Retailer Collaboration Category Leadership
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1 Retailer Collaboration Category Leadership Insights & Strategies to Win Rob Colarossi VP Category Leadership Hostess Brands November 2012
2 Retailer Collaboration 2 Starts and end with the Consumer Understand how their consumer thinks Understand how their consumer purchases Collaboration is looking at business thru retailer s lens Deep dive in Facts & Insights Understanding our customer s objectives, wants & needs Category Strategies & Category Solutions that deliver results!
3 3 Category Leadership Process How we do it? WHERE TO FOCUS HOW TO WIN RESULTS INSIGHTS STRATEGY ACTIVATION Assessment Discovery Aligned Planning Action Planning Execution Measure Results Consumer Trends Category Trends Market Trends Competitive Assessment Shopper Behavior Research / Modeling Finance / IT / Supply Chain Guiding Principles to Win Customer s Corp Strategies/ Platforms Category Strategies/ Needs CUSTOMER-CENTRIC Current Volume Initiatives (1 yr) Future Volume Initiatives (2+ yrs) Developing Stronger Relationships Custom Programs Assortment/ Space Price/ Promotion Sponsorships Innovation Scorecard/ Measure Finance / IT Solutions
4 Insight Generation Process How the consumer think about category? CONSUMER How the consumer purchase category? Market Structure/ Purchase Decision Data/ HB & Industry WHAT they buy natural groups? WHO are they? Demographic Data/ SPECTRA WHERE do they shop? Opportunity Gap & Leakage Chart/ IRI Panel Data HOW do we merchandise? Assortment/ Space Planning/ Merchandising Principles/ HB & Industry 4
5 Five Mega Trends Shopper Behaviors Quest for Value Budget Consciousness Personalization Value of doing things my way Coupon use exploding +67% vs 2007 Net worth declined -17% since 2007 Gasoline +130% increase since 2008 Facebook 900mil = 3 rd largest country +5000% 2010 Black Friday sales using mobile device vs % cons <45 online ads as source to find bargins over TV/ Print 29% coupon users exclusively digital Demand for Convenience Value / Cost of my time +300% increase in single parent families 50% growth fresh convenient food (-59%) chg in time spent cooking / cleaning $250 bil US on line sales by 2014 Age & Health Value / Cost of my well-being Ethnicity Values of My culture / lifestyle 77% consumers believe healthy food is more expensive share of US pop over 65 will double by 2030; 13% today Hispanic 50mil in US (50% of growth) Buying Power over $1trillion 5
6 Retailer E Conversion Shopper Behavior Fresh Bread Increase Conversion Leader? National Best-in-Class Source: Builders Suite Calendar Year
7 Best in Class - Bread Consumer Behavior Panel Data Source: Builders Suite Mid-Year
8 Account E - Bread Consumer Behavior Panel Data Current: 62% $32mil - Leader: 80% $41mil +9mil - BIC: 93% $48mil +$16mil Source: Builders Suite Mid-Year
9 How the Consumers thinks about bread.... How the Consumer purchases bread... Bread Insights 7 Consumer Segments Define the Category Fresh bread/rolls 3 rd Largest Category 1/3 of all bread consumers looking for better for you +12% Fiber is important, Sodium is a concern T Source: 2008 NPD Eating Patterns of America 7 Segments 3 Key Factors Define Consumption Decision Tree: Bread Type, Flavor/Variety... Source: Consumer Market Structure Study
10 Proprietary Research that deliver Category Solutions Unified Research Approach: Retailer + Mfr Shopper Preference on Aisle Flow T Shopper Preference by Product type & brand Category Reinvention Solutions Source: 2008 NPD Eating Patterns of America 10
11 Marketing Tools 4-P s that deliver Category Results Diagnostic Tool / Scorecard Acct / Market Assortment Tool Acct vs ROM T Planogram capabilites JDA, Apollo Price / Promo Tools Source: 2008 NPD Eating Patterns of America 11
12 12 Insights, Strategies & Best in Class Solutions 1. Category Insights Bus Review vs ROM Panel Data Conversion vs Competiton Consumer Research Segmentation Studies / Decision Trees Spectra, Simmons, IRI 2. Category Strategies 4 P s of Marketing Product Assortment Placement / Merchandising Price Promotion 3. Category Solutions BIC (Best in Class) Collaborative Solutions 1. Assortment / Space 2. Best in Class POG Flow 3. Best in Class Merchandising 4. Price Promo Tool 5. Finance / IT Solutions 6. Supply Chain / Operations
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