← BRAVE COMMERCE
BRAVE COMMERCE
Mars Pet Nutrition’s Approach to Navigating the Evolving Pet Care Market with Jean-Paul Jansen
00:25:28
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- [00:01]
Unknown Speaker
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- [00:29]
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- [00:58]
JP Jansen
To 1 in 3 pet owners say that their pet is their most important thing in their life. And for Gen Z and millennials it's almost 45% that claim their pet. Pet food is actually one of the most penetrated businesses in E commerce. Yes, it is heavier to ship, but at the same time the cash outlay is quite high. It's also a regular purchase. Depending on the retailer, you will see 50% or even higher levels of subscription. Actually, because it is a relatively heavy product to handle, subscription delivery to your home is a convenience that is highly valued by pet parents.
- [01:43]
Sara Hofstadter
Welcome to today's episode of Brave Commerce.
- [01:46]
Rachel Tippograph
I'm Rachel Tippograph, the founder and CEO of Micmac.
- [01:49]
Sara Hofstadter
I'm Sara Hofstadter, president of Profitero, and.
- [01:52]
Rachel Tippograph
This is a show that talks about what's relevant in E commerce for the world's biggest brands. Sarah, I feel like I can't ask you this question because at this point you're a Hall of Famer. But if you needed to go gain a skill set to do your next big thing, what skill set would you invest in today that you feel you're underdeveloped in?
- [02:21]
Sara Hofstadter
Oh gosh. I think for me there's plenty of soft skills I need to work on, plenty of hard skills I need to work on. Not all of them do I want to work on, but if I were to work on one, it would actually be like taking like a real course on AI and like the applicability of it versus just like when I'm reading. I think I need more practical, hands on understanding. That's probably what I need to do. And you know, in fairness should be a passion project.
- [02:48]
Rachel Tippograph
How about you to just increase my confidence level in operating, I would go do a tour of duty as an engineering manager.
- [02:57]
Sara Hofstadter
Interesting. Explain what you mean by engineering manager.
- [03:01]
Rachel Tippograph
Like literally be the day to day manager of people who ship code every day.
- [03:07]
Sara Hofstadter
Why?
- [03:08]
Rachel Tippograph
I think that when you're operating a business, especially a technology company, you're investing a lot of your resources in R and D. And when you don't come from that world, it's really hard to understand if you're over investing or under investing, if you're holding people accountable to KPIs that create equality across an organization because sales and marketing is so black and white. But engineering is not. And so I think it'll allow me to develop a lot more empathy for a function that I'm not native to.
- [03:42]
Sara Hofstadter
Oh, that's very interesting. One of the things I was thinking about is I might do a tour of duty on the client side to think more like a customer so that I can see things. So I think putting yourself in other people's shoes in general creates tremendous amounts of empathy. The idea, when I was agency side, one of the things that I used to do with my team is I would bring clients into the office and do a swap with one of our account teams and we would do these two week stints where the client would become the agency person, the agency would go work at the client and see how the other half lives. And it created a tremendous amount of empathy as a result of that. So I think seeing how the sausage is made gives you a greater appreciation and then can determine, okay, well now how do I pivot as a result of that?
- [04:27]
Rachel Tippograph
Absolutely. So you and I spend a lot of time talking to CMO types. We're obviously sitting at the intersection of marketing and commerce. And I think what's interesting with sort of the current generation of CMOs is that not all of them have done a tour of duty in commerce, or let alone the sales organization.
- [04:46]
Sara Hofstadter
I have certainly noticed that. And there are a few exceptions, including our guests today, those who do, I think, have a heightened awareness not just about commerce, obviously, because they did their tour of beauty there, but a little bit more about how all the pieces kind of come together and what it actually means to have all those different interdependencies, commercially and otherwise. Because commerce does sit at the intersection not just of sales and marketing, but supply and product innovation and R and D and all these other things. And it is where the rubber meets the road. So if you've done a tour of duty there, sky's kind of the limit. But how do you get there? And how do you get from there? I've seen a ton of people that are coming in early in their career, are doing a tour of duty in E Commerce, Omni or Commerce or whatever, and then use that to branch out career wise into lots of different places. But very rarely do you see people take that step later in their career as a catapult for or a launchpad for a CMOS hyperl.
- [05:55]
Rachel Tippograph
We are very excited to have JP Jansen, the CMO of Mars Pet Nutrition North America, onto the show. Hello.
- [06:02]
JP Jansen
Hello. Thank you for having me.
- [06:04]
Rachel Tippograph
We're super excited because we've had your peers in confectionery and then food and now that we got pet, I think we can say that we we've fully done Mars after this episode. So we're so excited to have you.
- [06:16]
JP Jansen
Great.
- [06:17]
Rachel Tippograph
So I think we were all aware during the pandemic that the pet business surged. I think I remember reading a stat 1 out of 3Americans by the end of the pandemic had a dog. Now that we're no longer in that time period, a continued trend that we've seen is the premiumization of this space. What headwinds are you seeing as well as opportunities within the pet space right now?
- [06:42]
JP Jansen
Yeah. If you look at pet over a longer time horizon, it is actually a category that is very resilient, has been growing and continues to grow, sometimes more rapidly, sometimes a little bit slower. Premiumization is fundamentally one of the trends. If you think about pets, they used to be in a barn, now they're in our bedrooms. With that comes a lot higher expectations on the kind of nutrition we give our pets, obviously also the care that we give our pets. So we are, and we continue to be very confident in the future of this category. Now at the moment, we're coming out of a period of very high inflation. Prices are high. One of the things we're looking at is how can we make sure that we continue to provide great value to pet parents. Now we are blessed with a fantastic portfolio. We have a portfolio that spans both the more premium and super premium price tiers with brands like Nutro and Greenies. But we also offer great value through our pedigree brands. So through our portfolio, we're able to bother satisfy the needs of shoppers if they're becoming a little bit more value conscious, as well as lift on the trends of premiumization as that returns in the next few years. And then the other headwind that we're addressing, and it's through the same lens, is if you look at some of our discretionary categories when in pet so wet dog food treats. When the prices went up, consumers or pet parents cut back a little bit on consumption of wet dog food on treats and became lighter users. So what we're doing now is to provide better value on some of our multipacks on our larger sizes. So we help consumers to trade up again and restore consumption levels to where they were pre inflation.
- [08:32]
Sara Hofstadter
Makes a lot of sense. I mean, at the same time, you also have explosive tailwinds right there. Parts of the world, one third of all households have a pet. And you guys have grown tremendously, both through the strength of the category, but also through just the strength of the diversity of the brands that you have. I myself am not a pet parent. Longer story for another time. My husband, not me, but so many of my friends. I will say I don't think treats are discretionary from what I have gathered. I'm just saying I'm no expert, but it does seem like the treats come out pretty often. Or maybe just my friends spoil their dogs, I don't know. But help me understand, like, what's driving the category growth because it continues to grow, which is beautiful. And then where do you see your unique proposition? And what's your. I wouldn't say secret sauce, because then if it's a secret, then it's not a secret anymore. But give us a little peek.
- [09:25]
JP Jansen
I think first and foremost, we are pet parent obsessed. So it always starts with the pet parent. We just conducted a very large study with 20,000 pet parents across 20 countries to really understand the evolving needs of pet parenthood and also getting insights of some of the pain points or the emerging pain points that we need to address going forward. Very interesting. By the way, one in three pet owners say that their pet is their most important thing in their life. And for Gen Z and millennials, it's almost 45% that claim their pet.
- [10:01]
Sara Hofstadter
This explains why my husband won't let me get one because he's jealous.
- [10:05]
JP Jansen
Potentially.
- [10:06]
Sara Hofstadter
I finally figured it out.
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Rachel Tippograph
Also, my W tells me that our dog is her first love and I get offended every time.
- [10:13]
JP Jansen
There are amazing stats here. Today, almost 80% of Americans allow their dog to sleep in their bed. And that was only 40% about five years ago.
- [10:24]
Rachel Tippograph
I draw the line there. I draw the line.
- [10:26]
JP Jansen
What it does, it leads to much higher standards of care and nutrition for our pets. So that drives a lot of the fundamental growth. What we're also seeing is younger generations, newer generations taking a pet, often before having kids. So pets become our fur babies. So more people Take pets earlier in life. And people are looking for higher and higher standards when it comes to nutrition and care. And all of that obviously drives the category growth. Now what we're doing about it, we are constantly looking for ways to improve pet parenthood. We have this notion that we want to really transform the experience of pet parenthood and creating a better world for pets because essentially pets create a better world for us humans. To give you an example, cat treating is on the rise. It's growing and traditionally cat feeding was very much done through little pocket treats, crunchy treats. But what we've noticed that cat parents would love to spend more time with their cat like bond with our cat over time. So we've introduced this year on our Temptations brand, Temptation Spoons, little disposable spoons with a liquid puree. And that enables you to bond with your cat, to have your cat with you for a longer period of time. And that's just one example of ways that we're thinking about making pet ownership even more enjoyable.
- [11:50]
Rachel Tippograph
Like those types of insights, are you gleaning them from social like publicly available social data or is there's some sort of observation lab where the group is coming up with this?
- [12:00]
JP Jansen
There's a multitude of ways we're looking at it. Sometimes you know, we have a very foundational research we're doing. We have something called the Wolfen Institute that's actually based in the UK that does very foundational research about pet health, the relationship that we have with pets and the impact that pets have on us humans and society. But then we also obviously look for, look across what's happening outside the spoons example I gave. We started to see see some similar trends happening in Asia, particularly in countries like Japan where people are even more advanced in their relationship with their pets. And then it's the benefit of being a global company is obviously is to spot these trends around the world and then see can we be the first to bring that into the US and lead in this market.
- [12:51]
Rachel Tippograph
It's so fascinating.
- [12:53]
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- [13:43]
Sara Hofstadter
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- [13:52]
Unknown Speaker
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- [14:25]
Rachel Tippograph
You said something earlier when you were talking about headwinds and essentially increasing pack sizes to have a greater value exchange. When you think about the consumer and the type of product that you're selling, often it could be quite heavy. So how are you guys thinking about how you drive profitability between channels like online marketplace, last mile Delivery, physical store, D2C. Like how do you think about all that?
- [14:55]
JP Jansen
Yes, so on one hand pet food is very heavy. On the other hand, especially if you talk to manual propositions, when we talk wet food or treats is obviously more favorable the way to order ratio. But if you look at our E commerce business, pet food is actually one of the most penetrated businesses in E commerce. Of all the fast moving consumer goods categories, it's a relatively high cash outlay. So yes it is heavier to ship, but at the same time the cash outlay is quite high. It's also a regular purchase. So in pet food, depending on the retailer you will see 50% or even higher levels of subscription. Actually, because it is a relatively heavy product to handle, subscription delivery to your home is a convenience that is highly valued by pet parents. As we think about E commerce, what we're trying to do is a couple of things. First and foremost, the assortment online tends to gravitate more to higher price tiers. People who buy online tend to spend a little bit more which also helps. Obviously the ratio of the shipping cost versus the order value. It's actually in dichotomy now. We see a focus on subscription and larger pack sizes on one hand, but at the same time a same day delivery also becomes more prevalent from the likes of Walmart Or Amazon. We also see now smaller pack sizes taking off in E commerce. So it's a very dynamic space. And for us what is exciting about E commerce is also the data access it offers. We work a lot with retail media networks. We actually almost a third of our media is invested through retailers, retail media networks. And the benefit we're seeing for example is that it allows us to target based on purchase. So purchase based targeting. For example, in a campaign with Amazon we were able to identify small dog owners which is highly relevant for our Caesar brand which is over indexing on small dogs. And we saw an ROI that was two to three times higher than our normal campaigns or average roi. We're very excited about E commerce. It's the fastest growing channel for pet. The latest stat is that now about 30% of all PET food in America is sold bought online. It's booming.
- [17:10]
Sara Hofstadter
It's very interesting. One of the things that you were talking about was people who buy online tend to spend more because they're kind of averaging their total cost down once you factor in for shipping. Are there similarities in that to club buying too? Do you see correlations on that? Just because it could be a mindset of I know I'm not going to get ripped off or the averaging the cost. I just see that there's a lot of similarities to the way you talk about E commerce and also the way I think about club, which might not necessarily correlate in many cases, but curious to your take.
- [17:43]
JP Jansen
Yeah, there's definitely similarities. People tend to buy obviously larger bulk sizes in club as well. I would say the key difference though, at the moment at least, is that E commerce offers that breadth of assortment that's also driving some of the premiumization online. Because people who are looking for specific diets or for nutrition with specific ingredients, it is just much easier, quote unquote to find that online and find exactly what you're looking for for your pet than it often is in quote unquote traditional brick and mortar stores.
- [18:19]
Sara Hofstadter
That's most certainly something that we're seeing cross category. You can also try a little bit more on diversity of pack sizes, on your assortment on which retailers might fulfill. You can do a little bit more local targeting. The richness of retail media data is most certainly there. Have you thought about how you take that data and approach that other 2/3 of your media spend now that you're getting this phenomenally rich data, how do you make that flow across your full comms ecosystem?
- [18:49]
JP Jansen
Obviously a lot of radio media networks, or all of them are still Walled gardens. Now, there's a limit in terms of what kind of data you can take from that and apply elsewhere. But the insights and the learning we absolutely apply and reapply in across other media platforms. In addition, we're investing substantially in getting first party data and particularly high quality first party data. It's not about quantities really about quality. For example, puppy owners or kitten owners or people have just adopted a dog or a cat. If we're able to connect with those consumers, if those consumers are then willing to opt in to stay in touch with us, that gives us very rich data. That rich data we then use often as a seed audience or an audience we use for to create lookalike audiences either within a meta or Google or with Amazon or with Walmart. And we're seeing our media effectiveness significantly increase by leveraging that first party data. But again, it's more about quality than quantity. And the beauty about today's world with the technologies we have that a relatively small set of data can already help you create very effective audiences at scale.
- [20:05]
Rachel Tippograph
When you think about channels beyond retail media and you've been talking a lot about Gen Z and Millennials, are they living in TikTok? Are they living in Instagram? Where do you feel the discovery is happening?
- [20:19]
JP Jansen
Yeah, a lot of it is happening in social media, obviously. What is interesting is that there's a little bit of convergence almost taking place across social media. You see that content that is trending on TikTok also then starts to trend on Instagram. Right. The algorithms are starting to operate in a very similar way, which is actually good news for marketers because if we have content that really resonates, we can be pretty confident that it is content that we can also amplify our boost across other platforms. Definitely that younger generation is looking for social media as one of their primary sources for discovery and information. The other thing that is fascinating is the amount of research Gen Z is willing to do to get to the really the right product. It's usually not one source they'll have done research or search. They've reviewed what they see on social media. They go to retailer platforms to read the content and the ratings and reviews. Reddit, very, very effective platform also for us as a marketer. Reddit is really, really on the rise. They're much more knowledgeable than any other generation we've ever seen.
- [21:32]
Rachel Tippograph
They also think that you need a million dollars to be wealthy at the age of 27.
- [21:37]
JP Jansen
Yeah, I read that stat.
- [21:39]
Ryan Reynolds
Too.
- [21:39]
JP Jansen
Yeah, exactly.
- [21:40]
Rachel Tippograph
Yeah, because they're researching everything. I think if Anything over the last 20 minutes together, what we've realized is the pace of change within the pet industry is pretty wild. You're the cmo. You're responsible for not just building demand and driving conversion, but building a great team. How do you approach the talent game when you have so much change happening within your space?
- [22:04]
JP Jansen
It's a great question. Personally, the one thing that always is important in any talent or anybody that's on my team is attitude. You know, I always believed anything you can learn. But if your attitude is really making a difference, I heavily gravitate to people that like to be transparent and open about problems and also optimistic and creative about solutions to problems or challenges. So attitude is always number one for me. I'm not a particular fan of people with a big ego, especially in a company like Mars. Collaboration, creating, we call it mutuality, is super important. So that's another area. And then when it comes to skills, there's almost two types of talent in marketing. There's talent where you, where you look for expertise, specialists, and obviously, let's say it's someone that needs to head up our media department, for example, you want someone that is really a specialist in media, has a lot of experience in that space. But not only that, I specifically then look also for thought leadership. I would love our specialists and our experts to have an idea where is the world going in their area of expertise? How can they lead the thinking in that space? So thought leadership for an expert is very important to me. And then on the other side, you have the more generalists, the more brand builders, the ones that can lead a brand team or lead a portfolio of brands. Couple things I look for in that talent. One, are you really obsessed with consumers or with the target group or in this case, pet parents? You bring the voice of the pet parent into the company as a marketer, and that's where it often starts. Secondly, are you able to imagine what's possible? How can you take the insights from pet parents and consumers and connect that to something that makes sense for your brand and how can you grow your brand going forward? And then last but not least, a certain level of general management skills, because as a brand, if you're a brand manager or you're a brand vp, you're almost like mini GM of your. Of your brand. You may not have the formal authority, but the expectation is that you understand the enterprise agenda, that you know how your brand can contribute to that agenda, and that you're able to effectively again collaborate with your peers or your multifunctional Team. So, yeah, that's in a nutshell, what I'm looking for when it comes to talent.
- [24:29]
Rachel Tippograph
You've brought a lot of people from the beauty space, just like your background. So it makes sense based on everything that you just shared. Knowing where the puck is going. Act like a gm. We gotta ask you our famous last question, which is, what's the bravest thing you've ever done?
- [24:44]
JP Jansen
Ah, that's a great question. I. Besides marrying my wife, now the real bravest thing, I think professionally I was working at Procter and Gamble, had worked in marketing mainly for almost 19 years. The business unit I was in was bought by Coty, so we were transferring to Coti and I want to do something different. And then the question was, okay, would you in something more commercial? And then the question was, would you want to set up E commerce? Lead E commerce for the consumer beauty division at the time at Coty, and at the time I had never bought anything online. So actually my wife was laughing. It's like they want you to set up E Commerce. You have no experience in that space. But I was very intrigued and I truly believe if you take a shopper or consumer mindset, if you look at E commerce through the lens of what does a shopper experience as you search, as you go to a product detail page, as you look at the assortment and ratings and reviews and so forth, as a marketer, you have a good, There is a grain, a core to be able to be. So that was a brave step. In fact, I joined and I had one person and no budget in my team. So I had to build this all from scratch. Recruiting the right talent, creating the right playbooks, setting up the right structure, both in the local markets as well as my global team at the time. Very exciting time. I learned so much working directly with customers with the likes of Amazon and other beauty players. In hindsight, that was a brave step, but also one that really paid out well, both for my personal development and also professionally.
- [26:21]
Rachel Tippograph
Jp, we're so appreciative for your time.
- [26:23]
Sara Hofstadter
No doubt. If there were more CMOs that had taken a tour of duty in standing up Ecom, I think they would be speaking more like you and having the kind of success that you've had. No doubt. And yes, Rachel and I are clearly affected and have a bias to that.
- [26:41]
JP Jansen
Thank you.
- [26:41]
Sara Hofstadter
But I can tell you the number of CMOs that we speak with where we have to kind of go back to 2028 level education and you just jump right in. You are so native in that language and it makes you a stronger marketer commercial leader, period. Full stop. Thank you.
- [26:57]
Rachel Tippograph
Thank you everyone. Go shop the Mars portfolio.
- [27:01]
JP Jansen
Thank you. Absolutely. And check out the IAM's Healthy Weight Hub. We just launched a new campaign to help get your pet to healthy weight because unfortunately, almost 60% of dogs in America are overweight and most pet parents don't even know it.
- [27:16]
Rachel Tippograph
We went through that with Wally, our dog. So, yes, thank you.
- [27:20]
JP Jansen
Thank you.
- [27:23]
Rachel Tippograph
If you like what you heard, you probably noticed we love Mars on this show. And you can go check out Gabrielle Wesley, who's the CMO of Mars Wrigley. Or you can go listen to again a recent episode with Matt Graham, the CMO of Mars Food. We've now completed the Mars trifecta. If you like what you heard, please write us a review. Tell a friend. Thanks for listening.
- [28:07]
Unknown Speaker
Hey, you know what would make your customer service help desk way better? Dumping it and then switching to intercom. But you're not quite ready to make that change. We get it. That's why Fin, the world's leading AI customer service agent, is now available on every help desk. Fin can instantly resolve up to 80% of your tickets, which makes your customers happier and gets you off the customer service rep hiring treadmill Fin by Intercon, the leading customer service AI agent now available on every help desk.
- [28:38]
Jackie Cooper
Hi, I'm Jackie Cooper, Global Chief Brand Officer at Edelman and the host of Touch of Truth, a new podcast launching on the Adweek Podcast Network. My dad gave me this incredibly smart piece of advice. Meet everyone once. As a result, I've met some of the most fascinating and inspiring people on the planet. Now on Touch of Truth, we're coming centre stage and sharing the mic to experience stories of truth, insights and visions for the future that will challenge your way of thinking. Touch of Truth is available wherever you listen to podcasts. New episodes come out every Tuesday. I do hope to see you there.