1 District 6 April 16, 2009 By: Melissa VanderMel (Customer Sales Executive) Meghan Krivoshein (District Manager) Jim Morrison (Retail Sales Representative)

1

District 6

April 16, 2009By:

Melissa VanderMel (Customer Sales Executive)

Meghan Krivoshein(District Manager)

Jim Morrison(Retail Sales Representative)

2

Agenda

Why Confection?

Business Review

Grow profit and sales with Hershey’s exciting Q2 promotions

Fun contest with prizes

Questions

3

Why Confection?

4

Confection is a large Category at Hannaford Ranking in the top 20

DSS: YTD 11-12-2008

5

Confection consistently outperforms top edible categories in recession years

-4

-2

0

2

4%

Win

e

Con

fect

ion

Cookie

s

Cra

ckers

Salt

yS

nack

s

Beer

Soup

Bott

led

Juic

e

Cold

Cere

al

Carb

Bev -2

-1

0

1

2%

Con

fect

ion

Cra

ckers

Beer

Salt

yS

nack

s

Bott

led

Juic

e

Soup

Win

e

Carb

Bev

Cookie

s

Cold

Cere

al

Source: IRI FDMx 52 weeks ending 12/2000 and 12/2003

Dollar Percent ChangeTop 10 Edible Foods in 2000

Dollar Percent ChangeTop 10 Edible Foods in 2003

6

Confectionery Delivers High Profitability Driven By High Gross Margin

Confectionery margins are 3-5% points higher

Source: DHC Analysis of Retailer Data

% Gross Margin

27%30%

Confectionery Grocery Average

7

Confectionery Is Among Most Frequently Purchased Categories In Stores

Source: ACNielsen HomeScan

Frequent purchases make it key to retailers

Annual Purchases

15

12

11

7

31

30

22

16

Coffee

Soup

Cookies

Bottled Juice

Cereal

Confectionery

Milk

Carb. Bev.

8

Candy Is The Most Responsive Category For Display Treatment

Source: IRI, Food, 2005

% Increase On Display Only

88%

68%

61%

49%

169%

105%

95%

95%

Beer

Spices/Seasoning

Wine

Salty Snacks

Bottled Water

Carb. Beverages

Cookies

Candy

9

Confectionery is Expandable – Not a Zero Sum Game

Source: Dechert-Hampe & Co.

Fixed Consumption Expandable Consumption

Consumption

weeks

PurchasingConsumption

weeks

Purchasing

Consumption at fixed rate

Soap, Detergent, Toilet Paper

Promotion Loads Pantry

Consumption Driven by Purchase

Candy, Snacks, Beverages

Promotion Builds Consumption

10

See Candy, Buy Candy, Eat Candy…buy more candy

See Candy

Buy Candy

Eat Candy

Buy Candy

11

Consumers Often Have A Special Relationship With Confectionery


“It makes me happy, when I’m feeling blue”

“It’s a little pick-me-up when I need some energy”

“I feel I’m a better person when I have my candy”

“I hide candy. I keep my own stash – the good stuff”

“The holidays wouldn’t be the same without the candy”

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Business Review

13

Hershey is larger than the next three manufactures at Hannaford

Source: IRI 52 Week Ending 12-28-2008

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Top 4 Packtypes represent 62% of Hannaford’s C.G.M. Business with Hershey being share leader in all 4.

IRI Hannaford RMA 52 wks ending 12/28/08

Hsy share 42%

Hsy share 17%

Hsy share 44%Hsy share 57%

15

YTD March 22, Easter timing is driving total dollars down. However, Hannaford declines are greater than market.

Dollar % Chg vs. LY

IRI, YTD 3-22-2009

16

Easter is driving YTD dollars down due to the timing of Easter falling on March 23rd LY

Other 1.7%

0

20

40

60

80

100%

Dollars

Easter 8.6%

Valentines 13.6%

Non-Seasonal 76.1%

$11,308,800

$228,424

-$185,794

-$1,541,978

Dollar Chg

IRI, YTD 3-22-2009

Hannaford Total CMG Dol Share & Dol ChgHannaford RMA; YTD we 3/22/09

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There’s an opportunity to increase Candy, Gum and Mint sales with Hershey’s in District 6

DSS Hannaford YTD w/e 3/28/09 Hershey

Last 52 LY Last 52 TY % +/ -

Overall Result $ 17,685,493 $ 17,235,435 -2.5

DISTRICT 3 $ 1,484,952 $ 1,418,646 -4.5

DISTRICT 8 $ 1,459,178 $ 1,409,544 -3.4

DISTRICT 10 $ 1,439,888 $ 1,376,417 -4.4

DISTRICT 4 $ 1,379,031 $ 1,354,217 -1.8

DISTRICT 2 $ 1,344,734 $ 1,328,476 -1.2

DISTRICT 1 $ 1,302,958 $ 1,274,354 -2.2

DISTRICT 9 $ 1,264,598 $ 1,265,334 0.1

DISTRICT 6 $ 1,259,451 $ 1,186,960 -5.8

DISTRICT 7 $ 1,239,906 $ 1,182,238 -4.7

DISTRICT 19 $ 1,194,318 $ 1,132,710 -5.2

DISTRICT 18 $ 1,031,395 $ 1,123,642 8.9

DISTRICT 13 (Independents) $ 815,317 $ 865,297 6.1

DISTRICT 21 $ 790,207 $ 766,547 -3.0

DISTRICT 22 $ 825,108 $ 761,254 -7.7

DISTRICT 20 $ 778,481 $ 742,121 -4.7

DISTRICT 23 (Dover #242) $ 17,900 $ 47,678 166.4

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District 6 Hershey’s sales by store

DSS Hannaford YTD w/e 3/28/09 Hershey

Store # Last 52 LY Last 52 TY % +/ - Hershey Rep DistrictTotal $ 17,685,493 $ 17,235,435 -2.500149 $ 62,253 $ 53,778 -13.6 KRISTINA GOUGOUSHEVA DISTRICT 6

00159 $ 91,573 $ 91,176 -0.4 BETHANY KUCHARIK DISTRICT 6

00160 $ 76,432 $ 76,281 -0.2 JAMES MORRISON DISTRICT 6

00247 $ 76,320 $ 87,743 15.0 TIMOTHY KEEFE DISTRICT 6

00248 $ 130,355 $ 117,961 -9.5 TIMOTHY KEEFE DISTRICT 6

00253 $ 0 $ 17,672 0.0 TIMOTHY KEEFE DISTRICT 6

00314 $ 109,362 $ 109,518 0.1 TIMOTHY KEEFE DISTRICT 6



00318 $ 87,325 $ 82,482 -5.5 TIMOTHY KEEFE DISTRICT 6

00319 $ 90,308 $ 91,399 1.2 JAMES MORRISON DISTRICT 6

00352 $ 135,418 $ 123,177 -9.0 BETHANY KUCHARIK DISTRICT 6

00373 $ 155,361 $ 122,967 -20.9 KRISTINA GOUGOUSHEVA DISTRICT 6

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Encourage ‘one more sale in the basket’ with secondary displays of these top selling Hershey items

Source: Hannaford DSS 1/5-11/15/08 item rank $ sales TOTAL CATEGORY everyday and seasonal combined

Rank in the

Top 10

20

Hershey’s Chocolate Syrup 24oz ranks #1 in dollar sales at Hannaford

Hrd DSS 1-5-2008 thru 11-15-2008 ice tea, cocoa and syrup

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Grow profit and sales with Hershey’s

exciting

Q2 promotions

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Increase sales of top selling Hershey’s Syrup 24oz with continued support of rack displayed near milk case

Hannaford Factory Sales YTD to April, 2007 – Sam (+18%)

+18%

Source: Hrd DSS 1-5-2008 thru 11-15-2008 ice tea, cocoa and syrup (#1)

23

Items on the Hershey’s Low Profile rack, at Hannaford, return between 36% to 44% profit margin

Ice Breakers Mints 41%

Ice Breakers Bottle Packs 36%Ice Breakers Gum Packs 44%

Standard Bars 38%

Benefits:•Highly profitable•Confection is highly impulsive with 42% unplanned•Allows for first to street with new items (e.g. IB Bottle Pks)

April 2, 2009

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4 sided rack April – June Planogram displays high profit, top selling candy items

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April 2009 promotional display plan

Packaged 12oz

Largest Packtype

Night at the Museum Battle of the Smithsonian

5/22

Summer

Profitable, Top Selling Items

Milk 6pks (S’Mores): ranks 1, $ sales

Reese’s & Kit Kat Snack: ranks 2 & 6, $ sales

Bonus Twizzlers: ranks 9th, $ sales

Bonus Standard Bars: 38% profit margin

King Size Shipper: 38% profit margin

Mother’s Day Pot of Gold Demo (4/25)

Theater Boxes

Profitable, Value Offering

at 5/$5

Source: ranking; Hannaford DSS 1/5-11/15/08 item rank $ sales TOTAL CATEGORY CGM everyday and seasonal combinedProfit margin: std bars based off .79 SRP and King based off $1.39 SRP

32% profit margin

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May 2009 promotional display plan

Packaged 12oz

Largest Packtype/Value

Offering with Bonus

Bonus Packaged Module, 150ct

Summer





Bonus Standard Bars: 38% profit margin

King Size Shipper: 38% profit margin

Fresh Magazine

Profit

Starbucks featured in May – June issue


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June 2009 promotional display plan

Packaged 12oz

Largest Packtype/Value Offering with

Bonus

Bonus Packaged Module, 150ct

Summer





Summer Co-Marketing June 7-July 11:

–Asst module (cartons/Twizzlers) & Syrup module

Hannaford & Hershey Help Fight Hunger

Hershey’s donates $20K

Reese’s Loves You Back Standard Bar shipper

New Item

Demos

Reese’s Dark Pkg DRC co-op with water (end of June)

Reese’s Cremes DRC and Trial Size (end of June)


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May 3rd

$1 off Bliss or Reese’s Clusters

May 17th

$1 off Honey Maid Grahams when you buy 1 Jet Puffed Marshmallow and 1 Hsy Milk 6pk

May 17th

$1 off two Syrup/Toppings

June 28th

$1 off two 6 packs (graphics pending) &

$1 off 3 Twizzler bags

Hershey’s National FSI’s April – June 2009

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S’Mores Rocks Your Block …

Smores_Rocks_Your_Block.mpg (4...

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Corrugated S’Mores Display

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Confectionery has the dimensions to increase consumption, sales and profits

– Huge category One of the largest

– Profitable Strong margins

– Frequently purchased Key to shopping trips

– Incremental Builds the shopping basket

– Promotable Responds to activity

– Expandable Consumption leads to growth


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Hershey’s fun facts………..

•When did Hershey began making Kisses?

•Finish this - SEE CANDY, …

•Who has the largest share of C.G.M business at Hannaford?

•What’s Hannaford’s #1 Confection item, $ sales

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Thank you!

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See Candy, Buy Candy, Eat Candy…buy more candy

See Candy

Buy Candy

Eat Candy

Buy Candy

Documents

1 District 6 April 16, 2009 By: Melissa VanderMel (Customer Sales Executive) Meghan Krivoshein (District Manager) Jim Morrison (Retail Sales Representative)