in the Traditional Trade There is a vast array of potential outlets with differing needs and value to you Routes-to-market are highly complex and evolving, with a myriad of structured and unstructured sales and distribution options Your existing and emerging competitors are rapidly shifting focus away from developed markets to increasing their presence in high growth Traditional Trade centric markets. This requires an absolute focus on winning at point of purchase A new type of diagnostic is required to help your people cut through the complex clutter of results and symptoms to identify and address root causes Winning at point of purchase in the Traditional Trade requires world class understand of performance drivers in the Traditional Trade P&L Historical value created Problems to fix and how to fix them Outlet Coverage, GfK, Competitive Position, Channel P&L Poor Picture Of Success compliance, ineffective NPD, out of stocks, negative trading relationships Are they understood? Do customers & internal stakeholders agree? What actions should be undertaken? Results Pain felt today Symptoms Root Causes Our 3-D Traditional Trade Diagnostic is your essential tool for root cause analysis Our 3-D analysis tool ensures that root cause issues are identified, rather than just symptoms Each dimension (stakeholder perception, data, expertise) provides unique insight into how to drive customer performance Once root cause issues are agreed, improved performance can be targeted and actions automatically generated to address these issues and deliver real results 3-D root cause analysis defines actions that deliver real results Root Cause Analysis Perception 3D Traditional Trade Diagnostic Stakeholder Reality Level of Experience Quality of Data Data Expertise Actions
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The product architecture
directly supports the clients business planning process A consistent quantitative research structure is used to collect information, compare benchmarks and create the financial analysis The 3-D Diagnostic product is unique in the way it step changes productivity in clients business planning processes by structuring unstructured information and automating action planning Financial Model 3D Performance Plan Expert Performance Review Client Data Repository Industry Benchmark Database Web-Based Stakeholder Questionnaire 3-D Traditional Trade Diagnostic Business Planning Channel Planning Investment Agreement Execution Planning Execution Key stakeholders (internal & customer) deliver feedback on performance through our web-based quantitative research tool Existing data (brand plans, customer presentations, raw data) is analysed by CA to understand if stakeholder perception is valid Nominated experts challenge stakeholder perception and data analysis to create a final 3-D root cause analysis of performance In each performance area a current and target level of performance is set to define actions to shift customer performance A valuation model creates a direct line of sight between planned actions, predicted value creation and potential investment scenarios STEP 1 STEP 2 STEP 3 STEP 4 STEP 5 5 steps are undertaken to create a 3-D Performance Plan Stakeholder does not see the question Order of statements is randomised to increase objectivity Stakeholder sees statements to agree or disagree with 1. Has the potential outlet universe for the category been identified? 1The supplier has a really good understanding of which outlets are most relevant for the category it operates in 8The supplier entirely misses some outlet locations where the category is highly relevant 2. Is the outlet universe segmented around appropriate consumption needs and/or shopping missions (nature)? 9The supplier treats different types of outlets in different ways based on deep consumer and shopper insight 2The supplier lacks consumer and shopper understanding at outlet level 3. Is the consumer value of each nature segment and its constituent outlets appropriately quantified? 3I think the supplier has a good understanding of which outlet types have the biggest potential value 10The supplier seems unable to prioritise its focus on the most valuable outlets 4. Have the growth drivers for each nature segment been determined? 11Its really clear how the supplier is intending to drive growth in different ways in different types of outlets 4The suppliers trading and activation plans tend to be one size fits all outlets 5. Are the servicing requirements of each nature segment and its constituent outlets appropriately defined? 5 The supplier has a good understanding of how different types of outlets need to be serviced in different ways 12 The suppliers servicing approach tends to be one size fits all outlets 6. Has the cost-to-serve for each outlet been accurately quantified? 13I think the supplier has a good understanding of total cost-to-serve for different outlet types 6The supplier has little understanding of how much it costs to service different types of outlets 7. Has the potential outlet universe been prioritised in a way that will help maximise profitable growth? 7The supplier prioritises its investments appropriately across different outlets to drive maximum value creation for all 14I have no idea how the supplier allocates investments for different outlets Web-based quantitative research collates rich stakeholder opinion STEP1 Expertly designed web-based quantitative research tool Seeks degrees of agreement to key statements that indicate performance versus expertly identified customer performance drivers Drives objectivity: Statements are built to be intuitively understood Provides positive and negative versions of the same statements to examine consistency of response Avoids tying statements directly to the customer performance drivers Users can be any stakeholder All functions All grades Local and international Internal & external OUTLET SEGMENTATION STEP2 Data is reviewed to better understand reality Data is both deposited on our server by the client team and stakeholders can post documents to the software directly in response to submitting specific opinions. This is existing data only - no new analysis needs to be undertaken by the client. = Data is evidenced against the quantitative research structure to assess the validity of differing stakeholder perceptions 1. Has the potential outlet universe for the category been identified? Market & category analysis + Advantage Group / GfK survey + + Consumer & shopper research + Innovation pipeline + Activation plans + Organisation structure + Sales fundamentals + Operational performance + Financial performance Outlet research OUTLET SEGMENTATION STEP3 Expert opinion challenges data and perception Specific client experts are nominated to work with our experts to provide opinion on stakeholder perception and available data in order to create a final 3-D conclusion on each area of performance We agree upfront who the client experts will be for each area of subject matter e.g. Relevant Category Opportunity = Category Strategy Director, Trading & Activation Plans = National Sales Manager, Supply Chain Execution = Logistics Manager and build on their input to create the expert view As you can see, root cause analysis only works in 3-D Key Accounts believe relevant outlets are missed, but people in the supplier believe the outlet universe has been mapped The outlet research was skewed towards the suppliers biggest brands and missed relevant outlets for smaller brands and untapped sub-categories The final conclusion is that Key Accounts are right and the potential outlet universe for the category has not been correctly identified A considerable amount of outlet research has been conducted, which would suggest the outlet universe has been mapped 1. Has the potential outlet universe for the category been identified? Perception 3D Traditional Trade Diagnostic Data Expertise NO NO YES YES / NO OUTLET SEGMENTATION STEP4 Actions to improve performance are agreed with key stakeholders Once the 3-D analysis is complete, we then work with the client experts to conduct a final interpretation of the results In each performance area a level of current performance is agreed using 3-D insight and a target level of performance is set, using the structure on the page opposite Actions are then automatically generated to shift to a higher level of performance AUTOMATICALLY GENERATED ACTION: Use high level research to define the outlet universe structure and estimate its potential size DESIRED FUTURE PERFORMANCE CURRENT PERFORMANCE 1. Has the potential outlet universe for the category been identified? 4. The full outlet universe for the category has been mapped using outlet level data for the overall geography concerned 3. The structure and high level size of the potential outlet universe has been defined 2. There is a good understanding of how to define the potential outlet universe for the category, but the potential outlet universe for the category has not been defined 1. There is little understanding of how to define the potential outlet universe for the category 2. Is the outlet universe segmented around appropriate consumption needs and/or shopping missions (nature)? 4. The entire potential outlet universe has been segmented by consumption need and shopping mission to create a full view of appropriate nature segments 3. Robust research has been conducted to identify the different consumption needs and shopping missions exhibited across the outlet universe and priority segments have been defined 2. There is good understanding of how to segment the potential outlet universe by appropriate consumption needs and/or shopping missions, but the outlet universe has not been segmented in this way 1. There is little understanding of how to segment the potential outlet universe by appropriate consumption needs and/or shopping missions 3. Is the consumer value of each nature segment and its constituent outlets appropriately quantified? 4. Robust data has been collected from an appropriate sample of outlets and the consumer value of each nature segment and its constituent outlets has been accurately estimated 3. High level research has been conducted to create insight into the consumer value of different types of outlets and a high level value has been defined for each nature segment 2. There is good understanding of how to quantify the value of each nature segment and its constituent outlets, but the valuation has not yet been delivered 1. There is little understanding of how to quantify the value of each nature segment and its constituent outlets OUTLET SEGMENTATION STEP5 The final step is a valuation of improved performance Our valuation model uses an algorithm to create a direct line of sight between planned actions to shift performance, predicted value creation and potential investment scenarios Current revenue & profit delivered through current performance Incremental Revenue Derived From Performance Improvement Incremental Profit Derived From Performance Improvement Improvement Fund @ 1:2 Ratio To Profit Planning Fund At 1:4 Ratio To Improvement Fund Incremental revenue & profit delivered through improved performance 1. Has the potential outlet universe for the category been identified? 4. The full outlet universe for the category has been mapped using outlet level data for the overall geography concerned 3. The structure and high level size of the potential outlet universe has been defined 2. There is a good understanding of how to define the potential outlet universe for the category, but the potential outlet universe for the category has not been defined 1. There is little understanding of how to define the potential outlet universe for the category PLANNED PERFORMANCE SHIFT VALUE DRIVING ALGORITHM INVESTMENT PLANNING $
OUTLET SEGMENTATION Confirmation of areas of strong performance Root cause analysis for critical areas of underperformance Improvement actions defined to shift current performance to future desired performance Planned financial outcome As more of these are conducted, comparative internal benchmarks can be run across performance components, customers, markets and stakeholder communities 3-D Traditional Trade Performance Plan Comprehensive report Web-based survey can be delivered in any language in any country * = Incremental Annual Revenue / Contribution 4 = From Terminal To Shaping Category 1 Portfolio Proposition Outlet Segmentation Relevant Category Opportunity Supply Chain Execution Trading & Activation Plans RTM Operating Model Key Account Management Cost Pricing, Terms & Conditions Outlet Management - 3.1 3.0 4.0 Planned Value* Planned Contribution* 2.9 2.0 3.2 Planned Value* Planned Contribution* 2.4 2.0 3.1 Planned Value* Planned Contribution* 2.8 2.3 3.5 Planned Value* Planned Contribution* 2.5 1.8 3.3 Planned Value* Planned Contribution* 2.5 2.2 3.0 Planned Value* Planned Contribution* 2.7 1.2 2.7 Planned Value* Planned Contribution* 2.5 1.4 3.3 Planned Value* Planned Contribution* 2.5 2.8 4.0 Planned Value* Planned Contribution* The appendix delivers rich detail on the perception of stakeholders, data reviewed and the expert opinion provided. This creates a direct line of sight between the summary conclusions and detailed analysis Rich detail provides supporting insight into required action Performance Component Questions 1.5 Level 1 Level 3 Stakeholder Perception Split by Stakeholder Group Current Performance Target Future Performance Improvement Action 1. Has the potential outlet universe for the category been identified? 2. Is the outlet universe segmented around appropriate consumption needs and/or shopping missions (nature)? 3. Is the consumer value of each nature segment and its constituent outlets appropriately quantified? 4. Have the growth drivers for each nature segment been determined? 5. Are the servicing requirements of each nature segment and its constituent outlets appropriately defined? 6. Has the cost of delivering each specific service requirement been accurately quantified? 7. Has the potential outlet universe been prioritised in a way that will help maximise profitable growth? Scored 1 (low) to 4 (high) in terms of agreement with supporting statements to question (as explained in pages 14 - 15 ) Agreed current and target performance (as explained in pages 16 - 21) Use high level research to define the outlet universe structure and estimate its potential size OUTLET SEGMENTATION The bespoke software solution has been specifically designed to help our corporate clients analyse business performance It allows stakeholders to provide their opinion and back it up with fact, for example by attaching files that they believe are relevant The same analysis structure is then used for the data analysis and expert opinion As root cause issues and levels of current and desired performance are agreed, actions are automatically generated to shift performance On the basis of these agreed actions, a valuation of improved performance is automatically generated The software itself has been built exactly for the purpose The diagnostic is deployed annually to support business planning Suitable for deployment annually as part of the business planning process Can be used adhoc for channels or markets that require remedial attention Fact based analysis of reality 6 Week Process Completion of web based quantitative research by agreed stakeholder community Write-up of the 3-D Traditional Trade Performance Plan Set-up Client Tailoring 3-D Traditional Trade Diagnostic Business Planning Channel Planning Investment Agreement Execution Planning Execution Client time commitment on each diagnostic is minimal Key stakeholders (internal & customer) deliver feedback on performance through our web-based quantitative research tool Existing data (brand plans, customer presentations, raw data) is analysed by CA to understand if stakeholder perception is valid Nominated experts challenge stakeholder perception and data analysis to create a final 3-D root cause analysis of performance In each performance area a current & target level of performance is set for the next year to define actions to shift customer performance A valuation model creates a direct line of sight between planned actions, predicted value creation and potential investment scenarios STEP1 STEP2 STEP3 STEP4 STEP5 20 minutes per survey respondent Total of 3 hours for the data co-ordinator and 30 minutes per data provider (typically 5-7 data providers) no new analysis needs to be done by the client Total of 3 hours for the expert reviews with each of the typically 4 individual client experts All activities are delivered online through the web-based survey, teleconference calls and videoconferences There are 3 levels at which the diagnostic can operate Stakeholders typically include - 5 local Leadership Team members - 10 cross-functional local representatives - Appropriate sample size of trade customers Fact based analysis is conducted from local data 36,155 fee* as a one-off and less for a 3 year programme or multiple diagnostics * = excludes out of pocket charged at cost and VAT charged at the applicable rate GLOBAL 1 3 2 LOCAL REGIONAL The outputs of all 3-D Traditional Trade Diagnostics completed globally are summarised and interpreted for global stakeholders The local diagnostic is run individually for each specific customer channel The outputs of all 3-D Traditional Trade Diagnostics completed across an agreed region e.g. Africa are summarised and interpreted for regional stakeholders 50% - 70% reduction in requirement for face-to-face meetings drives e.g. - Lower T&E expenses - Better resource utilisation Understanding the root cause problem cuts 250k-1m+ of unnecessary spend on addressing symptoms e.g. - Shopper research - Packaging redesign - Promotions - Terms & conditions Transformed clarity and strong stakeholder alignment around what problems need to be solved uplifts revenue by 25% - 50% - Better segmented outlet universe - World class RTM operating model - Improved customer relationships - Winning at POP - Sales fundamentals - NPD - Through the line activity * = subject to customer profile Customer revenue growth, profit growth and improved ROI COST SAVING* REVENUE GROWTH* The business case for deploying the diagnostic is compelling Write the brief for each solution identfiied Define solution build resource requirements Identify external partners to build each solution Provide quality assurance support throughout solution build Annual business planning cycles locally, regionally and globally One-off strategic reviews of global or regional performance Insight before a major agreed change Root cause analysis on specific problems e.g. broken customer relationship, brand turnaround Example Results - 50m of incremental profit in Year 1 of a world class JBP - 357% brand growth over a 3 year period - 10m of trade spend cut - $100m of incremental brand profit - +40% YOY revenue growth through improved trading plan - $20m cost avoidance Example Suppliers & Retailers World class experience in consumer goods