Booz & Company
Opportunities for Store Brands
Chicago
July 19 th , 2011

The Shopper Marketing opportunity: influence malleable brand preferences along the full path to purchase
Shopper marketing: building insights about consumers when they are in shopping mode and applying these insights to influence their purchase decisions
Timing of Brand Selection
(% of total items purchased)
41%
Room to firm up preference before the store
21%
19%
Room to influence brand selection in the aisle
19%
Brand on List,
Purchased in Store
Brand on List,
Switched in Store
Item on List, Brand
Selected in Store
Item Not on List,
Impulse Purchase
Source: Booz & Company, SheSpeaks survey of 2,200 shoppers completing post-shopping survey

Shopper marketing spending already accounts for a significant share of the A&P mix and is one of the fastest growing spends
Size $108B $22B
CPG Marketing Mix
2010 Spending, 2011-2013 Growth
$338B $198B $60B
9.0%
6.3%
0.6% 0.6%
Traditional Digital
Media Media
-0.8%
Trade
Promotions
Advertising:
$130Bn
2.4% CAGR
Source: eMarketer, AdAge, GMA, promoMagazine, Booz & Company client experience
Consumer
Promotions
Shopper
Marketing &
Co-Marketing
Promotions:
$616Bn
2.1% CAGR
2

Shopper marketing evolving as part of an integrated approach
Stages of shopper marketing evolution
“The Shift to
Shopper”
Distinguishing between consumer and shopper
Category Growth
Sales Lift
Value drivers
 Trade overlay
 Buy-in to retailer events
 Planogram design
Evolution of Shopper Marketing
“Shopper Solutions”
Insights and solutions tailored to the shopper’s occasion
“The New Integrated Marketing”
Using the full range of marketing activities with store back insights
Engagement &
Branded Experiences
Marketing ROI
Closure Rate
Basket Size
 Insights to inform retailer calendar (e.g., shopper psychology and need states)
 Multi-brand and multimanufacturer programs (e.g., spring flu, summer BBQ)
 Focus on owned and earned media
 “Store back” filter for creative
 Consistent themes, customized elements
Time

At its best, it plays a complementary role in reinforcing brand attributes and motivational “cues” along the P2P
Pre Store
Brand
Marketing
 Develop emotional connections with consumers’ motivations
 Be “relevant” to consumers’ lives
Shopper
Marketing
 Catch consumers at moment when shopping behaviors begin
 Target shopping and lifestyle “triggers”
In the Store

Reinforce equity and motivational “cues”
 “Activate” equity with consistent imagery
 Build insights about shopping mode to influence decisions
 “Stop, hold, close” in the store
Post-Purchase
 Reinforce shoppers made the “right decision” and sustain branded experience
 Grow “loyalty” and
“advocacy”
 Influence next trip with cues that tap into motivations
 “Reward” behaviors consistent with brand
Traditional Focus Expanding Focus

A broad set of platforms can be integrated into the playbook, increasingly via digital vehicles
Adoption of Shopper Marketing Platforms
“On Average, to what extent are you using the following shopper marketing vehicles?”
Example Digital Vehicles by Platform
Displays & In-Store
Advertising
Deals
Relationship
Marketing
Social Media 37%
17%
19%
30% 70%
63%
83%
81%
In store video, kiosks, scanners
Direct to card, e-circular
E-newsletter, personalized storefront
WOM, reviews, branded community
Search 40% 60% Sponsored results, virtual display
Thematic Content 47% 53% Retailer sitelet, how to video
Apps 49% 51% Barcode scanners, shopping lists
Never Use
Source: Booz & Company analysis for GMA Shopper Marketing 4.0 Study
Use

Unlocking the potential of shopper marketing capabilities requires sustained commitment
1
Shopper
Insights
2
Retailer
Intimacy
National
Brands specific
Holistic Capability-Building
Reliably and consistently delivering a distinctive outcome by applying processes, tools, knowledge, skills, and organization
7
Skills Organization
3
ROI and
Brand
Health
Processes Tools Knowledge
Shopper
Marketing
Capabilities
Strategy and
Brand
Development
6
Program
Execution
5
Platform
Design and
Collaboration
4
Creative
Development
Source: Booz & Company analysis for GMA Shopper Marketing 4.0 Study
Outcomes
 Insights across seasons, occasions, formats
 Strategies that integrate across advertising
& promotions mix, across the full P2P
 Scalable platforms with clear playbook for where to focus customization efforts
 Larger share of programs measured with insights incorporated into brand planning

What does that mean for store brands?
Strengths
 Full transparency / ownership of consumer purchasing data
 Higher speed to market as the owner of the “theater”
 Flexibility to pilot & run shopper marketing initiatives
Challenges
 Competing internal agendas
 Strained funds and collaboration with national brands
 Resources vs. national brands
 Misaligned metrics
(sales vs. margin)

Opportunity #1: Build own insights to tailor the events calendar and marketing messages for greater effectiveness
Example Calendar of Events for ConAgra “Seasons of Mom”
Post
Holiday
Spring Summer
January, February March, April, May
Nesting, decompressing after stress, getting back into routine, eating out less
High energy, more time outdoors, senses awakening, reconnecting with friends
June, July,
Mid-August
Freedom, looser schedules, outdoor activity, no rules, fun
Back to
School
Mid-August,
September
Overwhelmed, balancing schedules and tasks, new routines
October
Fling
Holiday
October
Steady routines, family time, creativity, eye on the holidays
November,
December
Joyful traditions, extravagant parties,
Fun pulling it off
“Little Extras” campaign featuring brands in occasions unique to season with emotional connection around reduced stress
Make mom a
“Financial Hero,” give her good deals on easy-to-make, lighter meals that are easier to eat in shift
“Anytime
Entertaining” with focus on being prepared for informal parties
“Prepare for
Success” campaign delivers on need to save time and money while make family advantaged
Booz & Company
“Creative Comfort
Food” leverages mom’s change in cooking techniques and menu, providing relevance for brands
“Time to Celebrate” focuses on brands that meet high expectations for holiday events
8

Opportunity #2: Serve as “anchor tenant” for category solutions
Category Solutions

More effective crosscategory merchandising
 Dial Flu Season
(with Clorox and K-C)
Discussion
 Leverage advantageous position of
“owning the theater” to access consumer data and ensure rapid cycle time
 Work with national brands to develop co-promoted events when applicable
 Deliver much better execution for shopper marketing events
(compliance, quality)
 Leverage test & learn opportunities to define right playbook

Opportunity #3: Leverage digital to drive traffic and add call to action to in store displays and packaging
Paid Search & Digital Shelf Deals Embedded in Ads
Database Marketing
 Leverage loyalty database for targeted offers
 Communicate via shoppers’ preferred channels (e.g., email, mobile, social)
Mobile Call to Action In Store

Opportunity #4: build a learning agenda with waves of pilots
Building the Learning Agenda for Shopper Marketing

Assess data environment and lay out a road map to build the required capabilities and discipline to systematically prioritize opportunities
 Bring external experience and expertise on the analytical and managerial dimensions of leveraging data sources for online shopper insights

Use in-house data repositories to develop hypotheses and mine the data for insights that can be used to filter opportunities in terms of impact and doability
 Engage the organization to select sets of pilots that can be launched in waves to validate opportunities and build moment around the business case
 Define the new data, analytics and processes required to operationalize learnings from the pilots and embed them into way the various parts of the organization get things done

Provide a perspective on key capability levers (e.g. talent, processes, metrics, technology) required to cultivate a stronger culture of innovation

Putting it all together — What to do “Monday morning”
Suggested Areas of Focus
Build the Winning
Ecosystem
— Lead Your
Partners, Build the Talent, and Score Results
Define Strategic
Ambition and
Capability Gaps
Shift from
“Simultaneous
Equations” to
“Waves of Pilots”
Redefine Approach for Insights to Enable
More Integrated
Planning Across Path to Purchase