Managing a winning portfolio Bernard Hours
2 Rewind
2008-2010: Historical move to boost our sales 18 000 Group Sales 16 000 14 000 12 000 10 000 8 000 6 000 4 000 Baby & Medical 2 000 0 1998 2007 2008 2009 2010 3
Fresh Dairy Products: Over 10 bn sales Consolidated sales in K 11 000 Fresh Dairy Products Sales 10 000 9 000 8 000 7 000 6 000 5 000 4 000 3 000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 4
Waters: Back to growth Waters Sales Life for Like Sales growth 6,0% 5,0% 4,0% 3,0% 5.3% 2,0% 1,0% 0,0% 4.0% 1.9% 1.0% 2007 2008 2009 2010 5
Baby Nutrition: growth potential confirmed Baby Nutrition Sales Consolidated sales in K 3 550 3 350 3 150 2 950 2 750 2 550 2 350 2 150 1 950 1 750 2007 2008 2009 2010 6
Medical 1 bn: change of scale Medical Nutrition Sales Consolidated sales in K 1 100 1 000 900 800 700 600 500 2007 2008 2009 2010 7
Specific nutrition/health needs 2007: a historical move to reach out for more consumers High High Low Low Baby Toddler Childhood Adulthood Elderly/ pathology Life stage 8
Leading to A COMPLETE AND WINNING BRANDS PORTFOLIO SHARP HEALTH HEALTHY NUTRITION PLAISIR/INDULGENCE Specific healthy conditions Healthy living & best nutrition Health as a Reassurance 9
Supported by a very specific R&D model SHARP HEALTH HEALTHY NUTRITION PLAISIR/INDULGENCE R & D Consumer has Different needs Specific healthy conditions Healthy living & best nutrition Health as a Reassurance 10
Research: scientific rigor in Danone laboratory R Ongoing scientific investigation to strengthen current benefits and find new ones Clinical studies and scientific papers GMPP Publication Danone-Harvard PNAS Bifidobacterium animalis subsp. lactis fermented milk product reduces inflammation by altering a niche for colitogenic microbes Strong network of partnerships and collaborations 11
Development: magician competences in Danone kitchen Constantly innovate on product line extensions and new launches D Continuously improve taste in obsession for excellence Multiply textures and play with ingredients 12
With an extended geographical coverage and strong local leadership Dairy Product Waters Baby Food North America Medical N. Dairy Product #1 Western Europe Dairy Product #1 #2 #1 #1 Eastern Europe Baby Food #1 #1 Medical N. #1 Asia Pacific Waters #1 Dairy Product Waters LATAM #1 #1 Africa Middle East Dairy Product Baby Food #1 #2 Baby Food #2 Market share 2010 13
14 Play
The Danone winning model We have 3 weapons MICRUBs LABs People Organization & Mindset 15
MICRUB MEXICO I NDONESIA CHINA RUSSIA USA B RASIL 16
MICRUB: our trump for today Sales Growth People > 35% > 60% 60% 17
MEXICO Fresh Dairy Products Activia Dan Up Danonino 18
MEXICO Market share Fresh Dairy Products Volume share 35.3% 34.5% 35.9% 36.9% 38.1% 40.1% 38.9% 41% 44.1% 18.5% 19.1% 17.9% 17.3% 18.3% 19.5% 23.0% 23.1% 22.0% Competitor #1 6.8% 9.7% 13.1% 15.5% 17.0% 15.2% 16.2% 16.9% 15.9% Competitor #2 2002 2003 2004 2005 2006 2007 2008 2009 2010 19
MEXICO Waters Diversified product ranges Booming HOD business Sales 2004 2005 2006 2007 2008 2009 2010 20
MEXICO Market share Waters Volume share (Bottles + HOD) 29% Competitor #1 27% Competitor #2 12% 14% 17% 19% 22% 2004 2005 2006 2007 2008 2009 2010 21
INDONESIA Nutricia & Sari Husada Baby Nutrition Superpremium Premium Mainstream Affordability 22
INDONESIA Leader on the 2 nd Asian Baby Nutrition Market Value Share 38.6% 34.3% 32.3% 29.5% 31.4% 23.5% 23.7% 24.0% 23.2% 23.9% Competitor #1 11.1% 10.2% 10.1% 9.6% 9.2% Competitor #2 2006 2007 2008 2009 2010 23
INDONESIA Waters Large Products range Nature Origin uniqueness Icon Status The sign of me By Sebastian Gunawan 24
CHINA Waters +50% Mizone TV Brand promotion Sampling Enjoy my pulse of life Digital Distribution New drinks concept born in Asia 25
RUSSIA #1 #1 JV Danone Unimilk: #1 in Fresh Dairy Products #2 Ukraine North West Moscow +Center South #2 Volga #1 Oural 44% 42% 40% 38% 36% 34% 32% Jan '10 Siberia #1 And #1 in Baby Nutrition Fev '10 Mars '10 Avr '10 Mai '10 Juin '10 Juill '10 Aou '10 Competitor #1 Sept '10 Oct '10 Nov '10 Dec '10 26
RUSSIA Danone Unimilk Leverage Baby Rich brand mapping covering all price segments and consumers need Premium Basic Affordable All family Pleasure Health Kids & Teens 27
USA A consolidated business leader on Fresh Dairy Products 35% market share (value) Complementarity Strategy Visible in our product range 28
BRAZIL Initiatives accorded to the local identity More than a Lab: A Pioneer From Hospitals Strong brands To the community Worldwide O T X And locals 29
BRAZIL Long term & stronger leader on Fresh Dairy Products 29.8 % 30.5 % 32.9 % 32.6 % 33.2 % 34.1 % 35.8 % 26.9 % 25.9 % 22.8 % 21.3 % 22.4 % 22.4 % 21.1 % Competitor #1 13.3 % 13.4 % 13.6 % 14.4 % 13.5 % 12.4 % 11.0 % Competitor #2 2004 2005 2006 2007 2008 2009 2010 30
Danone Winning Model DANONE LABs NEVER STOP TRYING 31
Testing the future: New channels New retail model Yoghurteria Expand Danone experience into new and personalized ways of enjoying Yoghurt 32
Danone Winning Model People Organization & Mindset 33
A multi centric, highly connected organization Adaptability Multiplicity Reactivity + = connections + intelligence + best practices + synergies + knowledge + success New York Amsterdam Paris Barcelona Moscow Shanghai Sao Paulo Singapour Buenos Aires 34
State of Mind Moving by nature No dogma: Jeu de Jambes Curiosity Uncommon Energy 35