Episode 02 - Creating Entrepreneurship Innovation in Large Companies w/ Kevin Burke (Beam Suntory)

Predicting_the_Turn_w_Dave_Knox_EP_2_Kevin_Burke-04.jpg

Listen to the episode on iTunes:

Episode 2 - Creating Entrepreneurship Innovation in Large Companies w/ Kevin Burke, Sr. Director Global Marketing - Innovation at Beam Suntory

Show Transcript:    

Kevin Burke:  It’s easy to say better faster cheaper, because you’re always looking for those inside of the organization, but sometimes the solution just presents itself.

 

Dave Knox:  I’m your host, Dave Knox, and this is Predicting the Turn.  A show that helps business leaders meet their industries inevitable disruption head on. 

 

Welcome to another edition of Predicting the Turn.  Today I’m here live at Brandemonium in Cincinnati, Ohio and I’m joined by a guest that I think is going to be a really fascinating conversation.  Joining me is Kevin Burke, who is the Senior Director Global Marketing-Innovation at Beam Suntory.   Kevin also comes from an amazing background, spending time at Coca Cola and even before the acquisition at Vitamin Water working on those businesses.  So, Kevin, welcome to Predicting the Turn.

 

Kevin Burke:  Thanks Dave, I appreciate you having me. 

 

Dave Knox:    I want to start off with that story of your background and the journey that you’ve gone on as somebody that joined Vitamin Water right before the acquisition but then stayed nearly a decade after that and helped really grow that into a global brand.  So, tell us a little bit about your story.

 

Kevin Burke:  So when I finished school, I was kind of out there hunting what do I want to do next and I was actually working in the spirits business out oddly enough, as a sales rep, trying to sort of find my way around what I wanted to do really with my life and I stumbled upon Vitamin Water around 2005.  They were looking at expanding a lot around their experiential marketing program at the time and I latched on doing some sampling events and things like this with them and started to kind of see the culture of the company, the speed at which they work with, the fun they were having and kind of hounded their brand team about what roles are out there.  Was fortunate enough that they had a regional marketing kind of position open.  I did it for three months and they were like, wait a minute, you seem to kind of know what you’re doing as a lot of these younger companies do and quickly brought me into more of a brand experiential marketing role.  So, directly working for the brand team, managing a regional budget, managing a lot of sampling teams, what events to partner with, that sort of stuff.  Little, unbeknownst to me at the time, they were looking to move and Coke came along in early 2007 and purchased Glaceau and I sort of went whoa, I guess I work for Coke now, right?  The fun part was for a couple years after that Coca Cola was smart enough to let Vitamin Water and Smart Water grow, still operate as its own entity, still builds, find the right people that they needed to fit with their brand and then started kind of weaving us into more brands that they wanted to see work like Vitamin Water.  One of the things I thought Coca Cola did really well in that acquisition was not just throw it over the fence inside onto the red truck. They used Glaceau and the people and their methods as a platform for other brands like Powerade and some of the other investments they had at the time, Fuse, Nos, was an energy drink.  And so, I got more exposure working on those brands. 

 

In 2011, Glaceau had started to go Global, so Vitamin Water, Smart Water started to go global within the Coca Cola company and I got the opportunity to go live in Germany and spend two years over there launching the brand around Europe.  Came back from that assignment into the Atlanta corporate HQ, the khaki pants and blue blazer building, that one I might get in trouble for, Dave.  But yeah, came back and worked in a global marketing role there on a lot of sort of enhanced water business and innovation. 

 

Dave Knox:  That wonderful, super cool journey.  So you came back into Atlanta and one of the things you started diving into was more of those, let’s call it entrepreneurial corporate innovation type stuff.  So you became a facilitator, organizer for startup weekend.  You went through the Flashpoint program at Georgia Tech and you even were the cofounder of something called Karma Forward that came out of, it sounds like, a startup weekend.

 

Kevin Burke:  It did.

 

Dave Knox:  So what caused you, coming back into corporate to do that nights and weekends extra work without understand the space?

 

Kevin Burke:  There were some mentors at Coke, a girl that’s still doing a lot of innovation, entrepreneurship work in Atlanta named Carrie Davis.  She built a program inside of Coca Cola that really selected people that were of like mind to try to do things differently within that large organization.  Carrie had a partnership with startup weekend, which fed me into it.  Carrie brought me to Flashpoint, which was a corporate incubator program that we actually ran some Vitamin Water stuff through.  So, really through people, finding those like minded people is how you get into that stuff.  For me personally, I think there was a desire, kind of coming from a fast moving Glaceau make our own choices but pay for those choices whether they’re good or bad.  What you got inside of all this structure of Coke, I was doing a lot of the standard brand management things, right?  A lot of reporting, a lot of analyzing, a lot of Power Point and there was a desire to do more, kind of play around in the sandbox, if you will.  And having things like startup weekend inside of Coca Cola or becoming a facilitator, pushing our brand outside of the building to do the Flashpoint Georgia Tech program, there was that desire and once you started, you kind of catch the bug, as they say.  And I started doing a lot of it.  Karma forward actually was a, there was an actual Coca Cola startup weekend where we gave people two days to come in and run the program with internal employees and we created the idea of, could you, the idea was kind of spawned of could you  give people rewards for doing good?  So, it was kind of do good, do some charitable acts, plant a couple trees on a Saturday, you would earn some karma points, right?  And then those would be redeemable with businesses.  We got it to a place where we actually had some pilots running with movie theaters and a couple of different charities in Atlanta and we ended up throwing it over to Points of Light, I don’t know if you’re family with Points of Light, civic accelerator, who liked the idea and they continued it and ultimately killed it.  But, just those things where you could play around outside of you day to day job and then the cool part was the opportunity to bring those together with Flash Point and Carrie and I went to Flash Point to do an actual project on Vitamin Water, that the Coca Cola company funded.  So it was this play around with startup weekend, do it on your own, now bring it back to your real job, which has been a really fun journey.

 

Dave Knox:  That’s awesome.  So last year you made the move and left Atlanta, went up to Chicago to work for Beam Suntory and the role you are now doing Global Marketing Director for Innovation.  So what’s involved in that role?  What innovation mean at a liquor company?

 

Kevin Burke:  So there’s three sort of areas that we focus on in my remit.  So one is exactly like it sounds, new product innovation.  Beam Suntory will release between 50 -75 new products this year or out around the world. That's everything from your limited time offerings in our whiskey portfolio.  This week, we actually launched two new products from what we call the house of Suntory.  So Haku Vodka, which is a hundred percent rice based vodka and Roku Gin.  So both Japanese vodka and gin came out in the portfolio, so that’s sort of remit one, is new products. The second is what we call foundational insights, it’s really trends, what's going on in the industry?  How do we predict what's coming 3, 5, 7, 10 years away?  And our team takes a deep dive into that.  And then third space is what we call marketing capabilities, which is defined a little bit differently being within our team.  It's, it's really about finding new ways to work.  And that's a lot of the reason I'm here at Brandemonium and Brand Fusion is to look at startups.  Look at new ways outside of the company to do things differently.  It's easy to say better, faster, cheaper, because you're always looking for those inside of an organization.  But sometimes the solution just presents itself right?  And you just didn't know that company existed.  So unless you're kind of always looking outside within that marketing capabilities vertical we have, we're never going to even find them.  So I encourage our team to do that.  We work with 1871, the startup hub in Chicago, working with a lot of their folks on a kind of monthly basis to see what's out there as well.  So those three things, new products, foundational insights and what we call capability building.

 

Dave Knox:    So let's dive into the second part of that.

 

Kevin Burke:  Sure.

 

Dave Knox:  So in Predicting the Turn, I call that market intelligence.  You know, this idea of predicting the how and when the future of your industry is going to happen.  Ten years ago, big companies relied on futurists, these people that just thought about big ideas and where things could go.  Today, I'm seeing people in corporate innovation dive in a lot more of looking at things like venture capital as a predictor of where things might be in five years, doing engagements with startups like you are.  What are the tools of how you think about that, and dive into that roadmap of not a guarantee of where things might be, but the scenario planning of where things might go?

 

Kevin Burke:  I think it's a balance of the old and the new, to be honest, right?  So we still use some futurists.  What we do task those futurists with those, is what I like to call sort of shock and awe.  So I think it's really interesting to get a really strong futurist agency to go out there and paint a picture for your company on what the world might look like, just to shock people into what we, to get things moving, right?   So I think kind of using the old in a different way is kind of step one.  One of the other things we do a lot of is we've recently started looking into where government money is flowing, right?  So where's the government money being spent on research around alcohol, around cannabis, CBD, around rules and regulations.  Because typically, if you can figure out where the money is going to start flowing, and who's doing what in that space, and what research is taking place, you can predict 5, 8, 10 years out.  And then we use a balance of, I'd say other sort of partners and methodologies, right?  Events like this one today, we’ll use scouting events like London Cocktail Week, or Tales of the Cocktail in our specific industry.   Try to find those people that are truly kind of ahead of the game and get them in the building for interviews, try to find the bars or the mixologists that are out that are really reinventing menus. Things like this, and try to bring those in through either M&A or strategic relationships, right?  So I think kind of getting out, the Japanese Suntory team has a thing called Gimba, which is about getting out into the field, getting out into seeing where your customer truly lives.  And so I think a balance of those three right is sort of where we're figure out what's going on in the world of insight.

 

Dave Knox:    That’s great.  Yeah, I love that you mentioned Tales of the Cocktail.  I went to my first one ever last year down in New Orleans.

 

Kevin Burke:  It’s a lot of fun.

 

Dave Knox:  It's a blast, but it's fascinating seeing an industry where your front line is the bartenders, the mixologists and seeing an event where they are talking about that engagement in the industry, that it's the B2B side of the liquor industry.

 

Kevin Burke:  Yeah, I mean, one of the big trends happening today is this idea of sort of low ABV or even zero proof cocktails, right, that's out there happening in the world.  It's here today.   William Grant, one of our competitors, opened Tales last year with a zero proof party.  Who’d imagine at a bartender conference that you'd open with a party that doesn't serve any alcohol right?  But just their showing their mindset, kind of signaled to us, we better start doing more in that space.  And we've got 5, 7 projects in the pipeline right now addressing and that sort of thing, right?  We're probably behind.  So if you can get out and start to see what's going on ahead of the game and I think those kind of key events like that, or like this one today, are the places that happens.

 

Dave Knox:    Talent is a big part of Predicting the Turn.  And as we talk about talent, I wanted to mention one of our sponsors, Hunt Club.  Imagine the power of the best marketers in the world, helping you to find your next marketing leader.  That's the power of Hunt Club.  Hunt Club is a new category of talent company that powers the network of experts, connectors and business leaders to help you find the best talent.  Let's face it., recruiting hasn't changed with the times. Hunt Club is changing the recruiting game by leveraging technology, and crowdsource referrals to find you the best people possible for your company.  Stop paying job boards that don't work, or recruiting firms that recycle the same active candidates.  Partner with Hunt Club.

 

Dave Knox:  So, the last few years of your career has really been spent in this dead center corporate innovation, where big companies kind of evolve and go.  As you've started this journey what other companies have inspired you?  Who are you looking to, to learn from and take lessons from?

 

Kevin Burke:  That’s a great question.  I've had the, working on Powerade back a Coke, I got kind of a deep dive look at what Under Armour has done with their data platform, something that's super, super fascinating and kind of opened up my eyes to by having things like MapMyRun in their portfolio and the data that they can pull off of consumers and then use that to innovate, right?  They've launched a ton of tech products around sort of that as sort of a new vertical for them.  So I think that was one that sort of sparked what I was doing.  I recently met the founder of a product called Seed Lip.  I don't know if you're familiar with Seed Lip.

 

Dave Knox:  No. 

 

Kevin Burke:   It’s zero proof gin, essentially, out of the UK.  The founder distilled over 45 batches in his backyard, trying to get to something that could taste like gin.  Then he did another 450 to get to this product that he now sells to consumers.  He's selling a distilled product with no alcohol, right?  When you meet these kinds of people, Diagio has invested in him, something we missed on, unfortunately, but you see these kind of people, you meet these kind of people.  I think that finding one insight, someone's driving it all the way through, or those companies that are truly interesting in the space.  I met some guys recently, to give you another spirits example. They're selling carved ice.  So everybody likes to drink their whiskey with the right clear glass block of ice, or the right ball of ice for their serve.  They're selling it in six packs, and twelve packs in stores, right?  Taking something that molds, you can make them at home, or you're seeing in the restaurant experience and kind of bringing it to retail.  I think these are the kind of nuggets that are starting to inspire where we want to go with pipelines.  Something the corporation, frankly, it's hard to convince your bosses to let you get in the ice business if you're selling spirits, right?  I'd say those three are probably something that's been pretty interesting, Spotify, their data is fascinating, what they're able to do, and kind of, they probably know more about me than then Google does at this point, just based on when I turn on, what I listen to, what mood I'm in, those are some good ones.

 

Dave Knox:  I love that. So you know, what's fascinating about what you just described is there are things where there's an emerging seed of an idea, something that looks really interesting, but it's not yet a big market opportunity.  How do you start educating and convincing your peers, your management of, there's something interesting here, don't evaluate the company on its own. but look at the idea behind the company?

 

Kevin Burke:  Prototypes, I would say, or even (packseps) 15:12, right?  So if you've got a great design partner, or and in-house designer, mocking up, I'll use the ice example again.  Seeing this product show up in a store, there’s no interest in kind of our business to get in that today, but if we went and mocked up a Maker's Mark prototype of what a box looked like with six cubes of ice at it, right?   Now, all of a sudden, they're interested.  Oh, you've connected it back to something and that could help me sell more Maker’s Mark.  I found with our leadership teams that visuals and kind of walking them through what a potential business could mean for Beam as an adjacency, as a new product, as something new.  It sounds simple, but just illustrating it into something that they can touch or feel, or even just see on a slide during a business review, or something like this,  tends to spark interest in them.  Now, will they green light it?  Now you got to go do the business case.  But you haven't even got permission to do the business case yet.  So we'll build prototypes, we work with a great partner in Chicago called Kaleidoscope, that will literally mock up a bottle, and then we'll pour a competitive liquid in it, right, just to show the bosses what it might look like.  I think this is a step that a lot of startups do, right?  They make minimum viable products, which helps get across what they want to do.  Helps give them that first iteration.  In the corporate world doing that with whatever you have, and whatever ability you have, whatever budget you had to do it, is a great tool to continue to use.

 

Dave Knox:  Yeah, it's kind of the essence of design thinking and how to use that.  So that's how you do it right.  What do you think companies are doing wrong when it comes to corporate innovation with?  There's probably a long, long long list, but what are the two or three things you think people are doing the wrong the most?  

 

Kevin Burke:  They’re not taking enough swings, right?  They're not trying enough.  For whatever reason, many corporations are stuck in the world of create some, create an idea, I've got to research it 2, 3, 4 times,  iterate it again, research it again, right?  Spend a lot of time and dollars versus just take a bunch of swings at it.  Try to make a prototype.  Try to build version one or two, without so much time or effort or cost and see where it could go from there.  They don't even try.  We kind of wait for our process to come before you get there.  I think stages and gates are a big problem with a lot of corporate innovation teams.  They are necessary to trigger decisions.  I think they're necessary to signal to other parts of the organization what's coming, so they can plan for the future.  But many of the stages and gates processes that I've witnessed or talked to colleagues about in other industries tend to get in the way of a lot of innovation.  I think someone could reinvent that.  That would be a huge step forward.  I’m trying to think what else do people do wrong?  They don't listen to the person, the consumer.  I think is the other, it sounds it should be principle number one, right?  Consumer first, product launches consumer first innovation, but people don’t, they let the corporate world get in the way of that, in thousands of ways, right?  You get a boss that might fall in love with the project and then you just kind of ignore what the consumer is telling you. You let a customer dictate what flavor something should be just because they think that's the right thing to do.  Truly try to stick to the principles, I think is what helps.

 

 

Dave Knox:  So when you started your career, you went into that emerging brand category, joining Vitamin Water before it was even bought by Coke and beverages is probably that first industry that emerging brands, new brands, what was happening 10 years ago is now starting to hit a lot of other categories, including craft liquor now, finally.  The examples you mentioned, with Diagio, when you think about big companies engaging with these emerging brands, is it investing, acquiring, partnering, trying to compete directly against them by replicating?  How are you thinking about that portfolio strategy of what you want, not just Beam Suntory to do, but what big companies should do as a whole?

 

Kevin Burke:  The best model I've seen is actually the one that Coke built over twelve years ago now, right, which is venturing in emerging brands.  I had a chance to small part of it for part of my career there, but they truly saw the roadmap to, we're going to make 75 or 100 investments right and we're going to do this over time, and some are going to be big and some are going to be small.  Some are going to be really small bets and distribution into data companies, into retailers, right.  They've done a really nice job of that, which is a really good model.  If your company hasn't built something, so Suntory a much more traditional M&A operated company, which has its advantages as well.  What we try to do is is sort of create opportunities for those M&A guys to see potential in something.  We're running a program at Beam called the founders forum, which is much like your event today, where you're going to bring in 8-10 startup spirits companies from different verticals, right.  There might be a craft mixer, there might be a craft whiskey.  We may find a data company, a spirits media company that's emerging, bring them all kind of in and spend a couple days with Beam under the opportunity for us to learn from them. But also we're taking a look and kind of seeing what they're doing.  And you can run these kinds of workshops and hopefully that opens up the eyes to M&A.  I've seen different tactics.  It can be as small as a one time event, once a year.  It can be a full fledged venturing and emerging brands like Coke, but you got to have something and I don't know if it needs to be super formalized.  I think all that's dictated by our strategy and where you want to go as a corporation.  But, innovation teams could do it on their own.  It doesn't have to be something that's dictated from the top down

 

Dave Knox:  So with that founders forum, is that something you're curating yourselves?  Are you working with agencies, partners, vendors?

 

Kevin Burke:  We are curating ourselves, something that we, you know, great artists steal something that we plucked from a previous boss that work at venture and emerging brands.  A model that truly an innovation team can lead.  Now we're involving corporate strategy, we're involving the commercial team, we’re involving the customer teams, right?  Because we want someone from Walmart to come speak to these startups on our behalf and explain to them what it's like getting a listing there, right?  So there's value for these startups to want to join our program too.   We, again we're taking an active chance to meet those founders and kind of understand their businesses and what we like about them during those days that we can have the session.   So we’re curating ourselves, building it, doing it in Chicago, in the office. If you know, anyone, please throw their names my way.

 

Dave Knox:  I've got a couple names I’ll toss out to  you.

 

Kevin Burke:  Yeah, I’d love to have them.  We could get some invites out.

 

Dave Knox:   When you think about companies a lot of times, they get management says, you know, we need to act like a startup.  We need to do all this.  You talked about prototyping.  You talked about some of the lessons for corporate innovation.  But, what’s it really even mean when somebody says, within the corporate halls of, let's act like a startup?

 

Kevin Burke:  I don't even think they know.  Typically it means a ping pong table.

 

Dave Knox:  Yep and jeans to work.

 

Kevin Burke:  Yeah, something like this, right?  All the cliches kind of come to mind.  It starts with a culture of a leader, right?  It’s going to take a high level leader putting something in place or giving someone a license to do it, right?  I've had that fortunately at Beam from the top down from our CEO to CMO have said, you guys are global innovation, go figure some things out for us.  In my previous world at Coke, right, I guy named David Butler, and Carrie Davis created this innovation entrepreneurship group that was blessed by the CFO, actually, to go figure some things out.  So it does take a blessing.  It does take a cultural shift for someone to kind of give a push to it, for them to start understanding, but I truly don't think they know what that means.  You hear it all the time.  We have an entrepreneurial culture, we have these things, we move fast, we move quick.  But, in the end, they tend to default back to the to the status quo.

 

Dave Knox:  Yeah, makes sense.  So final question for you, since you've been so gracious with your time.  So you meet a lot of startups.  It was point number three, when you talk about what your role at Beam Suntory is, what advice would you give to a young company that is coming in to talk to a Fortune 500?  How should they approach it?  What should they keep in mind?  And how are they going to have the best success?

 

Kevin Burke:  Don’t come in, I think there's two things that come to mind.  One, don't come in with the attitude that a lot of startups you meet, come in with this attitude that they're going to get a sale that day, right?  They're going to come in and they're going to hit their home run right out of the gate versus this first meeting.  Chances are, it's not the right person to make that decision you're meeting with.  Chances are, they're showing up there for something different. They're evaluating you as a potential partner, not necessarily something that could be a 10 year relationship, or even acquire.  I feel like startups show up with the wrong mindset sometimes.  I like it when startups show up to these meetings and say, help me understand your business, right? Can you tell me more about Beam?  And they spend the bulk of the time learning about that, and then ultimately go to well, who's the right person that our business could fit into.  So that's a trap I think that the teams tend to fall into.  And then the other one that I think that's pretty blatant and easy for people to get, and if your startup that’s ever worked with a corporation, once you have convinced that contact to work with, know that there are 15 other hoops you're going to jump through from master services, agreements, to PO processes to Net 30, Net 60 days, payment processes, approvals, all that sort of back end stuff before you can even become a vendor in many cases.  So, don't think that just because you had a successful sales meeting that you're going to be able to turn it on immediately.  Be ready for those things.  Be patient with those things.  Trust me, the person wants to hire you as much as you want to work with them, but there's going to be a long loop of process you're going to have to be ready for.  If you show up with the right attitude, and you're willing to be patient, there’s a lot of cool work that can happen between the big guy and the little guy.

 

Dave Knox:  Yeah, I love that last point, because I think a lot of people forget once that person decides they want to work with you, they are your champion, but they're under as much pressure to get it down as anything else.  So help them to be successful. 

 

Kevin Burke:  Yeah, just because you decide to work together doesn't mean that it's done.  You still got to continue that relationship. 

 

Dave Knox:  I think that's a great kind of point to end on.  So I really appreciate you taking the time, it’s been a fascinating conversation.

 

Kevin Burke:  Yeah, it's a really fun day. Thanks for having us.

 

Dave Knox:  For sure, we’ll talk real soon.

 

Thanks so much for listening.  If you like the show, hit that rating and make sure to subscribe so you don't miss a single episode.  And for more resources, head over to predictingtheturn.com.