Tikkurila distribution Tikkurila Analyst Day on August 15, Janno Paju, Chief Commercial Officer

Transcription

1 Tikkurila distribution Tikkurila Analyst Day on August 15, 2013 Janno Paju, Chief Commercial Officer

2 Sustainable beauty since 1862 August 15, 2013

3 Key success factors in paint business: 1.Brands 2.Distribution August 15,

4 Strong and well-established strategic brands "High end" (premium) "High end" (premium) "Medium" "Economy" August 15,

5 Main goal for our marketing activities: CUSTOMER HAS MADE THE DECISION BEFORE ENTERING THE RETAIL August 15,

6 Allocation of Tikkurila S&M spend EUR 1, East Scandinavia Finland CEE SBU East S&M spend has been increased the most in the past years SBU Scandinavia's relatively large proportion of S&M spend is explained by own professional paint retail shops Absolut S&M spend has been quite stable in the past years August 15,

7 Sales personnel and brand strength matter in the paint purchase process According to studies, brand strength is an important factor in the paint purchase process However, sales personnel seem to have an even bigger impact on the final decision Tikkurila continues to strengthen its brands further and steps-up distribution-related investments August 15,

8 Evolution of the paint distribution 1980's 1990's 2000's Today Traditional paint retailing Introduction of tinting Focus on products and technical advisory Consolidation of paint retail Big boxes appearing Focus on trade marketing and campaigning Customer segmentation Dedicated distribution channels Focus on service and added value Purchasing behaviour changing E-commerce Focus on complete solutions August 15,

9 Distribution structures differ a lot on our main markets Sweden Number of retail outlets: 800 Tikkurila coverage: 50% Big box vs. others: 15/85 DIY vs. Profe: 50/50 Russia Number of retail outlets: >8,000 Tikkurila coverage: >70% Big box vs. others: 25/75 DIY vs. Profe: 70/30 Finland Number of retail outlets: 750 Tikkurila coverage: 80% Big box vs. others: 70*/30 DIY vs. Profe: 65/35 *Incl. traditional hardware stores Poland Number of retail outlets: <3,000 Tikkurila coverage: 50% Big box vs. others: 30/70 DIY vs. Profe: 70/30 Baltics Number of retail outlets: 300 Tikkurila coverage: 90% Big box vs. others: 80/20 DIY vs. Profe: 60/40 August 15,

10 Distribution channels Tikkurila Wholesale (some countries) RETAIL Direct sales to: construction industry wood industry metal industry BIG Boxes Hardware stores Specialised paint shops Consumers Professionals/ Industry Advertising and trade marketing August 15,

11 Current Group* customer and distribution structure Customer segment split Distribution channel split 9% 0% Distributor/ Wholesaler 40% DIY/ Consumer Professional 22% 36% Big box Traditional paint shops 60% Own shops 34% Online *Including countries corresponding to 85% of Group revenue August 15,

12 Mature markets dedicated distribution channels for different customer segments Consumers Professionals Industry August 15,

13 Emerging markets distribution channels in transformation Open air market Big box Branded retail Color Studio August 15,

14 Needs and expectations of Tikkurila customer segments Consumers Inspiring shopping environment Simple color and product selection Technical advisory on product and application Fast service in the shop Convenient location Convenient shopping/online shopping Post-purchase service Complete product assortment for painting work Opening hours Professionals Flexible pricing and payment schemes Pre-ordering system Rental equipment for painting Deliveries to the site Area for socializing August 15,

15 Our strategic intent in distribution is to ease the purchasing process and to provide the best shopping experience for consumers and professional painters in the industry August 15,

16 Tikkurila Professional Shop New retail concept for serving professional painters on other than Scandinavian markets Based on the knowledge of running professional shops in the Scandinavian market since 1970's Complete product offering provided in co-operation with selected partners Service offering Pilot shop opened in Russia in 2013 August 15,

17 Digital initiatives support our growth strategy Customer dialogue Digital services Digital marketing August 15,

18 Conclusions Purchasing behavior of consumers and professionals is changing Relative share of professional painters is increasing End-user needs are quite similar in different markets, creating a good basis for unified group-wide concepts Challenges related to distribution are mainly driven by the market position and/or brand portfolio August 15,

19 Our focus in the coming years Goals and targets Improving user experience - Easy buying, fast service - Easy choice of colors - Inspiring with ready-made decoration solutions - New improved online services - Post-purchase service Improving our position in multibrand shops - Improving trade marketing tools - Tikkurila retail shop concept - Shop-in-shop concept - Promoter activities Increasing our distribution efficiency - Regional customer service centers in Russia - New distribution set-up in the emerging markets - Dedicated retail channels August 15,

20 Q&A