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23 January 2007

Britvic Innovation. 23 January 2007. Introduction. Paul Moody Chief Executive. Agenda. Britvic innovation The process The team The start points Andrew Marsden, Marketing Director 2007 Innovation Andrew Richards, Sales Director. Relative Size Of Categories And Growth. +0.9%. -3.8%.

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23 January 2007

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  1. Britvic Innovation 23 January 2007

  2. Introduction Paul Moody Chief Executive

  3. Agenda • Britvic innovation • The process • The team • The start points Andrew Marsden, Marketing Director • 2007 Innovation Andrew Richards, Sales Director

  4. Relative Size Of Categories And Growth +0.9% -3.8% -1.4% -20.7% -14.4% -0.7% Carbs -1.0% -1.0% -0.5% -1.2% -2.8% +5.1% +18.2% +9.0% +4.2% +1.2% +10.2% +6.9% Stills +13.5% +7.7% -7.5% +1.5% +0.2% +2.4% +10.0% +14.3% +129.8% Volume (‘000s litres) Take Home MAT to 30.09.2006 AC Nielsen Scan Track

  5. Britvic’s Innovation within the Soft Drink Market Andrew Marsden Marketing Director

  6. Our Approach To Innovation Is Clear

  7. We Have A Strong Brand Portfolio Source: AC Nielsen on premise, scantrack, HomeScan

  8. We Have A Strong Brand Portfolio Source: AC Nielsen on premise, scantrack, HomeScan

  9. We Have A Strong Brand Portfolio Source: AC Nielsen on premise, scantrack, HomeScan

  10. We Have A Strong Brand Portfolio Source: AC Nielsen on premise, scantrack, HomeScan

  11. We Have Driven Some Great Innovation From Our Strong Brand Portfolio Source: Hall and Partners tracking study, AC Nielsen Scantrack, HomeScan

  12. We Have Driven Some Great Innovation From Our Strong Brand Portfolio Source: Hall and Partners tracking study, AC Nielsen Scantrack, HomeScan

  13. We Have Driven Some Great Innovation From Our Strong Brand Portfolio Source: Hall and Partners tracking study, AC Nielsen Scantrack, HomeScan

  14. We Have Driven Some Great Innovation From Our Strong Brand Portfolio Source: Hall and Partners tracking study, AC Nielsen Scantrack, HomeScan

  15. Last Year We Launched Into New Categories

  16. Our Innovation Record Is Successful • Of the 254 new brands launched over the last 2 years in the soft drinks market, only 40 remain in +20% distribution • A success ratio of 16% • Over the 2 year period Britvic launched 5 pieces of Innovation • 4 out of the 5 have achieved over +20% distribution • A success ratio of 80% Source: ACNielsen Scantrack April 2006

  17. We Have Driven Real Value Through Our Innovation Success • NPD has contributed over £165m worth of retail sales and 122m litres volume to our business in 2006 alone Source: AC Nielsen Scantrack/ On Premise – Innovation is defined as new products post 2000 Includes J20, launched into Take Home in 2002

  18. Orange & Pomegranate launch Oct 06 Top 2 flavours launched in PET Apple & Raspberry launch 12 pack launched Orange & Cranberry flavour+ new design launch Launched into Take Home+ 4-pack launch We Have Focused On Driving Scale Innovation • J2O, launched in August 1998, now worth £215m. p.a. retail value • Continued flavour and pack Innovation Source: AC Nielsen

  19. Increasingly Focused On Speed To Scale • Fruit Shoot, launched in 2000, is now worth >£95m p.a. • Fruit Shoot H2O, after only 9 months in trade: • No.7 mineral water brand • No.1 Kids Water Brand with 35% volume market share Source: as quoted in the Grocer review of the year, December 2006, from AC Nielsen.

  20. We Have Added Value When We Have Entered New Categories BSD Water Innovation In the last 2 years • market innovation has added £57.1m to the water category • we have added £12.3m (21.5% of innovation) to the category – Drench and Fruit Shoot H20 Source: AC Nielsen Scantrack

  21. We Are Working Hard To Get Products To Market Quicker By Refining Our Stage Gate Process Concept to launch Concept to launch • Planning process aligned with corporate annual planning • Calendarised innovation expected twice pa. • Delivery process reduced to 12 months

  22. We Are Working Hard To Get Products To Market Quicker By Refining Our Stage Gate Process Concept to launch Concept to launch • Planning process aligned with corporate annual planning • Calendarised innovation expected twice pa. • Delivery process reduced to 12 months

  23. We have a dedicated Innovation Team comprising R&D and Consumer Marketing experts

  24. We Are Ensuring That Our Pipeline Benefits From All Types Of Innovation

  25. We Are Ensuring That Our Pipeline Benefits From All Types Of Innovation

  26. We Are Ensuring That Our Pipeline Benefits From All Types Of Innovation

  27. We Have Invested Significantly In New Technology • Investment for In-House Bottle production of Big Pack Robinsons • Investment in new Technology

  28. Finding the Scale Opportunities

  29. Traditional Innovation Start Points

  30. Our Start Point Is A Combination Of Four Factors … to ensure we focus where there is optimal value

  31. Demographic Trends Provide The Foundation For Our Consumer Insight Health and well-being Naturalness Occasionality Indulgence

  32. Our R&D Programme Is Fully Integrated Into Our Innovation Plans

  33. Our Category Expertise Is Added At The Earliest Stage • Identify the key opportunities • Key segments in growth • Retailer strategies • Most important segments by retailer • Assess the optimal start point

  34. Our Brand Assets Are Then Evaluated For Optimal Start Points We believe that the four teams work most effectively together…

  35. Innovation Areas • 3 Innovation areas • 3 Teams consisting of: • Marketing – consumer and brands • Technical • Insight • Category • Specific agencies and technical suppliers linked to each area

  36. Britvic Experience

  37. 2007 Innovation Andrew Richards Sales Director

  38. Agenda • Innovation Aims • Detail around 2007 innovation • Refreshing current brands • Next innovation

  39. -5.2% -1.2% +2.6% -13.7% -24.8% +17.4% Carbs -5.8% -5.5% -5.2% +13.3% -3.9% -7.7% +15.0% +6.8% +7.0% -4.6% +7.8% +3.0% 8.7% -0.7% +6.1% Stills +0.5% -0.3% +1.0% +10.0% +18.9% +146.4% Our Innovation Focus Has Been Across The Full Portfolio Of Stills And Carbs Volume (litres) Take Home MAT to 30.09.2006 AC Nielsen Scan Track

  40. Refreshing Current Brands Carbonates, Water, Stills

  41. We Are Continuing Our Focus On Better For You Carbonates

  42. We Are Continuing Our Focus On Better For You Carbonates

  43. We Are Continuing Our Focus On Better For You Carbonates

  44. Leveraging Cola Consumption Occasions Through New Pack Formats • New 18 pack for Max and Regular to leverage seasonal stock-up packs • New 250ml PET is a handy on-the-go format in multi-packs • New 200ml NRB bottle for the on-premise. A unique iconic bottle design in all Pepsi variants • A major brand redesign in April 07 with multiple designs for each variant

  45. We Are Continuing With Our Strategy For Long Term Success In Water • 3 Brand water strategy • Distinct consumer targeting • High growth segments • Differentiated brand positionings

  46. We Are Continuing With Our Strategy For Long Term Success In Water • 3 Brand water strategy • Distinct consumer targeting • High growth segments • Differentiated brand positionings

  47. We Are Continuing With Our Strategy For Long Term Success In Water • 3 Brand water strategy • Distinct consumer targeting • High growth segments • Differentiated brand positionings

  48. We Are Continuing With Our Strategy For Long Term Success In Water • 3 Brand water strategy • Distinct consumer targeting • High growth segments • Differentiated brand positionings

  49. Developing Larger Packs To Drive Further Growth • The ‘Children's Water’ category has doubled in the last 12 months – from £13m to £25m • Robinsons Fruit Shoot H2O contributed 79% of this growth since its launch • Low cannibalisation of core Fruit Shoot brand • Further opportunity to increase growth with the introduction of a new 8 pack Source: AC Nielsen Scantrack, HomeScan

  50. Our Nurturing Plan For Drench And Pennine Spring Continues. • Leveraging a PVO programme across Pennine Spring to enable further distribution • Driving distribution of Pennine through pack innovation • A new improved Drench pack and design – significantly preferred by consumers Significantly higher preference (%) Vs current pack… …and increased propensity to buy (definitely/probably %) Source: Britvic commissioned independent research, Nov 2006

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