PepsiCo: More local talent and products
Localization is playing an increasingly important role in PepsiCo’s expansion strategy in China, said Katty Lam, chairman of PepsiCo Greater China Region.
The move is expected to help PepsiCo to win even more market share in the country, she added.
“China is one of PepsiCo’s most important markets in our strategic global business plans and the country is going to have another golden 10 years ahead,” she said.
The international giant has put great effort in nurturing local talent at all levels, from junior to senior positions, as an important step in its localization strategy.
“In the past, senior executive positions were often filled by foreigners. Now the majority of high-level jobs at PepsiCo are taken by Chinese,” Lam said.
The company said 99.8 percent of staff and 88 percent of all senior management at PepsiCo China are locals.
Lam herself is the first-ever Chinese woman to serve as the head of the company’s subsidiary in the region.
Lam said employees from different provinces help PepsiCo know more about markets in various regions of the country.
To increase its share of the non-alcoholic beverage market, last year PepsiCo formed a strategic alliance with China’s leading instant noodle and beverage maker Tingyi Holding Corp.
Lam said Tingyi’s mature sales and production network on the mainland is a huge bonus for PepsiCo.
The company also focuses on developing products that cater to the tastes and preferences of local consumers.
One of the best- selling potato chips in the country is cucumber flavor, which is not available in other countries.
“We came up with the idea from a common dish, pai huanggua (shredded cucumber),” Lam explained.
For a company to do well in the North American market, it only needs to focus on one or two popular products, said Lam, but in China the company needs to have constant innovation.
“Local consumers are experts in food and they have an appetite for new products. This challenges us to be very creative in product innovation and in trying to satisfy the demands of local consumers.”
To develop more new products, PepsiCo opened a food and beverage innovation center in Shanghai last year.
“The innovation center can help us to develop products that are more locally relevant,” Lam said.
“It is the trend for the whole consumer industry” as leading companies in the food and beverage industry develop different products for the various regions in China, she added.