RAMSTORE & GILLETTEOral Care Category Management Project
Anton Voichik National Key Account Manager
Kirill Liseev Oral Care Business Director
Agenda
Oral Care Category Review– Russia market review– Supermarket channel dynamics
Oral Care Category Management Project– Joint Business Planning– Agreement to proceed– Analysis– Implementation– Review
Future Collaboration
Toothbrush Market Review
Global Market Share Leadership
Manual - 22% (#1) Power - 48% (#1)
– Rechargeables 70% (#1)– Battery 30% (#2)
Refills - 73% (#1)
34%
Value Shares:
Oral-B34%
SKB 7%
J&J 4%
Other 23%
Colgate 17%
P&G 6%Unilever 6%
Oral-B: Clear Global LeaderOral-B Global Market Share
Toothbrush Market Size - Russia
1999 2000 2001 2002 2003 200440
50
60
70
80
90
100
44.5000
52.5000
70.8000
89.100091.600095.0000
Market size has grown significantly over past yearsIn 2003, category growth has slowed downMM units
49.9
22.4
27.721.5
22.256.3
Low Price Premium PriceMid Price
Volume % Value %
Low price segment is still the largest in volumePremium segment is the clear contributor in value
92 MM toothbrushes 56 MM USD
Toothbrush Market Segments - Russia
Toothbrush Segment Development
JF 2001 JA 2001 JF 2002 JA 2002 JF 2003 JA 2003 JF 2004
15.1 15.518.8 19.6 20.5 21.4 21.7
17.2 17.9 19.4 19.8 21.924.4
28.9
67.7 66.761.9 60.6
57.654.2
49.4
Low Price Mid Price Premium Price
Continuous upgrading of market during past three years
%
JF 01 JA 01 JF 02 JA 02 JF 03 JA 03 JF 04 Avg 01 Avg 02 Avg 030
5
10
15
20
25
30
35
18.6000
23.2000
25.6000
12.1000
9.70008.8000 9.5000
10.9000 10.90009.3000
13.9000
20.0000
22.5000 23.300025.3000 25.7000
26.8000
25.1000 25.1000
28.2000 27.6000
29.900031.4000
34.0000
ColgateAvg.Oral-B share
Oral-B GSK
Value Share Trends - RussiaOral B continues to achieve record market share growth while Colgate is leading with strong position
Importance of KOBs
Total Toothbrushes
Oral-B
JF 2004
Toothbrush Market Size - Moscow Supermarkets
1999 2000 2001 2002 2003 200440
540
1040
1540
2040
2540
109.7365325.2986
632.0581
1136.8990
2125.79592311.0000
Market size has grown significantly over past years1000 units
JF 01 JA 01 JF 02 JA 02 JF 03 JA 03 JF 040
5
10
15
20
25
30
35
40
45
7.93575.1205
8.0937
13.171111.2665 11.2045 11.7682
43.2078
30.4482
21.022923.7047
26.5105
19.6220
25.5374
10.1602
22.4001
25.8953 26.355924.5275
32.6898 32.5789
Oral-BAvg.Oral-B share
Colgate GSK
Source: AC Nielsen Russia National
Manual Value Share Trends Moscow Supermarkets
Strengthening Leading Position
SO 2002 ND 2002 JF 2003 MA 2003 MJ 2003 JA 2003 SO 2003 ND 2003 JF 2004 MA 2004-0.0000000104%0.0999999940%0.1999999881%0.2999999821%0.4000000060%0.5000000000%0.6000000238%0.6999999881%0.8000000119%0.8999999762%1.0000000000%1.1000000238%1.2000000477%1.2999999523%1.3999999762%1.5000000000%1.6000000238%1.7000000477%1.8000000715%1.8999999762%2.0000000000%2.0999999046%2.2000000477%2.2999999523%2.4000000954%2.5000000000%2.6000001431%2.7000000477%2.7999999523%2.9000000954%3.0000000000%3.1000001431%3.2000000477%3.2999999523%3.4000000954%3.5000000000%3.6000001431%3.7000000477%3.7999999523%3.9000000954%4.0000000000%4.0999999046%4.2000002861%4.3000001907%4.4000000954%4.5000000000%4.5999999046%4.7000002861%4.8000001907%4.9000000954%5.0000000000%5.0999999046%5.2000002861%5.3000001907%5.4000000954%5.5000000000%5.5999999046%5.7000002861%5.8000001907%5.9000000954%6.0000000000%6.0999999046%6.2000002861%6.3000001907%6.4000000954%6.5000000000%6.5999999046%6.7000002861%6.8000001907%6.9000000954%7.0000000000%7.0999999046%7.2000002861%7.3000001907%7.4000000954%7.5000000000%7.5999999046%7.7000002861%7.8000001907%7.9000000954%8.0000000000%8.1000003815%8.1999998093%8.3000001907%8.4000005722%8.5000000000%8.6000003815%8.6999998093%8.8000001907%8.9000005722%9.0000000000%9.1000003815%9.1999998093%9.3000001907%9.4000005722%9.5000000000%9.6000003815%9.6999998093%9.8000001907%9.9000005722%10.0000000000%10.1000003815%10.1999998093%10.3000001907%10.4000005722%10.5000000000%10.6000003815%10.6999998093%10.8000001907%10.9000005722%11.0000000000%11.1000003815%11.1999998093%11.3000001907%11.4000005722%11.5000000000%11.6000003815%11.6999998093%11.8000001907%11.9000005722%12.0000000000%12.1000003815%12.1999998093%12.3000001907%12.4000005722%12.5000000000%12.6000003815%12.6999998093%12.8000001907%12.9000005722%13.0000000000%13.1000003815%13.1999998093%13.3000001907%13.4000005722%13.5000000000%13.6000003815%13.6999998093%13.8000001907%13.9000005722%14.0000000000%14.1000003815%14.1999998093%14.3000001907%14.4000005722%14.5000000000%14.6000003815%14.6999998093%14.8000001907%14.9000005722%15.0000000000%15.1000003815%15.1999998093%15.3000001907%15.4000005722%15.5000000000%15.6000003815%15.6999998093%15.8000001907%15.9000005722%16.0000000000%16.1000003815%16.2000007629%16.3000011444%16.3999996185%16.5000000000%16.6000003815%16.7000007629%16.8000011444%16.8999996185%17.0000000000%17.1000003815%17.2000007629%17.3000011444%17.3999996185%17.5000000000%17.6000003815%17.7000007629%17.8000011444%17.8999996185%18.0000000000%18.1000003815%18.2000007629%18.3000011444%18.3999996185%18.5000000000%18.6000003815%18.7000007629%18.8000011444%18.8999996185%19.0000000000%19.1000003815%19.2000007629%19.3000011444%19.3999996185%19.5000000000%19.6000003815%19.7000007629%19.8000011444%19.8999996185%20.0000000000%20.1000003815%20.2000007629%20.3000011444%20.3999996185%20.5000000000%20.6000003815%20.7000007629%20.8000011444%20.8999996185%21.0000000000%21.1000003815%21.2000007629%21.3000011444%21.3999996185%21.5000000000%21.6000003815%21.7000007629%21.8000011444%21.8999996185%22.0000000000%22.1000003815%22.2000007629%22.3000011444%22.3999996185%22.5000000000%22.6000003815%22.7000007629%22.8000011444%22.8999996185%23.0000000000%23.1000003815%23.2000007629%23.3000011444%23.3999996185%23.5000000000%23.6000003815%23.7000007629%23.8000011444%23.8999996185%24.0000000000%24.1000003815%24.2000007629%24.3000011444%24.3999996185%24.5000000000%24.6000003815%24.7000007629%24.8000011444%24.8999996185%25.0000000000%25.1000003815%25.2000007629%25.3000011444%25.3999996185%25.5000000000%25.6000003815%25.7000007629%25.8000011444%25.8999996185%26.0000000000%26.1000003815%26.2000007629%26.3000011444%26.3999996185%26.5000000000%26.6000003815%26.7000007629%26.8000011444%26.8999996185%27.0000000000%27.1000003815%27.2000007629%27.3000011444%27.3999996185%27.5000000000%27.6000003815%27.7000007629%27.8000011444%27.8999996185%28.0000000000%28.1000003815%28.2000007629%28.3000011444%28.3999996185%28.5000000000%28.6000003815%28.7000007629%28.8000011444%28.8999996185%29.0000000000%29.1000003815%29.2000007629%29.3000011444%29.3999996185%29.5000000000%29.6000003815%29.7000007629%29.8000011444%29.8999996185%30.0000000000%30.1000003815%30.2000007629%30.3000011444%30.3999996185%30.5000000000%30.6000003815%30.7000007629%30.8000011444%30.8999996185%31.0000000000%31.1000003815%31.2000007629%31.3000011444%31.3999996185%31.5000000000%31.6000003815%31.7000007629%31.8000011444%31.8999996185%32.0000000000%32.1000022888%32.2000007629%32.2999992371%32.4000015259%32.5000000000%32.6000022888%32.7000007629%32.7999992371%32.9000015259%33.0000000000%33.1000022888%33.2000007629%33.2999992371%33.4000015259%33.5000000000%33.6000022888%33.7000007629%33.7999992371%33.9000015259%34.0000000000%34.1000022888%34.2000007629%34.2999992371%34.4000015259%34.5000000000%34.6000022888%34.7000007629%34.7999992371%34.9000015259%35.0000000000%35.1000022888%35.2000007629%35.2999992371%35.4000015259%35.5000000000%35.6000022888%35.7000007629%35.7999992371%35.9000015259%36.0000000000%36.1000022888%36.2000007629%36.2999992371%36.4000015259%36.5000000000%36.6000022888%36.7000007629%36.7999992371%36.9000015259%37.0000000000%37.1000022888%37.2000007629%37.2999992371%37.4000015259%37.5000000000%37.6000022888%37.7000007629%37.7999992371%37.9000015259%38.0000000000%38.1000022888%38.2000007629%38.2999992371%38.4000015259%38.5000000000%38.6000022888%38.7000007629%38.7999992371%38.9000015259%39.0000000000%39.1000022888%39.2000007629%39.2999992371%39.4000015259%39.5000000000%39.6000022888%39.7000007629%39.7999992371%39.9000015259%40.0000000000%40.1000022888%40.2000007629%40.2999992371%40.4000015259%40.5000000000%40.6000022888%40.7000007629%40.7999992371%40.9000015259%41.0000000000%41.1000022888%41.2000007629%41.2999992371%41.4000015259%41.5000000000%41.6000022888%41.7000007629%41.7999992371%41.9000015259%42.0000000000%42.1000022888%42.2000007629%42.2999992371%42.4000015259%42.5000000000%42.6000022888%42.7000007629%42.7999992371%42.9000015259%43.0000000000%43.1000022888%43.2000007629%43.2999992371%43.4000015259%43.5000000000%43.6000022888%43.7000007629%43.7999992371%43.9000015259%44.0000000000%44.1000022888%44.2000007629%44.2999992371%44.4000015259%44.5000000000%44.6000022888%44.7000007629%44.7999992371%44.9000015259%45.0000000000%45.1000022888%45.2000007629%45.2999992371%45.4000015259%45.5000000000%45.6000022888%45.7000007629%45.7999992371%45.9000015259%46.0000000000%46.1000022888%46.2000007629%46.2999992371%46.4000015259%46.5000000000%46.6000022888%46.7000007629%46.7999992371%46.9000015259%47.0000000000%47.1000022888%47.2000007629%47.2999992371%47.4000015259%47.5000000000%47.6000022888%47.7000007629%47.7999992371%47.9000015259%48.0000000000%48.1000022888%48.2000007629%48.2999992371%48.4000015259%48.5000000000%48.6000022888%48.7000007629%48.7999992371%48.9000015259%49.0000000000%49.1000022888%49.2000007629%49.2999992371%49.4000015259%49.5000000000%49.6000022888%49.7000007629%49.7999992371%49.9000015259%50.0000000000%50.1000022888%50.2000007629%50.2999992371%50.4000015259%50.5000000000%50.6000022888%50.7000007629%50.7999992371%50.9000015259%51.0000000000%51.1000022888%51.2000007629%51.2999992371%51.4000015259%51.5000000000%51.6000022888%51.7000007629%51.7999992371%51.9000015259%52.0000000000%52.1000022888%52.2000007629%52.2999992371%52.4000015259%52.5000000000%52.6000022888%52.7000007629%52.7999992371%52.9000015259%53.0000000000%53.1000022888%53.2000007629%53.2999992371%53.4000015259%53.5000000000%53.6000022888%53.7000007629%53.7999992371%53.9000015259%54.0000000000%54.1000022888%54.2000007629%54.2999992371%54.4000015259%54.5000000000%54.6000022888%54.7000007629%54.7999992371%54.9000015259%55.0000000000%55.1000022888%55.2000007629%55.2999992371%55.4000015259%55.5000000000%55.6000022888%55.7000007629%55.7999992371%55.9000015259%56.0000000000%56.1000022888%56.2000007629%56.2999992371%56.4000015259%56.5000000000%56.6000022888%56.7000007629%56.7999992371%56.9000015259%57.0000000000%57.1000022888%57.2000007629%57.2999992371%57.4000015259%57.5000000000%
21.4000%22.7500%
31.3500%
37.4200%40.3800%
26.5500%
23.0100% 22.4500%
13.7200% 12.8110%
0.0000%
8.0000%
11.7400%
7.1800% 7.6400%
3.7900%6.1700%
1.8200%4.1800% 3.5708%
27.6800%
21.0800% 21.0100%
28.6200% 28.0700% 27.4000%
31.6300%
25.3100%
29.1700%
25.3684%
50.9200%
46.2900%
34.2400%
26.3100%23.6200%
42.0100%
37.9100%
50.0500%52.2400%
57.4110%
Power Value Share Trends Moscow Supermarkets
Strengthening Leading Position
Market Assessment Summary
Category growth slowing down Strong consumer upgrade to premium products Nationally growth has been driven by distribution
expansion Oral-B has strong leading position in manual and power
oral care Oral B has the expertise to grow the overall cake and drive
oral care category
RAMSTORE & GILLETTEOral Care Category Management
Anton Voichik National Key Account Manager
Ramstore Oral Care Category BackgroundThe category used to grow by double digit numbers YOY until
2003
– 57% Chemical– 43% Physical
The growth was driven by the new stores openings and performance of the power and Oral-B
– 92% Toothbrush– 885% Power– 241% Oral-B
Oral-B is leading in Toothbrush Category in Ramstore while it is #2 in total Russia
4 Step Process
Category Context
Opportunity Delivery
Opportunity Identification
Planning And Alignment
STEP 1
STEP 2
STEP 3
STEP 4
The category management opportunity and the need for data / insight
Category growth slowing down
Strong consumer upgrade to premium products
Nationally growth has been driven by distribution expansion
Oral-B has strong leading position in manual and power oral care
Oral B has the expertise to grow the overall cake and drive oral care category
At store level:
Space allocation
Product assortment
Promotion mix
On-going education
Oral care category in Russia:
General research :
Shopper insight
Potential category management levers:
Pruchase frequency
Shopper / consumer education at POS
Footfall
Category opportunities:
Limited availability of the required data
Retail data at the store level:
Space allocation
Product assortment
Promotion mix
On-going education
Purchase frequency Trade - up Penetration Footfall
Required data/insight to understand impact of...: Possible sources of information:
Limited data environment:
Agencies: - Data not complete - Data not ready
Sales force: - Too time consuming
Retailers: - Data not shared with suppliers
... on...:
Oral Care solutions 1: Joint Business Plan
Gillette Oral CareJBP
JBP strategy articulated around the expected category management key growth drivers:
– Increase the turnover and profit via maximizing the frequency of purchase the trade-up and penetration– Shopper and consumer education via the on shelf communication– Increase the footfall via the life style images
Access to data:
Retailer: Data shared with Gillette as preferred suppliers
Key data to deliver JBP: Space allocation Product assortment Promotion mix On-going education
Oral Care Encompasses a Variety of Categories that Help Consumers Maintain Healthy Mouths
The Oral Care occasion is the collection of categories that help consumers keep their mouths healthy and beautiful
Toothpaste
Toothbrushes
Interdental/Floss
Mouthrinse
Whitening
Definition
Categories
OC CATEGORY
Physical
Paste Rinse Manual Power
Rechargeable
Chemical
Oral Care Category
Battery
Interdental
Floss
Specialist
Category Optimization - Oral Care
Get the Category Segment Space Right
Get the Assortment Right
Get the Promotional Mix Right
Toothpaste Manual Power Kids Floss Rinse
0.50
0.30
0.100.05 0.03 0.05
0.70
0.20
0.03 0.02 0.02 0.03
Get the Category Segment Space Right
Opportunities Exist to Grow Category Volume by Right-Sizing Key Sections Based on Ramstore Data
Main Aisle Percent Space AllocationBeforeRecommended
Get the Assortment Right
Brand Rationalize Important Items– Consumers are confused by huge assortment– Limited Unique Selling Propositions (USP’s)– Lower price points devalue the category– Out-of-stocks on high volume brands force
shoppers to go other outlets Toothbrush Brands portfolio was Reviewed
Category Growth Driver/Support Matrix
Jordan
SKU’s in Top 20
Consumer Loyalty
Trade Promotional Spending
Advertising/Media Spending
New Product Development
Dental Professional Support
TrisaAquafreshReachColgateOral-BKey Brands
• deal with the whole category• more focus on physical (brushes + interdental), on premium and value-added brushes• include power• have a separate dedicated Kids area• a unique Ramstore design
Oral Care Strategic Partnership Agreement
Oral Care Category VisionEnsure all products within the consumers
consideration set are merchandised together, with appropriate call to action messages at the point of
purchase to facilitate the category strategies3 Steps : 1. Attract shoppers to the aisle– Paste adjacency is critical - forms total category in the eyes of the consumer
2. Complexity of the selection– Consumers take 137 seconds to shop the physical oral care section vs an average of 53 seconds for other HBA categories – 26% of physical oral care shoppers walk away from the aisle due to confusion.3.Facilitate the trade up and frequiency – Effective call to action messages– Clear segmentation and use of the key brands for easy navigation
BEFORE CATMAN: Category Outlook Toothbrush category were underspaced
Toothbrush fixture on hooks looked not too attractive
Display by brand
No dedicated Kids and power section
Toothpaste were overspaced
No detailed communication at the POP
Price tags and price promo communication only
Ramstore Oral Care Visibility Elements
Oral Care Planogram RecommendationBased on the Ramstore sales data, store level
recommendations were prepared
CATMAN Implementation Steps
#1 Allocate appropriate space for quemical and fisical (Increase space for brushes)
#2 Introduce more shopper friendly layout and replace hooks by shelves for the toothbrushes
#3 Introduce lights to category to attract the shoppers
Highlight the sub categories for POC & Kids
AFTER CATMAN: Category Outlook
160
180
200
220
Jan03 Feb03 Mar03 Apr03 May03 Jun03 Jul03 Aug03 Sep03 Oct03 Nov03Dec03Jan04 Feb04 Mar04
Oral CareCategory
Sales Value
Ramstore Oral Care Category Performance
ToothbrushCategory
Sales Value
Oral-BSales Value
70
80
90
Jan03 Feb03 Mar03 Apr03 May03 Jun03 Jul03 Aug03 Sep03 Oct03 Nov03Dec03 Jan04Feb04Mar04
25
35
45
55
Jan03 Feb03 Mar03 Apr03 May03 Jun03 Jul03 Aug03 Sep03 Oct03 Nov03Dec03Jan04Feb04Mar04
BEFORE AFTER7%
8%
20%
Apr04 May04
Apr04 May04
Apr04May04
• The appropriate space allocation, ballanced product assortment, the right promotional mix and more pleasant shopping experience can really grow the category value• The toothpaste segment did not decline despite of the reduction of the shelf space• The maintenance of the agreed planograms and the on shelf availability is vital• The evaluation is the key for the future recommendations• Understanding the magnitude of the category management and the Oral care project success, Ramenka and Gillette agreed to approach the Grooming Category
Summary: Project Results & Learnings