Ep. 11: Scaling Sustainability with Francesca Hahn of Mondelēz

Today’s guest is Francesca Hahn, vice president for digital commerce, U.S. At Mondelēz, the multinational snack leader. Francesca is responsible for the strategy, vision, execution, covering everything about how Mondelēz brands are discovered, shopped for, purchased, fulfilled online, including two direct to consumer sites. Before Mondelēz she had roles of increasing responsibility in category management and sales, at Britax, Colgate-Palmolive (including the Hills Pet e-commerce team), Acosta Sales and Marketing, PepsiCo, & Diageo. Mondelēz recently added sustainability as its fourth strategic pillar, and Francesca is a sponsor of the sustainability team for the U.S. In this episode we discuss introducing sustainability across such a large enterprise, the intersection of sustainability and climate work and e-commerce.

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Transcript

Keith Anderson: Welcome to Decarbonizing Commerce, where we explore what’s new, interesting, and actionable at the intersection of climate innovation and commerce. I’m your host, Keith Anderson, and together we’ll meet entrepreneurs and innovators reinventing retail, e commerce, and consumer products through the lenses of low carbon and commercial viability.

Welcome to the Decarbonizing Commerce podcast. I’m Keith Anderson, and today’s guest is Francesca Hahn, vice president for digital commerce, U.S. At Mondelēz, the multinational snack leader. And in that role, which, she started in April of 2021, Francesca is responsible for the strategy, vision, execution, covering everything about how Mondelēz brands are discovered, shopped for, purchased, fulfilled online, including two direct to consumer sites. And she’s got a great career, even before Mondelēz with roles of increasing responsibility in category management at sales, at Britax, Colgate Palmolive, including the Hills Pet ecommerce team, Acosta Sales and Marketing, PepsiCo, Diageo.

And I was really interested in having Francesca on the show because Mondelēz recently added sustainability as its fourth strategic pillar. And Francesca is a sponsor of the sustainability team for the U.S. And I was really interested and curious to learn more about what it’s like trying to introduce sustainability across such a large enterprise, including to so many people who don’t have sustainability in their titles, they aren’t sustainability experts or full time practitioners.

And given her personal interest and passion for the subject, I really wanted to hear from Francesca, how she thinks about the intersection of sustainability and climate work and e commerce. So we talk a lot about her own journey and trajectory into roles dealing with sustainability and how she and the rest of the organization are working to bring sustainability into the roles of everyone at the company.

So I’m really excited for you to learn more from Francesca Hahn of Mondelēz.

Francesca, good to see you. Thanks so much for joining us for the show.

Francesca Hahn: Thanks for having me, Keith.

Keith Anderson: Well, as regular listeners know, I love to start just by, helping people get to know you a little bit and your current trajectory and specifically how you became interested and involved in sustainability. So why don’t we start there?

Francesca Hahn: Sure. I have grown up in consumer packaged goods. I early in the career did category management when it was just exploding and then moved into sales leadership and center of excellence roles, did some company integrations, worked on some amazing brands at PepsiCo, at Colgate-Palmolive, at Britax, carseats and strollers, and now I’m at Mondelēz.

I got into e commerce by accident about eight years ago. I was in Germany doing an integration of two companies, and we needed to create a little e commerce strategy, which became a Europe e commerce strategy, and then became a global, because at that point it was still fairly new. And, ended up doing e commerce for Hills Pet Food as my job, as it was emerging as a big thing at that moment, and have really enjoyed doing that for the last eight years.

I now lead digital commerce for Mondelēz, the company known for Oreo, Sour Patch Kids, Toblerone, and many other amazing snacking brands. And I am responsible, or my team is responsible, for anything to do with finding, learning, buying, and fulfilling products online. And it’s really been, of course, an amazing journey in that sense.

There’s a lot going on there. And I got into sustainability early when I started working with Amazon as part of e commerce and it’s just been a passion point ever since. Trying to make sure that as we’re making choices that we’re doing the right things for our people and our planet.

Keith Anderson: And how does it intersect with your role now at Mondelēz?

Francesca Hahn: So for sustainability purposes, I have two major roles besides the everyday work. I both support our DEI initiatives in terms of being an executive sponsor of the Women’s Sales Leadership Network, which is a group of about 800 women and allies. And we work to advance, attract, and retain, women and their advancement. And then I’m also the sponsor for the U.S. Sustainability Team.

Keith Anderson: Can we talk a little bit more about what it means to sponsor that team?

Francesca Hahn: The U.S. Sustainability Team is activating sustainability initiatives in the U.S. And of course it’s supported by a global sustainability team. We actually call them the Global Impact Team. And so they’re thinking short term, mid and long term initiatives to support our business and think for the future.

We ultimately want to create a future where together the people and our planet can thrive together. As a sponsor, I am helping to give advice on how to think and influence the organization. And if you can imagine, with digital commerce, it’s very similar. It’s trying to ensure that everyone is thinking about it, making it front of their minds in everything that they do.

Keith Anderson: Yeah, I mean, that was a big part of why I wanted to have you on the show. I see so many parallels between the way that e commerce has grown and evolved within the CPG industry and what’s happening now with sustainability. And as you just said, the role of influence is huge. I I’m sure it’s shifted, but when I was in my past life consulting, we used to say.

In your first year as director of e commerce, roughly half of your effort is going to be spent selling internally. That is, you may be responsible for selling online through and with retailers, but to do that, you’ve really got to, shift thinking and behavior internally as much as externally.

Francesca Hahn: Well, and if you think about it, digital commerce is an end to end game. You’ve got to think about all the areas of what you look like on the shelf. You have to think about your packaging. You’ve got to be thinking about. How you’re advertising, how you’re efficient, with everything that you do. And, and that’s, I mean, from example, I, when I started at Hills Pet Food for Colgate as leading their e commerce, we were trying to ship bags of pet food, 35 pounds of kibble across the country efficiently. And that was a really big challenge. And, Amazon actually brought us together. To show us that our bags were getting pierced in distribution centers and causing hazards by the product, of course, rolling around on the floor and, it had oils on it. So it could make it slippery. It could be, mice or something else could be, a challenge with it as well as, ensuring that it was, packed efficiently in boxes with other products.

So we were tasked to try to find a solution. And we did a ton of test and learns to figure out what the solution could be and ended up in a, with a bag in a box solution. And not only did we do that, we also added a shopper message to it, to the pet parent to say, you know, tell them that they’ve got this and they’re doing the right thing by choosing the Hills Pet Science Diet product for their pet.

And it ended up getting highlighted by the sustainability team because they felt like it was such a nice combination of doing the right thing, making it a more efficient experience, and then also an amazing marketing brand opportunity as well.

Keith Anderson: Yeah, as, as you and I were, speaking a few minutes ago before we hit record, I, I mentioned In one of our, research reports on Winning with Amazon on Climate, we actually feature that Hill’s case study and you shared with me, that was you so.

Francesca Hahn: It was my team, a big team that figured it out together, but it was really cool that I was able to be part of that. And it became an example, which I think is positive to inspire other brands to do the same.

Keith Anderson: Yep. Well, you’ve had experience in a pretty diverse set of, CPG and consumer product categories. What have you learned about, where CPG and sustainability intersect and, you know, where to focus and what some of the biggest challenges are?

Francesca Hahn: I think typical in a big CPG is you need goals, things that you can strive for. And of course, we have our own goals from a sustainability perspective. And then you need to develop a path to reach it. And, and, and it’s important that the whole organization is pointed in that same direction. And when you think about Mondelēz, it’s a massive company.

And so, it’s so important that everyone is moving towards that same spot, because if not other business priorities can come up. Obviously we had COVID, other things happening at the same time, right? So how do you ensure that as an organization, you’re still working on it together? I’m really proud of Mondelēz as in their path to our vision 2030.

We added sustainability as the fourth pillar. There’s a growth execution culture, which we’ve been talking about for a few years and we added sustainability to it. And why that’s so important is then everyone is inspired or motivated or, you know, expected to have objectives that are moving towards that goal.

And in 2023, we started creating objectives as part of your, it’s your everyday performance plan and in some cases, that was easy for some people that were closer to sustainability, but for others, they hadn’t had the chance to read our ESG report or understand really what does it take to win? And then how does my job interact with that?

And, and so how can I help in that sense? And so I think by making it an objective for everyone, then we all are lined up together and really making much more genuine impact together.

Keith Anderson: If I’m in the e commerce organization, or any part of the business, but just for the sake of proximity and familiarity, let’s stick with e commerce. Maybe I’m, you know, involved in, I’m on an account team, or you probably have a better example than I do. What is that process like of identifying objectives for somebody who’s a non sustainability specialist or practioner ?

Francesca Hahn: Well, it’s typical objective building or thinking about what’s our priorities for next year. It’s saying, okay, like, let’s look at what we’re doing and are we doing enough? Are we taking it to the next level of sustainability? So let’s, as an example, an easier one is customer service and logistics. How am I making an impact with sustainability?

And then you look around and you go, okay, are there areas that I can already amplify? Example would be Dropship or direct vendor shipments. And, and for those not as familiar, that means that when you order online, the product doesn’t ship to a DC, a distribution center, and then to the shopper. Instead, it directly ships from the manufacturer warehouse to the shopper’s home.

So in that case, you are taking out a one line of transportation. And so you’re being more efficient in that case. And by the way, also you’re eliminating damages, potential products, you know, that could get lost or something could happen to it on the way. So it’s just a more efficient overall. So experience.

So if that’s that customer service and logistics, if we can lean into that, or how do we, you know, make that more prevalent with other retailers, then you’re helping on the focus of getting more sustainable customer service.

Keith Anderson: Yeah, you had mentioned how much of what’s going to have to happen in sustainability is going to be long term and, sort of heavy lifting in a sense, but I think with examples like those, it gets clearer and clearer that there’s a lot that’s immediately actionable and tends to align with commercial objectives as well as climate and sustainability goals.

Francesca Hahn: There are little things that pop up all the time, and you don’t, you can never underestimate that. Small choices are being made constantly. For example, packing a box. for e commerce making sure it doesn’t have plastic in it , it has paper you’re, you know, easier to recycle, is, is an example. There’s so many little choices that if you’re more aware of, of these things, you can be making more impact every day.

Keith Anderson: I’m glad you mentioned that one. Because I think it’ll serve as a nice segue. This year, both Amazon and Walmart introduced new programs or initiatives specifically related to omni channel and e commerce fulfillment. They’re both getting more focused on right sizing. They’re both doing something I think is pretty cool with automated box printing.

If you’ve never watched the videos of these, it’s pretty fascinating to watch. Everybody has opened a box and found, you know, a tiny product inside and wondered, why am I getting such a huge box for such a small product? And You know, the logisticians have started, working on that problem through on demand box printing that aligns the size of the box with the products in the order, and they’re also shifting to more, Paper and other, you know, non plastic forms of secondary packaging.

And the reason I say I think it’s an interesting potential segue is, so much of what is happening is really. The result of work between the retailer and the brand. I mean, take the example you shared between Amazon and Hills earlier. How do you think about the relationship between CPG and, and retailers as it relates to sustainability?

Francesca Hahn: Well, I’ll go with your example there about, about the, the box printing and forming to the product’s exact shape. Our products, we, we also sell chocolate and, candy products that have multiple challenges during the summer in the U S and so having a relationship with the retailers, because it’s in their best interest and it’s in our best interest, it’s stated goals, everyone’s working towards it.

We’ve been having conversations about how to do cold ship more effectively. In nature of cold ship, it’s not been very sustainable. So we need to work towards. Better solution. So by being partners, I mean, we’ll get there quicker. I have a lot of, faith that, that we will get there, but yeah, so being partners, I feel like there is so many opportunities, and frankly, retailers need CPGs because they’re really a house of brands and so they need us and then we need retailers.

Because they’re both the way our products are delivered to the shopper. So how do we do that the most efficient way? As well as, I think there’s a lot of opportunities as well for them to be recycling centers too. You know, when you think about some of the big retailers, they’re often in environments where there may not be a recycling infrastructure yet.

I think of my, actually my dad and my parents are in an area that they are. Not having recycling coming at their pickup at their house still, which just kind of blows my mind still that you don’t have recycling. And so they have to take it somewhere. And so when you think about retailers, they can actually be that point to help in an environment where the infrastructure is weak.

Keith Anderson: Yeah, yeah, I, it’s been an interesting three or four years in, in the recycling infrastructure. Landscape. I, I think the retailers, some retailers are, you know, headed in the right direction. Others, I think, are in a holding pattern trying to assess how do we do this at scale in a way that is going to work across different packaging formats.

So I’m glad you called that one out.

Francesca Hahn: I think it’s another synergy or analogy to, e commerce, right? There were some retailers that were slow to the game and they let. Other retailers get ahead of them and, and get their, you know, get their website online in a way that really made sense to shoppers and others. There were people, retailers, that did not have websites early, if you can remember that, Keith.

And, and so, it’s the same thing with sustainability. We gotta, everyone needs to be moving towards it. It’s again, not a perfect path, but you’ve gotta be making steps. And, and to your point, I think there’s some retailers really, innovating here. They have chief sustainability officers who are very influential and are great connection points for, for CPGs to come in.

And, and partner together.

Keith Anderson: Do you see those retailers? Gaining commercial advantage because they’re moving earlier and sort of the flip side of that coin. Do you see upside for CPG companies that are leaning in? Are the retailers rewarding you in some way?

Francesca Hahn: Yes. And yes, Amazon is big focused on Climate Pledge. There’s a filter online. So if, if, a shopper, that’s incredibly important to them, they can click that button and you’re only seeing the products that are. Marked Climate Pledge. Now, it’s complicated to get Climate Pledge acceptance. Maybe we talk about that later in our, our, double click, to your, your detailed audience.

But, it’s, it’s a challenge, from that perspective, but, but yet. It is something that they’re offering and it allows people to find and get the products that they’re looking for and thus the CPG who can qualify wins and there is reported lift percentages if you can achieve that.

Keith Anderson: Ooh, from, from where? And I only ask because

Francesca Hahn: They’ve been published a few times, Keith,

Keith Anderson: By

Francesca Hahn: don’t want to quote it.

Keith Anderson: No, of course.

Francesca Hahn: it’s, some other third parties have published that there’s a lift associated when you have that. I mean, like any badges that you would often get, it attracts your attention on the digital shelf automatically. And then, and of course, now that you have this filter, I think it’s, it definitely helps.

Keith Anderson: Well, I, I was going to say, in my past life, I did analysis on the list of those badges. Not the Climate Pledge Friendly badges, but Amazon Choice, Best Seller, and so I, I know based on data that those both drive traffic by attracting people from search result pages to product pages and can increase conversion.

The open question that I’m trying to get more facts on is, well, what about Climate Pledge Friendly? So if anybody in the audience has seen hard data on that, let Francesca and me know because, uh. I think it’s a safe assumption that it has an impact on, you know, how many people see and buy, but I like data.

Francesca Hahn: Me too.

Keith Anderson: Well, while we’re on the topic, do you want to go any deeper on, the complexity or some of the challenges of, of qualifying for some of those things?

Francesca Hahn: Well, there, I think at this point, there are some general big challenges and you’ve talked about it in your other podcasts, but of course the recycling infrastructure is major challenge for us, as we mentioned earlier. Also materials. And when you think about the size of Monsali’s, if we make a major change in packaging, as an example.

It causes, a real challenge in availability of that, of that supplier, materials that we need. So I think working with suppliers to have a long term plan on how to achieve these, so I think, you know, again, keeping your own partners very close on that journey that you’re taking so that you can implement those changes so that you have more sustainable products.

It’s very important and there aren’t that many vendors in general. So it, it, so I think it’s going to be a continued challenge as we’re all navigating towards this, that we, and it’s why I love the things that you’re doing here, Keith getting kind of the word out, is we need more vendors, suppliers that can produce the, the, the source materials so that we can achieve these all 100%.

Keith Anderson: Materials, ingredients, packaging, yeah, I mean, you mentioned, you mentioned some of the, complexity of making shifts in the production process. I, I’ve been looking at, a universe of roughly 400 companies that have basically raised capital for some sustainability related solution oriented to retailers and brands.

And one Interesting pattern I’ve noticed among a subset, especially those that are focused on packaging and, and, you know, largely packaging actually is where it’s the case they’re plug and play. That is, it increasingly looks like,, success factor. To be able to directly substitute for an existing material or ingredient that you, need a replacement for without having to adjust or adapt other processes, other machines and systems and, you know, to your point in a majority of cases, looks like Longer term planning is going to be necessary in many cases, but I am starting to see companies promote themselves as, hey, we’ve got something that you can drop into your existing production run today.

There’s not a lot, but it’s an interesting point to me, because especially for the larger CPG majors, you can’t just, switch a material out if it doesn’t have most of the same attributes and characteristics as. Whatever it’s supposed to replace. And the other, the other factor I’m noticing is some of the, suppliers that seem initially promising, as you peel back a couple layers of the onion, they just don’t have the scale to move the needle at this stage.

So there’s a lot of early stage, you know, pioneering work being done, but. A lot of what I think is going to happen over the coming 5 to 10 years is seeing what clears the stage gate and actually ends up reaching a critical mass that can become part of the CPG majors way of working, as opposed to so many of these things that sort of get stalled in pilot test and learn stage.

Francesca Hahn: I’m hoping that because we, and many other CPGs are publishing these long term plans, that it’s motivating for more positive change on the vendor side. And, and, and also there’s examples of regenerative farming and, and, and. You know, as we engage in and drive more farmers to think that way, we can drive more, you know, more expansion and, and people see that the possibility is there to, to drive something that’s also good for the planet, but hopefully also good to drive their own business.

Keith Anderson: Yeah, where do you or where do you see the industry searching for those kinds of. Partners or suppliers are their full time dedicated roles the same way that many companies now have e commerce capability leads or or similar? Is it the corporate venture team, sustainability team? You know, how do you even go searching for those kinds of cutting edge capabilities?

Francesca Hahn: We have a sustainability team and locally, and then also globally, that they’re both chasing the bigger innovations and, and, as opportunities. So sometimes it’s partnerships. These sometimes come through from retailers, sometimes they come through from government, author authorized groups that are pushing, and giving opportunity.

For example, we are now part of a cargo. Owners for Zero Emission Vessel Group, it’s a group that brought, was brought to us from a retailer and now it, now we’re part of 35 or so freight buyers who are focused on zero emission ocean transport. I mean, it’s not something I would have known or heard about before, but it came to us via a retailer and now we have signed in on it and we are focused on container utilization.

Opportunities as, as well as reducing distance traveled. So again, trying to do the right thing for the planet, but also trying, you know, it’s also more efficient for business as well. So I think those are some of those opportunities that come to us and, and you need a team who can focus on these. If you, you know, this is where you need, you do need the specialists who can focus and, and understand it, and then they can teach the rest of us, to understand.

And then also we can talk about it, with other retailers and try to encourage the same kind of behavior.

Keith Anderson: You know, I’ve, I’ve definitely seen an acceleration of those kinds of consortia and cross industry initiatives. The NRF just launched a center for, for sustainability. The UK, there seems to be a lot of activity too. They just formed, for the major grocers there, just formed a group to try to develop standards for product level, carbon footprinting and labeling.

And I think with so many of these. Bigger, longer term challenges, part of what’s held it back is, you can go try to do it in a vacubut if nobody follows you, it’s almost destined to be,, certainly destined to be a cost center and nothing more, it’s not going to reach the scale to move the needle, it’s not going to change chopper consumer behavior, so the appetite for participating in these Sort of pre competitive or on some level collaborative initiatives to accelerate getting to a standard across the industry.

I just see those things proliferating pretty quickly at the moment.

Francesca Hahn: I agree. I think it helps everyone raise up together. And I love the ones that are both CPG and retailer, cause then you’re collaborating on all parts end to end. of, of the whole, supply network. And, I agree. I, I think it’s hard. There are a lot of groups. So, you know, our team spends a lot of time analyzing if this is the right choice.

And, but. You know, I see us signing more and more agreements where it makes sense globally and locally.

Keith Anderson: Hey folks, this is the part of the show where we say thank you and see you soon to the general audience, plus and higher tier members of Decarbonize. co, stay tuned for the rest of the episode.

Thank you for listening, and we hope you’ve enjoyed this episode. If you find value in what we’re doing, we really appreciate your support. Please consider leaving us a review on Apple, Spotify, or your favorite podcast platform, or share this with a colleague to help us reach more listeners. To hear the complete episode and find more news, insight, analysis, and to join the Decarbonizing Commerce community, please visit decarbonize.co. Thanks for listening, and we’ll see you on the next episode of Decarbonizing Commerce.

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