The Way To Win At Retail, Is To Help The Retailer Win

The Way To Win At Retail, Is To Help The Retailer Win Wise Person Thomas L Fox Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 1 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 2 Objective Changing Behavior & Driving Your Development Occurs In Stages EXPOSURE Increase your influence with retail Key Accounts GAIN UNDERSTANDING DEVELOP SKILLS BECOME AN EXPERT Process Accelerates With Vision, A High Level Of Open Mindedness & Training Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 3 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 4 1

Key to effective Key Account Mgt? Objective (It s obvious it helps the category) Fact Based (you ve proven it) Research How Do Retailers Perceive Our Service? Solution Oriented (makes it easy to execute) Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 5 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 6 Who Are We Evaluating? Beer Suppliers Wine Suppliers Spirit Suppliers What Are We Evaluating? Total value each supplier provides Knowledge of retailer goals / strategies Sales Process Analytical capabilities s / Executable solutions Pricing Promotions Objectivity Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 7 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 8 2

Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 9 Who Are We Interviewing? On Premise National Accounts Casual dining Beer centric Fine dining Theme Off Premise National Accounts Grocery Mass merch C-store Drug / Club Beer Suppliers ABI MillerCoors Pabst Crown Imports Boston Beer Diageo - Guinnes Heineken USA Mike s Hard Lemonade North A Brewers Sierra Nevada New Belgium Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 10 Who Are We Evaluating? Wine Suppliers Fosters Wine Constellation Wines Diageo C & E Gallo Majestic Trinchero The Wine Group Spirit Suppliers Bacardi Brown-Foreman Diageo Spirits Beam Global Pernod-Ricard Skyy Spirits William Grant Who Is Surveyed? Summary 7-Eleven Super-valu Kroger Circle K Target Sam s Club CVS HEB Wal-Mart Winn-Dixie Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 11 Yardhouse Marriott Dave and Busters Hard Rock Winking Lizard Hooters Buffalo Wild Wings Disney Applebee s Planet Hollywood Do not meet expectations theme for all beverage alcohol categories How would you be graded? How do you EXCEED expectations deliver presentation that are: Objective Fact Based Solution Oriented Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 12 3

Agenda The Keys To Accounts: 1. Knowledge of your accounts 2. Data proving your value / benefits 3. Process taking data and making it easy for your accounts to understand value Customer Account Profile What is an Account Profile? A single source file for all critical information pertaining to Key Account Customers Uses Serves as a foundation or reference source for future Planning, Business Reviews, Promotion and recommendations Background information that covers the organization in the event of employee turnover Some elements can be linked to facilitate chain management processes as well as goal achievement tracking What s necessary Accurate and timely information Effective maintenance and updating processes Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 13 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 14 Off-Premise example CUSTOMER PROFILE - OFF-Premise Update Date: ACCOUNT INFORMATION CONTACT INFORMATION Account Name: Buyer / Key Contact: Parent Company: Office Phone: Trading Names: Cell Phone: FAX: Headquarters Address: Email Address Buyer Profile # of Corporate Units: Likes # of Franchise Units: Dislikes Key Competitors: Other Current Category Captain: Other Key People The Buyer's Boss Category Validator(s): (Name, Title, Phone, Store Operations Optimal Call Frequency: email address) Regional Management Finance - A.P. CATEGORY MANAGEMENT Ad Coordinator Store Destination Categories CATEGORY STRATEGY AND TACTICS Beer Category Role Pricing Strategy Sub-Segment Role (Everyday vs. Promo) Scorecard Measures Promotional Category Goals for 2012 Strategy Space Mgmt. Strat. (Allocation & Assort.) Target Consumer Profile Reset Timing & Comments / Other Issues Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 15 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 16 ON-Premise example CUSTOMER PROFILE - ON-Premise Update Date: ACCOUNT INFORMATION CONTACT INFORMATION Account Name: Buyer / Key Contact: Parent Company: Office Phone: Trading Names: Cell Phone: FAX: Headquarters Address: Email Address Buyer Profile Likes # of Corporate Units: # of Franchise Units: Dislikes Key Competitors: Other Current Category Captain: Other Key People The Buyer's Boss Category Validator(s): (Name, Title, Phone, Store Operations Optimal Call Frequency: email address) Regional Management Finance - A.P. CATEGORY MANAGEMENT Ad Coordinator Account Destination Categories CATEGORY STRATEGY AND TACTICS Beer Category Role Pricing Strategy Sub-Segment role (Everyday vs. Promo) Scorecard Measures Category Goals for 2012 Target Consumer Profile Comments / Other The On-Premise Profile form can be almost identical to the Off-premise or, you can customize it as needed Promotional Strategy Draft and Bottle Strategy Menu Change Timing & Issues 4

Data Fact Based Selling What Data To Secure, How To Analyze Each Report, & Building Fact Based Solutions That Will Influence Retailer Behavior Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 17 What Are 6 Benefits That Could Come Out Of Our Recommendations? A) Increase Sales B) Increase Profits C) Increase transaction Rings D) Enhance store Image E) Increase store Traffic F) Create consumer Excitement Increase Check Size On Premise Think SPRITE for remembering Retailer Wins 18 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 18 Proving Benefits w/out Syndicated Data Sales Forecast sales in Like accounts Profit Unit profit X Forecast Trade Up Higher Average Transaction Rings Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 19 Proving Benefits w/out Syndicated Data Express Profit Difference 2 Ways A Craft 12 pk earns the retailer $3.00 A premium 12 pk earns the retailer $1.50 What is the $ difference in profit? $3.00 - $1.50 = $1.50 What is the % difference in profit? To calculate %, take the $ difference and divide it by the premium 12 pk (YOUR TARGET) Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 20 $1.50 / $1.50 = 1 or 100% 5

Proving Benefits w/out Syndicated Data Express Profit Difference 2 Ways A Craft 12 pk is $14.99 A premium 12 pk is $9.99 What is the $ diff in transaction size? $5.00 What is the % diff in transaction size? 50% $14.99 Craft 12 pk - $9.99 premium 12 pk = $5.00 To calculate %, take the $ difference and divide it by the premium 12 pk (YOUR TARGET) $5.00 / $9.99 =.5 or 50% Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 21 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 22 What Data Reports Do I Need? Securing The Necessary Reports Segment Overview RMA & CRMA Report tracks price and package segment gaps (IDs what is going on? ) SKU Ranking report for the RMA & CRMA SKU ranking tracks $ volume, trend, velocity & % ACV helps us understand SKUs to add & delete Promo Summary Secondary promotional report that tracks SKUs that received display ACV & their lift What Data Reports Do I Need? Securing The Necessary Reports SymphonyIRI Dan Wandel (312)474-4947 Daniel.Wandel@SymphonyIRI.com Nielsen Danny Brager (949)716-0224 Danny.Brager@nielsen.com Identifying Opportunities What is going on? Why is it going on? What can we suggest to solve it? Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 23 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 24 6

Identifying Opportunities What is going on? Category Segment Package Brand SKU Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 25 Vs. Market or Channel Identifying Opportunities Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 26 2 kinds of Opportunities: What Is Going On? Performance: TREND: volume, sales, or profit Vs. plan, the market or a competitor They re not growing as fast as my other customers Development: SHARE (or volume per outlet) Vs. the market or a competitor They don t sell as much as my other customers What Is Going On? What Is Going On? Segment Fox Groc. RMA % Chg vs. LY Fox Groc. CRMA % Chg vs. LY Fox Groc. RMA Share Fox Groc CRMA Share Share Index Identifying Opportunities Craft 4.8% 12.1% 6.6 7.9 84 Import 2.1-3.7 14.2 13.2 108 Super Premium 6.3 4.3 9.3 11.6 80 Premium -6.4% -7.2% 51.2 49.7 103 Sub Premium -11.7% -5.2% 18.7 17.6 106 Share Index = RMA Share / CRMA Share RMA = Retailer s Marketing Area, CMRA = Comparative Retailers Market Area (6.6 / 7.9 =.84 or 84 index means they are getting 16% less out of the High End than the average account in the CRMA) A 100 index equals fair share (meaning that the High End segment is equally developed in the RMA as the average account in the CRMA) The Premium segment is a 103 index meaning they are getting 3% more out of the segment than the CRMA Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 27 Critical To Ask Your Retailer s, Where Do You Want To See The Craft Segment In The Next 3-5 Years? What developmental index would you like for Craft? Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 28 7

Even if you don t have data, you can still ask your retailer s Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 29 What Is Going On? How is your Craft Segment doing? Where do you see it going? What is your goal? Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 30 Why Is It Going On? How do you Explain Opportunity Gaps? Look at how your retailers are managing each TACTIC Space allocation Promotion / displays / features Pricing Merchandising TACTICS explain why these Gap Opportunities exist What is it? How to influence Retailer s assortment decisions? Bottom Line: o Retailers need to understand that any change they make to their assortment needs to equal o More sales (what is the channel velocity average?) o More profit (unit volume X unit profit comparison) o Sales must prove that your SKU can outsell something that they currently handle o CRITICAL to understand average velocity levels of your SKUs by channel / geography o We average 2 cases of Fat Tire in casual dining restaurants in this neighborhood Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 31 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 32 8

Strategy Identifying SKU s that deserve more % ACV Low % ACV and high $ sales per point (relative to other SKUs) start at the top of the Brand & SKU report and go down looking for low ACV High rank / large volume SKUs in the Market Level report not available in the account (or not at a high level of ACV) Other secondary measures to consider (tie breakers only) ACV Dist change vs. YA $ Sales change vs. YA Unit PTC Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 33 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 34 Measures - $ Sales / Point o Sales Per Point is calculated by taking total $ volume and dividing it by ACV o It s a velocity measure that speaks to how fast it sells where it s currently available o The actual $ per point number is meaningless unless you compare it to another number then the relative comparison is meaningful o Example: Our 12 pks have a SPP of $2000 and their 12 pks have a SPP of $1000 ours sells 2 X faster o Does not mean that if a store puts our SKU in that it would sell $2000 for that store Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 35 Measures - ACV o Stands for All Commodity Volume o Is a distribution measure 80% ACV means: we have availability in stores that make 80% of the chains volume (not in 80% of the stores) o It s different than % of stores in that Nielsen understands that all stores are not the same size they factor in the fact that some stores are bigger than others o Also, don t forget to mention if there is a significant + / - in the measure ACV Point Change, no retailer wants to be on the wrong side of momentum Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 36 Strategy (Cont.) What we need to know to make assortment recommendations Reset timing (most reps don t know) When recommendations are due When sets are implemented Addition / deletion criteria Minimum # of units sold per week Is uniqueness / authenticity important Is marketing support important Market coverage by segment 9

RMA SKU s that Should Gain ACV IRI wk ending SKU Rank $ Sales $ Sales % Chg YA Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 37 $ Per Pt. Of ACV Ave. ACV Wtd Dist Added $ w/100% ACV Pacifico 12 Pk 36 $212,256 +12% $4245 50% $212,256 Dos Equis 12 PK 41 $198,110 +21% $3602 55% $162,090 Sierra Nev 12 P 45 $192,209 +17% $3696 52% $177,424 Mike s Hard 12 P 51 $178,330-3% $3023 59% $123,924 Don t Worry About Sales Declines With Your Add Suggestions focus on $ Per Point $675,694 ======== Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 38 Strategy Identifying SKUs to de-list High ACV and low $ Sales per point of distribution (relative to other SKUs start at the back of the Brand & SKU report and work up looking for high ACV) Low rank / small volume Other secondary measures to consider (tie breakers only) ACV Dist change vs. YA $ Sales change vs. YA You should identify 2 X as many De-list SKUs as you suggest RMA SKU s To Consider Deleting IRI wk ending SKU Rank $ Sales % Chg YA Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 39 $ Per Pt. Of ACV Ave. ACV Wtd Dist Lost $$ if Deleted Bud American Ale 12 P 119-19% $1254 75% $94,064 Smirnoff Ice 12 P 128-21% $1136 80% $90,901 Leinekugel Red 12 P 133 +5% $1089 78% $84,988 Bud Light Gld Wht 12 P 139-15% $1078 75% $80,906 Don t Worry About Sales Increases With Deleted Suggestions Focus On $ Per Point -Ultimately you want to subtract the lost from From your de-list SKUs from the added revenue From your add recommendations in this Example, the potential gain is: $344,835 $350,859 ======== $675,694 -$350,859 =$344,835 ======== Promotion What is it? How to influence Retailer s promotional decisions? Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 40 Promotion 10

Strategy For Secondary Promotions Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 41 Promotion Identify what SKUs received significant Display % ACV and yet offer either low lift or low volume opportunities (these are your display less suggestions) Identify what SKUs received little Display % ACV and yet offer good (high %) lift and solid volume (highly ranked) opportunity (these are your display more suggestions Promotion Secondary Display Analysis Availability & Performance SKU Rank % ACV any Display % Increase in $ any Display Great Lakes Dort 12 Pack 13 15% 168% Goose Island IPA 12 Pack 16 14% 151% Windmer Hefe 12 Pack 17 15% 172% SKUs To Display Less Frequently SKU Rank % ACV any Display % Increase in $ any Display Killians 12 Pack 61 46% 25% Michelob Amber Bock 67 56% 47% St. Pauli Girl 86 65% 17% Source: IRI InfoScan Data Ending SKUs To Display More Frequently Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 42 Format Development 1. Opportunity Identification 2. Title Page 3. Objective Retailer Benefit Statement 4. Agenda 5. Situation Analysis 6. Solution 7. Action / Benefit Slide 8. Next steps Pre-work before developing Your presentation Sections in your presentation 43 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 43 Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 44 11

Critique Name Was there a retailer centered objective to open the presentation? YES / NO (Circle one) Was there fact based info reviewed that proved we can accomplish the objective / benefit? YES / NO Was there a solution identified to insure easy execution? YES / NO Was there linkage were all the slides flowing towards a common goal? Did the presentation have proper slide development (easy to understand the slide s objective and good title s and take-a-ways)? YES / NO Did the presentation have significant mention of the SPRITE benefits was it all about the retailer? YES / NO Was there an effective Action / Benefits summary? YES / NO Scottsdale, Craft Brewers AZ Conference - November May 3-4, 2012 2009 45 12