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Deutsche Bank Global Consumer Conference 2014
Imperial Tobacco Group PLC
Paris
17 June 2014
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Alison Cooper Chief Executive
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Disclaimer
Certain statements in this announcement constitute or may constitute forward-looking statements. Any
statement in this announcement that is not a statement of historical fact including, without limitation,
those regarding the Company’s future expectations, operations, financial performance, financial
condition and business is or may be a forward-looking statement. Such forward-looking statements
are subject to risks and uncertainties that may cause actual results to differ materially from those
projected or implied in any forward-looking statement. These risks and uncertainties include, among
other factors, changing economic, financial, business or other market conditions. These and other
factors could adversely affect the outcome and financial effects of the plans and events described in
this announcement. As a result, you are cautioned not to place any reliance on such forward-looking
statements. The forward-looking statements reflect knowledge and information available at the date of
this announcement and the Company undertakes no obligation to update its view of such risks and
uncertainties or to update the forward-looking statements contained herein. Nothing in this
announcement should be construed as a profit forecast or profit estimate and no statement in this
announcement should be interpreted to mean that the future earnings per share of the Company for
current or future financial years will necessarily match or exceed the historical or published earnings
per share of the Company.
This announcement has been prepared for, and only for the members of the Company, as a body, and
no other persons. The Company, its directors, employees, agents or advisers do not accept or
assume responsibility to any other person to whom this announcement is shown or into whose hands
it may come and any such responsibility or liability is expressly disclaimed.
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Our Priorities for 2014
Strengthening our portfolio
Backing growth with increased investment in Growth Brands
Growth Markets
Returns Markets
Fontem Ventures
Building resilience
cost optimisation
stock optimisation programme
How Will We Win With Our Brands?
Peter Corijn
Group Marketing
DB Conference June 2014
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Marketing is:
Maximising benefits
to consumers
Selling as high as
possible and have
consumers come
back for more
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Agenda
Source: Roger Martin
Copyright © 2000 Monitor Company, Inc. — Confidential — CAM
How will
we win in
chosen
markets?
What are
our goals
and
aspiration?
What
capabilities
must be in
place to
win?
Where will
we play?
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“Consumer
inspired,
brand centric”
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How big can our brands be?
JPS
Australia 13%
UK 10%
Germany 9%
Source: *Market Share & Size P6 YTD
Davidoff
Saudi Arabia 8%
Taiwan 6%
West
Slovenia 18%
Azerbaijan 17%
GoB
Algeria 18%
Germany 6%
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How to Win?
Davidoff, JPF House, West House, Gauloises, USA Gold, as per
the global portfolio model.
1. We focus on 5 global brands:
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West
West
JPF & West House are a “chassis”
a “chassis” = a group of
brands managed as
“one” brand despite
different brand names
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Mainline
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How to Win?
2. Total Tobacco
10 Specialist Brands managed for value FMC Unique
Proposition
Fine Cut
Specialist
Cigar Premium
Cigar Mass
Market
Smokeless
Papers
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30% simplification
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Benefits of Simplification
This simplification enables the £300m cost optimisation by 2018
Procurement Buying larger quantities of fewer items Procurement
Manufacturing Longer runs of fewer brands/ fewer SKUs Manufacturing
Marketing Focus investment and effort behind fewer, bigger, better Marketing
Sales Focus on driving 2+2 brands = better execution Sales
roll out initiatives faster across fewer chassis +
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Drive superior consumer/shopper lead Brand
Equity
How to win?
Brand Equity
Innovation
Simplification
People
Execution
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So how are we delivering in equity?
The Sales Growth Drivers
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Gauloises “Enjoy the freedom
to be yourself”
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25 Retail shop, Casablanca, May 2014
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Building Capabilities: One Agency
1
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How to Win?
“Fewer, bigger, better” initiatives.
Innovation
Brand Equity
Simplification
People
Execution
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Additive Free
In Western Europe
Freshness In
Middle East Menthol in ASIA
Example Lead Brand Initiatives Specific to Cluster Demand Shifts
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Innovation in e-vapour (Fontem Ventures)
Puritane Launched February 2014
– healthcare channel brand
– launched at 2400 Boots stores
– marketing campaign started in April
– opportunities to expand in UK and
internationally
One more launch before year end
Our strategy remains measured:
– regulation is developing
– working on patented technology
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Plan and execute migrations and
SKU reductions, and the portfolio
strategy.
How to Win?
Simplification
Brand Equity
People
Execution
Innovation
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12 Migrations on track in FY14. More to come!
Migrating
=
Focus
Equity
Innovation
Quality
Availability
Consumers get added benefits
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Migration Creates Value for ITG
Value
Value Uplift
Brand
Migration Brand without Migration
Brand with Migration
Time
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Clear Portfolio Strategy
All other total
tobacco category
brands in local ITG
portfolios
Portfolio Brands
ASSETS NON- ASSETS
Specialist (10)
Now need to align Market priorities & management implications...
Growth (5)
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Portfolio Strategy
Primary
Secondary
Cash
Delist
Migrate
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Build a world class Marketing Team
How to Win?
People
Brand Equity
Execution
Innovation
Simplification
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New Brand focused Structure
Upgraded talent via internal
and external recruiting
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How to Win?
Improve the executional quality in
everything we do: on time, great
content
Execution
Brand Equity
Innovation
Simplification
People
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Alison Cooper Chief Executive
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Our Priorities for 2014
Strengthening our portfolio
Backing growth with increased investment in Growth Brands
Growth Markets
Returns Markets
Fontem Ventures
Building resilience
cost optimisation
stock optimisation programme
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Deutsche Bank Global Consumer Conference 2014
Imperial Tobacco Group PLC
Paris
17 June 2014