A Look at Trends in Promotion Activity and Shopper Behavior

1. A Look at Trends in Promotion Activity and Shopper Behavior Senior Analytics Lead, Promotion Analytics / Inmar Andrew W. Coleman

2. Session agenda • Introduction • Definitions and methodology • Topline findings • Economic conditions • Promotion landscape • NEW: Canadian trends • Spotlight: Digital trends • Conclusions and predictions • Questions

3. Senior Analytics Lead, Promotion Analytics Background in creative and digital brand management Agency and client-side perspective Loves data, hates buzzwords New dad

4. Percent change compares activity throughout 2014 with activity from 2013. • Distribution and redemption data consolidated • from the Inmar coupon database. • Industry distribution and redemption statistics extrapolated using Inmar and Kantar Media data. Analysis conducted to develop key insights. • Data cross-checked with major coupon • distributors and third-party vendors.

5. DEP (Dual electronic and paper) • EC (Electronic checkout) • EDO (Electronic discount opt-In / load2card) • FSI (Free-standing insert) • HO (Handout) • IR (Instant redeemable) • NET (Internet printable / print at home) • SP (Shelf pad) • Manufacturer offers vs. coupon codes • Digital vs. digital-ish • Convenience vs. accuracy • IR vs. IRC

10. Free-standing insert Up from 87.4 % in 2013 Source: 2014 Inmar Coupon Trends

11. Other Dual electronic and paper Internet Free-standing insert Down from 40.0% in 2013 Direct mail Shelf pad Electronic checkout Instant redeemable cross ruff Instant redeemable Source: 2014 Inmar Coupon Trends

12. Source: 2014 Inmar Coupon Trends

13. Source: 2014 Inmar Coupon Trends

15. Food Food Non-Food Non-Food 2014 2013 Source: 2014 Inmar Coupon Trends

16. Food Non-Food Food Non-Food 2014 2013 Source: 2014 Inmar Coupon Trends

17. Electronic Discount Opt-In / Load2Card Free-Standing Insert Instant Redeemable Electronic Checkout Shelf Pad Internet Printable /Print at Home Handout

18. Electronic Discount Opt-In / Load2Card Free-Standing Insert Instant Redeemable Electronic Checkout Shelf Pad Internet Printable /Print at Home Handout

20. Consumer confidence increasing Unemployment rate falling Misery index falling Gas prices falling Retail improving, but CPG eCommerce lagging

22. Face values getting sweeter Units holding steady Shrinking redemptionperiod Baskets and trips on the rise

23. Average face value distributed Average purchase requirement distributed Average redemption period distributed Source: 2014 Inmar Coupon Trends

24. New Products Promoted via FSI in 2014 Categories Featuring New Product Events in 2014 New Product Event Dates in 2014 • (814 in 2013) • (412 in 2013) • (96 in 2013) Source: Marx / Kantar Media

25. Average face value distributed Electronic Discount Opt-In / Load2Card Free-Standing Insert Instant Redeemable Electronic Checkout Shelf Pad Internet Printable /Print at Home Handout Source: 2014 Inmar Coupon Trends

26. Average purchase requirement distributed (units) Electronic Discount Opt-In / Load2Card Free-Standing Insert Instant Redeemable Electronic Checkout Shelf Pad Internet Printable /Print at Home Handout Source: 2014 Inmar Coupon Trends

27. Average redemption period distributed (months) Electronic Discount Opt-In / Load2Card Free-Standing Insert Instant Redeemable Electronic Checkout Shelf Pad Internet Printable /Print at Home Handout Source: 2014 Inmar Coupon Trends

28. Average face value distributed Average purchase requirementdistributed Average redemption period distributed Source: 2014 Inmar Coupon Trends

29. Source: Nielsen Homescan, 52 w/e 12/28/2013 - excludes gas-only or Rx-only trips

31. (Billions) Source: 2014 Inmar Promotions – Canada

32. (Millions) Source: 2014 Inmar Promotions – Canada

33. Source: 2014 Inmar Promotions – Canada

34. 2013 2014 Source: 2014 Inmar Promotions – Canada

35. 2014 Source: 2014 Inmar Promotions – Canada

36. Source: 2014 Inmar Promotions – Canada

39. Still a small share of distribution • Declining share of redemption • Rich face values • Wide range of redemption rates • Overall average: • “Middle half” spans 2013: 5.0% Source: 2014 Inmar Coupon Trends

40. Similarly small share of distribution • Growing share of redemption • Decent face values • Average redemption rates: 2013: 0.9% • Overall average: • “Middle half” spans Source: 2014 Inmar Coupon Trends

42. Large share of distribution • Large share of redemption • Average face value • Average redemption rate • Overall average low • Middle half spans Source: 2014 Inmar Coupon Trends

45. “I think the days of traditional mass marketing are kind of over. Marketing has to be a conduit into the multi-screen world that everyone’s living in. How do you create a two-way conversation?”2 “The eventuality of the world is a one-to-one relationship with every consumer which results in trust, loyalty – all the things that a brand wants.”1 • Ann Muhkerjee,SVP and CMO,Frito-Lay North America Bob McDonald Former CEO & Chairman of the Board, Procter & Gamble SOURCE: 1) AdAge, AdAge Digital A-List: P&G, February 2011. 2) Business Insider, Frito-Lay CMO: The Days of Traditional Mass-Marketing are Over, July, 20, 2012

46. Engagement coupons generate 5x redemption of traditional print-at-home coupons4 SOURCE: 1) L2 Business Intelligence for Digital, “Where Consumers Look for Grocery Coupons”, 2) Institute for Advanced Analytics, NCSU September 2014, 3) Knowledge Networks , Trend Report 2011; Coupons .com Digital User Behavior presentation 2011 4) 2014 Redemption Statistics, Hopster Coupon Platform

47. Multiple print technologies • Industry best security options • Seamless media integration • Robust data capture • Integrated engagement activities • Accepted at all retailers

48. Personalized emails delivered through retail partners • Targeting capabilities match offers with shoppers • Maximize promotional dollars with targeted offers • Robust financial and behavioral data capture