“We started selling more on Thursdays, for example, but only in certain places, and we realised all of those stores were less than 2 blocks from a train station…”
An interview with Jerome Pellaud, General Partner, at the Beverage Fund of ZX Ventures, the global investment and innovation group of Anheuser-Busch InBev. We discussed flavor, neuroscience, data and creating a superior customer experience. Read about it out here…
A chemist by background, with a passion for flavour and scent, Jerome Pellaud pursued a PHD in biophysics before moving into the brewing industry.
“For me, I’ve always been fascinated by and respectful of beer because it’s so complex and the number of molecules in beer is unparalleled.” There are more than 2500 different natural compounds in beer vs. 400 in wine, which creates an exponential range of product design options in brewing.
The beer testing process
When it comes to ZX Ventures beer testing process it’s down to neuroscience, data and a bit of observation. “We don’t rely on a lot of consumer surveys because their answers would be processed in the cortex of the brain, but the real decision for something like choosing a drink isn’t made by the cortex, it’s made in the limbic brain.” (Odors travel directly to the limbic system including the hippocampus and amygdala, which are associated with memory and emotion.)
“So instead of long on-line surveys, my team rapidly seeds the product in the market and observes the reaction,” said Pellaud. I wondered if they just watch people drinking it?
“Yes sometimes, but more that we crunch data to find patterns from a geographic, store type, and neighborhood point of view. We started selling more on Thursdays, for example, but only in certain places, and we realised all of those stores were less than 2 blocks from a train station. So it’s the commute, the convenience, and the access. Ok- so how can we make it more convenient? We set assumptions, test and prove them. We do this in 20 stores, then 50. Then every store.”
Achieving product superiority
Better solutions for a consumer involve being obsessed with solving a meaningful problem the consumer has. Pellaud maintains that product superiority, is key here, as it’s only probably the top 10% of the beer that consumers will purchase again.
“To get them to remember it, it involves unique aroma signature that the brain will register.” Pellaud is adamant that the name has to be memorable as well and the product convenient, including the packaging and access. All of their brands have their own DTC (Direct to Consumer) platform with a home delivery option.
“Even if it’s a small proportion of our revenue, we try to create a seamless way for people to enjoy the product,” said Pellaud. “We look at what pieces in the consumers’ journey are broken and try to be superior in every single touchpoint, not just the liquid itself, but of course the liquid has a big, big role.”
ZX Ventures is the global investment and innovation group of AB InBev. They invest ahead of the curve: seeding, launching, and scaling new products that deliver exceptional consumer experiences and bring (more) people together. Jerome Pellaud has deep experience in the beverage space and spent over two decades in various roles across AB InBev and ZX Ventures. He is a certified brewmaster, holds a Master’s Degree in chemistry, and a PhD in Biophysics from the University of Basel (CH).