The future of commercial planning for DSD operators POI Lightning Talk | April, 2019

Solutions Suites Overview Focus Today Seven complete solution suites that combine advanced analytics, cloud based tools, training and ongoing client service to support business growth Insight Solutions Marketing Solutions CX Solutions Category Solutions Pricing Solutions Performance Solutions Measure sales effectiveness, empower your frontline with skills and tools they need to maximize profitability of each transaction Sales Solutions Get cutting-edge insights into your consumers’ and buyers’ needs and behaviors via agile market research techniques and proven analytic approaches Enable and support CMO decisions regarding marketing and media spend at both strategic and tactical levels Enhance customer experience by capturing feedback from all your customers, across every channel Become category captain, understand customer behavior, optimize assortment and space allocation accordingly Optimize pricing, promotions and markdown in a fast-changing market environment across all seasons Convert business intelligence into granular business performance improvement Periscope® Platform People Platform (Data management, insights expertise, implementation and capability building) Technology Platform and Partnerships 6 Continents 27 Locations 750+ People 25+ Solutions 300+ Expert Network SOURCE: Periscope® By McKinsey

Department Stores and Apparel Our solutions cover all subsectors of Retail & CPG, including highly complex areas as outlined below Focus Today Consumer Goods CPG - DSD FMCG – Warehouse Durables Consumer Electronics Retail Grocery FMCG Random Weight Fresh Goods Alcohol Department Stores and Apparel Convenience Stores DIY (Do it yourself) SOURCE: Periscope® By McKinsey

DSD operators face many unique challenges DSD operators face many unique challenges. However, brand managers specifically within these organizations face additional pressures RGM, Brand and marketing teams must react to the broader industry challenges and competitive pressures. However, many face technology and analytic limitations due to: 1 Outdated tools which do not fully leverage the data for advanced/predictive analytics – no clear idea on the total potential 2 Processes & organizational structure are not fully aligned to support an analytically driven trade marketing & sales organization, leading to inefficiencies from burden of low- value work 3 Behavioral shifts - Millennial effect drawing consumers away from traditional brands and “big food companies”

Periscope has 3 primary workflows to support the next-generation brand managers within DSD organizations Simulators/ Forecasters Reports Supporting analytics Platform modules System outputs The combination of advanced analytics, tools, and capability development enables Nimble and automated decision making – respond rapidly & efficiently to changes in business and freeing up capacity Better decision making through improved data collection and seamless access to multiple data sources More mindshare & time to get closer to the customer Faster learning through “Test & learn” / “Fail fast” approaches Consistent customer engagement & experience across formats by taking a customer-centric and an omni-channel approach Performance reports1 Client internal system Promo Effectiveness (TPE) Allows user to understand drivers of past promotion performance and define guidelines for commercial planning Price & Portfolio List Impact Report Growth Mapping (Purchase structures) Econometrics (Promotions models) Granular elasticity and loyalty (by SKU, region, channel) Econometrics (Pricing models) Segmentation enabled by Geospatial analysis Pricing & Portfolio (PVP) Salesforce handhelds What was unique: We redesigned the end-to-end process from planning to execution. This involved developing automated reports to generate insights, tools to simulate impact of commercial actions (e.g., pricing, promos for specific groups of POS), machine learning forecast that integrates all commercial actions to inform Supply and outputs to the client systems so the commercial actions arrive to the sales force. It also involved detailing the organizational capabilities required to make this new process run Commercial initiative forecasts Dynamic POS Grouping (DPG) Trade Promotion Planning (ICP) Allows user to define future commercial initiatives and assess their impact in terms of volume, sales and margin S&OP Planning Granular demand forecast Demand Forecasting

Promotions to retailers Promotions to customers The Periscope solutions platform provided the beverage client the flexibility to manage promotions across both Modern and Traditional channels Promotions to retailers Promotions to customers 24 pack for 10% off Buy one get one free Manufacturer Retailer Consumer SOURCE: Periscope® By McKinsey

Case study – Beverage company with DSD service to about 700K stores Context Our work Impact The client is the market leader in its categories They have leading sales execution capabilities with live PoS performance tracking They have a robust execution strength through DSD network, which outperformed its own central planning capacity The marketing team has data that could be used to produce new insights and strategies to take advantage of its salesforce The tools to process the multiple sources of data were outdated: Excel files Arima models for forecasting Designed a digital analytics platform to: Develop advanced insights and automated reports Generate accurate simulation capabilities Automate internal system connections Concentrate end-to-end key trade marketing processes Developed the analytics behind the platform: switching and loyalty, elasticity, POS segmentation, promotional effectiveness and a machine learning demand forecasting Processes and decision rights were re- designed to fully leverage the new analytical capability We reorganized the entire trade marketing organization Implemented the new platform, processes and structure in 2 countries with additional countries on the roadmap Reduced the time to run key processes from weeks to minutes Reduced the trade marketing structure ~30% while increasing the granularity of the planning process Better planning and more accurate execution tracking has enabled faster decision making at leadership level Increased EBIT by US$15m through in the first 6 months of implementation, with an estimate run-rate impact of US$50m per year Context