Foreseeing the fantastic scope of AI and Machine Learning, the worldβs largest F&B company adopted the technology early and started implementing it from scratch for different departments.
Today, PepsiCo is embracing AI, ML, and Automation to ramp up four key pillars of its business: Production, Trend/Demand Forecasting, Consumer Research, and Advertising.
AI automates Production
Have you ever thought about how every piece of Layβs chips is always so crispy and consistent? (Why did we bring up Layβs here? Layβs is a sub-brand of PepsiCoβs subsidiary company.)
Because every Layβs chip is passed through a Laser scan, and the sound it produces is processed and analyzed by an ML algorithm to determine the chip texture.
Thatβs how PepsiCo automates the quality check process.
Another instance is how PepsiCo combines ML with a visual system to estimate the mass of treated potatoes. This single upgrade saved them $300,000 per line spent on measuring equipment.
How PepsiCo introduces favors or products consumers donβt know they want!
The secret lies in a tool PepsiCo uses to discover what people are eating and why. When the company creates a new flavor or product, itβs based on reliable consumer insights generated by a tool called Tastewise.
The tool employs an algorithm trained by massive volumes of culinary data like more than 95 million menu items, 226 billion recipe interactions, and 22.5 billion social media posts.
Using tool insights, the company adopted seaweed as a flavoring for savory snacks, and can you believe, it has been a top seller since.
AI makes Distribution ultra-efficient
Getting your products and promotions narrow-down to stores/places where your best matching set of customers live can instantly boost your sales.
It becomes even more crucial when catering to customers across 200+ counties.
PepsiCo uses its in-house big data and analytics platform, Pep Worx to identify the most promising distribution strategy.
For example, when the company was planning to launch Quaker Overnight, Pep Worx helped identify 24 million households from a dataset of 110 million US households. Then they used the data to promote the product in stores where these households are most likely to visit.
Result?
80% of the productβs sales growth in the first 12 months after launch!
AI boosts ROI on Advertising
The best thing about AI is it allows you to make data-driven decisions.
When defining your target audience, ad design, keywords, or bidding strategy, AI can empower the marketing team with valuable insights like suggesting look-alike communities who are most likely to take action after seeing your ad.
The AI-use cases we just discussed took years of effort, determination, and a long-term vision to transform into sales and profits.
PepsiCo took the right decision at the right time. Thatβs why the company is at the peak of leveraging what AI can offer today.
