Bruno De Labar: How new premium categories can generate additional retailer turnover and profit

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  • 1. How new premium categories can generate additional retailer turnover and profit Reckitt Benckiser Russia February 2011
  • 2. How new, premium categories build incremental turnover and profit Add incremental categories to existing big categories: Fabric Treatment Build completely new categories: Automatic Dishwashing Expand category consumption through new, wider usage Air Care 3 strategies for HH Cleaning categories
  • 3. One purchase on top of Laundry Detergent increases the value of the shopper in 2 times Laundry Detergent* Only ( 9 washes) 60 * * х 3 = 180 RUR * Premium Laundry Detergent (Key Player #1) ** Average shelf price, RUR (AC Nielsen Russia, 2010 ) 180 RUR Laundry Detergent* + Vanish Liquid ( 9 washes) 320 RUR Laundry Detergent* + Vanish Powder ( 9 washes) 445 RUR Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 140 * * Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 265 * * Laundry Detergent Laundry Detergent Laundry Detergent x 1.8 x 2.5
  • 4. One purchase on top of Laundry Detergent increases the value of the shopper in 2 times Laundry Detergent* Only ( 9 washes) 60 * * х 3 = 180 RUR * Premium Laundry Detergent (Key Player #1) ** Average shelf price, RUR (AC Nielsen Russia, 2010 ) 180 RUR Laundry Detergent* + Vanish Liquid ( 9 washes) 320 RUR Laundry Detergent* + Vanish Powder ( 9 washes) 445 RUR Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 140 * * Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 265 * * Laundry Detergent Laundry Detergent Laundry Detergent x 1.8 x 2.5
  • 5. One purchase on top of Laundry Detergent increases the value of the shopper in 2 times Laundry Detergent* Only ( 9 washes) 60 * * х 3 = 180 RUR * Premium Laundry Detergent (Key Player #1) ** Average shelf price, RUR (AC Nielsen Russia, 2010 ) 180 RUR Laundry Detergent* + Vanish Liquid ( 9 washes) 320 RUR Laundry Detergent* + Vanish Powder ( 9 washes) 445 RUR Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 140 * * Laundry Detergent Laundry Detergent Laundry Detergent 60 * * х 3 = 180 RUR 265 * * Laundry Detergent Laundry Detergent Laundry Detergent x 1.8 x 2.5
  • 6. The potential for this market in Russia: +7,0 bn RUR retail sales Washes per week 4.5 3 Consumption frequency ** 6 % of HH using category * Laundry detergents Fabric softeners Fabric Treatment Driving PENETRATION Increasing CONSUMPTION * Source : GFK Russia , 200 9 ** Source : TNS Russia, U&A 2009 2009 FT Sales  3,5 bn RUR (AC Nielsen Russia, Total National) More Homes More Washes Consumption x 2 (+ 3,5 bn) Penetration x 2 (+ 3,5 bn)
  • 7. The potential for this market in Russia: +7,0 bn RUR retail sales Washes per week 4.5 3 Consumption frequency ** 6 % of HH using category * Laundry detergents Fabric softeners Fabric Treatment Driving PENETRATION Increasing CONSUMPTION * Source : GFK Russia , 200 9 ** Source : TNS Russia, U&A 2009 2009 FT Sales  3,5 bn RUR (AC Nielsen Russia, Total National) More Homes More Washes Consumption x 2 (+ 3,5 bn) Penetration x 2 (+ 3,5 bn)
  • 8. We actively build the market through strong advertising and co-marketing programs Laundry Detergent Key Players Media Weights 2010, TRP's In-Store Shelf Extension Programs
    • Expand FT space to increase visibility and remind
    • shoppers to buy
      • Shelf share for FT = shelf share for FS (equal value sales)
      • Signage for category highlight and easy navigation
      • Full line stand displays in high traffic areas
    • Increase cross purchase with Laundry Detergents
      • Hang (parasite) displays in LD section
    * Source: TNS Russia , 20 10
  • 9. We actively build the market through strong advertising and co-marketing programs Laundry Detergent Key Players Media Weights 2010, TRP's In-Store Shelf Extension Programs
    • Expand FT space to increase visibility and remind
    • shoppers to buy
    • Increase cross purchase with Laundry Detergents
    * Source: TNS Russia , 20 10
  • 10. How new, premium categories build incremental turnover and profit Add incremental categories to existing big categories: Fabric Treatment Build completely new categories: Automatic Dishwashing Expand category consumption through new, wider usage Air Care 3 strategies for HH Cleaning categories
  • 11. One purchase on top of ADW Detergent increases the value of the shopper in 3.5 times Hand dishwashing Only 71 * * х 3 = 213 RUR ** Average shelf price, RUR (AC Nielsen Russia, 2010 ) 213 RUR 807 RUR 1049 RUR Hand Dishwashing Liquid H.D. L. H.D.L. 807 RUR * * 1049 RUR * * ADW System ADW Multifunction x 3.7 x 4.9
  • 12. Automatic Dishwashing – a category in its baby years … but with mid/high value consumers
    • In Russia - 52 mio households
    • 9 from 10 housewives wash dishes daily by hands*
    *U&A TNS, Russia, 2010 ** Rosstat, 2009
  • 13.
    • ADWD market is growing in a long run (+9% growth ’10 vs ’09), healthy recovering after the crisis
    • Expected market growth 2011 +15%
    Automatic Dishwashing – a category with immense potential +15% +11% +23%
  • 14. Finish is the only brand investing in ATL and growing ADW category
    • Finish has SOV 100% in this category investing in TV practically equally to the
    • biggest advertiser in Laundry Detergent category and 30% bigger than biggest
    • advertiser in Hand Dishwashing category.
    • Finish TVC is on air every year with positive tendency to increase GRP and NR of
    • contacts
    • Cooperation, attractive call-to-action proposal of ADWM with WGM/WGS in each TVC
    TRPs
  • 15. We create demand outside the Food Retail Trade – by stimulating sales of Dishwashing machines
  • 16. New specific March, 8 copy (in partnership with BSH)
  • 17. We create demand outside the Food Retail Trade – by stimulating interest and sales of Dishwashing machines
    • Mechanics of promo in mass retail: Buy RB products  participate creative contest  Win a Dishwasher Washing Machine
  • 18. How new, premium categories build incremental turnover and profit Add incremental categories to existing big categories: Fabric Treatment Build completely new categories: Automatic Dishwashing Expand category consumption through new, wider usage Air Care 3 strategies for HH Cleaning categories
  • 19. Air Care category in Russia today is about fighting bad odors Source: Nielsen, FY2010
  • 20. Air Care category tomorrow is bringing nice fragrance creating special atmosphere at home
  • 21. Russia Air Care market vs France and UK HUGE POTENTIAL Source: Nielsen, FY2010 HUGE POTENTIAL 0,70 4 5,5 per capita 14% 29%
  • 22. Air Care shelves today
  • 23. Air Care shelves of the future
  • 24. Air Care formats diversity to meet all consumer needs Luxury fragrance Automatic Spays Electrical (plug in) Aerosols of new generation 100% pure air Nature-Inspired Fragrance Candles
  • 25. How new premium categories can generate additional retailer turnover and profit Reckitt Benckiser Russia February 2011