PowerPoint Presentation

[Virtual Presenter] Good morning, everyone. It's a pleasure to have you all here today to discuss RONA's growth and progress. In this presentation, we'll go through the sales performance and our plans for 2022, take a look at market trends and competitive dynamics, and discuss how our supply chain can help us reach our goals. Let's get started..

[Audio] "Our upcoming focus is on the 2023 fiscal year forecasts. We anticipate that between May and July 2023, growth will be at a rate of 2.8%, and that for the full fiscal year, that growth rate could range between four and five percent. With this in mind, let's review the context for this forecast and take a look at the market dynamics and competitive landscape..

[Audio] The chart before you illustrates the Sparkling Beverages category's sales performance over the last year. As you can see, the category has experienced a steady rise in performance, most notably peaking from March to June of this year. This growth is promising and highlights the potential for the Sparkling Beverages category to continue this upward trajectory..

[Audio] Without greetings, without beginning with Today, and without thanks, this slide summarises the performance of RONA in the Modern Trade Home channel for the month of July 23. A table is presented that shows the market value growth, volume growth, and category growth, which includes the Energy, Health and Sports sub-categories. A chart is also included that shows the performance of the Wellness drink category from July 22 to July 23. The overall data indicates that RONA's growth in the Modern Trade Home channel was muted at 2.9%, with the Juice & Juice Drinks and Energy categories experiencing declines. The Wellness drink category, on the other hand, exhibited positive growth of 5.0% from July 22 to July 23. This information is important to consider when evaluating RONA's overall growth and performance..

[Audio] With the analysis and data presented here, it’s clear that RONA’s growth performance is solid. Our figures show that RONA is on track to reach its 2022 plans. We can also see that growth in the current year is higher than in 2021, and higher than average for the past three years. Looking closely at the data, our sales figures for the first and second quarter of the current year, we can see that RONA is outperforming the 2022 plans by 11% and 10%, respectively. Looking ahead, these are good signs for RONA’s performance in the year ahead..

[Audio] We have analyzed RONA's sparkling product shipment volume up to July 2023. Tall can saw strong growth of 50.3%. However, SSD LSET platform saw decreased sales, particularly in 1.25L and 2L products. To make use of this situation, we suggest maintaining the locked price for 1.25L and reducing the 2L price, as it has proven effective in driving sales. Analysis also indicates there is potential to strengthen collaboration in WOW deal and Yuu member price platform to further capitalize on the product..

[Audio] The slide reveals that still shipment volume year-to-date has seen an overall 1.7% growth, and 2.4% growth on SCCHK shelves, compared to the same period last year. The table also indicates varying percent changes in pack types, with Minute Maid being the highest at 38.7% and Authentic Tea House being the lowest at -11.3%. To keep driving growth, it's essential to identify and take advantage of available opportunities, such as aggressive pricing offers, combo support, and increased instore visibility for 1.2L PET, as well as maximization of Cold Brew and premium still opportunities..

[Audio] We have seen remarkable growth in the Tall Can 4P category from November last year to April this year, with an increase from 2187 units to 5743 units. Likewise, our Mini Can 6P category has increased from 8775 units to 10530 units in the same period. This growth is mainly attributed to our successful Coke No Sugar Campaign launch in OOHA and the release of our new product development. This data shows the effectiveness of our partnership collaboration, which has led to a 40 percent growth rate in the past few months..

[Audio] In June 2023, RONA and SCCHK had a collaboration with customers being offered discounted rates of $80 on SCCHK products, accompanied by a free SSD 1.25L. Additionally, a Summer Drinks Campaign featuring Wow Deal, Plus Sell and Bundle Support was launched. This resulted in a 150% increase in promotion frequency compared to the previous year. These initiatives have aided in creating a stronger partnership and assisting in improving customer service..

[Audio] Reaching the tenth slide, the year 2023 to August has seen a strong partnership collaboration. Four key players - #381 Elements, #26 1 Peng Chau, #412 Discovery Bay, and #273 Central - have been pivotal in meeting the rising demand for on-the-go consumption. A cooler idea trial has also been initiated with positive results - an average sales increase of 24%. Moreover, the location of the coolers has been carefully chosen..

[Audio] We'll be delving into how the 2023 Mega Display Execution Excellence and Restart Store Incentive Program can assist us in reaching our goals. This initiative contains several elements, for example, complying with stacking display demands, maintaining shelves properly stocked, attaining in-store sales expansion, and putting into effect Coke CNY, OOHA, ATH, and Coke Summer campaigns..

[Audio] We now turn our focus this year to Wellcome's Non Alcoholic Ready to Drink (NARTD) Beverages and look to regain the growth momentum with an aim for a 9.8% increase by 2023. We will do this through attractive platform promotions, multi packs for value seekers, festive offers and low price locking. We want to provide an inventive product and experience, so we will implement yuu to me activations, cooler placements and checkout coolers. Partnering with suppliers such as Bonaqua and DFI, we will make sure that the products are consistently available. To capitalize on the no sugar trend, we will be launching OOHA, 3rd wave ATH, cold brew Nescafe, Smoovback and Qoo. Additionally, for the upcoming holiday season, we will be introducing the Coke Christmas..

[Audio] Shoppers have become more aware of prices and determined to get the most out of their purchases. Wellcome has seen a positive effect from this shift and shoppers have become more loyal to the store due to its competitive pricing and promotional platforms. For many, finding a good deal is a priority when deciding which store to shop from..

[Audio] Our focus for this slide is on the sales success of the RONA drinks campaign and the results are very positive. There has been a 97% increase in sales for 500ml products, and a 178% increase in sales for 1.2L products. This is due to the Buy X2 Get X1 Free and Plus Sell promotions. Looking at the chart, it is clear sales have grown in the period between Week 25 and Week 30, and we anticipate the trend will continue. This success is a clear reflection of our commitment to innovation in order to grow our business and exceed our customers' needs..

[Audio] "This week, we want to highlight the success of the Bonaqua Multi-pack's Wow Deal Promotion. As you can see in the chart with the data provided, the promotion has seen a remarkable +192% in sales compared to the previous 2 weeks. This is an increase of +137% compared to the same period before the deal was activated. This indicates a strong reaction to this promotional event and makes it clear that RONA's customers are responding positively to the offer..

Combo Promotion Purchase SCCHK SSD products free SSD 1.25L 1 2 3 Plus Sell Promotion Pricing Promotion $21/2 $12.

[Audio] This pilot run will be exploring a meal combo option in three stores: Yau Tong, Choi Ming in Tseung Kwan O, and Fu Tung in Tung Chung. The period for this initiative is from September 1-30, 2023. Customers can redeem a four-pack of SSD Tall Cans for just $17 when they purchase any food items. The purpose of this program is to gather insights on the customer preferences for meal combo options and the potential for growth in this area..

[Audio] For the period between April 1st, 23 and September 30th, 23, our graphical user interface was generated automatically with medium confidence. This same process will be followed for the period between October 1st, 23 and March 31st, 24..

[Audio] With the Asia-Pacific market becoming increasingly aware of sugar content in their drinks, 40% of the market share is for low sugar drinks, 31% for no sugar drinks, and the rest for premium-flavored drinks. Examining market segmentation, low sugar beverages are the top priority for all age groups, male and female, followed by no sugar beverages, and then premium flavors. It is clear that this creates a chance to capitalize on the trend and create products and advertising strategies that fit the demands of the growing market..

[Audio] Our data reveals that RONA's no sugar solid drinks have experienced a growth of over twelve percent in the three year period, with a particularly sharp increase of close to twenty-three percent in comparison to the preceding year. Conversely, the regular solid drinks have experienced a decrease of nine percent in the same period. This indicates that the no sugar category has increased the overall sales across RONA's products. Through our market trends and competitive dynamics analysis, we can further examine the impact of RONA's growth in this category..

[Audio] Our focus this slide is on a particular communication plan. We are allotting much resources into both above the line (ATL) and below the line (BTL) activities to take advantage of the no sugar sparkling trend. The purpose of ATL is to bring some life to the everyday commuter or waiting times. For August to October, specific BTL activities have been set. We are sure that these strategies will be helpful in increasing basket value and increasing sales..

[Audio] Data compiled shows that the unsweetened tea market is on the rise, with a focus on premiumization. Consumers want to purchase a product with an exceptional taste, reflected in the growth, price, and 2022 plans of RONA. To maximize awareness, ATL activation and tactical promotions have been utilized, with the launch of Jan Lamb visuals which feature cold brew technique as well as bus body and media gross value of 13 million dollars. As a result, the cold brew oolong and green tea sales have increased by more than 50% and 66%, respectively. This demonstrates the success of RONA in the unsweetened tea market and plans to further grow in the future..

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46%. RTD Coffee trend skews toward no/ low sugar content coffee.

[Audio] We looked at RONA's growth plans for 2022 and now we are focusing on 2023. We have created a product concept that is made with choice coffee beans for a light, sweet taste and a nutty finish. It has a soft mouthfeel and an aroma of coffee, while having no fat and low sugar. We want it to be enjoyable while being a bit sweet, making it a treat. Our launch is planned for the end of September 2023, and our campaign will include bus-shelter and bus body ads, digital and social ads, banners, and a video with celebrity AK..

[Audio] The data presented in this slide is quite impressive. The chart shows that single RONA's growth projections from 2022 to 2023 have increased by 4.9%, while ultra 4P growth has increased by an impressive 47.5%. Monster has outperformed category growth by 5.1%. Monster Energy 4P has contributed to an incremental growth of 17.3%; other factors such as extended 4P offering, NPD excitement, and Ultra 4P distribution expansion also contributed to this growth. This data shows that RONA has a successful formula in place for continued growth in the years to come..

[Audio] We have a Minute Maid promotion in week 35 with a Zipper Bag redemption, followed by a Minute Maid Qoo Plus 'Sell at $12' campaign in week 39. With the Qoo brand, the focus is on 'Delicious and Fun', giving us the opportunity to increase sales and create an exciting new category for customers..

[Audio] We have seen success with our in-store displays and associated competitions in increasing consumption, creating opportunities for people to socialize, and providing a range of options to choose from. We recently held a party night which was especially popular among adults and included a lucky draw to win a new Disney Frozen World. These initiatives have enabled us to connect with our target audience and keep our consumers engaged..

[Audio] Yuu has launched a festive promotion to provide great value to customers. When buying any original carton of alcoholic beverages, members will get a bonus of TaiGoo Coca-Cola sodas with three boxes of eight cans. Also, RONA's Cold Brew Japanese Green Tea and Cold Brew Taiwanese Gold Oolong Tea are featured in 500mL bottles. Take advantage of these offers during the festive season and enjoy the unique taste of our quality products..

[Audio] The digital landscape presents a great opportunity to improve the customer experience. We have increased navigation and provided more detailed product information to promote customer buying. Our case study displays the influence of the changes made. The 'before' part shows how the digital shelf was not as evident in vital categories. After making modifications, those categories are brought to the foreground on the 'after' section. To further enhance the customer experience, we also optimized keyword search and search titles. This means that, when customers search for products in Drink, OOHA and Sparkling categories, they will be pointed straight to products such as Sparkling Drink and Can..

[Audio] RONA plans to expand its Sparkling 500ml sales in 2022, with an estimated 124,383 units sold and earning 28.4 million dollars. An analysis of similar markets indicates that one in ten beverage trips includes a purchase from the front end, 40-50% of chilled beverage purchases are impulse driven, and 39% of large store trips include food/beverage consumed within an hour. Additionally, the average immediate consumption rate in Hong Kong is 10% compared to 4% in other locations, showing a larger potential to increase RONA's presence in the market..

[Audio] Identifying the top 50 stores in key tourist areas and central business hubs, we placed coolers to up-trade the consumer. This has resulted in a 24% uplift in retail sales figures. Further sales performance also been driven by the application of Rocket-Free marketing icons and profitable SPET. Leveraging Profitability Icons, we have been able to intuitively understand the sales performance of both the 920ml and 500ml sizes in 2021, 2022 and 2023. This strategy has increased our on-the-go consumer sales by 24%, enabling us to reach our target figures ahead of projected timescales..

[Audio] Our team has been striving to guarantee in-store execution greatness. We have finished an auto replenishment instore following report, and accomplished a store accessibility of nine center things of more than 99%. For 2023, we plan to develop the center thing list to nine SKUs, and cooperate with SCCHK to give day by day following reports for a progressively auspicious follow up. We have additionally framed a plentiful relationship with SCCHK, and for 2023, we are investigating sorting out a warehouse visit for our Supply Chain team to investigate more joint effort openings..

[Audio] We will discuss RONA's growth, price, supply chain, 2022 plan, market trends, competitive dynamics and other related topics. We will examine the key activations calendar sharing, weekly promotion pricing sharing, key activation calendar with BTL display proposals, demand and supply management, 2023 enhancement, 100% service level for Monster, top 10 SKUs SOH and week cover sharing, and import items forecast sharing which can help increase our success. Let's get started..

[Audio] We conducted a study with WCL in our 2019 Q4 partnership on the price effectiveness of SCCHK products. The results showed enough potential to lead WCL to implement the new pricing, which has given them a competitive advantage in the SSD category and has resulted in a 18% GSV growth. Considering this data-led partnership, we have identified an opportunity to drive profitable category growth in SSD. We are eager to take the next steps to capitalize on this..

Logo Description automatically generated. Holistic support for Bonaqua x dfi campaign.

[Audio] We have an exclusive premium redemption for our upcoming event in OC2 that is sure to make an impact with its instore visibility. Plus, it now has an exciting new color option of Ice Gray to highlight our product. Don't miss out on this opportunity!.

[Audio] As part of our journey to sustainable business practices and growth, RONA is forging a 'golden trio' comprised of partners, retailers, and recyclers. We plan to roll out an extended partnership, as well as host an Earth Day event featuring a hiking and trail clean up on April 22nd, 2023. As part of our commitment to sustainable growth, we will also be launching a long-term program for plastic beverage bottle recycling in our community. This effort is essential in understanding the competitive dynamics of our category, and will be a major sales driver..

[Audio] In the period from September to December, RONA's growth was monitored and the strategies implemented during this period were evaluated. These strategies included plus sell, meal combo, cooler placement, hi-C and Nestea 6P plus sell, Yuu member price, Nescafe Smoovlatte Black NPD, redemption, OOHA lucky draw, Nescafe can campaign, Nestea campaign, locked price, ATH 1.2L bundle, ATH CB, Nestea, AQ, MM, HW SPET plus sell, OOHA sustainability, Tetra Pack case deal and Double 11 digital shelf. We can now take a deeper dive into the outcomes of these efforts..

[Audio] Our Gross Shopping Value targets for 2022 and 2023 are set to 685. We have already achieved the 2022 target for Gross Shopping Value and are aiming to reach the 2023 target. To do this, we have some initiatives in place such as focusing on shopper insights based promotions, introducing simple price innovation on product and experience, and increasing e-commerce availability and sustainability..

[Audio] We have gone over a lot, from RONA's growth, price, supply chain, 2022 plan, market trends, competitive dynamics, category & shopper insight, past period sales review, category sales driver, and summary & next steps. We now have a better understanding of both the successes RONA has made and the areas needing improvement. This has been an enlightening journey, and we are more prepared to move forward. Thank you for being with us..