UP406 The Buy Side: What Does PepsiCo Want?

The Buy Side is our regular series talking with brand side marketers about sport and sponsorship. 

This week’s guest is Mark Kirkham, the SVP & Chief Marketing Officer of PepsiCo, one of the biggest spenders in the sports industry, whose brands such as Aquafina, Pepsi, Gatorade and Lay’s are associated with a huge number of major events globally across a portfolio that includes official partnerships such as UEFA Champions League, the NFL, the Saudi Premier League, the LPGA, WNBA and EA FC or what used to be called the FIFA game franchise, but also a large number of tie ups with individual sports stars, musicians and other creators.  

With this type of spend, comes influence and power. How, where and with whom Pepsi spends its money is a signal to every sports rights holder to shape their commercial programmes to catch Mark Kirkham’s eye. What are the implications of this for sport and what does Pepsi want sport to be? 

The Buy Side is sponsored by KORE Software the global leader in engagement marketing solutions. More than 900 brands, venues, and sports organisations trust KORE’s tools and platforms as a source of truth to manage partnerships, assets and measure impact, with real-time insights. Through Sponsorship Management and Evaluation, Ticketing, Fan Engagement, Data Management and Analytics, KORE unites corporate sponsors, properties, and their fans with solutions that help enhance the fan experience, drive smarter decisions, and enable marketing and operations teams to spend time where it matters.
 Learn more at KORESoftware.com or follow them LinkedIn or Twitter. 

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Transcript

Richard Gillis Unofficial Partner: 0:00

Hello, welcome to Unofficial Partner, the sports business podcast. I'm Richard Gillis. This is an episode of The Buy Side, which is our regular series, talking with senior brand marketing people about sport and sponsorship. This week's guest is. Mark Kirkham, the global CMO of PepsiCo. One of the biggest spenders in the sports industry whose brands such as Aquafina, Pepsi, Gatorade, and lays. Are associated with a huge number of major events globally across a portfolio that includes official partnerships, such as UA for champions league, the NFL Saudi premier league. The LPGA w MBA and EIF seal. It used to be called the FIFA game franchise. But also a large number of tie-ups with individual sports stars, musicians, and other creators. With this type of spend comes influence and power. How, where, and with whom Pepsi spends its money is a signal. To every sports rights holder to shape their commercial programs to better catch marker comes. I, what are the implications of this for sport? And what does Pepsi want sport to be? The buy-side is sponsored by KORE Software. The global leader in engagement, marketing solutions, more than 900 brands, venues and sports organizations trust cause tools and platforms as a source of truth to manage partnerships, assets, and measure impact with real time insights. Through sponsorship management and evaluation ticketing, fan engagement, data management, and analytics, core unites corporate sponsors properties, and their fans with solutions that help enhance the fan experience. Drive smarter decisions and enable marketing and operations teams to spend time where it matters. Learn more at KORESoftware.com or follow them on LinkedIn or Twitter. Thanks for doing this. Yeah, no worries. I've been seeing you buzzing around. You've Been busy. You have been busy. Been busy, in a good way though. Can, what was that like? Oh, it's great.

Mark Kirkham, PepsiCo: 1:58

It's it was a lot of work. But yeah, it was, you know, it's beyond just an advertising event. It's become an industry event and sports taken a massive step up between Sports Beach, FIFA Beach, the elevation of the women's game across sport. The number of Talent, celebrity and players who show up to help, you know, not just tell the story what they're doing, but actually build their own brands. It's become really interesting. So why do you

Richard Gillis Unofficial Partner: 2:23

think that's happened? What's what's going on? I think

Mark Kirkham, PepsiCo: 2:25

well, I think Stagwell started it in some ways by taking that level of investment into sports. And it was if you think about it was last year, it was very American sport. And then actually what we've been able to do, and we've been a partner with theirs for the last two years, is bring much more of a global sporting nature to it. I think this year, because the Euros, you had the torch running down the closet. So I think it just shows the importance of sports. in culture and not sports as just a medium or a an industry. I think it's showing it's connected much more in storytelling and brand building. And you know, we've been doing that a long time, so it's natural for us, but I think it's becoming more of an industry within the advertising and marketing industry.

Richard Gillis Unofficial Partner: 3:08

Do you enjoy

Mark Kirkham, PepsiCo: 3:09

it? Yeah, I enjoy it. It's a long yards though. It's it's a busy week. It's a great way to reconnect and network with friends and colleagues and see people that you don't see. It's like any of these big events. People all travel to it, whether it's CES or some of the big industry events. It's as much about the opportunity to be with each other as it much is to learn from, see examples, spend time at events. And between speaking opportunities, media work that I did. It's a busy, it's a busy week, that's for sure.

Richard Gillis Unofficial Partner: 3:38

I mean awards generally, but I think Cannes particularly, and you're right, I agree with you completely about the rise of sport within it. I was looking at that we did a thing with Louise, who obviously Chair of the Governors, Chair of Governors, Chair of President, what's your name? President of

Mark Kirkham, PepsiCo: 3:53

the Lions in Sport, yeah. That's right.

Richard Gillis Unofficial Partner: 3:56

And I was, we had a, we did a podcast about it and we, I'm always interested in what the signal is from an awards like that and what the reading is, because their sort of role is to say, right, this is now good. This is what we think is, and they use the phrase, can worthy. I'm just wondering what the. What the reading is, well,

Mark Kirkham, PepsiCo: 4:15

I think it's an acknowledgement of the important sports is playing to elevate creativity in the industry, right? So, and we were lucky to have a few projects we did actually were honored. But if you look at it, it's no longer just about sponsorship. It's about how can sports. Help build brands, tell different stories. I mean, if you look at the work that EA did with FC Bromley, I mean, that's amazing, an amazing piece of database creativity that got acknowledged. JD Sports, a couple years ago, about the player who had had passed, but they brought him to life in the game. So there's just some amazing ways that you can take An IP partnership, a relationship with a club, a league, and turn it into a much more creative and differentiated brand story. And I think that's what Cannes is doing by creating, you know, the Cannes Lions for Sport because they're acknowledging and they're bringing in people who in the past wouldn't have even been part of these juries to really kind of weigh in on the role that sports can play to elevate brands. So I think it's a great thing to see. And I think you'll see even more and more kind of creative, you know, executions in sport.

Richard Gillis Unofficial Partner: 5:20

What does it mean for the old, good old sort of official partnership model? Because you're right in that there's crea it's rewarding creativity across the board. And it was used to be very delineated and people, got into their lanes in terms of bought the rights for this and then if you haven't bought the right, you're an imposter. What's happened to that world? That's blown apart. I think

Mark Kirkham, PepsiCo: 5:40

that world is, if not gone on its way out. I mean, I hate the word rights holder. And I've said that before because it sounds tactical. It sounds transactional. The reality is, and actually I think sponsorship is a bit dated in a term. I think it is about partnership. Partnership for meeting mutual, you know, business objectives. Partnership for reaching new audiences. Partnership in telling stories. Partnership in building out new platforms within, you know, like what we've done with UEFA and music, you know, I think If you only think of it as a rights holder and a rights user, then it's a completely transactional relationship. So I think the world has changed, and Can is just one example. If you look at how the industry has evolved, how you value sponsorship is very different. And I think that's where, I think that's where the brands have started to actually, Change the narrative. And I think we've done that. If you think about how, whether it's with sustainability, whether it's music with UEFA, whether we've done with the NFL, if you look across the properties that we work with, it's not just for visibility and LEDs. It's not just for rights usage. It's actually for storytelling. And it's in those stories could be purpose based. It could be fun brand base. It could be sustainably based. All of this is changing. In my mind what sponsorship or what you know, what I'd say partnership is all about.

Richard Gillis Unofficial Partner: 7:02

So if I'm UEFA, FIFA, Premier League, NFL, I'm listening to you. I'm a bit worried because that model has funded me for a very long time and I'm wondering how if you don't need the rights to be creative and do what you're doing, why do you need me?

Mark Kirkham, PepsiCo: 7:19

Well, you need the rights. I just think if you refer to people as just rights holders, Then you're not taking advantage of the dual benefit and value you can get from each other, right? So, if you simply want to do a sponsorship for visibility, you're not maximizing, in my opinion, the value that both you and the league, the club, the talent, can actually get. You do need the rights. You know, the Orange example with what they did is phenomenal, but you couldn't have done that. And for us, where we've gone is taken, you know, if you look at Pepsi, what we've done in the kickoff show with UEFA, you know, when we first started this journey in 2015, 16 with them, you know, bringing music to core football was, you know, not something that was, as I'd say, welcome or open in the system. But actually we helped do it in authentic ways and we built stories beyond just the, you know, six to eight minutes. We led up to it with content, with storytelling, and then we brought different audiences into it. You know, we've allowed to attract audiences from different parts of the world, Latin America, the US, etc. So I think we've brought something into that relationship that's beyond just using rights. It's about taking that relationship and creating really differentiated points of view from a brand standpoint like Pepsi. Or if you look at what we've done with Gatorade, we use 5v5, our 5 a side program, which we've had over 151, 000 kids participate in, and we actually use Champions League Final, both for men's and for women's, as a way to engage kids around the world to actually be, yes, it's a prize, but ultimately it's experience. We can tell stories. We created a documentary called Canterra 5v5. We've told stories that essentially got anchored in how we use rights. But it's not using rights in the traditional kind of LED sponsorship visibility way. It's storytelling. It's purpose based It's much richer than what we've done in and I think what the inner the industry's changed that way Which is why now it's being, you know acknowledged and can

Richard Gillis Unofficial Partner: 9:11

What do you make it the orange? Just well, you mentioned it. It's interesting. I Was I mean obviously creatively it was a really interesting idea It was obvious of its moment. There's a bit of me that thinks it's still fighting an old battle. It's still saying, okay, there's a reveal and it's men. You know, you thought it was men's and now it's women's. You sort of think you want the conversation to move beyond that. But actually, this is flagging it.

Mark Kirkham, PepsiCo: 9:36

Well, I think that what the conversation is, it's just sport. If you think, if you watch the play in that or in anything that we've done, we celebrate the sport. It doesn't have to be men's football, women's football. It has to be football. And what we've seen in an industry is that the industry has embraced, you know, all the different teams, all the different clubs, all the different leagues. I mean, you know, if you look at the fact that you're now playing in the Emirates, you know, the ladies are playing 11 games there. If you look at their going on international tours, you're seeing a change that's basically elevating football. And, you know, I think that's also the brand, the role brands can play. If I can take, for example, what we did with Rachel Yonke's story. You know, we, people knew, people in industry may have known her story about cutting her hair at nine years old. But when a brand then celebrates that in a really personal way, but actually brings it into what we call confidence coaches, we then take that, part of what we're doing for the Women's Champions League, and we educate young kids about building confidence. We know it's one of the biggest issues of any athlete, especially between like 13 and 16. And it's even twice as bad for women, for young girls that they drop out because they don't have confidence. When you can celebrate that, tell a story. We use technology to actually bring her back to her nine year old self, but then we actually turn it into a fundamental value for us. So we've now turned it into a program that we've made a commitment to help get two and a half million young athletes back into sport over the next several years. So, I think this idea of brands creating stories is helping elevate the importance of sport and the challenges and the barriers we see in sport But also we're actually using creativity to actually bring in new audiences because people will now say, wow, I didn't think about that. And I think that's why it, I think it's a good thing that brands, and particularly our brands are telling different stories. They're not just doing the same old kind of promotions or partnerships.

Richard Gillis Unofficial Partner: 11:26

So when you look at something like a FIFA World Cup or an Olympics, where you don't have the rights what's the approach? Is it you say, right, okay, now we're going to go via individual ambassadors or we're going to use a different.

Mark Kirkham, PepsiCo: 11:38

I think brands who are authentically associated to sport, endemic brands, they can tell stories all year round, any season, any time of year, as long as it's authentic to them. And regardless of partner or not, if you're authentic, you have the right to engage in a topic, right? So, we've been engaging in football for decades, well before we had a UEFA relationship. And I think that gave us the right to actually tell the stories we tell today as PepsiCo. And especially with Pepsi, and even recently with Lays, and Gatorade. And if you think about Gatorade's history in the women's game, you know, we put Mia Hamm and Michael Jordan in that in 1997. Way ahead of the industry, but that gave us, and many other endemic brands have done this, the right to tell stories throughout the year, regardless of what league is playing, what term is playing. And I think that's the difference. And I think there's clearly advantages of having rights and there's the commercial value, but I think what's having is authenticity in sport is what gives brands the right to tell these stories. So you're

Richard Gillis Unofficial Partner: 12:37

quite sort of sanguine if someone comes at you around a Champions League or Euros this summer, When they're using football as their marketing platform, they're in your category. You think, okay, that's fair enough. They're authentic. That's an authentic story. I

Mark Kirkham, PepsiCo: 12:48

don't think it's okay. I think you earn authenticity. I think brands who've been doing it a long time consistently, and you think about the women's game, that's a great example. If you can authentically tell stories and use the rights that you have to make those stories richer and more relatable and relevant to the audience, then you're doing the right job. If you just come in and out and you don't build those authentic stories or you don't maximize the value of the different rights that you have, then I think you're missing out. So I think it's the great thing is, and back to your original question. Authentic brands that I believe PepsiCo has and our history that goes back decades, depending on, you know, if you go to the NFL, it's 50 years. If you look at Champions League, we're going into our fourth cycle. You have the ability to tell stories like no other. You have the brands, you have the properties, but I think you also have the creativity and the storytelling. And I think that authenticity, you will always stand out amongst your peers.

Richard Gillis Unofficial Partner: 13:43

I'm really interested in Sport as entertainment because you hear it a lot on podcasts, you hear it on conferences, where people are saying sport should define itself as part of the entertainment industry, and this is, you know, it should be its world view, and this is how, and I'm interested in the implications of that, and obviously you're embedded in that, and I'm wondering what, so if you take, for example, The NFL halftime show or the, you know, the kickoff concert for the Champions League. What does that do? How popular is that with football fans? Is this something that you're imposing on? Football fans, because when, you know, the memes and the what's Lenny Kravitz doing here? Let's get on with the game. We're not in America now. Stop making it the Super Bowl. All of those, all of that stuff comes out from football fans, from the football side of the equation. I can see it as an entertainment piece, but I'm wondering if it's a jarring sort of relationship.

Mark Kirkham, PepsiCo: 14:37

I think it's an evolution. And every sport has, is it a different stage or level? And I would say sport in different countries is at a different stage of evolution. Ultimately, is sport entertainment? I think we could all say yes. But at its core, sport is competition. And so finding the balance around staying true to the authenticity of a league, a competitive spirit, a competition in structure, But then bringing entertainment to actually allow that product, which, you know, if you're UEFA, if you're FIFA, if you're the NFL, you create a product that ultimately you sell to the world. And if you can elevate that experience that takes the heart of an amazing competition and brings entertainment to it in an appropriate and relevant and authentic way, you bring more audiences you actually, I think you enhance the experience in the stadium and around. I mean, if you go back when we had Dua Lipa in Kiev. I mean, that became a cultural moment for Liverpool fans singing along to the fact they sing that song today. And it's because Pepsi brought her to the opening ceremony, you know, and I think that's rewarded by that. Do they attribute that? No, it's not about an attribution, actually. It's about culture. And I think if you realize that you've had a point in time that you've made culture, the thing about be like Mike, you know, think about that song. It's in your head right now. Cause I brought it up. It's something that But it turned into something that reflected culture. You know, we just did something with Shaquille O'Neal in minis, and we did a wish it was a little bit taller. You know, if you play on something that's already anchored in culture, But then bring it into a new conversation, in this case football. I think you then naturally and authentically can merge the entertainment of music and the competition of sport. And I think it's a natural, it's a natural evolution. I understand how purists might have been jarred when we first brought this into it. But I, I feel every year when I go to, I mean this year in particular, I mean Lenny rocked it. You know, he fundamentally brought that energy in a 90, 000 person stadium and you felt it. And you saw it in the broadcast. And honestly, I think that brings new audiences, new stories. And also, we as a brand, then we get to tell a story. You know, we talked about painting Wembley blue. And he had an album called Electric Blue. So, I think it's a great way to kind of slowly bring this entertainment into the competitive spirit of sport. But I think it's a natural evolution.

Richard Gillis Unofficial Partner: 17:03

He didn't name that album because you were sponsoring it. No. That was just an amazing the quiet hand of Pepsi working behind

Mark Kirkham, PepsiCo: 17:09

the scenes. Amazing coincidence. But yeah, it was, it's amazing to see also the crossover in genres. I mean, Lenny's 60 years old, but yet, Youth of today are being brought back into his old music through platforms like sport through what we've done with champions league. And I think that's the kind of opportunity we have as we continue to bring entertainment and bring music into platforms. And partnerships. I mean the crossover between footballers, between sports, music, and fashion, gaming, it's there. And that's a good, I mean, you think about our partnership with the AFC, it's a perfect example. You know, we have a natural affinity with youth and young consumers through various passion points. But to bring that connection between talent we sponsor, in game visibility, of course, but it's more about the culture and the engagement. And so by working with EA, we're able to connect the dots and, honestly, reach new consumers. Because, I mean, as you saw with the example we talked about, Can, you've got guys playing EA now actually helping manage and coach football clubs. You know, you saw what happened a couple years ago when you did a sponsorship in the game That actually turned into a or a sponsorship in Stephen? Yeah. In a small club that ends up becoming a scale play in in, in the game. So this convergence, and if brands like Pepsi, Gatorade, and others can start to in, insert ourselves there, which inauthentic ways, then I think naturally you're kind of seeing that entertainment and sport coming together.

Richard Gillis Unofficial Partner: 18:34

You can imagine that we go to lots of events, different types of sports, so last week it was rugby, it's golf, it's football, and they're all wrestling with similar challenges and they're all looking at audiences and, you know, all of the tropes of modern sports marketing. And one of the questions that keeps coming up is, well, when everything's a scroll on my phone, what is rugby? What is golf? And as a brand marketer, you know, you're P& G, PepsiCo, that's your lens. I'm really interested in what you think, because there is a sort of existential fear in a lot of sports that actually, if we go the entertainment route, we're all being mushed together and it will be very similar. We'll, there'll be no difference between rugby and sports. Dancing or in, you know, entertainment shows on Saturday night. And what's the difference? And I'm really interested in your sport as competition. Matt, I think, feels like part of the answer. But what do you think? I think so.

Mark Kirkham, PepsiCo: 19:33

I look I actually don't feel that the evolution of sport and entertainment will make things all vanilla the same because every human being attaches themself to a sport, an entertainment, a genre of music because there's something they personally connect with. You grew up playing Gaelic football, or you grew up playing rugby, or you grew up playing tennis. That's your connection. There's a personal connection, which either started from your family, your local community, or just your love of a game. And I think that's where the competitive piece parts. But as you get older, you get more interested in the story. You get more interested in the culture of sport. And that's where, frankly, it becomes more sometimes entertaining, because at some point, even the greatest can't compete the same way that they did. And so, What role is sport for them? Sport is a way to connect with culture, connect with society, connect with their roots. And so I don't think it'll ever get vanilla. But I also feel that if the industry doesn't embrace the fact that you're scrolling through their worlds, and doesn't embrace data, doesn't embrace social, doesn't embrace storytelling and content, then I think they'll miss out on what's the ecosystem of sport, which is evolving massively, probably faster than in many ways the rights holders are kind of evolving. So that comes down to data. If you think about the work that we do we, in particular, if I look at UEFA or even look at the NFL or others, we really work closely with our partners to look at data, you know, look at data, first party data, look at data we capture around our events. How can we use that data to actually tell better stories, be more relevant. Be more personalized with our messaging, because then when you're scrolling, you're not going to get lost amongst the noise. So I think it's a combination of one, there's always going to be an inherent connection that anyone has to their sport, but then there's always a way to kind of make that experience a little more robust. And the last thing I'll say is look at talent, okay? You know, we're lucky to work with some of the greatest talent in the world across PepsiCo, and we've had that, you know, for decades. But you look at someone like Vinnie Jr., you know, who we work with both on Pepsi and on Gatorade. He has a very unique role for each brand, but look at his brand. A great player, a great competitor, but what he's done and what he adds in storytelling with his personality, the work he's done with us on gaming, with EAFC, the work he's done in just you know, in just what we did in our most recent Pepsi campaign. He brings a personality. He brings entertainment. Look at the way he dances on the sideline. That is entertaining. You know, you look at Sonny, Sonny is a pure competitor, but he's got a unique story he tells. You look at the role of female athletes, you know, we had Karen Carney as a broadcaster, but also Leah Williamson as a player. They represent something and that is more than just what they did on the pitch or what they do on the pitch. And I think if brands can brace that, it's a much bigger story than the competition itself.

Richard Gillis Unofficial Partner: 22:21

Okay. The numbers are always wrong when they're reported in terms of sponsorship. Do you agree? When you see, when you look in the trades and when you look at the thing, okay, the deal has been done and Pepsi have spent X. That's always wrong, that number.

Mark Kirkham, PepsiCo: 22:35

I mean, typically, yeah,

Richard Gillis Unofficial Partner: 22:37

I mean, we

Mark Kirkham, PepsiCo: 22:37

don't discuss our, the terms of our deals, as you know, but look, I think the industry will always speculate because they put value on traditional measures, but I think the value is actually beyond that, to be honest. So are they always wrong? Maybe sometimes they aren't, but I don't think it's about the month, the number, it's not about how much you paid, it's how much value you get out of it. And that's a very different conversation because value isn't measured in LED exposures.

Richard Gillis Unofficial Partner: 23:01

But you don't want the rights holder to be completely cognizant of the value of their sponsorship, because otherwise you'll be paying more, presumably.

Mark Kirkham, PepsiCo: 23:10

Well, I think the value is mutual. So, for example, if you're the NFL, and you're putting the games on here, and you've got a brand like Pepsi Max involved, or Gatorade involved, You get the value of, you know, we're the number one cola brand in the UK, and you get that value because of your relationship with the U. S. You can engage new fans, and you've been to an NFL game here, it's, you've got every kid in the entire league showing up and yet a brand who's universally been connected, you know, for years as Pepsi or as Gatorade to the sport, now you're actually connecting with new consumers in different ways, and the value we bring to that is because of our local presence, or because of some of the, you know, history we've had with A specific sport, which is actually for the NFL internationally, a benefit. And so I think you have to look at value, not as the price you pay for rights. Value is the shared value you both get. One, there's the, call it the contractual value of any relationship, but I think there's the inherent value you get through the storytelling, through the local relevance you play, through the system. And then you look at brands like PepsiCo. You know, we, the in store impact that we can have. For brands or, sorry for leagues and clubs who have traditionally been only focused on their traditional channels, you open up entire new business opportunities. So, I think that's where the value is. So it's, this is why, back to your earlier comment, the evolution of sport and partnership, Has to change because the way you measure value is changing. And that's where I think the industry is kind of in the, we're in the process of evolving. There's always going to be the traditional metrics, the broadcast value, the LEDs. That's the stuff that's easy to measure. And it's the stuff that the, call it the industry was founded on. But if you think about what's happening on the periphery, on your phone, through experiences, that's making a much bigger difference.

Richard Gillis Unofficial Partner: 25:00

My question was about regardless of what the number is, and I'm not going to ask you what it is, but just in terms of globally it's hundreds of millions in terms of rights and sponsorship and the amount of money, you know, accompanying spend. I'm wondering what how that shapes incentives on the rights holder side. What, there's a sort of question about are they selling the right stuff on a very basic level, but also just more generally across the industry. What signals they take from your spending behavior?

Mark Kirkham, PepsiCo: 25:26

I think they realize, I think any rights holder has to realize they need to be more creative in how they package their products. They have to realize that in some cases their own players The own teams in their leagues are actually building more value and they have to compete with that. They have to realize that brands themselves can help them tell their story in ways they never thought before. Whether it's through sustainability, purpose, all the different things. I look, I mean our relationship at UAIF is a great example. You know, when we first started talking to them in 2015, you know, like with anything, it's your traditional sponsorship rights holder discussion. But then you open up the conversation, alright, how can we bring music and entertainment? How can you help us on our sustainability journey and our ultimate goal to zero waste to landfill? How can you help us with the women's game? I mean, if you go back and look at the investment that UEFA puts behind women's UCL, and look at women's Euros, as a sponsor of both of those, you know, we've been lucky to have the right to actually tell stories, build experiences, around games, around the finals. www. agilent. com And we were doing that earlier than many others, and now all of a sudden you see the value. It's not necessarily the same value in terms of broadcast and in terms of the same number of audiences, but it's unique, different ways to tell value. And again, I use the Rachel Yankee work the conference coach work, the work we do with 5V5 and Five Aside Football, and having them literally be a part of something that's anchored in a traditional tournament final. That's hugely valuable as UEFA looks to continue to build the women's game, both within Europe and outside. And I think that's where we come in. And I do think they're gonna have to be more creative. If I could, the one thing I would always say to my partners is, like, let's not start with, you know, your typical term sheet. Let's start with a brief of what we're trying to achieve together. And if you can do that, then I think you'll come up with different ideas. And you'll have some of the traditional ingredients for sure. But the overall value might be different because you're not just looking at it that way.

Richard Gillis Unofficial Partner: 27:28

Do you think that you're more enthused about women's football than the general football population? Do you think that you're pulling that argument by your spend? You're encouraging that, you're doing it for reasons other than sport. And I'm, by the way, I'm in favor of it. I'm not making it, I'm not, this is not a snide point. But I'm just, I'm interested in. Where you see that economy, that bit of the economy going, because it's a really critical moment in women's football, we've got a whole load of things going on, which, fingers crossed, will work. You're a major player in that, the media is the other player in it, and I'm just wondering how you shape what's happening.

Mark Kirkham, PepsiCo: 28:07

I think first off, you have to be committed and you have to be authentic about it. This is, we're at a very unique time, and we're lucky in particular as PepsiCo, in particular with Gatorade, that we've been doing this for 30 odd, you know, for 30 years or more. And it's because we had an authentic connection with athletes, and in some cases leagues, but originally started very much on the athlete front, sometimes it was teams, national teams for example. And they were successful on the pitch, but actually they were successful in building the brand. The brand of sport, you know, not just women's sport. If you look at the, you know, if you look at the U. S. national team, you know, the women's team sells more kits than the men. Why is that? Because they're an amazing football team. That's why. And it changed the whole industry in practically, you know, in terms of how they made kits and what they sold. So, if you look at that, then the authenticity of a brand like Gatorade being part of that story, It gives us, not just, I think, it gives us the right to continue to invest, tell stories, but what's happened, and it helps when, you know, the finalism, it helps when the lionesses win the Euros, it just brings the attention to something that for many people was always there. And many, you know, whether it's us, Unilever, Visa, many brands are investing significantly in the space, but it's how you invest in it, I think is more important, you know, and also that you don't just do it as a one off. And I think that's where we're at, that turning point. I won't even call it a tipping point, because there's a long way to go. I was in Cannes, I was on a panel talking about it, called it the halfway point. We're not even probably near the halfway point, but actually, we, the momentum can be literally an accelerator. And this goes from 90, 000 at Camp Nou, to Arsenal putting in 11 games at home, to PepsiCo investing in, you know, dedicated girls tournaments for Five Aside, taking them to the women's final. All of this and selling and telling stories. Again, I use the Rachel story because that's, Rachel's told that story many times. But until we recreated her nine year old self using II and actually brought a really emotional piece to that, people said, wow, I didn't know that. So I do think we were kind of, I wouldn't say we're trailblazers. I think we're part of, we're part of the movement and it is a movement and I think it's just going to take more and more brands. And I also think the leagues and the rights holders and the clubs need to think about how they want package this, you know, industry differently, how they talk about the industry. Again, I think it's about sport, not women's or men's. It's sport. It's football.

Richard Gillis Unofficial Partner: 30:34

But do you see a different, one of the strong arguments I think is it's a different audience. And do you see that in your data? Do you see that actually there's something else going on here? It's not blokes like me and Sean watching football like we've done for ages. It's a different group that's younger. I think it depends on the

Mark Kirkham, PepsiCo: 30:49

country. In a lot of places, it's the same audience. If you look at, if you look at football in the U S That's a very different industry and it was actually, in many cases, driven by the women's national team, but look at the MLS, look at what's changed, look at the family dynamic. You're talking about rugby versus football. You know the difference of being in a rugby stadium versus a football stadium. That's changing. You know, you look at the convergence of, and this is where entertainment plays in too, right? If you bring in music, you bring in new audiences. That was one of the strategic, you know, rationale for us coming in with the kickoff show. If you bring in grassroots. You bring in new audiences, male and female, moms and dads, it's not longer, no longer just that very specific targeted male football audience that it was 20 years ago. And I think that's where the data comes in, you know, so if you think about how you can segment data, how you can look at performance of digital content, you can look at the demographics, you can look at so much more. And the interesting thing, and you can see this from any club, is that their demographics are absolutely shifting. You're seeing more female, you're seeing different age groups, different countries becoming fans of clubs. You know, years ago, the Premier League was way behind in Latin America. La Liga was dominant. Now you see the Premier League coming up. Why is that? It's because of the product. It's they're engaging new fans. It's because of the brand. Of the quality of the sport and embracing different genres, different ethnic groups, different countries. And I think that celebrates the sport in a whole new way. And that ultimately, to me, is what, what will change, will continue to change. People will value a club differently, they'll look at leagues differently. I mean, Champions League is the number one watched annual football tournament, and it's only played in Europe. You know, that's because brands like ours, broadcasters around the world are helping tell a story and they're helping to actually get access to new audiences that aren't just traditional, you know, what you'd say, male blokes watching football. It's families, it's women, and it's really the game is evolving. And you're also being able to get it different formats.

Richard Gillis Unofficial Partner: 32:48

Can you see a you know, there's the global game argument there. Does it need, does the product need to go to the U. S.? Do you need to have games in the U. S.? Either at Champions League level or, you know, it's obviously a trope that's been running. Yeah, I mean, I

Mark Kirkham, PepsiCo: 33:05

think you should probably talk to the leagues about that. I would say this. If you look at soccer or football in America, it's one of the number one participant sorts of youth in America. I mean, it still is today. I mean, I used to coach AYC, it would be 1, 200 kids out on a Saturday morning in a small town. So, so soccer and football have been part of, you know, society in America for a long time and different in different parts, just like American football is as well. I think this is all part of the journey that we've been talking about here, right? If you are a rights holder or a league and you see an opportunity, and you have brand partners like PepsiCo who have huge businesses and huge ability to kind of influence and story tell in different parts of the world, why wouldn't you think about extending? Look what the NFL, look what the NBA's done. Particularly in places like the Middle East and Africa, you know, and our partnerships with them just show how we can connect with new consumers. I mean, when every game and you've got Gatorade towels and bottles on the sideline, and you're seeing that in parts of the world where we don't even have a Gatorade business, it gives us a new entry point. So I do think the international expansion for certain clubs and leagues makes a ton of sense. The international tours for the clubs that we see today, You know, 10 years ago, none of this was happening. Maybe the odd game that happened in MetLife between a couple of clubs. But you're now seeing a kind of business shifting and thinking differently. And it goes back to the point I was making, they're getting different audiences. And for brands that creates new opportunities for us to engage, perhaps in a country that we haven't entered, perhaps with cohorts that we haven't talked to about our product. It also allows us to innovate. Or tell stories, whether it's about the work we do in sustainability or the work that we're doing, you know, in, in women's, all of these things come because I think leagues, rights holders are changing how they approach the sport.

Richard Gillis Unofficial Partner: 34:49

Okay, you mentioned sustainability a few times, so let's just talk about that for a moment. So there's a couple of questions. One is about the size of events. And just the scale and their footprint and just, you know, and the juxtaposition of that with messaging around sustainability and how you sort of balance those. And the other question, the obvious question is plastic. So, you know, PepsiCo, massive plastic generator, polluter. So how do you balance these two ends of your business? Well, I mean,

Mark Kirkham, PepsiCo: 35:17

ultimately, you know, it's the clubs and leagues have to manage the operational side of that. And we've worked very closely with them. Whether it's UEFA, the NFL or others on how we can be part of their solution, right? So, you know, UEFA's make pledge to zero waste to landfill. It's, it is, it's a journey. And so how can we help? How can they how can we help? So we did, if you look at what we did in Wembley, so we had returnable cups. We had tens of thousands of people who actually went and engaged with our brand. Only in returnable cups. They had a chance, we gamified it, they had a chance to win signed merch. We actually became part of, like, we reduced our footprint by what we were doing. We actually had recycling teams on the ground. We had for Rockstar, for example, for one of the concerts in Trafalgar Square, we captured energy from the crowd dancing and turned it into powering some of the mics and some of the headsets for for the band. You know, those are, they're small steps, but they're the right steps that you have to make, and it has to be holistically integrated into your strategy. You know, working with our sustainability office and the UEFA sustainability office, how can we help each other? How can we reduce emissions? How can we reduce plastics? Another 5e5, is only have powders. Or only have 100 percent ARPET bottles that we did in Italy a couple years ago. So we basically have squeeze bottles. You know, we do everything we can. We've made kits out of recycled materials, recycled PAT. You look at Lays Replay. You know, we create Pitches in towns that help communities out of recycled crisp bags. So all of those, you know, I would say there's, they seem small, but they can actually have a big impact.

Richard Gillis Unofficial Partner: 36:47

But in terms of the again, it's a, it's an obvious question of, it's a sort of greenwashing question ultimately. But it's to do with, I'm interested in the limits of marketing in this realm. Because the core of the business is, there's a problem. 24 percent of global waste, which is attributable to any brand, there are five companies of which Pepsi is one of them. So, it's a significant problem at the core of the business, but you've got marketing and then obviously sports marketing, you're signaling in a different direction. And I can, I hear you in terms of, it's the right direction, it's the direction everyone wants to go. at what point does it become greenwashing? What point do you start to say, this is not authentic?

Mark Kirkham, PepsiCo: 37:26

No, I think it's all about authenticity, right? So I believe that you have to treat sustainability as a horizontal. You need to think about sustainability across everything you do. To extend to how you operate your factories, how you operate, you know, your trucks. You know, we have Tesla trucks, we have electric vehicles in many countries around the world. ARPET, you know, supplying and also changing behavior. You know, some of the challenge is actually just collection, not just actually having the inclusion, but it needs to be part of a horizontal, not just a pillar on the side. And when I say that, it's that's why it has to be integrated into your sports marketing strategy. You know, you have to think about, okay, how do I work with this rights holder, this partner to, to help them meet their goals as a club, as a league as you know, as a team, And also help us achieve our goals because we're all spending money in this industry and we have the opportunity to influence consumer behavior. We have the opportunity to elevate what we're doing in terms of our own practices. And ultimately you have to have it integrated. So look at LEDs, you know, we have Please Recycle on LEDs. Those are little nudges, but it matters because that's, that is a significant amount of marketing investment that's now reinforcing behavior change. If you look at our packaging, if you look at our ARPET bottles that we tied to our UCL, you look at the collection that we were talking about before in terms of what we did on activation. And we do this with our foods teams as well. Doritos we're, when we have activations around different events, it's all recyclable, cardboard cartons, you know. Those little things add up and you have to do it consistently across. Because we have very clear goals and targets, we have very clear missions, and also we work with our partners to integrate the two. And that's, that is, you know, we talked at the beginning, that is a new way of delivering value through partnership and sponsorship. Because ultimately together you need to work on how do you get to zero waste to landfill, how do you get to reducing emissions in the industry. A lot of it sits with the rights holders, the broadcasters, they have their own footprints. But if you treat it as a horizontal and you make sure sustainability is part of your sports marketing strategy, then I think you'll make impact. And we're on our way there, but there's always, there's plenty of work to do.

Richard Gillis Unofficial Partner: 39:31

What do you think about the major event question? Are they getting, you know, are they too big? You've got a World Cup in the States coming up, which is expanded, 48 teams. You've got global footprints of rights holders.

Mark Kirkham, PepsiCo: 39:44

Look, I think there will always be, and I think it's important, there will always be a space for these major big events. Why? Because it gets back to the point I made about culture. You know, we all grew up with a memory tied to a Super Bowl, a World Cup final, a Euro final. And those moments in time, even if they change the format, add teams, you could argue they're adding teams so that they can create more big events. more games, more broadcast opportunity, but actually there's also the fan side of it. You're creating more opportunities for fans to experience the game. And I think this passion for those big moments, you know, and also the formats are changing to the point where you're connecting with, you know, with new audiences at different times, you know, going across different countries. You know, I mean, for us in North America, and as you know, we had Lays had a relationship with FIFA for the last World Cup. We have the chance to do unique things with our brands. Unfortunately beverages isn't part of that, but if you think about it, we now connect with different, you know, with different markets. You know, we were part of the work in Australia. We celebrated the women's game with Lays. So, it actually opens up new audiences. If you think about, the world is so much more you know, ethnically and culturally diverse. And when you can be part of those big moments that happen to represent lots of countries or lots of teams from different parts of even one part of the world like Europe, you are actually engaging with New France's brand. So I think the big marquee events still have an important role to play, but what's interesting is how that content is distributed is so different. So the engagement that you have through digital, through social, through new formats and mediums, whether it's Apple TV or any other streaming service. You're now, you're reaching different audiences. And I think those big events now are more broadly appealing and broadly relatable and more broadly accessible because of technology. And also I think the brands themselves are bringing whole new ways to tell stories around them.

Richard Gillis Unofficial Partner: 41:41

Okay, I've got a, there's a cheeky question. What was the, what was it like? In the Pepsi office when Jack Realish didn't get picked for England, is that right?

Mark Kirkham, PepsiCo: 41:49

Ah, well, so we don't have a relationship with the men's Euros, so to be honest, I would say, as a fan I was sad to see Jack not make the team. From a brand standpoint, you know, we're not directly relating our work with Jack to anything tied to that tournament. We have a relationship with Man City, with Gatorade, so obviously we've worked with him there. I think it's

Richard Gillis Unofficial Partner: 42:12

So a summer ad with Jack Grealish or another footballer is not connected to the Euros, in your mind?

Mark Kirkham, PepsiCo: 42:17

No,

Richard Gillis Unofficial Partner: 42:18

it's not.

Mark Kirkham, PepsiCo: 42:21

But it was connected to Champions League, you know, if you think about how when we launched that campaign, we launched it back in May. You know, where there's a ball is a way was really addressing the barrier of sport and how, you know, you can play anywhere, obviously. So if that's the importance of storytelling, you go back in the history of Pepsi, you know, even if we didn't have relationships with clubs or leagues, we told stories that are authentic to football. So we can run that ad anytime and it really reinforces Pepsi's connection to football culture. And Jack is a great ambassador for our brand. He's got a personality that fits. He's. He's a great player. I wish he was playing right now. That's a personal opinion, but I think it's important is that the authentic gets back. Everything comes back to authenticity. You tell an authentic story to, with an athlete, doesn't matter whether they're playing on the pitch or not. It always helps for them to be out there, but I think it's important for us to make sure that it's agnostic of any one moment in time. It's fundamentally true to what Pepsi stands for in football.

Richard Gillis Unofficial Partner: 43:21

Your accent, I've been trying to place it, and it goes from, it's American, there is a bit of Irish every now and then,

Mark Kirkham, PepsiCo: 43:27

and there's

Richard Gillis Unofficial Partner: 43:28

English in there as well, you're an Arsenal fan, you're an England fan. How is this, just unpick this. You've also got, I was looking on your thing, you've got the least romantic job title I think I've ever heard. Board Member Portfolio Concentrate Solutions.

Mark Kirkham, PepsiCo: 43:44

It's like a Bond, it's like a

Richard Gillis Unofficial Partner: 43:45

Bond villains.

Mark Kirkham, PepsiCo: 43:46

No that's I sit on our board for our concentrate business which is out of Ireland. And you notice I just said Ireland. Yeah, very good. Yeah, no I've, I was born in Boston. So, I was born in a town called Fall River, so I have to say Fall River, because if you say Fall River people will make fun of you. My dad's English, so he was born in Highbury. So I used to give him a lot of slack when he would say, you know, pecan, banana, potato, tomato. And then I went to school in the UK lived in the UK a couple different times. I've lived in Switzerland spent the last five years in Ireland. So I'm a bit picked up a little everything. Some people, yeah, I get what you just gave me, a little everything. I think it makes me, it makes it interesting. And you know, I've learned a lot about different sports. I mean, if, as a fan of sport, when you get to move around and experience the different sporting cultures, I mean, go to a Gaelic football final. I mean, one of the greatest sporting events I've ever been to, to watch Amateurs play in front of 90, 000 people, and Dublin won, so it was quite good.

Richard Gillis Unofficial Partner: 44:43

I agree. And I remember it because I just saying I moved to Dublin in 2004 for four years, three or four years. And I didn't and I'm British. You think you know Ireland and then you go over there and you don't. And it's the sports bit is where you're particularly alienated and the whole blue shirts. You know, you think what's going on here? I have no idea. And then I went like you. I went to the Croke Park. It's extraordinary. It's

Mark Kirkham, PepsiCo: 45:09

extraordinary. I've been blessed to go to Super Bowls, to Champions League finals. I will put the GAA final, watching Dublin win in the last second last year, is one of the best. If, well let me say the best I think Arsenal winning the Champions League will be the best when I get there. But I think seeing amateurs play at that level and the quality, the competitiveness, the performance, I But also the culture. I mean, you, 90, 000 people watching amateurs play, one of the toughest tickets to get. You have to only go through your clubs, or if you're lucky, you know somebody. And you, it's, they do a parade. There's so much inherently in it, whether it's the hurling or the football you know, it's amazing. And then, equally, I live just around the corner from the Aviva, you know, to see a Six Nation match, and to see The culture of the rugby culture, which is different than the football culture, or to see Celtic come and play Wolves, you know, and, you know, it's, you're also seeing different sports evolve, you know, actually, if you look at Ireland, they actually have an amazing women's national team, and their men's team is getting much better as well, and football, which was maybe a secondary, tertiary sport at the time, is growing in popularity. Why? It's because of the access, it's because teams are coming and playing there, it's because their own national teams are standing out of the crowd, they've got players who are playing in the UK or playing in other parts of the world. I think that's what's, you know, this whole conversation is about the evolution of sports and partnership, it's also about the evolution of sporting culture. And it's no longer just linear. It's crossing over genres clubs, men, women, leagues and ultimately the type of sport. So, getting to move around, I've been lucky enough to experience lots of it.

Richard Gillis Unofficial Partner: 46:52

Okay. Good place to end, I think. Excellent. Thank you, Mark, for your time. Really enjoyed that.

Mark Kirkham, PepsiCo: 46:57

Yeah, it was great.

Richard Gillis Unofficial Partner: 46:58

Appreciate

46:58

it.