Darden Tech Week: Rejuvenating a Digital Strategy and Supercharging the Growth of Contactless Payments

The University of Virginia Darden School of Business Technology Club presented a week’s worth of technology-driven programming to students in early November, with virtual alumni panels on topics ranging from the future of 5G technology to cultivating resilience as a product manager, and keynotes addressing issues in early stage tech startups and instilling a digital focus in a multinational corporation.

At an event hosted by Darden Marketing Professor Kimberly Whitler, former Procter & Gamble executive F.D. Wilder detailed his experience revamping and streamlining the digital strategy for the consumer goods giant.

Wilder, a 37-year veteran of the company who retired in 2019 with the title of senior vice president, go-to-market strategy and innovation, said P&G circa 2013 had not kept up with global digital trends. Digitally native brands were stealing market share. P&G social media efforts were disparate and of varying quality and digital complexity and risks were “out of control.”

No one at the company was fully dedicated to digital e-commerce, Wilder said, describing it instead as “10 percent of 1,000 peoples’ jobs.”

With a host of issues and an innovation pipeline that was unable to meet future growth goals, Wilder, now a senior adviser for McKinsey & Co., was charged by P&G CEO A.G. Lafley with bringing focus to the company’s lackluster efforts. After asking Darden students to present their plans to tackle the company’s digital alignment and growth, Wilder walked them through the steps he eventually took, which he distilled as:

• Strategy
• Structure
• Skills
• Systems
• Signals

On strategy, the plan meant a shift from incremental thinking on digital growth to one that prioritized digital transformation. Wilder said the company began to “plan from the future back,” asking themselves, “What is the world we would like to see?” A desired future where 50 percent or more of the company’s business was done online led to tactics such as pushing the sale of Pampers online in China, which became a huge success.

Through structure, the company sought to bring clarity to siloes across the organization, integrating the disparate digital media, online sales and IT under a single vertical and “aggressively following up on execution” by reviewing progress brand by brand against key performance indicators, for instance.

Skills involved staunching the flow of top digital talent to major tech companies. The effort involved creating a “digital genius academy” to nurture capabilities within the organization and teaching leaders throughout the organization how the digital, direct-to-consumer model actually worked. The efforts helped “demystify digital” for senior leaders, and led many to ask why so much work was being outsourced to agencies, Wilder said.

The systems shift represented a change in the way P&G considered its innovation process — becoming a more nimble, curious company.

“The big shift was: How do we move from an organization that feels like it has to know it all to one that really wants to learn it all?” said Wilder. The company tried to cultivate a greater tolerance for failure and experimentation, particularly among emerging brands, and started a program to grow startups within the organization.

On signals, the company worked to identify trends of the future it needed to pay attention to, bringing outside thinking into the company via an annual conference that brought in speakers from various industries and sectors. The conferences sought to help P&G think bigger, to go from a total addressable market mindset to a total addressable problem mindset, Wilder said.

The results of the yearslong transformation are evident in the P&G earnings reports and market position, with online sales a multibillion annual business and the fastest growing segment of revenue growth.

Digital Payments Revolution Drives Mastercard Transition to Tech

Mastercard Vice President of U.S. Issuer Development Craig Nussbaum said technology is leading the fabric of commerce to change. Known for its core credit card business, this shift has led Mastercard to undertake a quiet transformation over the past 15 years, evolving into a technology leader in the growing digital payments space via a new focus on internal innovation and a number of strategic acquisitions.

“Everyone right now is a digital consumer. The consumer is always on,” Nussbaum said. “The consumer is more sophisticated, demands choice and wants a simple one-stop shopping experience.”

Nussbaum spoke at a panel with Darden graduates Parks Daniel (MBA ’18) and Chris Condon (MBA ’19), who each accepted jobs with Mastercard after graduation and demonstrated new products the company is launching on the digital frontier.

The coronavirus pandemic has only accelerated a number of tech trends, Nussbaum said, creating new challenges for small businesses and merchants. Among those trends, he named:

• Growth in contactless payments and digital transactions
• The need for improved frictionless authentication for e-commerce transactions and fraud prevention
• A growing focus on cybersecurity
• Challenges with working capital and a credit crunch
• General digitization of business models and the need to make those models more efficient and comply with regulations

Before the coronavirus pandemic, Nussbaum said, the United States was well behind peer nations, including Canada and Australia, when it came to percentage of consumers using contactless and digital payments. At the onset of COVID-19, however, “people very quickly realized they don’t want to touch money.”

With the increase in digital business and payments, Condon said fraud and costly “chargebacks” have become major problems for small businesses and merchants at an already challenging time. Mastercard is tapping into artificial intelligence technology that leverages big data to provide a solution for businesses that minimizes fraud losses and requires minimal effort from the customer. Condon conducted a live demo of Mastercard’s Ethoca product, which is leading the company’s charge to fight fraud.

Daniel, a third-generation Darden graduate, conducted a demo of the Mastercard Track Micro Credit program, which leverages tech to create financial inclusion opportunities for small and micro businesses in developing nations around the world. She said there are $19.8 trillion in payments made and accepted in developing economies among medium, small and micro businesses, and yet these customers are “underserved and underrepresented by financial institutions.” Track Micro Credit is one of several solutions Mastercard is bringing to market to serve this customer base, which is often overlooked but critical to the globally economy.