Why CPG Execs Are Seeking Greener Pastures

Written by
E.J. Schultz
Advertising Age

Mar 23, 2016

Mar 23, 2016 • Author: E.J. Schultz

Category Is a Fertile Training Ground, but for Many It's Now Just a Stepping Stone

Leslie Newlee thought she would never leave PepsiCo, where she spent many years in insights and analytics roles. "I thought I'd stay there for life," she said. The company offered "great compensation, great challenges, great jobs, great people -- the list goes on and on."

But last year, after 20 years at the food and beverage giant, she finally decided to move on. Today she is VP-customer development and insights at Sambazon, a small maker of fresh juices, smoothies and frozen foods made from acai berries. And she is not looking back. At PepsiCo, "I could work a whole week and not change a damn thing," she said. "Here I am energized on a daily basis by what I can contribute."

Her career path -- from big to small company -- is an example of the tumult occurring in the consumer packaged-goods labor market. Shifting consumer preferences away from processed foods and beverages has led to slower growth, creating more pressure to cut costs at CPG stalwarts including Kraft Heinz, General Mills, Mondelez International, Campbell Soup Co. and others. This has forced some marketing employees to reconsider their career paths. Some people are migrating to higher-growth industries, like technology. Other marketers are finding landing spots at growing upstart food and beverage companies that are smaller, but offer the chance, as in Ms. Newlee's case, for broad influence.

"Life used to be quite simple: You go to business school. You do an internship at a CPG. They invite you back full-time. You get on this wonderful track, and you learn the technical aspects and the marketing function and you become a general manager," said Rory Finlay, who leads the U.S. consumer products practice at executive search firm Egon Zehnder. But "that linear, very clear track is going away."

That is a big shift for the CPG industry, which has long been a training ground for top-notch marketing talent. And the jobs were stable, for the most part. "You weren't going there to do cutting-edge work, but you knew you were going to do good work and have security," said Tom Bick, a former senior director-integrated marketing communications and advertising for Kraft-Heinz's Oscar Mayer business. Now "it looks kind of bland. … It's not the future. The energy is elsewhere," Mr. Bick said. His position was eliminated last year in a cost-cutting round in wake of the Heinz-Kraft merger that was orchestrated by 3G Capital and Warren Buffett's Berkshire Hathaway.

The bright side for CPG marketing professionals is that their skills in brand-building and consumer insights are in demand at smaller companies and in other industries, including technology. Amazon, for instance, is recruiting CPG execs to "help them establish a foothold in consumer products," said Tierney Remick, vice chairman of board and CEO services at recruiting firm Korn Ferry. Tech companies "need to get the consumer conscience into the equation so they can understand -- how do they service that customer," she said.

Mr. Bick recently accepted a job as VP-marketing and sales for Death's Door Spirits, a small craft distillery in Wisconsin. "It's going to be a wild innovative ride," he said. "But it's very exciting and that excitement doesn't exist anymore in these larger organizations."

Bret Quereau, formerly an analytics director at Kraft Heinz, was able to land a new job within months after the food giant eliminated his job last year. CPG is a "very unstable environment," Mr. Quereau said. "Everybody is looking at working with much leaner organizations in order to maximize profitability." So he decided to change industries and took a job as a director of marketing analytics at pharmaceutical company AbbVie.

Ms. Newlee, who led strategy and insights for the PepsiCo team supplying Safeway, had opportunities to stay at the company. But changes were on the horizon after the owner of the Albertson's chain acquired Safeway. Also, by overseeing insights, Ms. Newlee saw up close the shift taking place among retailers, which are increasingly willing to stock smaller brands that more consumers are demanding. At her new job, she has gained broader responsibilities, like overseeing sales in the western region as well as category insights, in addition to other duties, she said.

Big companies have responded to the trends by acquiring smaller brands. And increasingly, they are careful not to meddle in the operations of their acquisitions, fearing that would disrupt the entrepreneurial spirit. They are also trying to adopt a nimble mindset when launching products in some cases. For instance, PepsiCo's new Caleb's Kola came from a cross-functional team that worked in a separate space from the rest of the company at WeWork Labs in New York City, which is a shared workspace for early-stage startups.

Despite the cost pressures, CPGs have not lost all of their luster, especially for new hires. "CPG remains a very sought-after career for new MBAs," said Tim Calkins, a marketing professor at Northwestern University's Kellogg School of Management. "It's still a great place to go for training, but the long-term outlook is much more shaky," he added. His advice to students? "You have to go into it realizing that in the long run you will likely be moving into different industries."

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