How can CPGs significantly grow sales at lower cost in Asia-Pacific? By improving their coverage of traditional trade in emerging markets. Report highlights: -- the growth opportunities in emerging markets -- leveraging traditional trade channels and technology to grow -- case studies

1. Re-igniting APAC growth
through improved Traditional
Trade performance
September 2016

2. 2Copyright © 2016 Accenture Allrights reserved.
The opportunity for a $1 Bn CPG…
CPGs can significantly grow sales at lower costs
2
1 Grow sales by $100-
200 M…
...while reducing
spend by $30-50M…
Reach beyond traditional marketing
channels
Improve consumer and trade
engagement
Increase coverage of traditional trade
Reduce marketing wastage
Improved measurement
of promotions
Sales force control and
self-enabled retailers
Improved distributor mgmt and
activation of trade
…expanding the view
on MROI
3
Focus on total returns on market facing
investments

3. 3Copyright © 2016 Accenture Allrights reserved.
Global CPG: FY15 Revenue
(USD bn)
The top 15 CPG generate $350 Bn in revenue from
Emerging Markets
14%
DiageoKraft
Heinz
18.3
18%
82%
Danone
25.6
43%
57%
L’Oréal
27.4
38%
62%
Mondelez
29.6
39%
61%
ABInBev1
43.6
53%
47%
Coca-
Cola
44.3
27%
73%
Unilever
57.9
58%
42%
Pepsico
63.1
27%
73%
Nestlé
89.0
37%
63%
70.1
J&J2
15.3
18%
82%
43%
45%
55%
57%
KelloggBAT
13.5
19.3
86%
ColgatePMI
16.0
50%
50%
73.9
36%
64%
P&G
72.5
35%
65%
Emerging Markets
Developed Markets
Note: Only included revenues for CGS MNCs (regional companies e.g. COFCO etc excluded). Emerging markets as defined by the company, if not available APAC, LatAm, Middles
East and Africa used as a proxy.
Data is for the FY15 if not available latest reported FY. 1ABInBev is currently undergoing a merger w ith SABMiller- revenues above include ABInBev only; 2Included Asia Pacific &
Africa revenues(other emerging markets w ere difficult to segregate)
Source: CapitalIQ, and Company reported financials

4. 4Copyright © 2016 Accenture Allrights reserved.
• 10-20% Sales Uplift Potential
– Reach more traders 2X+
– Increase engagementw/each
trader
– From 6/mins /week to daily
– +10% store visit frequency
– +10% increase in drop size
• Extend reach into rising consumer
base
Unreached Potential
Significant growth can be generated from extending
reach and engagement
~ 20%
Coverage
CPG Distribution Customer Consumer
Traditional
Distribution
Model
(PUSH)
60%
Trade Spend
Visibility
80%
Unserved traders
due to traditional
channel complexity:
large number of
small stores
organised in a
layered micro-
distribution
Limited
targeting of
advertising due
to lack of
consumer
visibility
Enterprise CRM
(SFA, DSD
and DMS)
W/Sale
C&C
3bn
Consumers
10m
Customers
~ 60%
Reach
(through
traditional
mass
advertising)
Direct
In Direct
Growth
opportunity

5. 5Copyright © 2016 Accenture Allrights reserved.
Emerging markets in 2019(1)
For example, CPG’s could generate significant sales by
more effectively covering Thailand’s 800K mom & pops
Trader opportunities :
• COVERAGE – Increase coverage by using
direct promotions to new traders
• PRODUCT PULL – Use direct, targeted
promotions as a pull tool with Mom & Pop
shops
• SALES COST – Reduce sales calls for
small traders which can be reached and
can order through their mobile
Thailand store coverage by select
MNC’s(2)
>55%
>5000
24,509
38,300
41,013
47,100
221,000
225,000
>600,000
0 200,000 400,000 600,000 800,000
Total Stores
~10-20% average coverage
Source: (1) PlanetRetail; Euromonitor International 2016
(2) Accenture Research and Analysis
Traditional trade sales - Thailand

6. 6Copyright © 2016 Accenture Allrights reserved.
Limited Distribution – select client example
HUGE Uplift Potential: Sales via distributors to 200,000 outlets
illustrate that 80 percent of the sales came from 20 percent of the
outlets covered – 4% of the total outlet universe
• The top 20 percent are a mixture
of retail chains, wholesalers, and
cash and carry
• Long tail, the last 100,000 (51%)
outlets, have a low sell-in,
generating average sales of
US$200 or less
• Opportunity to establish direct
connection with customers who
purchase via cash and carry or
larger stores
• Opportunity to acquire new outlets
• Opportunity to register existing
outlets and generate sales uplift
via targeted and more frequent
messaging
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
25
30
35
40
45
50
55
60
65
70
75
80
85
90
95
100
105
110
115
120
125
130
135
140
145
150
155
160
165
170
175
180
185
190
195
200
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
$50,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Average sales of top 20,000 outlets grouped by 1,000 outlets
Average sales of remaining 176,000 outlets grouped by 5,000 outlets
Top 10% (20,000 outlets) 65% of sales
Top 20% (40,000 outlets) = 80% of sales
Top 35% (75,000 outlets) = 90% of sales
Last 65% (125,000 outlets) = 10% of sales

7. 7Copyright © 2016 Accenture Allrights reserved.
Increasing trader coverage with trader self-service solution:
Trader’s capabilities will enable CPGs to increase their
trader coverage with a full trader self-service solution
BRANDTONE
“Pull”
NEWSPAGE
“Push”
Trader• Expand ordering reach
• Reduces costto sell
Tradersynergy:
• Create incentive to sign-up
• Create incentive to order
Costto
sell
TraderCoverage
Low
High
0% 100%50%
Medium
Self-service
efficiency+ demand
pull incentive
20%
Direct selling Indirectselling

8. 8Copyright © 2016 Accenture Allrights reserved.
Driving this impact will require CPGs to re-focus
$200-400 M of market facing investment per $1 Bn sales
Typicalspend on$1 Bn sales Currentchallenges Opportunity
Advertising
Promotions &
premiums
Sales
force
Trade
terms
• Reach limited to 60%
• Wastage spend in
over-exposure
• Lack of consumer
engagement
• Inconsistentperformance and
oftennegative ROI
• Field sales only covering 10-
40% of mom & pop stores
• Poor
• Unconditional discounts with
little impact on sales
• Trade spend absorbedbefore
reaching retailers
Reach 20-40% more of
consumersin a
2-way connection
Engagementwith the
consumeracross
activities
Self-service and sales
force controlto cover
>40% of traditional
trade
Better activate
traditionalretailers
$50-100M
$50M
$50M
$50-200M

9. 9Copyright © 2016 Accenture Allrights reserved.
Saving levers
For every 1 BN EUR in revenue, CPG’s can potentially
save and redirect 30M – 75M to fund growth initiatives
This is based on past collaborations with:
Marketing Potential
savings
WorkingNon-Working
Brand Events
Brand Promotion
Sponsorship
Packaging
Product Dev
Agency Fees
Ad Production
Digital Production
Market Research
Other Marketing
Premiums
Sales Samples
10-15%
5-15%
2-5%
5-15%
5-10%
2-5%
10%
-
10-25%
15-20%
10-15%
5-15%
Merchandiser
Point of Sales
Sales Brokerage
Commercial Rel.
Mgmt
Sales Demos &
Promoters
Trade Events
Sales Events
Sales Incentives
5-30%
5-15%
5-15%
2-5%
5-10%
-
5-25%
5-10%
Sales Potential
savings
Efficient Operations
Business Building
Other terms
5-10%
10-15%
10-20%
Trade Spend
Media
TV Media Buying
Digital Media
Outdoor Media
Sponsorship
15-20%
Potential
savings

10. 10Copyright © 2016 Accenture Allrights reserved.
Efficient and Effective Reach in Traditional Trade
CPGs are deploying sophisticated tools to better serve traditional
trade and achieve higher penetration at a lower cost
Generate profitable growth
Uplift at existing stores
Increase sales
Push (via sales force)
Targeting and Analysis
Salesforce
automation/enablement
Pull (via increased
demand)
Direct
messages/offerings
Online portfolio
availability
Reduce costs
Trade spend
Reduce leakage
Reduce poor performing
promotions
Sales force costs
Reduce calls
Switch low-sales outlets
to self-serve
Acquire new stores
New sales
Push (new) Canvasing
Pull (indirect) On-case promotions
Save costs Trade spend
Better used trade spend
Reduce wastage
Objectives How to meet them

11. 11Copyright © 2016 Accenture Allrights reserved.
CPG Colombia case study – using Trader Connect*
In Colombiaa CPG client generated a 5 percent revenue upliftfrom
TraderConnect enrolled stores Vs non-enrolled stores; the highest
increase coming from the hardest to reach smaller stores
• Launched initially with 15,000 traders and rolled
out to 70,000 inless than 6 months
• 70 percentof total GT universe recruited in 45
days
• 2.7 million contacts made with traders
• Trader Connect enrolled stores on average had a
higher responserate forsimilar promotions
• Trader Connect enrolled stores achieved 9.2
percentrevenue uplift Vs prior year, mainly driven
by increased frequencyof purchase
12.6%
11.0%
5.5%
7.7%
4.1%
2.0%
Trader Connect enrolled stores Other stores
Personal Care Home Care Other consumer
12.8%
11.7%
7.6%
6.5%
4.5%
5.8%
3.8% 4.3%
3.1% 2.9%
Trader Connect enrolled stores Other stores
$0-100k $100-200k $200-300k $300-400k > $400k
Revenue growth across all categories
Revenue growth across trader clusters (by revenue)
de Col
No. of
stores
26.2k 1.8k 15.9k 7.6k 5.1k 2.1k 2.2k 1.8k 3.0k 0.9k
*Financial performance, including ROI, was calculated by the client’s Colombia team

12. 12Copyright © 2016 Accenture Allrights reserved.
Trader Profiling
Profiling the trader base would allowus to provide valuable
insights and supplement existing data set
How many people visit your store
daily?
a) Up to 50
b) Up to 150
c) Up to 300
Do you stock Competitor Brand A
at your store?
Do you stock Competitor Brand B
at your store?
How do you expect your business
to grow in the next 12 months?
a) Positive sales growth
b) Stay the same
c) Slowing sales volumes
Profiling would
allow us to
segment the
trader base
according to
your business
priorities
Volume
(Group
A) Sales
Growth
(Group
C)Mix
(Group
B)
Trader

13. 13Copyright © 2016 Accenture Allrights reserved.
Engaging with Traders
Increased and targeted engagements with CPG’s customers would
facilitate incremental sales growth in your traditional trade
business
Segment traders and
create sales pull offers
Segment A
Segment B
Segment …
1
Ongoing conversation driving
J&J awareness and
participation
2 3
Brand:
Buy five units of
Brand and win two
boxes of Product
for free!
Trader earns their reward
for complying with the
terms of the offer
4
Sales growth for offered
products is validated
through Trader Connect
reporting
 Enhanced profiling enabling highly targeted calls to action
 Communicated directly to the traders on their mobile
 Enabling an ongoing permissioned conversation with the trader

14. 14Copyright © 2016 Accenture Allrights reserved.
Targeted messages keep traders engaged and drive
further sales
Regular
updates halved
sales rep
visiting times
Motivational
messages drive
sales uplift
Education
drives
increased
assortment
uplift
Regular updates
and timely
rewards
increase loyalty
Hi Beth. Remember to buy more
than PHP4,000 of any product in
August to earn great rewards
Hi Beth. You have purchased
PHP2,000 worth of stock for August.
Buy PHP2,000 more before the end
of the month to earn your reward!
Hi Beth. Did you know that Ultra Thin
is now the most popular with
consumers? Order yours today and
receive 10 percent off your first
order.
Hi Beth. Congratulations you have
earned your rewards for August.
Your store discount will be on your
next invoice.
Motivate
Update
Educate
Reward

15. 15Copyright © 2016 Accenture Allrights reserved.
Trader Engagement Journey
Creating a one-on-one relationship with traders with
meaningful engagement would drive loyalty
Beth receives an update text: “Hello
Beth, halfw ay to this month’s target
already. Buy another PHP2,000 by
August 31 to earn great rew ards”
Beth receives a text message from : “Hello
Beth, congratulations on your performance
last month. This month, buy PHP4,000 to
earn great rew ards”
At her store, she makes her
first order from distributor
First
delivery
of
PHP2,000
worth of
products
Time for the
next order.
Beth orders
PHP1,000 this
time.
Second
delivery
Last reminder: “Hello
Beth, just a w eekto
go. Order PHP1,000
by August 31 to earn
great rew ards”
Time for the last order. Beth orders
PHP1,500 w orth of goods.
Month End:
“Congratulations Beth. You
have exceeded your arget
this month. Your discount
w illbe provided on your
next invoice.”
Beth owns a sari-sari store in Pampanga.
She has owned the shop for more than 10
years. She values being able to receive
loyalty updates so that she can get the best
deals on the products her customers like to
buy from her.