Innovation Challenge

1. Rapid Connect - Linking Marketers and Innovative Suppliers by Sanjay Holay, NSM ResearchJuly, 2009

2. Innovation Challenge • Suppliers are continuously developing innovative new ingredients and packaging products • Working with individual suppliers to develop new product concept is time and resource consuming for many CPG companies • Rapid Connect Process is designed to address this challenge

3. Overview • NSM Research has developed “Rapid Connect” process to link CPG marketers with innovative suppliers and smaller entrepreneurial companies • NSM Research assists Food and Beverage Marketer in identifying breakthrough new product ideas, concepts or entrepreneur partners • This presentation outlines how “Rapid Connect” process assists Food and Beverage Marketer in driving its growth agenda as well as cost reductions

4. Background on “Rapid Connect” services • The “Rapid Connect” program facilitates open innovation by linking CPG Marketers with innovative suppliers of ingredients and packaging as well as innovative entrepreneurs • The “Rapid Connect” provides a confidential, external expert resource to marketers, suppliers and processors and complements/extends their internal capabilities • The “Rapid Connect” program leads to new growth opportunities by rapid incorporations of these innovations into existing or new products or strategic alliances with new entrepreneurs

5. How Rapid Connect Works? • Sign off on Confidentiality Agreement with CPG client • Start with Food and Beverage Marketer’s Innovation Needs • Growth objectives or Opportunity Spaces • Priorities on preferred brands or opportunities to focus • NSM team to apply “Rapid Connect” process to identify new technologies, new ingredients and new product concepts using database of innovative suppliers and smaller entrepreneurial companies • NSM team works with select, few external partners to further define product concept or product prototypes • NSM team presents Food and Beverage Marketer and R&D team with 4 to 8 leading concepts, product prototypes or more finished in-market products every 8 weeks • Food and Beverage Marketer and R&D Team to lead further development and commercialization with NSM assistance as necessary

6. “Rapid Connect” Process • New or Market Ready Ideas/Concepts • Cost Reductions • Processors / Suppliers suitable for Commercial launch • Strategic Alliance / M&A • Identified market opportunities with branded marketers • Better targeting for Supplier innovations 2 4 Suppliers / Processors / Entrepreneurs Marketers Rapid Connect 3 1 • Unique product / concept / ingredients • Unique packaging • In market experience • Business / Innovation Goals • Innovation Priorities Project team will consist of Principal from NSM Research and additional associates based on targeted product category and technologies

7. Rapid Connect for New Products Starting Point Outputs of Rapid Connect Growth Strategies Opportunity Spaces Concepts Opportunity Spaces Concepts Products Prototypes Ingredients Packaging Ideas Strategic Alliances With Entrepreneurial Product Companies

8. Rapid Connect for Existing Products Starting Point Outputs of Rapid Connect Current Brands Reframing Current Brands Current Products Products with Added Features Products with Lower Costs

9. Benefits of Rapid Connect to Food and Beverage Marketer • Continuous monitoring of external innovation resources • Bi-monthly review of novel new ingredients, new concepts and new products that may fit Food and Beverage Marketer’s strategies • Leads into new entrepreneurial companies for potential strategic alliances or acquisitions • Enable confidential exchange of innovation needs and supplier capabilities • Incorporate novel ingredients / technologies into existing products to enhance features and / or lower costs

10. Supplier Next Steps • Membership to Rapid Connect Process is free • As a member, you would be expected to provide samples, technical information, prototype development assistance to select projects • If interested, please contact Sanjay Holay at sanjay.holay@nsmresearch.com

11. Appendix

12. “Rapid Connect” Case Study #1 Challenge • Large baked snacks marketer wanted to build pipeline of new products for existing brand Solution • NSM Research used distinctive innovation process that breaks down features of existing brand, product and packaging. These features were rearranged using creative idea generation process to identify new product concepts. External resources and suppliers were used to develop new product prototypes and presented at joint R&D and Marketing New Product Symposium

13. “Rapid Connect” Case Study #2 Challenge • Entrepreneurial beverage company developed unique infused, Asian theme alcoholic beverage. In order to reach broader market, the client company wanted to form strategic alliance with a large, existing beverage company Solution • NSM Research worked with the client to document consumer value proposition, business case development and financial pro-forma for the new beverage. NSM Research identified likely partner company and presented the new beverage proposition. Negotiations are underway between client company and large branded company for possible alliance.

14. Please contact us for additional information: NSM Research Inc. 1404 Lake Shore Dr. North Barrington, IL 60010 www.nsmresearch.com sanjay.holay@nsmresearch.com 847-630-3117 NSM Research Capabilities • Rapid Connect • Consumer and Customer Research • Nutrition Science Marketing and Claim Substantiation