Fifty-four percent of shoppers say they consider environmental sustainability when making purchases, but they bought green products on only 22 percent of their shopping trips.

Learn more by downloading GMA’s Finding the Green in Today’s Shopper: Sustainability Trends and New Shopper Insights.

Bringing the voice of the shopper to the sales and marketing process.

SmartRevenue.com

Oldies But Goodies Still

Available at Book Store

There’s nothing like going to the source. Walgreens and many grocers now are adapting solution selling in their retail formats. Read the original book that launched the initiative, Full-Service Solution Selling by GMA in cooperation with Anderson Consulting and FMI. Published 1999. Another: The Root Causes of Unsaleables, published also in 1999, in cooperation with FMI.

Click here to visit GMA’s book store for a storehouse of knowledge – newly published or long-lasting.

Contact Will Strauss at 202.639.5910 or e-mail wstrauss@gmaonline.org. for more information.

Coles ®

New CEO McLeod Battles to Put

Coles in #1 Retail Slot in Australia

At a Glance

Key Operating Facts

Group Sales, 2007/08 (Inc. VAT):

U.S. $36.4 bn

Net Sales, 2007/08 (Exc. VAT):

U. S. $29.0 bn

No of Countries:

Top 3 Market Positions:

Australia

Key Grocery Formats:

Supermarkets, Discount Superstores, Forecourt Stores, Liquor Stores, Department Stores, Office Equipment Superstores

By PlanetRetail

Ian McLeod was appointed managing director of Coles Group – Australia’s second-largest retailer – in February 2008 as a key component of the chain’s five-year turnaround plan.

McLeod has a tough challenge on his hands. After years of underperforming its major rival, Woolworths, Coles was acquired by conglomerate Wesfarmers in late 2007. Wesfarmers, led by CEO Richard Goyder, wasted little time in announcing a five-year turnaround and AUD 5 billion (U. S. $4.3 billion) investment program to overhaul the business. "It's an uncomfortable truth that Coles suffered from chronic underinvestment in its stores and customer service in an effort to drive profit in what we believe was an unsustainable way," CEO Goyder explained. "But I view that as an opportunity.... It's a great time to get our house in order.”

The appointment of Scot Ian McLeod is seen as an important part of the process. McLeod, with his years of with experience of retailing in the UK and working with Walmart in Germany, is being counted on to bring a new impetus to change at Coles.

McLeod was born in 1959 on the island of Tiree and raised in Glasgow. He graduated from business studies at Glasgow Caledonian University in 1981 and later attended the advanced management program at Harvard University in 1999.

McLeod got initiated into retailing at UK supermarket Asda, which he joined as a graduate trainee in 1981. During his tenure at the supermarket, McLeod gained notoriety for leading the defence against United Biscuits, the makers of the Penguin biscuits, following the launch of Asda’s own Puffin biscuits – a case that became known as the Battle of the Birds.

A soccer fanatic, McLeod then took over as CEO of his beloved (and Scotland’s most successful) football club Celtic in Glasgow. He then joined UK cycling chain Halfords as chief operating office in 2003, before becoming CEO of the business two years later.

McLeod is the latest in long line of UK retail managers and consultants lured to Coles with the hope of reinvigorating the chain. However, under new owners, McLeod certainly seems to have the experience and the backing to make a difference. McLeod is pushing the addition of a new senior management team with significant international retail experience. This process was completed by the appointment of Stuart Machin as store operations director in August 2008.

Described as a quiet, affable and sleeves-rolled-up type of leader, McLeod has a number of priority tasks in order to claw back some of the ground lost to arch-rival Woolworths over the past decade. A key part of this will be improving the fresh produce offerings at the supermarkets. Additionally, a great deal of money is also being ploughed into refurbishing and extending the existing stores and store equipment.

Although still seen a key, McLeod is perhaps more realistic about private-label development than his predecessors who wanted to double private-label supermarket sales to 30 percent. McLeod recognised that such targets were too high. "I think in the past in Australian supermarkets we tried to move too fast too quickly in terms of developing house brands – taking 30 years of house brand development in the UK and trying to do it within three to five years in Australia," he said.

By the end of 2008, there were 3,900 house-brand SKUs across 99 categories. The number of SKUs was trimmed by around a quarter under the leadership of McLeod as he looked to finetune the offer.

Initial results seem promising and surprised many with food and liquor sales for the three months ending March 2009 rising by 7.6 percent (or 8.3 percent if adjusted for Easter). Like-for-like sales from the division were up by an impressive 6.0 percent (6.6 percent Easter adjusted). Like-for-like sales at the convenience and petrol forecourt stores were up by 6.7 percent (8.0 percent Easter adjusted). The company reported the growth coming from an increasing number of customers in its stores, a rise in average basket spend and positive volume growth.

However, time will tell whether Coles can sustain such a recovery. With Woolworths still in the cat-bird seat, McLeod and Coles certainly face an uphill – but exciting -- challenge ahead.

Industry Affairs News

Association Leadership

CPG Award Deadline for Entry Extended to June 15

The GMA Associate Member Council announced that it is extending the deadline until June 15 for entries for the organization’s two CPG Awards for Innovation and Creativity.

The awards will honor the creative and innovative programs of two manufacturing member-companies – those with sales below $1 billion and those with sales more than $1 billion.

The awards, which originated in 2004, will be presented at the GMA Executive Conference August 29 -September 1 at The Broadmoor in Colorado Springs. To enter or for more information, click here.

Contact: Jill Johnson

GMA Board Updated on IA Programs and Priorities

Members of GMA’s Board of Directors were briefed on Industry Affairs Group’s programs in recall management, sustainability, retail and shelf-ready packaging, and closer coordination with retail trading partners.

Industry Affairs Council’s Chair Rick Wolford – chairman and CEO of Del Monte Foods Company and vice chairman of the GMA Board of Directors – and GMA’s Senior Vice President for Industry Affairs Stephen Sibert updated the board May 19 at its spring meeting in Washington on the Industry Affairs Group’s programs and priorities.

Also speaking at the meeting were the new Secretary of Agriculture Tom Vilsack, former Campaign Manager for the Obama Presidential Campaign David Plouffe, and Chairman Emeritus and longest-serving member of the U.S. House of Representatives John Dingell (D-Mich.)

Making a presentation for the new manufacturer-retailer industry initiative – the Healthy Weight Program – were PepsiCo’s Chairman and CEO Indra Nooyi and President and CEO of The Hershey Company David West.

Contact: Stephen Sibert

Executive Conference Headlines Wide Range of Retailers, Business Thought-Leaders

From a CEO roundtable on innovation in a challenging economy to sessions spotlighting initiatives on food safety, a healthy weight commitment, CEO succession and the future of in-store marketing and social networking – GMA’s upcoming Executive Conference embraces a wide variety of issues vital to today’s companies.

And the speakers at the conference – to be held August 29 – September 1 at The Broadmoor in Colorado Springs – are equally stellar.

Among the speakers are Ed Crenshaw, Chief Executive Officer of Publix Super Markets Inc.; Kim Feil, vice president and chief marketing officer and Mark A. Wagner, executive vice president, operations and community management, both of Walgreen Co.; Andrew Giancamilli, CEO of Snyders Drug Stores/Katz North America Group and chairman of the National Association of Chain Drug Stores; and Sonja Yates Hubbard, chief executive officer, E-Z Mart Stores Inc. and chair of the National Association of Convenience Stores.

Also on the agenda are two men whose best-selling books have taken the business world by storm in the last few years.

Malcolm Gladwell has been called the 21^st Century’s Peter Drucker. His books, Outliners, Blink and The Tipping Point, have changed the way businesses look at themselves.

Bill George – the author of Authentic Leadership and True North – is a leadership professor at Harvard Business School and former chairman and CEO of Medtronic. His subject is the need for a new type of business leadership in America today.

Attendance at the Executive Conference is by invitation only.

Contact: Mary Olsen, Stephen Sibert

Industry Development and Advisory Committee (IDAC)

Trade representatives from GMA member companies met in Washington May 13 with senior GMA executives on issues of importance to the member companies – from the new Trading Partner Alliance to sustainability, from program input into upcoming GMA meetings to a roundtable discussion of emerging issues in the industry.

The IDAC is comprised of trade representatives of member companies and is headed by Joe Bivona, vice president of customer development, Time Inc.

Contact: Brian Lynch

Supply Chain & Technology

Manufacturing Excellence Share Group Meets June 9

GMA’s Manufacturing Excellence Share Group meets June 9 from 8:30 a.m. to 3 p.m. to discuss digital dashboards, which CPG manufacturers are using to leverage real-time analytics and greater transparency throughout their companies.

Attendees at the meeting, to be held at GMA headquarters in Washington, D.C., are being asked to bring and present a sample manufacturing dashboard. Intelligent-platforms company G.E. Fanuc will lead a discussion on manufacturing execution systems and data dashboards. The agenda also includes debate on change management, including systems and cultures to engage and motivate company stakeholders.

Contact: Jeanne Iglesias

Industry Performance

June 9th Webcast Details Financial Performance Report
GMA Industry Affairs and PricewaterhouseCoopers host a webcast June 9 at 2 p.m. to release the key findings of the 2009 Financial Performance Report: Focusing on Today, Envisioning Tomorrow. For more information and to register, contact jfinci@gmaonline.org
Contact: Jennifer Finci

Controllers to Consolidate Efforts Around Proposed

Accounting/Tax Regulations

Controller Share Group at its meeting earlier this month agreed to meet on a semi-regular basis to continue discussions around the transition to the International Financial Reporting Standards (IFRS). The group also directed GMA to explore consolidation of input around proposed accounting and tax regulations and to facilitate comment letters to the SEC, IRS and FASB around proposed accounting regulation.

The share group met in Chicago and consisted of a mix of food and non-food member-companies. The meeting was chaired by Pam King (Controller, Kraft Food Inc.) and Rick Lund (Controller, General Mills Inc.).

Contact: Brooke Weizmann

Top SIFE Student Interns With GMA Industry Affairs Group

An international student from Germany at Drury University in Missouri has won the Students in Free Enterprise (SIFE) Emerging Leader Award. One of the rewards is a summer internship with the Industry Affairs Group at GMA headquarters primarily assigned to the Industry Performance Group.

As part of his SIFE activities, Yacine Chettouh – a management/finance junior with a minor in global studies – worked on establishing a fund to finance green initiatives for small businesses, on developing a water purification project in China and on promoting a program of ethical decision-making in the business world.

SIFE is a global non-profit organization in more than 1,800 college campuses in more than 43 countries. Student teams develop projects to help create economic opportunity through concepts of free-market economics, business ethics, entrepreneurship, and personal finance and success skills. GMA has a long-standing partnership with SIFE, as do many CPG manufacturers and retailers.

Sales & Sales Promotion

Unsaleables Conference Attracts Wide

Range of Attendees/Speakers

The 2009 Unsaleables Management Conference July 28-30 at the J.W. Marriott Las Vegas is attracting speakers and attendees from every aspect of the industry’s reverse logistics, packaging, merchandising, sales, supply chain and replenishment areas – and some from outside the industry.

The conference is being held in conjunction with Food Marketing Institute, Consumer Healthcare Products Association, National Association of Chain Drug Stores, National Grocers Association and Package Machinery Manufacturers Institute.

Highlights from two planned sessions:

Michael Okoroafor, vice president, package innovation, Heinz North America, will address how companies can create value, innovate and meet sustainability goals – all without sacrificing a product’s quality on its journey to the store shelf.
Gary Regina, supply chain replenishment, support manager for Winn Dixie Stores Inc., and Joe Scaccia, director, strategy and sales operations for Kraft Foods Inc., probe model practices for extending product shelf life.

For event summary, additional speakers and registration information, visit www.unsaleablesconference.com

Contact: Logan Kastner (Program) Jonathan Downey (Sponsorship/Exhibits)

Coupon Committee Tackles DataBar Implementation, Guidelines, Digital Coupons

The Joint Industry Coupon Committee in a meeting late last month discussed how the removal of the U.P.C.-A code from coupons on January 1, 2010 could pose significant hardship for retailers. The JICC has agreed to take further surveys to determine the industry's readiness for the GS1 DataBar implementation, which was scheduled to replace the U.P.C.-A on that date on all coupons. This summer, after evaluating the additional survey information, the JICC will provide the industry with revised implementation recommendations.

In a meeting held in conjunction with the Association of Coupon Professionals (ACP) conference, the JICC established a Digital Coupon Subcommittee to investigate the new national trend for thrifty-minded consumers to click rather than clip coupons. In other action, the JICC Co-Chair of the Coupon Guidelines Committee Mary Ann Pindulic (Unilever) was named, and a joint meeting was held with ACP’s guidelines task force to determine areas of collaboration.

Member companies and retailers interested in becoming members of the JICC can contact Logan Kastner at lkastner@gmaonline.org. More information on the GS1 DataBar implementation and the North American Coupon Application Guideline Using GS1 DataBar (RSS) Expanded Symbols can be accessed by GMA members at gmaonline.org.

Contact: Logan Kastner

Association Research

Just-Released GMA Book Charts New Demands on

CPG Sales Force

Skills of CPG sales forces need to be expanded to include high levels of merchandising innovation and strategic support in today’s marketplace, according to a just-released study by GMA, The Network of Executive Women and A.T. Kearney.

Talent Triage: Raising the Bar on CPG Sales Force Talent Management reports that CPG human resource and sales executives are aware of the new demands, rating their current talent management activities “highly effective” only 9 percent of the time. Sixty-eight percent of these executives expect to increase investment in their sales talent-management process.

The study notes that the role of the CPG sales person has evolved from a product salesman or saleswoman to a general manager able to act across a wide variety of retail functions – merchandising, logistics, finance, supply chain. Talent Triage reports that retailers now expect CPG sales teams to have strategic merchandising insights in addition to the traditional sales competencies, such as forecasting, negotiations, etc.

Brian Lynch, GMA director of sales and sales promotion, said new opportunities exist in an economic downturn for those companies that invest in the best and brightest sales force.

To download a copy of the new study, click here.

Contact: Brian Lynch

Quick Insights

Translating Shopper Insights into Strategy and Solutions*

By John Dranow, President, SmartRevenue

In today’s retail world, observing and quantifying shopper insights are key tools in running a profitable and successful store. Years ago, it was easier to gain the consumer’s attention and reach targeted shoppers. Today, a widely diverse media accessible 24/7 allows consumers to view detailed information on products, resulting often in delayed buying decisions in the shopping process.

Each of us is a consumer, an individual shopper with different needs, wants, likes and dislikes. Retailers and suppliers need to analyze what decisions consumers are making pre-store and what decisions are being made in-store. The more the retailer is in sync with the manufacturer, the more efficiently the manufacturer can drive trips and increase basket size, create a proper media mix both pre-store and in-store, quantify the shopper’s decisions and turn that analysis into a profitable outcome for all.

In addition, because each shopper has his or her own view on category importance, companies must be aware of which purchases are planned at store level and brand level, and which purchases are not planned at all. Most pre-store decisions are brand driven: The shopper has purchased the product in the past and will continue to do so in the future. In-store decisions, however, are often based on perceived value, merchandising and packaging. As a result, promotions and displays are a good investment.

Aisle and shelf organization also play a big role in purchasing decisions. It makes sense to organize shelves by brands, but the products should be merchandised in the least confusing way possible. For example, a health-conscious shopper who buys based on ingredients and preparation will seek brands that meet that need. The more time it takes a customer to compare prices and double check the product’s benefits, the more money the store loses.

By studying shopper insights, retailers and manufacturers can understand and address the difference between product consideration and product closure. Was packaging a consideration? Was the first choice out-of-stock? Was price a deciding factor?

Collecting and analyzing shopper insights clearly helps increase profitable sales. Retailers and manufacturers that devote resources to shopper insights can expect the investment to not only show a quick payback, but also are likely to gain a more engaged shopper base.

Contact: SmartRevenue

*This column is adapted from a presentation given to the Shopper Insights Council of the Advertising Research Foundation

GMA Leadership Profile

Clorox’s Robin Evitts

Current Position

Vice President, Chief Information Officer, The Clorox Company

Industry Leadership

GMA IS Committee: Chairman, 2008-2009; Vice Chairman, 2007-2008; member since 2005.

This past year, the committee has undertaken two major projects: a whitepaper on retail data sharing and collaboration plus a study with IRI/Accenture on PLM processes in support of innovation. Both are soon to be published and available to the membership.

In the past, Evitts has been involved in various initiatives with the National Retail Financial Executives Association (serving in the Dallas chapter) and with the Institute of Internal Auditors (serving as president in the San Francisco chapter and as Western Region District director).

Career Highlights

Evitts has served as vice president and chief information officer at Clorox since January 2005. In this role, she is responsible for managing the company’s business process initiatives and worldwide Information Services function.

She joined Clorox in 2002 as vice president, Internal Audit. In that role, she oversaw the monitoring and evaluation processes for operational effectiveness, efficiency, compliance and financial reporting. Evitts also provided counsel on corporate governance matters. In addition to her Internal Audit responsibilities, Evitts co-led the company’s effort for Sarbanes-Oxley internal control readiness. Prior to joining Clorox, Robin was a partner with Deloitte & Touche, where she spent more than 15 years providing audit and consulting services.

Personal

Originally from Chicago, Evitts lived in Dallas for seven years. She moved to the West Coast in 1999. When not at work, Evitts is an avid NASCAR fan, travelling to five or six races a year to support the Clorox-sponsored #47 car and its driver Marcos Ambrose. Also, she is a proud aunt to six nieces and nephews.

Education

Educated at the University of Illinois with a degree in accounting, Evitts is a licensed CPA in California.

First Job

“During summers while in high school and college, I worked as a lifeguard, swim instructor and pool office manager. While a glamour job, it seemed best to find something more year-round and with better pay.

How’d you get to where you are today?

“I am driven to find new ways of working that improve business outcomes and reduce barriers. My 15 years spent as an auditor, business advisor and consultant prepared me for the multi-faceted challenges facing corporate executives every day. My role as the Clorox Chief Audit Executive gave me the opportunity to broadly learn the business operations at both the strategic and tactical levels, with a focus on process improvements. Over my career, I have been fortunate to learn from great line managers and executive leaders, who helped me to better understand our competitive pressures and to gain insights into the business challenges the company faced. All of this enabled me to bring creative solutions to problems and opportunities. In the CIO role, I use that experience and knowledge to continuously partner with our business teams to deliver process improvements and – in the past four years – have enjoyed working with my team to transition IT from a support function to an integral business partner, bringing innovation, additional capabilities and efficiencies to support the company’s success.

Ideas on Collaboration

“As the economy becomes more global, it is important to tap capabilities far and wide to meet changing consumer needs and build the business efficiently. Beyond our own workforce, it is important to collaborate with others who can help us with capabilities that can be used successfully within our businesses. About three years ago, our IT team initiated a significant business partnership with an IT provider to take advantage of their expertise and resources in delivering IT services within Clorox, increasing dramatically the scale of our own resources. Additionally, it is fun to work in an environment where it’s possible to collaborate with many smart people around the world. The synergy of great ideas that turn into even better ones is a great win and will be key to continuing to deliver value to our shareholders in the future.”

Datebook

July 28 - 30

Aug. 29 - Sept. 1

Nov. 2 - 3

Joint Industry Unsaleables Management Conference

JW Marriott Las Vegas Resort and Spa

Las Vegas, NV

Contact: Logan Kastner

2009 GMA Executive Conference

(By invitation only)

The Broadmoor

Colorado Springs, CO

Contact: Mary Olsen, Stephen Sibert

Merchandising, Sales & Marketing (MSM) Conference

The Arizona Biltmore

Phoenix, AZ

Contact: Brian Lynch

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Industry Affairs Review is produced by the Grocery Manufacturers Association in cooperation with Planet Retail. Current and past issues may be found at www.gmaonline.com/publications/index.cfm. If you wish to add colleagues’ names to the mailing list or if you wish to unsubscribe, please click here, or write to jdowney@gmaonline.org.

@ Copyright 2009 by GMA, 1350 I Street N.W. #300, Washington, D.C. 20005. All rights reserved. The content and copyright for the lead profile is owned by Planet Retail, a leading provider of grocery retail intelligence— www.planetretail.net.

The Grocery Manufacturers Association (GMA) represents the world’s leading food, beverage and consumer products companies. The Association promotes sound public policy, champions initiatives that increase productivity and growth and helps to protect the safety and security of the food supply through scientific excellence. The GMA board of directors is comprised of chief executive officers from the association’s member companies. The $2.1 trillion food, beverage and consumer packaged goods industry employs 14 million workers, and contributes more than $1 trillion in added value to the nation’s economy. For more information, visit the GMA Web site at www.gmaonline.org