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• Focus of Today’s Breakout Session• What DeCA and Industry are Doing Well

• Mike Pfister, Maryanne Sullivan, Tim Brown and Tom Fehily

• Why we Promote?• Charlie Dowlen and Ron Maxey

• Why Marketing?• Sallie Cauthers and Mike Hatfield

• Areas of Opportunity• Michelle Frost and Leah Gardner

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• Did Someone Say Fun???????

• Lights

• Camera

• Action

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• Fun Cast – Take 1

Theme – What we are Doing Well

Starring• Mr. Michael Pfister, DeCA/Store Operations

• Ms. Maryanne Sullivan, Advantage Sales

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• DeCA and Industry do a Good Job of Partnering to Execute Published Promotional Plans

1. Display Compliance2. Display Activity

-Ensuring Enough Inventory is on Display to Meet Patrons Needs-Full End Caps From Start to Finish-Mass Displays

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JAN-SEP 2011 OCT 2011 NOV 2011 DEC 2011 JAN-FEB 2012

88.0%87.5%

84.8% 81.7% 81.7%

POWER BUY

82.0%76.1%

74.7% 73.1%

71.8% PRIMARY

84.7%83.6%

78.1% 77.0%

75.1%

MANAGER SPECIAL

79.0%

75.6%

POWER BUY FROZEN

70.0%

65.3% POWER BUY REFRIGERATED

Source: CommEx

Post Re-Org Improvements

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Focus Items (PB, MS, Primary - Grocery)Focus Items Compared to Rest of Package

Jan-Sep 2011 Oct 2011 Nov 2011 Dec 2011 Jan-Feb 2012 AVG% of Mandates 6.0 2.4 2.9 2.4 5.7 4.3 % of Package $ 22.1 16.1 18.7 16.8 24.1 21.1

Why Focus Items Matter….

Power Buys, Manager Specials and Primaries Account for:

• 4.3% of the Items in the Promo Package, and • 21% of the Promo Package Dollar Sales

Source: Empower IT

Source: Empower IT

As compliance on the focus items has increased, so has their $ contribution to Grocery

Why execution on focus items matters….

Focus Items Compared to Total Grocery

Jan-Sep 2011 Oct 2011 Nov 2011 Dec 2011

% of Grocery Items 1.4 1.4 1.6 1.4

% of Grocery $ 4.1 4.2 5.4 4.8

$ Contribution Index 293.8 294.7 342.8 343.9

293.8 294.7

342.8 343.9

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DeCA and Industry doing a Good Job of Partnering to Execute Published Promotional Plans:

DISPLAY ACTIVITY!!

1. Keeps Product in Stock and Available for Duration of Display Period.

2. Creates a “WOW” Factor to Enhance the Shopping Experience.

= Execution at its Finest

Mass Display Creativity (Themed)

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Compliance + Display = Execution1. Greater Patron Savings

• Sell More/ Save More

2. Greater Overall Sales Performance & Sales Lift• On Average 30-50%

3. Executed Promotional Plans Generate Opportunities for Additional Manufacturer Funds!!

$$$$$$$$$$$$$$

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• Deliver the Promise of the Lowest Price to Military Patrons!

• Promotional Differences: DeCA vs Retail

– Non-Profit vs Profit

– Number of Mandated Items Promoted Every Month

– DeCA: 124 items (Managers Specials-Power Buys-Primary)

Average Per Mandated 2 Week Period (250/month).

– Retail: On Average Retail will have 500 Mandated Items

Promoted each Month. Many Different Types of

Promotions-- Hourly, Daily, Weekend, Weekly, Bi-Weekly,

Monthly. Displays Change Often at Retail.

– Challenges

• Loss Leaders

• Cannot Market to the Highest Bidder

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• Why the Same Items all the Time?

– Top Selling Items (Destination Categories) Drive Promotional Frequency.

– DeCA Items Selected are on Similar Timing as Retail.

– DeCA Follows a Promotional Matrix by Category Which is Reviewed Annually

• Matrix Example: CANNED/BOTTLED FRUIT

• Based on Sales Canned/Bottled Fruit will not be Promoted May-June or July.

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• Why are there Mandated Qty’s/How are They

Arrived at?

– Top Selling items/Categories

– (Examples: Snack--Laundry Detergent)

Drive Category Growth

– Many Times These are Seasonal Items

– Historical Sales Data From Past Promotions

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• Fun Cast – Take 3

Theme – Why We Market

Starring:• Ms. Sallie Cauthers, DeCA/Sales – Marketing

• Mr. Mike Hatfield, S & K Sales Company

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• Promote In-store Sales Periods, Special Events,

Guard/Reserve On-site Sales, and Department of

Defense Partnerships.

• Generate press releases

• Coordinate campaign promotion plans

• Provide Web content

• Create social media and e-newsletter postings.

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• May – Family Fun Fitness Festival (Partnership with

Exchanges and MWR)

• June – Your Pet, Your Family (Industry Demos and

Pet Festivals)

• July – Farmers’ Markets (Month-long, Outdoor

Produce Markets)

• August – Back-to-School (Cross-promotion Tactics

with Exchanges)

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• Serve as Marketing/Creative Consultant for Special

Event Planning.

• Assists in Local Marketing of Celebrity Visits.

• Develops Radio Spots and Social Media Postings for

Large Partnerships/Community-wide Events.

• Serve as a Sounding Board on any New Ideas you

May have in Enticing Young and/or Newly-joined

Military into the Commissary.

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• Fun Cast – Take 4

Theme – Areas of Opportunity

Starring:• Ms. Michelle Frost, DeCA Promotions & Marketing Division

• Ms. Leah Gardner, Kraft Foods

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• Current State

• Mandate Package is Large/Difficult to Execute

• Manager Specials, Power Buy, Primary’s, Shippers

• Secondary's, One Time Buys, Features, Line

Extensions

• Promotional Matrix Complexity

• Opportunities

• Execute Display for Entire Display Period

• Clear Direction on Required Displays

• Patron Savings Focus

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• Future State

• Promotional Goals/Expectations

• Savings, Sales Potential, Display Effectiveness

• Streamlined Promotional Package

• Simplify Display Definitions and Compliance Needs

• Promotion Matrix Refinement Based on Military &

Total US Consumption Data

• Category Consolidation

• Reduction in Frequency of Promoted Categories

• Push Quantities to Stores

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Questions?

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That’s A Wrap – Thank you for attending

today’s event.