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

2. 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

3. 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

4. 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Outdated tools which do not fully leverage the data for advanced/predictive analytics – no clear idea on the total potential 2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”

5. 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

6. 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

7. 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