REGION OVERVIEW EMEA. David Johnston President & CEO EMEA

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2 REGION OVERVIEW EMEA David Johnston President & CEO EMEA

3 TOUGH MACRO ENVIRONMENT IN EUROPE GDP Growth Bond Prices Consumer Confidence United Kingdom % Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 % % United Kingdom Italy Spain United Kingdom Italy Spain Q3 Q Q2 Q3 Q Q2 Q3 Q Q Q3 Q Q2 Q3 Q Q2 Q3 Q Q2

4 LOYALTY CURRENCIES AND CUSTOMER ANALYTICS REMAIN RESILIENT Nectar UK partners using points aggressively Jun YTD vs YAGO Bonus Points + 44% Jun Jun YTD vs YAGO Bonus Points + 9% Jun Jun YTD vs YAGO Bonus Points + 84% Jun Nectar Italy - billings growth despite recession Q2 YTD % ISS thriving in a growth industry Jun YTD Gross billings + 18% UK Self Serve clients 110 to 122 International relationships 3 to 4

5 HELPING OUR CLIENTS BUILD STRONGER CUSTOMER RELATIONSHIPS

6 IMPROVING FINANCIAL PERFORMANCE Gross Billings AEBITDA Growth AEBITDA Margin % YoY% Growth 21.5% 120% 7.4% AE Margin % 19.4% 15.4% 5.2% 12.3% 13.0% 55.9% 3.8% 3.9% 5.1% H % Q12011 Q2Q22011 Q3Q32011 Q4Q Q12012 Q2 Q2 Q1 Q1 AEBITDA YOY% Growth AEBITDA YoY% Growth H H Adjusted for the impact of the VAT ruling, changes in the breakage rate, Italy launch costs and restructuring costs GB growth, AE% calculated in GBP; AE growth measured in Can$

7 DELIVERING ON OUR STRATEGIC PLAN STRENGTHEN CUSTOMER RELATIONSHIPS DRIVE INNOVATION BUILD MARGINS Renewals Sainsbury s Homebase HSBC Expanding coalition partners British Gas Original Marines Unicredit Mobile Nectar, Sainsbury s & BP mobile apps Location-based offers Analytics Enhanced Self Serve modules Share of Wallet Loyalty Self Serve CRM Campaign Execution Tool Offer engine VAT mitigated Improving leverage Strengthened commercials

8 MOMENTUM FROM STRATEGY THROUGH TO EXECUTION UK MEA OTHER COALITION LOYALTY LOYALTY ANALYTICS PROPRIETARY LOYALTY

9 NECTAR Jan-Pieter Lips MD Nectar

10 GROWTH DRIVERS OF THE NECTAR BUSINESS INCREASE NECTAR S FOOTPRINT DRIVE VALUE FOR PARTNERS GROW THE MEMBER BASE MONETISE MEMBERS THROUGH INNOVATION

11 LOYALTY PAYS 100% PARTNER RENEWAL IN THE LAST 18 MONTHS 11

12 SAINSBURY S RENEWAL IN PARTICULAR SETS NECTAR UP FOR A PROFITABLE AND SUSTAINABLE FUTURE Nectar at the core of Sainsbury s marketing JUSTIN KING CEO Sainsbury s We have signed a new long-term contract with Nectar to ensure we retain this source of customer insight - a key competitive advantage Joint Business Plan to drive value for both parties Contract renewal with improved terms Extended 7 year term 12

13 BRITISH GAS LAUNCH HAS EXCEEDED EXPECTATIONS AND DRIVEN GREAT RESULTS CUSTOMER INCREASE +2m INCREASE +5 Our partnership with Nectar is delivering some great results. 55% of the customers that have joined us as a result of Nectar fall within our highest value category and nearly two million of our Nectar-collectors now self-serve, incentivised by points. Brand perceptions have also benefited. On-line account Net Promotor Score WILL ORR, Marketing and insight director 13

14 ANNOUNCING OUR NEWEST PARTNER Most visited retail website in the UK 17m unique monthly visitors Retail sales and peer to peer Elephant : top-5 partner 14

15 DRIVING VALUE FOR PARTNERS THROUGH CONNECTING THE DOTS BUSINESS CHALLENGE ANALYSIS RESULTS Homebase wanted to understand the headroom potential to grow customers spend This would enable more effective retention and spend stretch strategies First ever view of share of wallet across customer segments Targeted DM campaign to those with highest growth opportunity New headroom segmentation for more effective targeting and use of promotional spend Non-top customers with significant headroom behaving like top customers 15

16 WE VE HAD A MAJOR FOCUS ON INNOVATION OF MEMBER INTERACTION 16

17 AND WE RE TESTING A DEALS PROPOSITION TO FURTHER MONETISE OUR MEMBER BASE 17

18 WE RE MOVING WELL BEYOND THE TRADITIONAL TRANSACTION MOMENT INTO INTERACTIONS POST- PURCHASE AWARENESS Interactions PURCHASE RESEARCH PRE- PURCHASE 18

19 NECTARS MOMENTUM IS CLEARLY VISIBLE IN OUR METRICS 18.5m 83% 20.7% 4m 15.5m 75% 16.1% 2.2m 19

20 GROWTH DRIVERS OF THE NECTAR BUSINESS INCREASE NECTAR S FOOTPRINT DRIVE VALUE FOR PARTNERS GROW THE MEMBER BASE MONETISE MEMBERS THROUGH INNOVATION 20

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22 ISS NEW BUSINESS with Sainsbury s Peter Gleason President ISS

23 SHOPPER MARKETING IS A KEY STRATEGY FOR DRIVING SALES Shopper marketing is about understanding how target consumers behave as shoppers throughout the total purchase journey ISS services currently provide the core of shopper marketing understanding and execution The growth of shopper marketing as a whole continues at a fast pace

24 ISS IS WELL POSITIONED TO CAPITALISE ON SHOPPER MARKETING GROWTH

25 OUR INSIGHT OFFERING AND TARGETED MEDIA CHANNELS ARE GROWING STRONGLY Our insight tools and capabilities utilise customer data collected via loyalty cards to deeply understand customer purchasing behaviour EXAMPLES INCLUDE:- SELF SERVE INSIGHTS CONSULTANCY Targeted media channels utilise customer data collected via loyalty cards to deliver relevant, timely offers to shoppers on a one to one basis EXAMPLES INCLUDE:- COUPON AT TILL DIRECT MAIL MOBILE The speed and flexibility of our primary insight tool, Self Serve, is widely recognised in the market place. This is complemented by a growth in our offering of insight advisory and consultancy services The targeted nature of these comms enables the evaluation of campaign ROI we know who was issued with offers and we can accurately track redemption rates Used intelligently, targeted comms facilitate the building of highly valued relationships between retailer and customer

26 NON-TARGETED MEDIA INCLUDES OVER 20 CHANNELS Non targeted channels are more of a mass communication vehicle and customer data is not currently used in deployment IN STORE AROUND THE STORE Traditional channels include: AT HOME

27 THE NEXT GENERATION OF ISS IS UPON US We are creating a new business in the UK with Sainsbury s that will accelerate the overall growth of ISS This new business is a natural development for our relationship with Sainsbury s The partnership opens up lots of exciting new opportunities including New store targeted media channels A streamlined buy in process for CPGs Closer alignment with Sainsbury's strategic plan Long term revenue and profit growth is significantly enhanced by this new partnership

28 COMBINING TARGETED AND NON-TARGETED MEDIA PRESENTS REAL GROWTH OPPORTUNITIES Market research SHOPPER RESPONSE EVALUATION BEHAVIOUR DRIVERS Media evaluation ACTIVATION LOGISITICS SHOPPER SEGMENTATION SHOPPER ACTIVATION PROGRAMME TARGETING STRATEGIES COMMS CHANNELS Shopper targeted Store targeted

29 AIMIA, SAINSBURY S, CPGs AND SHOPPERS ALL BENEFIT AS A RESULT OF THIS NEW PARTNERSHIP Stronger relationship with Sainsbury s and supply of wider range of services whilst retaining IP Stronger relationship & communications with customers; capitalise on market growth opportunity Unique opportunity to drive ROI via integrated campaigns Faster, more relevant environment

30 WE HAVE GROWN OUR INTERNATIONAL PRESENCE AND CONTINUE TO BUILD OUR GLOBAL BUSINESS Store of the future Customer Self Serve Coles Express Fully launched Category planning Embedded Self Serve into Category Management Review of commercialisation opportunities Offer Engine Strategic consulting Over 185 Sobeys users 12 CPG suppliers already signed up

31 REGION OVERVIEW EMEA David Johnston President & CEO EMEA 20 Sept 2012

32 NECTAR ITALIA DELIVERING RESULTS IN A TOUGH ENVIRONMENT ITALY JUN 2012 GDP growth (0.7)% Bond Yield 5.8 % Unemployment 10.8 % DELIVERY FOR PARTNERS Highest spontaneous awareness in market Newly acquired customers driving 1-3% Y1 sales growth DELIVERY FOR MEMBERS Engagement 12 cards swiped every second Customer Satisfaction 8.2/10 Over 50m of rewards distributed to members

33 MIDDLE EAST SUCCESSFUL PROGRAMME RELAUNCH AIR MILES MIDDLE EAST Change YoY 2012 Q2 Points issuance (millions) 13.7% Gross Billings +AED 24m

34 PROPRIETARY FOCUSED ON LOYALTY - EUROPE

35 PROPRIETARY FOCUSED ON LOYALTY - MIDDLE EAST Saudi Arabia s largest Leisure & Hospitality Loyalty Program Qatar s largest Telecom Loyalty Program

36 MOMENTUM FROM STRATEGY THROUGH TO EXECUTION UK MEA OTHER COALITION LOYALTY LOYALTY ANALYTICS PROPRIETARY LOYALTY

37 THANK YOU