker 1: that are picking up, you know, it's relatively it's relatively easier,
Speaker 1: right to be with the grand Larry data that you
Speaker 1: have in social listening, in Google trends and all that.
Speaker 1: I think it's kind of, you know, easier to understand
Speaker 1: what's popping up and what's going on. I think the
Speaker 1: real question is the one that you ask, right, what
Speaker 1: are the things that you should really investigate and understand
Speaker 1: the drivers because they seem to be more long term,
Speaker 1: long term things, and what are the fads, and I
Speaker 1: think you know, in our experience that are two factors
Speaker 1: that have been you know, that have been separating the
Speaker 1: stats from the from the things that are real. You know.
Speaker 1: One of them is how this new product is really
Speaker 1: aligned with long term trends. Right. So to give you
Speaker 1: an example, you know, in the US, for example, for
Speaker 1: the past few years, we had a lot of new
Speaker 1: flavors and you know, hard soda or you know not
Speaker 1: your father's roots here and things like that that were
Speaker 1: in terms of health and wellness, they were almost anti trend,
Speaker 1: you know, because of the pointity of sugar and calories
Speaker 1: and and and all that. You know, and now you
Speaker 1: have heart cells. So we actually provides the flavor, provides
Speaker 1: a variety, but it's pretty much aligned with you know,
Speaker 1: a very strong long term trend in terms of health
Speaker 1: and wellness. You know. So that's kind of you know,
Speaker 1: one indicator of the things that are more sustainable than
Speaker 1: than than fat. And then the second one is is
Speaker 1: the kind of the consumer that you see adopting you know,
Speaker 1: these new these new products, you know, whenever it's just
Speaker 1: you know, now for consumer in the East and West coast,
Speaker 1: you know that it's kind of they they try everything,
Speaker 1: and you know they you know, everything new that they
Speaker 1: go there and try. Then it's it's hard, you know
Speaker 1: to establish on others there's simply more sutainable or it's
Speaker 1: uh or it's you know, it's sad. But when you
Speaker 1: see consumers that are more mainstream, you know, consumers mass
Speaker 1: consumers that there's start adopting, then you you have a heart.
Speaker 1: You have a huge indicator that the trend is more
Speaker 1: is more sustainable, and also that that's kind of you know,
Speaker 1: the two things that are being observing that make a difference.
Speaker 1: One of the things I once heard you say that
Speaker 1: fascinated me was beer created civilization discuss Yeah, it was
Speaker 1: actually not need Those are the archaeologists and you know
Speaker 1: that you know a lot of scientific evidence about that.
Speaker 1: But the story is, you know, beer exists for more
Speaker 1: than ten thousand years, and you know, before before that period,
Speaker 1: you know, humans were basically you know, no mats, right,
Speaker 1: they will hunter, they will hunt, and they will gather,
Speaker 1: and they will move from place to place as the
Speaker 1: resources become more scarce. And then and then a lot
Speaker 1: of academics were trying to explain why human being settled
Speaker 1: in communities you know, in the first place, and until
Speaker 1: the nineties fifties, you know, the main theory was that
Speaker 1: they start settling communities to plant, grow and stow wheats,
Speaker 1: you know, to make bread and and and that's why
Speaker 1: they you know, they start fawnning. But since the fifties,
Speaker 1: there is a lot of evidence that the most you know,
Speaker 1: the most ancient grains that they are finding in this
Speaker 1: very the settlement was was body, I know, was not
Speaker 1: was our weak and I don't know if you try
Speaker 1: to make a bread out of out of body, but
Speaker 1: it kind of doesn't work out, you know, so who
Speaker 1: apparently apparently the first you know, the grains that they
Speaker 1: found or it was body and it was basically two
Speaker 1: you know, to make beer. Right, So again, you know,
Speaker 1: I think beer, you know, the beer that that the
Speaker 1: rule that beer has been playing you know, in society
Speaker 1: for the last ten thousand years. It's truly to bring
Speaker 1: people together. It's an interesting to see it. You know
Speaker 1: that there is some evidence that it's been doing that
Speaker 1: for more than ten thousand years. Beer civilized people. I
Speaker 1: like that. I like that concept. So let's talk about
Speaker 1: an old joke and advertising, which is half of advertising
Speaker 1: dollars are wasted. The problem is we don't know which half.
Speaker 1: So that raises the question, how do you measure the
Speaker 1: impact of things like brands and influence and commercials. How
Speaker 1: do you recognize what actually works and what doesn't. What's
Speaker 1: the process like for that? Yeah, I think I think
Speaker 1: that that phrase I mean, of course, I mean it's
Speaker 1: not not perfect, but this phrase was very very true
Speaker 1: probably ten fifteen years ago, where digital and digital market
Speaker 1: is not so prevalent, where you had basically, you know,
Speaker 1: mass communication very hard for you to you know, to
Speaker 1: relay the mass communication. Today, you know, in a lot
Speaker 1: of places, we have operations that you can link every
Speaker 1: single dollar that you spent on advertising, you know, for
Speaker 1: the people clicking on your advertising being led to one
Speaker 1: of all the commers platforms, you know, purchasing the product
Speaker 1: and coming back. So in a way you can calculate
Speaker 1: very well what you know, the consumer lifetime value is
Speaker 1: and how much money you spend to acquire you know
Speaker 1: that that that customer. Right, So the things have become again,
Speaker 1: you know, with the commers and with technology marketing technology
Speaker 1: became much better and and I think the other thing
Speaker 1: is you know today, uh, you know, back in the days,
Speaker 1: you will kind of spend the money and then you'll
Speaker 1: you'll try to look back and use some econometric modeling
Speaker 1: and and marketing mixed modeling to show another that I
Speaker 1: think worked or not. Today we are we are working
Speaker 1: much more in terms of you know, you have a
Speaker 1: high parts and you have you know, some variations of
Speaker 1: creative lines and campaigns that you want to test, and
Speaker 1: then you put that in digital and then you keep
Speaker 1: running them and seeing on a daily basis what's working
Speaker 1: and what's not to be tasting and and putting money
Speaker 1: behind the ones that do work, you know. So I
Speaker 1: really believe that productivity, you know, and the returns have
Speaker 1: improved substantially, you know, for the companies that are being
Speaker 1: able to deploy you know, marketing technology and analytics. So
Speaker 1: digital certainly is helping. How do you how do you
Speaker 1: look at things like social What what do you think
Speaker 1: of places like Facebook and Twitter? Is it a marketer's
Speaker 1: paradise because it's so specific and can get so granular
Speaker 1: or do you run into the same issues that you
Speaker 1: run into advertising anywhere? Yeah, it's you know, these platforms
Speaker 1: they allow you to understand your audience and provide a
Speaker 1: message that it's much more adequate to the to the
Speaker 1: audience that you're trying to reach. Right. So back again,
Speaker 1: back in the days, you know, you would have to
Speaker 1: do a kind of a TV campaign, and the TV
Speaker 1: campaign is for everybody. So you you would pick some
Speaker 1: some passion points or some sponsorships, and then you would
Speaker 1: you would kind of blast that sponsorship to the to
Speaker 1: the whole population through through TV. You know. Today, what
Speaker 1: these platforms they allow you to do is to understand
Speaker 1: you know, consumer segmentation, the interests of people you know,
Speaker 1: and and and how many of them are there, and
Speaker 1: the engagement which one of the passion points, and then
Speaker 1: it allows you to you know, to basically communicate with
Speaker 1: them through passion points. Right. So, for example, inverter Wiser,
Speaker 1: you know, we have a lot of sponsorships. You know,
Speaker 1: we we sponsor music, sponsor sports. You know, we we
Speaker 1: have kind of responsor urban culture, responsor arts, uh, you know,
Speaker 1: and and uh and a bunch of other things. You know,
Speaker 1: back in the days, will kind of pick you know,
Speaker 1: one passion point like football for example, and you communicate
Speaker 1: through that platform and that sponsorship to the whole population.
Speaker 1: And what this platform is really allow you to do
Speaker 1: is to understand specific passion points and then what resonates
Speaker 1: through rich consumer segment and be much more surgical value
Speaker 1: or messaging. So you guys own three of my favorite beers.
Speaker 1: You own Stella, you own Whole Garden, you own Shock Top.
Speaker 1: When you're thinking about marketing a particular brands or a
Speaker 1: premium beer versus a sort of mainstream beer or a microbrew,
Speaker 1: is it all about just micro targeting that specific passion
Speaker 1: to a group or is there a broader, more holistic
Speaker 1: branding approach somewhere in the background. No, there is a
Speaker 1: you know, we we kind of you know, we have
Speaker 1: kind of our our process and on how to build
Speaker 1: the brands and the brands they are at different stages
Speaker 1: in different markets, so there's a very you know, specific
Speaker 1: approach to to give you, like, you know, an example,
Speaker 1: Scala is of course at at a much different stage
Speaker 1: than than who got in or or Shocked Top right.
Speaker 1: And you know, whenever, whenever we start, you know, in
Speaker 1: a country with a new brand, we we focus mainly
Speaker 1: on creating salients for brand and people getting to know
Speaker 1: that brand and creating points of difference you know, to
Speaker 1: other beers, so that we entype the career ositive of
Speaker 1: people to consume the beer. You know. As the brand grows,
Speaker 1: then we focus more on on relevance and meaning, you know,
Speaker 1: what what does this brand do for you know, for
Speaker 1: our consumers, and how it can create more of an
Speaker 1: emotional connection you know, over time. Right, So, so there
Speaker 1: is you know, there is a different approach of course,
Speaker 1: depending on the on the size of the brand and
Speaker 1: at the stage that it is. That's really interesting. You
Speaker 1: guys have been very active in the mergers and acquisition space.
Speaker 1: You seem to be adding products or at least pre pandemic,
Speaker 1: you were adding products to your portfolio on a regular basis.
Speaker 1: When a new brand comes in, how do you go
Speaker 1: about marketing that? Do you do? You have to come
Speaker 1: up with a whole new strategy for each new acquisition
Speaker 1: to take us through that process. Well, it depends a
Speaker 1: little bit. So first first and foremost, very we started
Speaker 1: with with the consumer you know, and we try to
Speaker 1: map out in in every market what's kind of the
Speaker 1: total addressable you know, population that we have, and then
Speaker 1: we try to segment them and try to define what
Speaker 1: brand and what beer styles or beverage styles are ideal
Speaker 1: to you know, address the needs of these consumers. Right,
Speaker 1: so even sometimes we even call this kind of a
Speaker 1: programmatic in an a approach because we start from the
Speaker 1: consumer lenses and then we go backwards and we define
Speaker 1: what the perfect portfolio that we need in order to
Speaker 1: you know, to to serve that that consumer. And then
Speaker 1: the answer you know, kind of how to do the
Speaker 1: market and help to integrate the market depends a lot
Speaker 1: on the on the type of consumer we are trying
Speaker 1: to to reach, right So, to give an example into
Speaker 1: thousand sixteen, we partner up with Candem Town Brewery, you
Speaker 1: know in London, the you know, the most loved and
Speaker 1: precedious craft beer uh you know in in the UK
Speaker 1: today and and their consumers you know, they are they
Speaker 1: are people with a high level of engagement, you know,
Speaker 1: with with the brewery, with the neighborhood, with the community
Speaker 1: and with beer. So we did very little advertising, and
Speaker 1: you know, one of our main tools you know for
Speaker 1: promoting the beer was basically the events get to have
Speaker 1: on a weekly basis in the brewery and then the
Speaker 1: group of that that we had, you know, that's kind
Speaker 1: of of course, it's like super different from the way
Speaker 1: we launched a but like Felter right, which is again,
Speaker 1: you know a lot of people are passionate about bud light,
Speaker 1: but now we are providing them with the bud light
Speaker 1: UH that confused different needs in different occasions and the
Speaker 1: one that they're used to, you know. So again, I
Speaker 1: think the important thing here always is to start from
Speaker 1: you know, from the consumer backwards and then define what
Speaker 1: brands you need to create or partner up with, and
Speaker 1: then what are the best channels and ways to communicate
Speaker 1: with them. Quite interesting, Let me ask you a question
Speaker 1: about the company culture. A ban in BEV has a
Speaker 1: reputation of being both challenging but breeding talent. And as
Speaker 1: an example, your predecessor as chief marketing officer is now
Speaker 1: the CEO of food Giant craft Higns. What does this
Speaker 1: say about the corporate culture and what does it mean
Speaker 1: as to where where you may end up running a
Speaker 1: company at some point in the future. You know, we
Speaker 1: have a culture very that is very is very entrepreneurial,
Speaker 1: you know, and and and for me it's hard to
Speaker 1: say that because I've been working here for twenty years.
Speaker 1: That was my first and only job. But I realized
Speaker 1: that when we set up UH as the ex Rangers
Speaker 1: you know, back in two thousands fifteen, because at the
Speaker 1: time we're trying to hire a lot of entrepreneurial talent
Speaker 1: to run new ventures and and run new ideas, and
Speaker 1: we had a big discussion on on where that we
Speaker 1: should have in the ex ventures the same culture that
Speaker 1: we had in our in our main company, or you know,
Speaker 1: we should try to do something different and talking you know,
Speaker 1: two people that we brought from the outside and you know,
Speaker 1: when they looked at our culture and erstand our culture,
Speaker 1: they say, this is entrepreneurial culture. You know, that's like,
Speaker 1: that's exactly what entrepreneurs are. They look for. So the
Speaker 1: main the main things that have in our culture and
Speaker 1: are about you know, dreaming big, right. We like people,
Speaker 1: you know that come here with big dreams and want
Speaker 1: to accomplish big things and want to have you know,
Speaker 1: a big impact. We love people that they like meritocracy,
Speaker 1: you know, which is the possibility of of growing profession
Speaker 1: and nationally at the base of the of your effort
Speaker 1: and talent. And we like to bring people that have
Speaker 1: a sense of ownership, you know that they treat the
Speaker 1: business of their own business and they have the autonomy,
Speaker 1: you know, like if they have their their own business,
Speaker 1: you know, so that those are the main things in
Speaker 1: the you know that are had in the in the culture.
Speaker 1: Easy acts of people that we brought to the company.
Speaker 1: They were external entrepreneurial talent. And our turnover is super low,
Speaker 1: you know, so which means that I think there is
Speaker 1: a fit between you know, the entrepreneurial culture and our culture.
Speaker 1: What what about pressure? Do you feel the situation when
Speaker 1: your predecessor is running leaves to run a giant company.
Speaker 1: Does that does that add anything to the expectations for
Speaker 1: what Pedro Earth is going to end up doing at
Speaker 1: a b in bev there you know again, you know,
Speaker 1: going going back to the to the culture, you know
Speaker 1: that the pressure that we're having here is because we
Speaker 1: want to accomplish more, you know, as a team and
Speaker 1: as owners. You know, it's not a pressure that comes,
Speaker 1: you know, because the border wants us to do something
Speaker 1: or deliver something. On the CEO wants to do something
Speaker 1: and deliver something. You know, we see ourselves and again
Speaker 1: I've been here for you know, for for twenty years,
Speaker 1: since this company here you know, was a small company
Speaker 1: you know, back back in Brazil, and we've been behaving
Speaker 1: you know, the same. We see ourselves as you know,
Speaker 1: a group of people that want to, you know, to
Speaker 1: to accomplish things and are ready to you know, to
Speaker 1: to work as owners in order to in order to
Speaker 1: do that. So the pressure for me is much more,
Speaker 1: you know, given by by our our ambitions and what
Speaker 1: we want to get accomplished, rather than by an external force. Huh.
Speaker 1: Quite fascinating. I know I only have you for a
Speaker 1: couple of more minutes. So let's jump to our favorite
Speaker 1: questions that we ask all of our starting with what
Speaker 1: are you streaming these days? Tell us your favorite Netflix
Speaker 1: or Amazon Prime show or any podcast that you're listening to.
Speaker 1: All right, so you know, I Netflix, I haven't been
Speaker 1: watching too much Netflix lately, and all the last the
Speaker 1: last one that I saw and I even missed. I
Speaker 1: think the last episode was the last Dance, you know,
Speaker 1: which is of course I'm fascinating. And but podcast I
Speaker 1: you know, I I listened a lot. I mean, I
Speaker 1: listened to the Bloomberg one. I listened, you know, you know,
Speaker 1: the CMO pod podcast is really great, the Skat Galloway
Speaker 1: prof Ga It's really good. Uh, you know, I I
Speaker 1: try to exercise, you know, every morning and for me,
Speaker 1: that's the ideal format in order to learn something get
Speaker 1: you know, getting formed while while trying to keep healthy. Huh.
Speaker 1: Tell us about some of your mentors who helped shape
Speaker 1: your career in the world of marketing. Yeah, you know,
Speaker 1: very kind of in the I mean when when I
Speaker 1: joined the company, the company was kind of in a
Speaker 1: crazy rhythm, right because we are growing a lot and
Speaker 1: expanding and doing a lot of things. So in a way, uh,
Speaker 1: you know, our training and our mentorship came more on
Speaker 1: a on a day to day basis, you know, and
Speaker 1: and facing the challenges that we that we staged, rather
Speaker 1: than proper kind of mentorship, you know, for someone that
Speaker 1: I would have like deep conversations and and get some
Speaker 1: some learnings from. Of course, I'm into my you know,
Speaker 1: my you know, before joining the company, of course, I
Speaker 1: mean my parents in terms of work, cathotics and fatties,
Speaker 1: they were you know, they were fundamental, you know. But
Speaker 1: after that, if you know, in terms of kind of
Speaker 1: learning you know, from the outside world. I'm a big
Speaker 1: fan of reading, you know, I think that the beauty
Speaker 1: of reading is that, you know, you can try to
Speaker 1: the extent possible learn with other people's mistakes. Is that
Speaker 1: with your own mistakes. So I've been you know, I've
Speaker 1: been really quite a lot since uh, you know, since
Speaker 1: I left a Quality So let's jump right into that question.
Speaker 1: This is everybody's favorite question because people are always looking
Speaker 1: for new things to read. Tell us some of your
Speaker 1: favorite books and tell us what you've been reading during
Speaker 1: the past six months. Yeah. So, you know, I'm reading
Speaker 1: about mainly mainly two things, right. One thing is about
Speaker 1: innovation and agility and things like that, you know, because
Speaker 1: again that's that's kind of coul we need to do
Speaker 1: to grow and up leading about leadership, you know, to
Speaker 1: kind of trying to to get better as a you know,
Speaker 1: as a leader. One book that I'm reading right now, Uh,
Speaker 1: it's from a big consultants called Agile Done Right. You know,
Speaker 1: there's a lot of people, a lot of he's talking
Speaker 1: about a gile you know, and and things like that. Uh.
Speaker 1: And and there are a lot of pit false you know,
Speaker 1: and the mean and he's basically he's the expert in
Speaker 1: the practicing in their consulting. So that's a pretty interesting book.
Speaker 1: I just read it. Know a good friend of mine,
Speaker 1: David Kidder, you know, the new Too Big book. You know,
Speaker 1: he explains a little bit how big companies are great
Speaker 1: at and taking big things and making them bigger, and
Speaker 1: how entrepreneurs are great at kind of creating things from
Speaker 1: zero and making them big, and then how big companies
Speaker 1: can try to do book at the same time. So
Speaker 1: this is more on the on the innovation side and
Speaker 1: then on the on the leadership side. You know, I'm
Speaker 1: I'm kind of almost finishing the lights out. She's h
Speaker 1: you know, the story of g you know, and what
Speaker 1: has been called happening with the company in Wiston, which
Speaker 1: is a pretty interesting story. Hm, I can just say
Speaker 1: the least. So what sort of advice would you if
Speaker 1: to a recent college grad who was just beginning a
Speaker 1: career in either marketing, branding or advertising. Yeah, you know,
Speaker 1: going back to the books, you know, I'm a big
Speaker 1: fan of Jim Collins, and Jim College has been you know,
Speaker 1: close to you know, to our company for a long
Speaker 1: time and we learn a lot from you know, from him,
Speaker 1: and he has this principle, you know, and what makes
Speaker 1: company companies great that I think it applies to people
Speaker 1: as well. And also he says that companies are outstanding
Speaker 1: and they last. A companies that first they love what
Speaker 1: they do. Second, they have the DNA to do that
Speaker 1: better than the people in third, kind of you know
Speaker 1: what they do. You know, it's it's kind of a
Speaker 1: sustainable economic model. You know, it's something that leads the
Speaker 1: company to a direction that it's that it's sustainable. You know,
Speaker 1: if if you use the analogy I think with your
Speaker 1: you know, your professional life, for your life is you know,
Speaker 1: try to to do what you love. You know, check
Speaker 1: on whether what you love, you know you have the
Speaker 1: genes or the capabilities to be to be better than
Speaker 1: than average. And then see if by doing that thing
Speaker 1: you know you're gonna you're gonna go, you are likely
Speaker 1: to go to a path that is going to make
Speaker 1: you a happy person in life. And also that's that's
Speaker 1: kind of a framework that I think is useful to
Speaker 1: think about your career choice. And our final question, what
Speaker 1: do you know about the world of marketing and advertising
Speaker 1: today that you wish you knew twenty years ago when
Speaker 1: you were first getting started. I think, you know, when
Speaker 1: I started, there was a lot about you know, understanding
Speaker 1: the the theory behind it, you know, understanding about brand duty,
Speaker 1: about channel planning, about all the all the theoretical underpinnings
Speaker 1: and of marketing and consumer understanding. And you know today
Speaker 1: today I think, you know, I realized that, you know,
Speaker 1: it's about having a deep customer obsession and a deep
Speaker 1: customer understanding you know the rest. If you have that,
Speaker 1: the rest you can learn, you know, pretty quickly. But
Speaker 1: having this obsessive you know, mindset on understanding what what
Speaker 1: your you know, what what are your consumers and what
Speaker 1: people need and how your products can can achieve that.
Speaker 1: I think it's it's a big part of what marketers
Speaker 1: should do well. You know the rest. I think it's
Speaker 1: it's easier to to call thank you, Pedro for being
Speaker 1: so generous with your time. We have been speaking with
Speaker 1: Pedro EARP, chief marketing officer at Beer Giant a b
Speaker 1: in Bev. If you enjoy this conversation, well, be sure
Speaker 1: and check out any of the previous three hundred or
Speaker 1: so we've had over the past six years. You can
Speaker 1: find that at iTunes, Spotify, Overcast, Stitcher, wherever your finer
Speaker 1: podcasts are sold. We love your comments, feedback and suggestions
Speaker 1: right to us at m IB podcast at Bloomberg dot net.
Speaker 1: Give us a review on Apple iTunes. Be sure and
Speaker 1: check out my weekly column on Bloomberg dot com slash Opinions.
Speaker 1: Sign up for our daily reads at rid Halts dot com.
Speaker 1: Follow me on Twitter at rit Halts. I would be
Speaker 1: remiss if I did not thank the Crack staff that
Speaker 1: helps us put together these conversations each and every week.
Speaker 1: Michael Boyle is my producer, Tim Harrow is my audio engineer.
Speaker 1: Atika val Brunn is our project manager. Michael bat Nick
Speaker 1: is our head of research. I'm Barry Ridholts. You've been
Speaker 1: listening to Masters in Business on Bloomberg Rady yum