1. © 2012 WIPRO LTD | WWW.WIPRO.COM 1 TPM/TPO 101 An Introduction to Trade Promotion Management and Trade Promotion Optimization

2. © 2012 WIPRO LTD | WWW.WIPRO.COM 2 AGENDA 1TPO/TPM Basics 2Promax Approach to TPO/TPM

3. © 2012 WIPRO LTD | WWW.WIPRO.COM 3 TPO/TPM Basics

4. © 2012 WIPRO LTD | WWW.WIPRO.COM 4 Trade Promotions What are Trade Promotions? –Executed between the Manufacturer and Retailer –Typically funded by the Manufacturer –Utilized to increase product visibility and brand awareness with the consumers and increase sales volumes/market share for Manufacturer –By providing incentives Types of Trade Promotions –Co-operative advertising e.g. catalogue or TV commercial –In-store marketing e.g. improved in-store placement or displays –Additional discounts e.g. volume case buys, scan data discounts, consumer multi-buys –Training programs to assist sales volume increases

5. © 2012 WIPRO LTD | WWW.WIPRO.COM 5 Trade Promotions

6. © 2012 WIPRO LTD | WWW.WIPRO.COM 6 Trade Promotions Why Promote? –Driving an increase in consumer sales Why increase sales? –Offensive sales gain –Increase market share –Recover market share –Stimulate Sales –Reward –Switch –New Product Launches –Reward to Trade –Because the trade threatens deletion

7. © 2012 WIPRO LTD | WWW.WIPRO.COM 7 Trade Promotions Optimization/Management Why TPO/TPM? –Second largest cost to your business, after COGS –Trade spend accounts for more than 60% of most CPG company’s marketing budget –Yet Just 61% of Trade Promotions generate incremental volume Trade Promotions raise out of stock incidents by 2-3% Just 62% are fully implemented at all locations 16% of Trade Promotions are unprofitable 30% of Trade funding goes to the retailer’s bottom line Key Stakeholders? –Key Account Managers and Category/Brand Managers –Trade Marketers, Sales Directors/Managers –Finance Directors, IT, Senior Management (Board)

8. © 2012 WIPRO LTD | WWW.WIPRO.COM 8 Business drivers for analysing trade promotions * * CGT April 2011

9. © 2012 WIPRO LTD | WWW.WIPRO.COM 9 What do good companies do? integrated strategic and tactical processes analytics - budget, plan, execute & evaluate uniform definition of financial measures clear processes to understand the drivers to baseline and uplift understand promotional quality and what effects it focus on one-number approach for revenue, volume and spend forecasting focus on the net effect of a promotional programme experiment with the shopper

10. © 2012 WIPRO LTD | WWW.WIPRO.COM 10 baselinetrade fundsuplifttargets how much? with whom? what products? the problem Promax addresses TRACK PREDICT OPTIMIZE

11. © 2012 WIPRO LTD | WWW.WIPRO.COM 11

12. © 2012 WIPRO LTD | WWW.WIPRO.COM 12 TPMTPM TPOTPO

13. © 2012 WIPRO LTD | WWW.WIPRO.COM 13 the Wipro Promax PX solution Fully integrated environment Ease of use drives user acceptance A strategic, scalable & global platform Rapid deployment ensures rapid ROI

14. © 2012 WIPRO LTD | WWW.WIPRO.COM 14 Trade Promotions Optimization/Management Overall Goal: –Improved productivity of trade spend => Improved profitability –Examples of benefits realized: 1-2% increase in sales with existing Trade Spend 2-3% increase in ROI 3-5% reduction in inventory through improved forecasting accuracy Significant productivity gains

15. © 2012 WIPRO LTD | WWW.WIPRO.COM 15 Promax Approach to TPO/TPM

16. © 2012 WIPRO LTD | WWW.WIPRO.COM 16 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

17. © 2012 WIPRO LTD | WWW.WIPRO.COM 17 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

18. © 2012 WIPRO LTD | WWW.WIPRO.COM 18 Modeling

19. © 2012 WIPRO LTD | WWW.WIPRO.COM 19 Modeling

20. © 2012 WIPRO LTD | WWW.WIPRO.COM 20 Modeling

21. © 2012 WIPRO LTD | WWW.WIPRO.COM 21 Modeling

22. © 2012 WIPRO LTD | WWW.WIPRO.COM 22 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

23. © 2012 WIPRO LTD | WWW.WIPRO.COM 23 Strategic Optimization

24. © 2012 WIPRO LTD | WWW.WIPRO.COM 24 Strategic Optimization

25. © 2012 WIPRO LTD | WWW.WIPRO.COM 25 Strategic Optimization

26. © 2012 WIPRO LTD | WWW.WIPRO.COM 26 Strategic Optimization – Measuring Effectiveness Efficiency - Extent to which trade spend is minimized (average cost) Effectiveness - Extent to which trade spend achieves an increase in sales or profit (incremental cost)

27. © 2012 WIPRO LTD | WWW.WIPRO.COM 27 Strategic Optimization

28. © 2012 WIPRO LTD | WWW.WIPRO.COM 28 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

29. © 2012 WIPRO LTD | WWW.WIPRO.COM 29 Strategy Planning

30. © 2012 WIPRO LTD | WWW.WIPRO.COM 30 Strategy Planning

31. © 2012 WIPRO LTD | WWW.WIPRO.COM 31 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

32. © 2012 WIPRO LTD | WWW.WIPRO.COM 32 Promotional Planning Promotion States –Planned –Confirmed –Active –Finished

33. © 2012 WIPRO LTD | WWW.WIPRO.COM 33 financial evaluation criteria for KPI and promotion control real-time evaluation of planned anticipated efficiency and effectiveness “green light” evaluation checks against management parameters –cost /volume –spend % –incremental spend % –ROI –retailer profit % –gross margin %

34. © 2012 WIPRO LTD | WWW.WIPRO.COM 34 Promax Approach to TPO/TPM 3 Key Areas –Strategic Optimization –Strategic Planner –Tactical Promotion Planning Optimize Operate Analyze

35. © 2012 WIPRO LTD | WWW.WIPRO.COM 35 Volume Planning

36. © 2012 WIPRO LTD | WWW.WIPRO.COM 36 Thank You Advanced Analytics