Spencer Baird, Senior Director, Strategy Category Management and SKU Optimization Roundtable Spencer Baird Senior Director of Category Strategy Kellogg Sales Company

Spencer Baird, Senior Director, Strategy Remembering the Inputs that Launched 2010 into a Chaotic Place. A Correction is Usually That of Bad Behavior, Right? Source: Pew Research July Per Capita Spending in the US Drops $16/week Compared to ‘07 Per Capita Savings Down to $613/Year In 2007 Versus $2,426/Year in 1982 Average Debt per HH $86,346 Average Debt per HH $128,134 Net Worth Per HH in US $600,000 in 2007 Net Worth Per HH in US Drops -24% In 2008 S&P Loses 51% & Home Prices Down -4% ’07 v ‘09 55% of American Workers Impacted With Reduction/Loss; 41% of Whites, 78% African American & 70% Hispanic 81% of African Americans & 75% of Hispanics Say That US is Land of Prosperity Saving as % of Income Rises To 4% from 2% in ‘07

Spencer Baird, Senior Director, Strategy The Majority of Financial Change was the Result of our Reaction to Uncertainty…Rather than Actual Consumer Uncertainty.

Spencer Baird, Senior Director, Strategy Learning #1.

Spencer Baird, Senior Director, Strategy Shining Star Retailer in the US in Share of Market Realities One Retailer. Shining Star. Near Double Digit Total Edible Sales % Change. 2 Weeks. Full Share Point Gained. 2 Weeks. Full Share Point Lost.

Spencer Baird, Senior Director, Strategy Learning #2.

Spencer Baird, Senior Director, Strategy Zero Sum. Defense. We “Uncertain’ed” Ourselves to a Slow Top-Line Death. Top 10 Categories. Total Edibles. 5 Inflated. +1% Sales Growth. 5 Deflated. -2% Sales Growth. Next 20Categories. Total Edibles. 8 Inflated. +4% Sales Growth. 12 Deflated. 0% Sales Growth. *Source. IRI Total Edibles

Spencer Baird, Senior Director, Strategy Learning #3.

Spencer Baird, Senior Director, Strategy Results. Accidental or Intentional. Yesterday. 50 Priorities Funneled Down Everything is a Focus Results are an Accident Tomorrow. New Process. 3-4 Priorities – Full Activated Results are Intentional 1-3 Prioritized Focus Areas Focus Action Focus Actions

Spencer Baird, Senior Director, Strategy Governing Results. 5 Key Acknowledgements Based on a Better Link to Reality. 1.Clarity is the Nemesis of Chaos. 2.Without Vision, Strategy is Impossible. 3.Answers Aren’t the Issue….Questions Are. 4.Don’t Ask Microsoft to Build Powerpoint Slides. 5.Game Change is +1%.

Spencer Baird, Senior Director, Strategy 5 Bias Points for the Future of Managing a Category Organization. 1.Govern, Don’t Manage. Scorecard Everything. 2.Make Compliance Bonus Eligible. 3.Manage Space Top-Down. 4.Embed Loyalty Data. 5.Scrutinize and Reward Presentation of Intention.