VHF: Vital Targeted Coupon August Cashback ClubCard Mailing Post-Campaign Report

1. VHF: Vital Targeted CouponAugust Cashback ClubCard MailingPost-Campaign Report November 2010

2. Contents • Introduction • Coupon Redemption & Response • Incremental Analysis • Immediate ROI • Conclusions & Recommendations

3. Introduction • 39,317 ClubCardshoppers targeted utilising 5one’s targeting tool • Campaign period: 16 Aug – 18 Sep 2010 • Both Current and New shoppers targeted: • 16,759 Current shoppers • 22,558 New shoppers • Offers tested: • Get R15 off when buying 2 or more Vital products to the value of R80 • Get R10 off when you purchase any of the following Vital products: Vital Cranberry, Vital Evening Primrose Oil, Vital Omega 3&6, Vital Fat Burner • Control group of look alike customers measured over the campaign period

4. The Mailing

5. Contents • Introduction • Coupon Redemption & Response • Incremental Analysis • Immediate ROI • Conclusions & Recommendations

6. Targeted Coupon: Redemption Redemption: customers who bought featured product at the same time as handing in the coupon • Overall redemption rate is good: 1.47%(above 1% is ‘good’ for Current shoppers, 0.5% ‘good’ for New shoppers) How many mailants shopped the promoted products?

7. Targeted Coupon: Response Response: shoppers who bought featured product regardless of whether they handed in the coupon A more accurate metric for campaign success as the coupon acts as both a discount and marketing message. • Overall response rate is excellent: 4.70%(above 2% is ‘good’ for Current shoppers, above 1% for New shoppers) • Campaign driving 88 new shoppers to the brand

8. Contents • Introduction • Coupon Redemption & Response • Incremental Analysis • Immediate ROI • Conclusions & Recommendations

9. Incremental Shoppers Incremental analysis shows how total mailed responders would have shopped had they not received the mailing – essential in understanding actual effect of the campaign. How many shoppers were incremental? • The mailed group shopped at a higher rate than control shoppers resulting in 23% of shoppers being incremental overall 9

10. Incremental Units How many more units were purchased? • Overall 33% of units purchased incremental 10

11. Incremental Sales How many more sales were achieved? • Total mailed sales of R91k achieved, with 4% being incremental 11

12. How Did Shoppers Respond at a Total Range Level Because the offer was only on specific Vital products, it is important to understand if responders chose a different product from the Vital range as a result of the mailing. Again, measuring this against the control group enables us to understand what was incremental How many more shoppers, sales and units were generated at a range level? • Targeted voucher delivered better results at a total Vital level, generating R146K incremental sales • This demonstrates the marketing halo effect of sending targeted communication

13. Contents • Introduction • Coupon Redemption & Response • Incremental Analysis • Immediate ROI • Conclusions & Recommendations

14. Immediate Return On Investment: Product level What was the immediate ROI of the targeted coupon based on Incremental sales? • Overall ROI is negative at a promoted product level : -84% How does this compare to range level? *sales through the till ex VAT 14

15. Immediate Return On Investment: Range Level What was the immediate ROI of the targeted coupon based on Incremental sales at a total Range level? • Excellent response rate of 22.5% for current shoppers at range level with R146k incremental • Control group is too small for new shoppers to calculate accurate incremental figures • Overall ROI at a range level is 512% 15

16. Contents • Introduction • Coupon Redemption & Response • Incremental Analysis • Immediate ROI • Conclusions & Recommendations

17. Campaign Summary • Overall campaign generated ideal response: • Redemption rate: 1.47% (577 shoppers) • Response rate: 4.70% (1,846 shoppers) • Successful at driving incremental behaviour at a promoted product level: • Shoppers: 416 (23%) • Units: 807 (33%) • Sales: R3,715 (4%) • Overall campaign generated an negative immediate ROI at a promoted product level, but a good ROI at Range level

18. Campaign Comparison

19. Recommendations • Continue to use targeted coupons to invoke re-purchase and gain new shoppers to the brands • Test broader offer for customers (less niched / fewer constraints) • E.g. R10 off any Vital product • In-depth analysis of what the Vital shopper looks like, how they shop across the range and what competitor products they are purchasing into

20. Thank-you Nikki Emerton – Account Manager Nikki.emerton@5one.co.za Zakariya Patel – Analyst Zakariya.patel@5one.co.za

21. Addendum - Proportions • At an individual product level the control group responds higher than the mailed group • Overall the control group responds at a higher level because the proportions of the offer cells differ