INSIGHTS INTO THE CONSUMER SECTOR

Issue Eight >>

Yankee Candle in focus >> President & GM EMEA Melanie Stack gives an insight into how the US consumer products maker is transitioning into a global organisation.

How to build a digital ecosystem SVP Victor Duran from Amer Sports, the owner of Wilson and Salomon, explains how its products help create global communities for athletes.

The future of digital services eBay's Andrew Whitehair tells us how the ecommerce giant is developing tools to get ever closer to its users.

Development with a difference TwiningsOvo's Annkatrin Ott shares some interesting people development initiatives within the business' international markets division.

Featured interviews: Miguel Chapa, Marketing Director at Bel Spain Paal Hansem, CEO at Fresh Fitness Pedro Diezma, Founder at Zerintia Technologies

PLUS >> Huge opportunity for French economy Analysis of Germany's bio industry Private label decline in Spain Spotlight on Sweden's Nutricia Talent mapping for the future Building the marketing function at Hovis Nigel Wright's new offices IF THE IDEAL CANDIDATE ISN’T IN YOUR NETWORK, CHANCES ARE THEY’RE IN OURS Nigel Wright brings together high-calibre candidates for your specialist recruitment needs. www.nigelwright.com Welcome >> CONSUMER FOCUS – ISSUE 8

Welcome to the latest edition of Consumer Focus Office locations >> Magazine, our dedicated annual publication for the global consumer industry. >> NEWCASTLE UPON TYNE Lloyds Court, 78 Grey Street Newcastle upon Tyne, NE1 6AF, UK A combination of a declining oil price, low On page 48, Ebay's Andrew Whitehair tells us T: +44 (0)191 222 0770 inflation and rising salaries has meant consumers how the ecommerce giant is developing tools to TEESSIDE with renewed spending power have been get ever closer to its users. And on page 20 we Eshton Suite, Office 2, Wynyard Park House, at the forefront of industry growth this year. learn how sporting goods giant Amer Sports is Wynyard Avenue, Wynyard, TS22 5TB, UK Businesses have also benefitted from a healthy seeking to further integrate its brands into a 'digital T: +44 (0)1740 661000 and competitive export environment, facilitated in ecosystem' with products that track and analyse LONDON large part by the European Central Bank's (ECB) fitness performance across a range of different 20 St Dunstan's Hill, London, EC3R 8HL, UK T: +44 (0)207 405 3921 progressive monetary policy, which has had a metrics. Wearable technology is investigated positive effect on unemployment figures in many again in greater detail on page 62 in our interview COPENHAGEN Havnegade 39, 1058, Copenhagen K, Denmark countries. with industry influencer Pedro Diezma. T: +45 7027 8601 While enjoying boosted sales ÅRHUS "…we catch up with senior executives and high footfall, many brands Værkmestergade 2, 17. etage, 8000 Aarhus C, Denmark from some of the sector's most and retailers are realising T: +45 7027 8601 that the pervading culture of dynamic brands" OSLO discounting is stifling growth. Dronning eufemias Gate 16, 0191 Oslo, Norway This is particularly apparent, as T: +47 238 97 773 we find out on page 33, in Spain, where supermarkets A slowdown in emerging market growth, however, STOCKHOLM has impacted some businesses and the longer like Mercadona have risen to prominence over the last Grev Turegatan 3, 4 tr, term uncertainty created by a vote in favour of few years. Bel Group's Miguel Chapa, however, explains 114 46 Stockholm, Sweden T: +46 (0)8 400 264 35 Brexit will no doubt continue to reverberate over on page 35 how brands are fighting back and on page the coming months and years. Governments 26 Former SCA Global Innovation Director turned MALMÖ consultant, Richard Nall, has some more insightful tips High Court, Malmöhusvägen 1, across Europe will continue to consider their 211 18 Malmö, Sweden for building FMCG brands in the age of the discounters. negotiating positions with the UK in relation to the T: +46 (0)8 400 264 35 structural changes created by Brexit and its longer Elsewhere, the health and wellness industry is GOTHENBURG term implications for the EU model. scrutinised on pages 56 and 66 when we talk to World Trade Center, Mässans gata 18, 412 51 Göteborg, Sweden key players in Germany's burgeoning bio industry In this issue, we catch up with senior executives T: +46 (0)8 400 264 35 from some of the sector's most dynamic brands before taking a look at a Norwegian fitness enterprise success story. TwiningsOvo's Annkatrin HELSINKI to find out how companies are leveraging Bulevardi street 7, 00120 Helsinki, Finland opportunities to grow, amidst what is an Ott shares people development initiatives within T: +45 7027 8601 the business' international and emerging markets increasingly complex and challenging trading DÜSSELDORF environment. division on page 44 and on page 14 is an in-depth Königsallee 2b, 5th Floor, 40212 analysis of opportunities in France's untapped Düsseldorf, Germany A big factor at the heart of the most successful digital economy. T: +49 211 882 42 364 growth stories continues to be innovation. AMSTERDAM Increasingly fragmented consumer tastes and As ever, throughout this Parnassusweg 819, 9th Floor, price preferences mean that brands must work edition you can find all of Amsterdam 1082 LZ, The Netherlands T: +31 (0)20 800 61 70 doubly hard to improve products and keep the latest news from our consumers interested. In our featured article on teams across Europe. PARIS 29 rue de Bassano, 75008 Paris, France page 6, Yankee Candle's Melanie Stack tells us We hope you enjoy T: +33 1 76 73 29 80 how innovation, optimisation and authenticity the latest edition of MADRID are the key product attributes driving the group's Consumer Focus Magazine Palacio de Miraflores, Carrera de San Jerónimo, transition into a global organisation. and would welcome 15 - 2ª 28014 Madrid, Spain feedback on any of T: +34 91 788 3172 Furthermore, the ability to build a genuine its content. LAUSANNE connection with consumers has led to greater Rue Caroline 2, 1003 Lausanne, Switzerland investment in big data analytics, as firms attempt PAUL WILSON T: +41 (0)21 311 2376 to turn customer data into powerful insights. CEO

Contents >> CONSUMER FOCUS – ISSUE 8

06 20

12

44 53

35 48

12. How talent mapping can help secure 06. 26. your business' future YANKEE CANDLE BECOMES TRULY DEATH KNELL OR REBIRTH? INTERNATIONAL Potential ways forward for the UK 18. Nigel Wright expands in the Nordics President Melanie Stack shares retail market expansion plans 33. Private label decline: a chance for 10. 44. Spanish retailers HR AND TALENT MANAGEMENT 64 AND COUNTING 35. Bel Group's Miguel Chapa talks about TwiningsOvo's international market Nigel Wright grows international teams rapid growth in a challenging market strategy

38. Fashion and Luxury: a new era of 14. opportunity CONSUMER GOODS AND DIGITAL 48. USER EXPECTATIONS OF TOMORROW Untapped potential in French market 53. Nutricia: the best kept secret How eBay is meeting modern consumer demands 20. 57. Fresh Fitness aims to be biggest fitness franchise in Scandinavia AMER SPORTS OUTLINES 2020 'GLIDEPATH' 62. Business seeks to expand further DEVELOPMENTS IN WEARABLE TECH 66. Bio report highlights changes in outside of North America Zerintia founder Pedro Diezma talks trends German consumption habits Featured interview >>

MELANIE STACK, PRESIDENT & GM EMEA AT YANKEE CANDLE INC

Melanie Stack President & GM EMEA at Yankee Candle Inc

For almost three decades Melanie Stack has presided over, and grown, some of the world's best loved brands including Barbie, Radox, Monopoly and Weight Watchers. In 2013 she was appointed European head of US-based household products maker Yankee Candle. Nigel Wright caught up with her to talk about her latest challenge and the role she is playing in helping the business transition into a global organisation. >>

It's just over two years its inspirational leadership and its success at since you joined Yankee growing brands, as well as the opportunities Candle. What was for professional development that exist within it about the role and the wider Jarden group. the organisation that attracted you to the Most of your career has been focused on opportunity? reigniting brands and successfully turning around businesses – examples include Matey I've always worked for heritage brands and (Sara Lee), Barbie (Mattel) and more recently brands that I'm passionate about and can Weight Watchers. Yankee Candle, however, relate to as a consumer. Yankee Candle is already enjoying huge growth. What, definitely fits that mould. I was excited by therefore, is the key challenge for you at the fact that Yankee Candle is a hugely Yankee Candle? successful brand with significant potential to grow further. It already has excellent The key challenge is around transitioning penetration in the US market and there are the business into a truly international still a great deal of opportunities for expansion organisation. This requires a need to develop in Europe and beyond. Furthermore, when deep understanding of the cultural nuances I met the Yankee Candle management team of the various markets that Yankee Candle Melanie Stack, President & GM EMEA I was really impressed by their alignment is targeting, as well as looking for ways at Yankee Candle Inc around, and demonstrable passion for, the to constantly innovate and reinvent the brand. The other aspect of my attraction was components of the brand. My experiences applicable here. So, the dynamics around due to the phenomenal reputation Yankee within the toy and personal care industries, marketing 'seasonality' and constant product Candle's owner, Jarden Corporation, has for as well as at Weight Watchers, are directly innovation are very similar to the toy and Melanie Stack, President and GM EMEA at Yankee Candle Inc 7

personal care industries and are elements What key objectives are you hoping to meet is aimed at mass market retailers. From our that were successfully leveraged to grow over the next few years? growing network of offices, we're able to brands such as Radox, Matey, Fisher Price, utilise different channels and better segment Barbie, Hot Wheels and Monopoly. At Weight Over the next three to five years the focus is and target consumers and build up a better Watchers, it was very revealing to discover very much on expanding the Yankee Candle understanding of the profiles of the markets the subtle differences in eating habits as well business across Europe. We already have we wish to grow in. as 'psyches' regarding weight loss around great distributors in some markets but we're the world. Understanding these differences keen to develop more distributor relationships What ambitions are there to grow further as well as the similarities, and building them elsewhere. We've also now established 'in beyond Europe in MEA? How is Yankee into the brand and the products was essential country' operations in France and Italy and Candle typically approaching those markets? to growing Weight Watchers' international we're in the process of building our teams We have a strong distributor base, especially in and capability in those Africa, and we aim to continue strengthening "...when I met the Yankee Candle markets. For the first our distributor network across the region. We time in its history, management team I was really impressed are hiring sales and customer care teams on Yankee Candle has also by their alignment around... the brand." the ground, building a support structure to started working in a give us a real presence in the marketplace. In business. I think the same cultural differences joined up way across some of the more developed territories, we exist when it comes to peoples' homes and its portfolio of brands. So, for example, we're have actually begun giving the sales teams Yankee Candle will need to be cognisant of now leveraging synergies that exist between more marketing and brand support from this when developing fragrances, and the Millefiori, the business we bought in Italy in the centre which is really paying dividends, types of emotions it wants to convey through 2014, our Yankee Candle Classic brand and because we're now experiencing a lot of fragrance, when entering new markets. a new brand called Home Inspiration which momentum in those countries. 8 Consumer Focus

"Over the next three to five years the also strengthening our commercial capabilities focus is very much on expanding the through upskilling Yankee Candle business across Europe..." across all of the channel disciplines such as It's Yankee Candle's incredibly strong sales digital, retail, category management and operation that is key to its phenomenal trade marketing. This is giving us a rounded growth. There is an opportunity, however, to capability to manage the brands locally and now introduce a more traditional consumer build the brands with different channels. marketing approach to complement the sales operation. How is the business rolling this out? How is Yankee Candle embracing digital?

Historically, the guardianship of the brand has The US business has a fantastic website and always been in the US and as a consequence it is currently doing some interesting things of this, in Europe, the business has basically in the digital space such as personalised established very strong sales organisations photo candles. The European business is that have relied on the marketing support currently working closely with the US team and brand guidance passed down to them to develop its digital capabilities, particularly from the corporate centre. Over the last three around mobile, to raise awareness of the years, however, there has been a clear shift brands sold in Europe. Furthermore, in away from this model. The implementation of Europe we're also bringing our websites back a global strategy for our brand architecture, under Yankee Candle control, after having based around the Millefiori, Classic and Home previously outsourced the management of Inspiration brands, seeks to establish different our online presence. So, there is currently solutions for the different channels and a lot of development work taking place to consumer purchase occasions. As part of this build our visibility online in Europe. I think strategy, we have invested in strengthening it's also important to note that Yankee Candle our marketing capability across Europe and is a very viral brand and testimonials and we now have marketing representation in recommendations are vitally important. So each of our core markets - the UK, France, social media campaigns tied in to new product Italy and Germany. In addition to this, we're launches form a key part of our marketing strategy throughout the year, as we try to engage consumers in conversations and create anticipation as our range evolves.

What do you look for in a retail partner and how do you work with retailers to maximise sales?

Our retail proposition and profile is really important to us. We work with a number of retail partners in the UK and a few in Italy and the most successful relationships are with companies that have strong visual merchandising credentials and a genuine passion for our brand. At the end of the day, Yankee Candle is a very experiential brand and we have a number of destination retailers in which we invest a lot into visual merchandising and other promotional and marketing support. The gift trade, in particular, does a phenomenal describe as a great cadence of new seasonal job of trailing and showcasing our ranges and product launches. Yankee Candle is very delivering a strong service to consumers. dependent on seasonal offers for occasions Throughout the year we have what I would such as Valentine's Day, Mothers' Day and Melanie Stack, President and GM EMEA at Yankee Candle Inc 9

"What has made and continues to The kind of people we pilot launched a new line and format called who will succeed Centrepiece, an electronic melt warmer where make Yankee Candle stand out from its at Yankee Candle the melts come in capsules enabling you to competitors is its commitment to offering over the next few change between fragrances to suit the mood. consumers a broad choice as well as our years as it transitions It was an expensive item, but still generally into an international sold-out as consumers were impressed by the innovation, optimisation and authenticity." organisation are those inventiveness of the product; and it was still who thrive in high selling strongly in early 2016. Easter and so on. Our retailers must be able to growth entrepreneurial environments, with manage our core business proposition with lots dynamic cultures. These are the kind of people What is the innovation process like at Yankee of choice and really strong ranging in a way who should definitely consider joining our Candle? that makes sense to the consumer. business. The process is well defined and has historically What other skills is Yankee Candle currently The male candle or 'mandels' trend is been driven from the US, however, as trying to introduce to the business? Why something that Yankee Candle has sought to the European business has grown, we've should people consider joining Yankee influence over the last few years. What other gradually had more input into developing Candle? market trends is Yankee Candle currently local fragrances and themes for Yankee monitoring? Candle products. Today, I would say it's a Our other key priority is to bring in people genuinely collaborative effort across the global with strong general management capabilities, The focus is very much on seasonal trends business, to leverage opportunities and trends and I'm delighted to say that we've now and we're currently collaborating with various and deliver products that meet consumer successfully appointed country managers European fragrance houses to develop expectations. It's generally a long process, in France, Italy and the UK, responsible for new seasonal offerings. For example, we're as delivering quality superior products and building the local business units. Furthermore, beginning to see huge success with some of ranges is absolutely at the heart of the Yankee in 2017 we are opening a new factory in our capsule collections such as My Serenity Candle proposition. I would describe it as the Czech Republic and in preparation for and Mediterranean Dreams, the latter of which ultra-rigorous, and it takes into account a that, we are currently seeking to identify is inspired by Mediterranean fragrances and number of significant factors such as fragrance, good operations and supply chain profiles. colour palettes. Furthermore, last Christmas burn performance, health, safety and quality. 10 Consumer Focus

Nigel Wright continues its support of Cancer Research UK In July 2015, the company raised a grand total of £10,700 on behalf of the charity by taking part in the Yorkshire Three Peaks Challenge. Twenty seven employees from across seven international offices took part in the walk, with many completing the route in under nine hours. >>

On Saturday 11th June, biggest contingents travelling to the UK was “We are delighted to have Cancer Research Nigel Wright once again Nigel Wright's Swedish team, from offices in UK as our designated company charity and to took up the Yorkshire Stockholm, Malmö and Gothenburg. Nigel continue our support for this wholly worthwhile Three Peaks Challenge Wright client, Swedish confectionery brand cause. Additionally, we are extremely proud of and successfully raised a Cloetta, agreed to support its countrymen's our team for taking part in the Yorkshire Three further £9,462 (as of 14th effort by suppyling the walkers with some of Peaks Challenge and indeed many of the other July) in support of its charity partner Cancer their delicious chocolate. events that we organise. So far, a fantastic sum Research UK. of money has been raised and our gratitude Other employees also upped the stakes this extends to the friends and families of our Employees from all 13 of its offices across year by attempting to run instead of walking the employees who take the time to donate and Europe signed up to take part. One of the 37.5 km. CEO Paul Wilson commented: spread the word of our efforts.” Talented expansion Like many businesses enjoying more favourable economic 90 hours of formal training from directors, managers and support functions in the first conditions during the last year, Nigel Wright's priority in three months, which is supplemented by on- 2016-17 is to continue searching for the best talent to the-job coaching and development by a line manager". help fuel its domestic and international growth. >> Kathryn Gill, a former retail As part of its strategy to As well as hiring experienced consultants, industry buyer, who Nigel Wright firmly believes in growing its consolidate its leading joined the business own talent and is currently recruiting for its position in established as a consultant competitive graduate scheme, after already markets and move in January successfully hiring four graduates in 2015-16. forward with new growth commented; "I'm thrilled to opportunities, Nigel Its graduate scheme offers one of the most Wright continues to recruit across its UK and competitive packages in the industry and a have joined Nigel Wright. To get the opportunity to work for a international offices. full year of training where those seeking a successful career in business will be able to consumer industry recruitment leader with a significant international footprint is very Group Executive Director Mark Simpson gain new skills and experience in all areas of recruitment. exciting. I'm already learning a huge amount of commented, “Despite the high number of skills that will help me progress in my career.” people joining us, maintaining quality is always Simpson continued; "We're passionate about crucial to our talent acquisition strategy and our vision and we want to equip our people For more information on working for Nigel therefore we have a rigorous process in place with the right tools to fulfil it. We are dedicated Wright, please visit for identifying and selecting the best people.” to our people's development, including over www.nigelwright.com/employers/work-for-us Nigel Wright Group news 11

Consumer division demonstrating impressive customer service results

Nigel Wright measures its customer service performance using the Net Promoter Score (NPS), a global management tool that can be used to gauge the loyalty of a firm's customer relationships. >>

In the last financial year, a strategic advantage in the marketplace by Openshaw continued, 'We are always looking for 2015-16, Nigel Wright's allowing us to identify any issues and then make ways to improve scores and in June 2017 when consumer division immediate improvements across all areas of our the new results are in, we anticipate that the achieved an impressive business. Net Promoter gives us a really clear and consumer division's Net Promoter Score will have NPS of 45%, following more in-depth idea of how our customers value grown during that time'. submissions from over our service'. 800 clients and candidates served by the division Division NPS FY 15-16 (%) between May 2015 and April 2016. Research suggests that NPS is actually correlated Germany 58 with overall revenue growth and the score Sweden 48 The table below shows the Net Promoter Scores achieved by the consumer division this financial Denmark 48 for Nigel Wright Consumer's main markets, as year is certainly in line with the heightened Spain 43 well as the overall score for the division. Nigel demand for Nigel Wright's services in the sector. Norway 42 Wright's Andrew Openshaw commented: Analysis of other B2B providers indicated that UK 42 a Net Promoter Score of 30+% means you are France 36 "Collecting valuable customer data gives us largely seen as 'unique' by your customers. Overall 45 12 Consumer Focus

How talent mapping can help secure your business' future

Overview is what will ultimately set businesses apart from Talent mapping, on the other hand, is a their competitors, and play a critical role in strategic service that is used by businesses to With the economy their immediate and future success. plan for short, medium and long term talent returning to growth, businesses are aware acquisition. It is used by the most perceptive Talent mapping is increasingly seen as the companies to ensure that a recruitment that the most talented definitive way to ensure that these objectives process doesn't just result in a quick hire, but employees are coming are achieved. It's important, however, that rather that it focuses on the short, medium out of hiding and seeking new opportunities to businesses are absolutely clear what the talent and long term needs and leads to a number of help boost their careers amidst positive market mapping process is, why and when they need strategic talent acquisitions over a prolonged conditions. The best people, however, are to carry out a talent mapping exercise and how also usually the most discerning and will only they will make sure the process is successful. period of time. engage with roles and companies they perceive to be absolutely right from a personal and What is talent mapping? Entering into a talent mapping partnership professional point of view. involves the provider of the service assisting Talent mapping is often confused with the a business with measuring and defining its preliminary stage of the executive search Put simply, although it's possible to attract the internal current capability, as well as its future process. This is when a search firm, together best talent in a buoyant market, it's even harder potential capability. This process should for companies to intimately understand what with the hiring company, identifies businesses reveal various immediate or future talent they need to get right to get the best on board. where it is believed the right kind of people will exist. The search firm will then target requirements and whether or not those needs The latest research suggests that talent those companies, with the aim of finding and can be met internally or externally. The service management and succession planning are the hopefully teasing out the right kind of talent provider will then gather intelligence about number one priorities for HR&D functions before approaching them with an opportunity. organisations, industries and talent on an on- today. Talent gaps are a major strategic concern This is a valuable service but it is also part of a going basis, building a talent pipeline, which and developing or investing in innovative ways fixed project, with a very specific objective to the business using the service can access to engage with, hire and retain the best talent find one particular person. whenever demand requires it. How talent mapping can help secure your business' future 13

Talent mapping recognises that if you're trying of them hiring the absolute best candidate. and succession planning (TMSP) service. Our to identify candidates for multiple potential Organisations that talent map also find that it sector expertise across the world means that vacancies, you need a large pool of candidates can improve their employer brand and raise we can provide our clients with an in-depth from which to make your selection. Often, their reputation in the market. analysis of how their organisational capabilities those engaged during the talent mapping project are regularly contacted and updated compare to others in the sector. We can Furthermore, because the process involves over a long period of time, meaning when then use our extensive networks to help our gathering industry and competitor data, as there is an immediate need, they can be clients plan for the future, by identifying the reached quickly and the search firm doesn't well as finding the best talent, it acts as a great right talent internally and externally for their have to repeatedly start from scratch and sell benchmarking tool for strategy, remuneration opportunities to the market. and employee benefits, competitor structures business. and reporting lines, roles of responsibility, Our TMSP service has become increasingly When and why do companies talent map? skills, academic background and so on. popular with clients over the last few years. Companies can benefit from talent mapping during times of growth or austerity, and Stockpiling this kind of intelligence over a Some notable recent examples of companies because there is such a broad range of sustained period of time can give businesses we have assisted in this capacity include analyses that can be done during the process, a detailed and holistic view of the market for L'Oreal and Henkel in the Middle East, they can be selective about the aspects on talent and it enables them to be decisive in DBApparel in Europe, Grupo Siro in Iberia and which they would like to focus, to best suit their hiring, while building a clear foundation the Americas and Greencore in the UK. If you their needs. for succession planning. are interested in finding out more about our The benefits of using talent mapping go TMSP service, as well as our other services, How can Nigel Wright support you? way beyond simply giving a business the please visit nigelwright.com. capability to make multiple hires over a long In support of our clients' future business plans, period of time. It also increases the chances Nigel Wright offers a robust talent mapping 14 Consumer Focus

Consumer goods and digital: a huge opportunity for the French economy, but can it be realised?

A year ago, McKinsey France carried out a major piece of work on France's €100 billion digital gap: the boost that French GDP could gain, by 2020, if French companies fully embraced the digital transformation. But where do the opportunities lie for the consumer goods sector, has the work of closing the gap begun, and will France get there? Nigel Wright gets to grips with the issues. >>

You might be forgiven for pleading “ennui” with recent media coverage on the French economy. The Republic's beleaguered and unpopular left-of-centre president has beaten the retreat on the latest development in the long-running thread of labour market reform. Its economy is firming but fragile and the country is struggling to move beyond the jobless growth trap. But it's not all gloom; with online purchases of consumer goods growing sharply in recent years and more than 45% of customers now shopping entirely online for some products, there is huge potential in digital for France's strong consumer goods sector. Global brands like Pernod-Ricard, Danone, and L'Oréal, with turnovers of ¤10-25 billion (equivalent to the entire GDP of Nicaragua Consumer goods and digital 15

or Estonia), also have the power to make a not sure which half.” But in France, allocations Looking within, embracing digital means material difference to the French economy. are of the order of 10%, the kind of statistic getting a company's operations and marketing fuelling fears that despite strong state support right too. Like other major economies, France Like the first industrial revolution, today's and a strong digital sector (whose growth sees the opportunity of Big Data. But, in a digital transformation promises a brave forecasts were recently revised up by sector country where labour market rigidity remains new world, which unsurprisingly, has more a challenge, it can be hard to find the right body, Syntec Numérique), France risks falling opportunities than threats. But it's easy to people for these relatively new disciplines. behind. Digital is disrupting distribution too. equate “digital” with good, and it's important to France's Syntec trade body, in tandem with France's “grandes surfaces”, like Carrefour remember that there are potential downsides digital-workforce watchdog, OPPIIEC, too. Companies that fail to address the risks or Auchan, are working hard to respond to has recently launched an online tool: an won't just miss out: they'll forego considerable home-grown, “pure player” channels, such “observatoire dynamique”, providing a rich amounts of turnover as others forge ahead. as Cdiscount and, more recently, burgeoning seam of information for French companies High on the risk matrix for consumer goods direct sales channels. Evian, for example, looking for skills. In addition, French is “hyper-competition”. Mobile apps, using now sells directly to customers through producers, like others, continue to pursue both search and scan, have revolutionised evianchezvous.com end-to-end digital transformation of their online shopping aggregators, comparators and processes. Automation is no conceptual reviews. More than 60% of French consumers Aside from cost and convenience, digital offers newcomer, but the digital transformation has now shop online and they expect a seamless scope for entirely new products and services. brought its own slant, with RFID tags now and consistent experience across all channels. France's strengths in luxury goods and beauty tracking items-in-production in real-time are regularly on display in the launch of new and the rise of “usines numériques”: entirely But what of the opportunities? First, the digitally automated factories. online content and mobile apps. L'Oréal's increasingly multi-channel and relational Makeup Genius is a virtual mirror that allows nature of customer journeys. Proctor and With all this to play for, what are the stakes, Gamble's average global allocation of its consumers to test some 300 make-up products and what should companies prioritise? promotional budget to digital channels is about on a tablet or smartphone and Mumm, McKinsey's detailed report on the French 35% (and 100% for some brands, like Braun), the iconic “maison de champagne”, draws digital gap estimates that consumer-facing putting, perhaps, a 21st-century spin on the consumers to its virtual champagne guide, to opportunities (transformed customer journeys, old advertising joke: “Half of it works, but I'm learn about the rituals surrounding the drink. and new products and services), have the 16 Consumer Focus

potential to boost turnover by 20%. And Danone, which crowdsources ideas for new better-focused decisions and operations (in flavours for its Danette brand: both engaging areas like Big Data and automation) could be consumers and cutting product development Market snapshot worth another 20%. costs). Better exploitation of Big Data comes a close third, with an emphasis both on skills, The consultancy, which made its name in and on making the considerable investments exactly this type of big picture advice, is (a game heavily involving distributors too) in FRANCE equally clear about what companies should increasing companies' analytical capabilities. prioritise. The first priority is continuing High unemployment and a largely to transform the customer experience, So, in conclusion, will the digital gap close for stagnant economy has led France to consistently, across all digital channels: not an France? As the apocryphal economist might become seen by some as Europe's entirely unexpected recommendation for a tell you: in an increasingly interdependent biggest problem. Debates about how sector that has exploited traditional marketing and still fragile global economy, it depends; to fix France have also been persistent methods so well, for so long. Second comes a reality captured in Napoleon Bonaparte's and range from changing its notoriously the need to innovate in terms of offer, with maxim: “forethought we may undoubtedly inflexible labour laws, to having France strong advice to make full use of areas like have, but not foresight.” Bon courage! rescind its membership of the EU. No crowdsourcing (already successfully used by one, however, seems to agree on the actual solution. France's minister for the economy, Emmanuel Macron, earlier this year launched 'En Marche!' (On the move!), a bipartisan political movement focused on finally finding answers to his country's enduring problems.

Macron's view is that France has severe self-confidence issues and is letting its tacit fears dictate the future. French consumers and businesses may have taken heed of Macron's clarion call for more poise and positivity. Recent Q1 figures show an unexpected increase in consumer spending as well as business investment - the strongest since 2004 and 2011 respectively - with overall GDP growth reaching 0.5%. Unemployment also experienced its biggest fall for over a decade. The French are hopeful this trend will continue for the remainder of the year. Nigel Wright Group news 17

Nigel Wright London office move

Nigel Wright's London office was officially launched in 2007 to help facilitate the national and international expansion of its consumer industry recruitment practice. >>

In the nine years since "The new office provide an excellent base for its inception, the team the teams to drive growth in our core markets in London, as well Nigel as well as offering our clients and candidates Wright's reputation in professional locations to meet. The central the sector, has grown and prestigious location - with fantastic views significantly. of HMS Belfast, Tower Bridge and the Shard - help to promote our premium image as well as As well as being home to teams focused on attract high potential people, because of who sourcing talent across the sales, marketing we are and what we offer." and operations disciplines, London is also the hub of Nigel Wright's global consumer search One of the people to join the London office Paul Wilson commented on the appointment: division, a dedicated team focused on national in 2016 was experienced consumer industry "Sarah-Jayne is a highly experienced and international c-level assignments. recruiter Sarah-Jayne Bennell, who was search practitioner with a strong consumer Following the addition of six new consultants appointed Director of Global Consumer industry specialisation. Her profile is a great to the London teams in 2015-16, earlier this Search. A former McKinsey e-strategy complementary fit with our business and I’m year the decision was taken to relocate the consultant, Sarah-Jayne has enjoyed a delighted to have her on board. We’re now business to new office near Monument, on St successful fifteen-year career in recruitment, seeking to significantly expand our London Dunstan's Hill. CEO Paul Wilson said about the specialising in executive search within the presence, with more appointments expected move: global consumer and retail industries. over the next twelve months." 18 Consumer Focus

Nigel Wright expands in the Nordics

Since the last issue of Consumer Focus Magazine, Nigel Wright has opened three new offices and launched new finance and interim divisions in the Nordics to service its growing portfolio of clients in the region. >>

After launching in Tobias Sjöberg, who rejoined Nigel Wright Stockholm in 2006, as Regional Manager after working for a Sweden has consistently global FMCG business, relocated to Malmö in been one of the Group's February to manage the new location. He has best performing been focusing on developing relationships with divisions. On the launch key clients in the local area and hiring additional consultants to facilitate growth. of its new Malmo office in February 2015, Simon Taylor, Country Manager Sweden, 2015 was a another great year for the Swedish commented: division of Nigel Wright, and at the beginning of 2016 the decision was made to expand again in 'We already have excellent exposure to the the country, as the business launched another Swedish executive market, yet this additional new office, this time in the city of Gothenburg, office has given our business the added ability in March. Regional Manager Daniel Holtryd was to get closer to clients and offer a greater appointed to spearhead the operation, focusing diversity of specialist sector and discipline specifically on Purchasing, Supply Chain, and knowledge, as well as expertise which is not Manufacturing roles, as an extension of Nigel locally or regionally limited.' Wright Sweden's operations division. Lars Herrem, Group Executive Director Nigel Wright expands in the Nordics 19

He commented: 'I'm delighted to join Nigel Wright has continued to concentrate greater capability to manage the number of the team at such an exciting time for the on building its capability in those key candidates approaching us, as well as clients business. I'm extremely excited to continue locations, making a number of new hires. enquiring about our services. Although our working with existing Nigel Wright clients In total, the company now has six offices business is international, we pride ourselves as well as forging new relationships in the across the Nordic region and has increased on our ability to be effective at the local Gothenburg and Västra Götaland area.' its total headcount by over 50% in the last level, within the countries that we operate six months. in. We continue to have strong industry Elsewhere in Scandinavia Nigel Wright relationships in the Nordics and we are as continues to support clients in Finland, According to Nigel Wright Group Executive committed as ever to growing our presence Denmark and Norway with talent acquisition Director for International Markets, Lars in this vital geographic region.' projects focused on opportunities in sales, Herrem: marketing and operation. In Norway, the business appointed a new Country Manager 'In all, we see a very bright outlook for - Jostein Hjellegjerde – as well as a number the remainder of 2016. Consequently, of new consultants last year and opened a we are still adding new people to our second office in Århus in Denmark. Nordic business units, enabling us to have Featured interview >>

VICTOR DURAN, SENIOR VICE PRESIDENT DIRECT TO CONSUMER & MARKETING AT AMER SPORTS

Victor Duran Senior Vice President Direct to Consumer & Marketing at Amer Sports

Whether it's Wilson rackets for world number one tennis player Serena Williams, Salomon shoes for champion ultra- marathon runner Kilian Jornet, or Atomic skis and boots for Marcel Hirscher, the four times alpine ski race world cup gold medallist, Amer Sports is committed to making sporting goods products for the world's greatest athletes. >>

You joined Amer Sports in plans to reach $3.5 billion turnover by the end 2010. What is your overall of 2020. This means the company needs to remit? What attracted add around $1 billion revenue in the next five you to the opportunity at years. Being part of that challenge is hugely Amer Sports? rewarding. I'm responsible for marketing at Amer Sports, essentially acting How does Amer Sports plan to achieve that as CMO within a traditional multi-business objective? Victor Duran, Senior Vice President unit corporate structure. In addition to that, Direct to Consumer & Marketing at Amer Sports I also manage the retail and e-commerce In addition to making improvements in critical business. This primarily includes our portfolio areas such as distribution, marketing, product launches and so on, Amer Sports recently of Salomon and Arc'teryx retail outlets as well our retail and e-commerce proposition, announced its 2020 'glidepath' growth plan as e-commerce channels in North America, will primarily support the development of Europe, China and Japan encompassing all which includes objectives to develop Apparel our Apparel and Footwear brands. Finally, Amer Sports brands. I was attracted to the role and Footwear in the US and China, Business Connected Devices and Services refers to our because it represented a fantastic opportunity to Consumer and Connected Devices and to work with and grow some of the best Services. Apparel and Footwear, which are growing portfolio of sports tracking products brands, not only in the sporting and outdoor both major categories for Amer Sports, will and apps. In line with other major players in goods industry, but also in the world. Amer grow disproportionately around the world. our industry, Amer Sports is seeking to further Sports is on a high growth trajectory with Business to Consumer, which is basically integrate its brands into a digital ecosystem. Victor Duran, Senior Vice President Direct to Consumer & Marketing at Amer Sports 21 22 Consumer Focus

that are aligned with those trends, something we call Idea to Consumer. The Wilson X Connected Basketball is a great example of the outcome of our innovation process. There have been some other great product launches across the group as well. Last year Arc'teryx released its Voltair Avalanche Airbag, which is an electric airbag that enables skiers caught in an avalanche to activate an airbag and significantly improve their chances of survival. Our product is different to other similar products on the market because it has a fan and battery and can be activated remotely. Also, at Salomon we launched our MTN range which integrates clothing, skis, boots and other hiking gear for all seasons. These products are all cutting edge and a result of our award winning innovation process.

Can you give some examples of how Amer innovative companies in the USA in 2015 by How does Amer Sports ensure that it's offering Sports is creating a digital ecosystem? Fast Company. the best sporting goods in the market? In May 2015 we bought Sports Tracker, an app I would definitely describe Amer Sports as a available for the iPhone and Android devices What's the innovation process like at Amer company of “scientific artists”. Most of our which allows users to track and analyse Sports? employees have grown up playing the sports their fitness performance across a range of Part of my remit as head of marketing is to and activities that we specialise in and are different metrics and share their data online. imbued with an obsession to make products manage a small innovation team which is Amer Sports now plans to develop a range of that enable people participating in those sports known as The Hub. This team collects and connected products. We already have some of to perform better. We have a very creative analyses data on emerging trends in the the leading franchises in this area such as our and inventive culture, which blends art and watch brand Suunto and fitness equipment sporting and outdoor industry, identifying science, and it is driven by people who are brand Precor, which now offer a range of unmet needs and hidden insights and then sports practitioners who get to work alongside connected products, but we recognise that this feeds these back to each of the Amer Sports actual sports professionals to try to make the is a still a relatively untapped area for product brands. The Hub then works alongside each of perfect products. So, having people who really development. An example of the type of the brands to develop concepts and products understand the nuances of the industry and product innovation Amer Sports is aiming for would be the Wilson X Connected Basketball. Launched in the US in September 2015, this digital basketball can record when it goes in the basket as well as other functional metrics such as spin rate, length of time travelling in the air and so on. On the one hand this is really helpful for basketball coaches to design training programmes for students and measure their progress remotely. The other major benefit of this ball is that you can play games with people right across the country or even the world – almost like a live action video game – creating a digital community of players. Furthermore, the metrics of the ball can also form a key part of the analysis of a basketball game on TV. This has definitely been a game changer within the world of connected devices and led to Wilson being voted one of the most Victor Duran, Senior Vice President Direct to Consumer & Marketing at Amer Sports 23

the products certainly helps us be the best at from soft goods, to equipment to electronic redesign our 130+ Salomon stores around what we do. Furthermore, working with the devices as well as providing services too. So, the world and we'll be testing omni-channel very best athletes means that we're constantly you can use all of our techniques in those but only things that have equipment and apparel been proven to work, rather than trying to while exercising and "…working with the very best athletes innovate ourselves in this area. For example, competing throughout we don't anticipate Click and Collect to be means that we're constantly challenged the year and at the a big area for us as we don't actually have a to achieve more to meet the very high same time access, for dense footprint of brand stores. However, example, your Suunto improving Online Information and the Online expectations of these exceptional people." watch and track all of Inventory available inside our stores as your metrics. So, we part of the natural buying process is a key effectively surround developmental area for us. The other area challenged to achieve more to meet the very the athlete. We also believe that our products we've been working on is customisation, so high expectations of these exceptional people. genuinely make a difference. So, you win an consumers can now go online and customise For example, Kilian Jornet, widely regarded ultra-marathon because of your footwear more Wilson Gloves, Demarini bats, Suunto watches as the world's best ultra-distance trail runner so than your apparel. Or, you win a tennis and Atomic skis prior to making a purchase. is one of our athletes. In 2010, after winning match because of your racket rather than practically all major European competitions, he your trainers – our equipment is just a little came to the USA for the first time to compete bit more special in that respect and that's why Which companies, in your opinion, have in the Western States Endurance Run, a 100 consumers choose us over other brands. demonstrated expertise in the omni-channel mile ultramarathon across California's Sierra approach? How will this trend evolve over the Nevada Mountains. He struggled on the Can you give some examples of Amer Sports next few years? course and ended up finishing in third place. campaigns that have sought to leverage the The next time around, he did not want to leave A brand which I've been impressed with is omni-channel approach to marketing? anything to chance, so he worked with the the cycling brand Rapha. It has an excellent Salomon development team to develop the Firstly, I don't believe it's important for Amer online presence which is complemented by perfect footwear and apparel for the race's Sports to be at the cutting edge of a trend a limited number of café/retail outlets, as climate and geography. And in 2011, wearing like omni-channel but we do believe in doing well as its Rapha Cycling Club which hosts a our products he won, becoming the first non the basics well. So, for example, over the last number of events each year. This all helps to US/Canadian citizen to do so. five years we've aggressively invested in and tie consumers in to one big on and offline eco- opened up branded stores and ecommerce system. Rapha has cleverly positioned itself as channels. Previously, we only sold through more than a shop, but rather as a place to hang How do you truly differentiate yourselves from wholesale retail, so we didn't have any of this out and I genuinely believe that any brand your competition? kind of infrastructure in place but now we're that wants to survive and be successful in the Arguably, Amer Sports is the only sporting focused on making sure we're delivering future needs a strong offline retail proposition goods company that manufactures everything excellence in these areas. We're about to to complement its online presence. I think 24 Consumer Focus

we're going to see more sophistication in relatively small in China so there is a lot of all of our brands and regions. Digital marketing how brands leverage online search. So today, upside. Also, China is a huge market and is clearly an in-demand skill and we're actively Google, Amazon and Facebook are the three despite the difficult market conditions, there interested in attracting and retaining the best main tools used by consumers to search for are still a vast number of social climbers in digital marketers. The other major recruitment products and brands need to be absolutely the country who have, in recent years, seen drive the business has undertaken is to identify their disposable incomes well rounded commercial leaders – people increase significantly. who have a really good holistic understanding "Launched in the US in September 2015, Consequently, they have of wholesale, retail and ecommerce and how [the] digital basketball can record when been and continue to these channels work together. A third area it goes in the basket as well as other be interested in buying and the next phase of Amer Sports talent outdoor and sporting attraction strategy is introducing people functional metrics..." brands which are into the business who know about demand considered to be 'cool'. creation. We're great at making products with At the same time, the solid concepts that consumers want as well certain that their search strategy on these sites super wealthy Chinese are now beginning as distribution. What we're not doing yet, is robust and clearly differentiated. Tied into to turn to outdoor and sports brands as an which other brands are, is building demand in this is content which must be inspirational, alternative to expensive luxury brands which a cost effective way – getting to the consumers educational and commercial; not having any have previously grown very strongly in China. before they've made their purchase decision one of these attributes will be detrimental What we're finding is that both practicing the and creating demand for Amer Sports brands. over time. Then, brands need to make sure sport and living the lifestyle is becoming part that they have great partnerships with other of the culture in China and that is playing to What kind of leader are you? How do you get retailers, both on and offline, to sell their our advantage. the most out of your teams? products. I try to set ambitious goals, create support for To achieve its 2020 glidepath objectives, Amer those goals and ensure we put the capability Growing in China is a key part of the Amer Sports must make a significant investment in and capacity (both people, process and Sports 2020 glidepath. What has been the people development. What initiatives have systems) in place to deliver them. It's the impact of slower growth in that market? you led in this area? combination of these three factors that helps We are continuing to grow in China, so the Within the ecommerce and digital marketing to create high performing teams. When I economic climate doesn't seem to be affecting areas of the business, we've hired around 60 joined the business in 2010, the company our growth too much. First of all we're still digital experts over the last four years, across developed a goal of driving direct to consumer Victor Duran, Senior Vice President Direct to Consumer & Marketing at Amer Sports 25

"Last year Arc'teryx released its Voltair you to a variety of different portfolio of brands, regardless of their size or Avalanche Airbag, which is an electric industries, people and the category. challenges – I would actually airbag that enables skiers caught in an describe it as a paid PhD. It Do you have a favourite Amer Sports brand? avalanche to activate an airbag and was particularly valuable to me from a personal perspective The beauty is that you can like them all, significantly improve their chances of as it enabled me to learn some because we have such a wide variety of survival." models outside of the P&G products. It's impossible for me to choose a way of thinking. Consulting favourite one but if you come to my house sales. At the time Amer Sports had a turnover also highlighted to me that you'll see that it's full of Amer Sports stuff – of around ¤25 million in direct to consumer sometimes it's beneficial to be more flexible probably too much stuff if I'm honest! and we wanted to grow this to ¤170 million and apply different methods to different by 2015. This was a big opportunity but in situations. During my four years with Zyman Outside of work, how do you challenge order to achieve our target we needed to Group I also learnt how to really influence yourself? significantly increase our portfolio of stores and change the thinking of presidents and around the world and create ecommerce business unit leaders. So, moving back in- During the winter I love to ski with my kids and channels for all of our brands, among other house was relatively easy and it meant I was ski tour with the Swiss Alpine club. During the things. These were definitely ambitious goals, able to comfortably work with the Amer Sports rest of the year I love to cycle, run and sail. but we put the plans in place, hired some great people around the world, and followed that up with the right investments to build a sustainable platform. In the end we hit our targets a bit ahead of schedule and plan on doubling sales in the coming four years.

Prior to joining Amer Sports two years ago, you spent four years working as a consultant. How have you found the transition from working as a management consultant to moving back into an in-house strategic role? I spent seven years with P&G during my early career and it was there that I learnt the fundamentals of business and how to be disciplined, methodical and robust. Working as a consultant is a great way to both build on and broaden your experience as it exposes 26 Consumer Focus

Death knell or rebirth? Building FMCG brands in the age of the discounters

The privilege of living and working in Munich for two years Remember Aldi and Lidl have a 40%+ share so visiting Real or V-Markt will be instructive. You gave Richard Nall a dispassionate position from which to judge will see a very different retail landscape. You the UK retail scene on his return. Having supported a number might notice two things amongst others: the large amount of space given over to Home & of CEOs in the last two years, he believes that all is not rosy, Gardening (suggesting Mike Coupe might be and that companies are struggling for answers to current onto something with HRG) and the seemingly random allocation of space to categories and market turbulence. In this interview, he gives an alternate brands. view of the UK retail market situation and suggests a route You will note that categories such as dairy forward for brand owners. >> and alcohol are thriving and brands such as Tempo hankies and Milka chocolate appear to have intriguingly large amounts of space; The proximity battle spend away from the multiple grocers, whose a seemingly 'distorted' space allocation The exceptional job recognition of the need to change value in comparison to UK norms. The truth is that traditional multiple propositions came slowly and late. that these retailers back the categories grocers did in reinventing the convenience, or The UK is not "The 2008 financial crisis accelerated the proximity, shop is well Germany…yet recorded. For this, they deserve high praise inevitable as consumers responded to the and yet, following the law of unintended In trying to foresee quality propositions of the discounters, consequences, they also enlarged the window the UK retail scene of moving spend away from the multiple of opportunity for Aldi and Lidl through 10 years' time, a trip grocers." sensitising shoppers to the experience and to Munich might do value of being able to shop for high quality wonders for your introspection. goods, at reasonable prices, locally. There is no particular reason for choosing this and especially the brands that support an The 2008 financial crisis accelerated the lovely city but you might as well take in the appealing, differentiated offer for which inevitable as consumers responded to the opera, Viktualenmarkt and the Hofbrauhaus shoppers will treat them as a destination. quality propositions of the discounters, moving whilst you are there! Aside from these, ranging is also very tight. Death knell or rebirth? Building FMCG brands in the age of the discounters 27

"…the inconvenient truth is that there has The great benefit of observing new brands never been a time when [UK retailers] emerge is that they Market snapshot have needed powerful, distinctive brands remind us precisely more to help differentiate offers and what we should cherish about our own. Whilst attract shoppers." attractive packaging does UK all the pre-trial work, it is Back in Blighty, whilst discounter share in the product's quality that A relatively positive start to 2016, some categories is racing towards 20%, the converts this from an unknown, risky one-off following a long needed stint of consistent traditional multiples have busily pillaged into a must-have discovery to be recommended economic growth in the UK, gradually suppliers' P&Ls to prop up profitability. Yet to friends and family… and leads to the next waned after Q1 as insecurities regarding entry in the sales ledger… and the development the inconvenient truth is that there has never the June referendum on EU membership been a time when they have needed powerful, of intangible brand value. Consider Innocent began to seep into consumer and business distinctive brands more to help differentiate or Yollies. consciousness. Consumer confidence, offers and attract shoppers. In other words, we all know that financial which had remained high up until April performance is the direct reward of providing took a tumble in May and that coincided False economy and earning reward products that our customers need, want, with a slowing down of GDP growth – And herein lies the rub. Too many FMCG and for which they will return in future… but lower in fact than the overall growth of companies, whilst proudly broadcasting brand we ignore the evidence in front of us, and the Eurozone. guardianship, have been undermining those myopically covet the numbers in our latest very bastions of long term profitability through P&L report. Although the prospect of a Brexit was one or more of: cost-engineering dressed up certainly one of the likely reasons behind as quality improvement, excessive promotional Driving consistent, superior this turn of fortunes, moderate demand activity to sustain volumes, and inconsistent profitability for British goods leading up to the mid- application of basic branding principles. Luckily, there is clear evidence that superior point of the year also had an impact. profitability comes from focusing back on Businesses may be cautious making Please indulge me for a moment. My father the basics. In their excellent 2013 Harvard investment decisions in the uncertainty retired some time ago. He has always had a Business Review article 'Three Rules for following the vote and as a consequence, sweet tooth. He has bought a certain impulse Making a Company Truly Great', Messrs. brand since before I was born… until a couple of the UK's growth projection for 2016 Michael E. Raynor and Mumtaz Ahmed from years ago. He rang to tell me what he thought will be lower than expected at the end Deloitte LLP analysed in excess of 25,000 (he's always been very good at that!) of those of the year. companies listed on the US exchanges who had cheapened his favoured purchase in between 1966 and 2010 to understand that renowned 'new improved' way. He used how companies with superior profitability to be intensely loyal to that brand but, alas, no more. In fact, when I quizzed him in preparation for our discussion, he hadn't purchased it since. He has damned them to hell… and they can surely stay there. He has replaced it with a much better, and cheaper, Lidl product.

As Adam Morgan noted in his seminal book Eating The Big Fish, brand leaders have always been masters of 'being just good enough' whilst the poor old follower has had to over-commit in order to gain traction. Worryingly, not only brand leaders' but also brand followers' short-term tactics to boost profitability have resulted in them gaining the perception of 'not being good enough', significantly undermining their performance and brand power as a consequence. 28 Consumer Focus

"Whilst it is convention to combine price for searching out growth. deep discounting. Whilst it is convention to cuts and promotional feature space, this combine price cuts and promotional feature Young's Seafood exhibited space, this is an evolved phenomenon and is an evolved phenomenon and hides this approach throughout hides an essential truth: price-cutting to drive the late '90s and noughties, an essential truth: price-cutting to drive sales is a sign of brand weakness leading to taking brand leadership of financial inefficiency. sales is a sign of brand weakness leading frozen seafood along the way. The brand's decline to financial inefficiency." It follows that the outcome of effective brand coincided with an arguable management is enhanced profitability and dilution of these principles cash flow yet most junior and middle ranking consistently outperform the stock market. as the company sought to 'cut its way to profit They came up with three surprising (or growth'. When I returned to the business in marketers (and quite a few senior ones) perhaps not) conceptual rules: 2014, the key reason for our rapid success in place greater value on the process than on improving business performance was a focus the business outcome. It is unsurprising that 1. Better before cheaper (compete on on these 'rules', reinvesting in product quality marketing departments struggle to be taken differentiators rather than price); and targeting those shoppers, consumers and seriously in a world in which the hard reality of market segments whence we could derive driving profitability, with ranging and margin 2. Revenue before cost (prioritise revenue growth; essentially earning financial reward as under the cosh, seems to leave no place for growth over cost reduction); a result of being better and for chasing growth 'pretty pictures and flower arranging' (as one in the most favourable market areas. particular Sales Director once explained it to 3. There are no other rules (so make very sure me!). you are good at rules one and two). Board room influence Marketing Leaders (and I don't just mean I say 'surprising' because all of the other Most FMCG businesses claim that marketing the Marketing Director) have an imperative measures one might expect to be drivers of is essential to success but, as I have already value e.g. customer focus, asset utilisation, intimated, this is often less true in practice. to ensure that their teams are financially superior gross margin, innovation rates Marketing leadership implies a relentless literate, understand their P&L and balance etc. had a negligible effect in comparison. focus on brand building as a pre-requisite to sheet, and can evangelise on the direct links What mattered most is not what they did, financial success. More powerful brands sell between product quality, brand development but how they thought. These companies more at full price with a reduced need for and superior sales growth, cash flow and institutionalised a desire for being better and discounting and certainly a reduced need for profitability. Death knell or rebirth? Building FMCG brands in the age of the discounters 29

So what to do? derive its growth. It will enable you to define Really think through your approach to research brand stretch parameters and formalise the and what type of discoveries you wish to Develop strategic insight and attributes and benefits required of your make. When developing actionable insights, discovery skills innovation. brands are often built on narrow insights that Marketers are often split on the value of are intensely relevant to the category but are strategic research e.g. segmentation. There In this omni-channel retail and media world, also restrictive. Take Snickers' 'you are not you is no doubt that they are both considerable it can be overlaid upon purchase and media when you are hungry' or Lurpak's 'great food investments and resource intensive to deliver. panels to create more integrated views of tastes better with butter' (with apologies to Many prefer using cumulative ad hoc research shopper behaviour, consumer product needs the original crafters!) and you have universal studies as the basis of their programmes. and media consumption patterns than have insights executed by those brands in a way However, this is akin to pre-supposing that been hitherto available. Think of it as the which holds universal appeal, significantly developing and executing a series of tactics Ordnance Survey map of your market that will enhancing growth prospects. equates to having clarity of the strategic significantly enhance your journey planning choices you are deliberately pursuing. and ensure you pick the best route/sights to Prioritise brand distinctiveness see. Specific projects can then be supported The value of segmentation lies in your teams with bespoke qualitative and quantitative The work of our Deloitte authors clearly defining the market they are in e.g. shaving vs research as required. implies that superior profitability is a direct personal grooming result of marketing activities. In order to be or cold drinks versus 'better before cheaper', we have to understand refreshment. It "Most FMCG businesses claim that our customers' needs and be able to derive brings real clarity of marketing is essential to success but, as I powerful brand and product platforms that are the strategic target both relevant and defendable over the long audience from which have already intimated, this is often less term such that they can generate sustained your business will true in practice." revenue. 30 Consumer Focus

more likely to trigger successful recall and purchase, driving a significantly greater return on investment.

There are, of course, times when the advertising idea has had its day and needs to be replaced but beware thinking this is a simple exercise. Careful thought is needed to isolate those key elements of your advertising to be retained. The acquisition of Bounty from P&G required SCA to migrate to Plenty. We were particularly concerned to maintain the right tonality as we replaced P&G's successful 'Strong Housewives' campaign and I will admit to some sleepless nights as we launched Juan Sheet. I needn't have worried. He has been a huge success, all due to the excellent work of the brand team and Publicis. Academia has taught a generation of business and confirmation that the correct choice was Too many 'campaigns' are allowed a single people that brand differentiation is their made, can be recommended, and should airing before being declared a failure with the objective. This appears a sensible goal but is be considered again. As mentioned above, brand team returning to the drawing board. It arguably misguided, when a focus on creating that superiority is the starting point for, and will be pretty obvious if it really isn't working clarity and distinctiveness will serve you better. constant reinforcement of, brand value. For (your employees will tell you!) but all too often Your brand will have a number of (usually not food brands, actual differentiation seems the decision to ditch is made hastily, ignoring so) discrete emotional attributes in an attempt difficult to sustain yet many businesses do not the fact that consumer memory structures to make you stand out in your category but have a pervasive food culture from boardroom might have been broken and require if your communication of these is grey, you to factory floor that delivers and sustains rebuilding over some considerable time. will remain unnoticed. Recall some favourite effective scaling up from development kitchen Sometimes, historic memories are so powerful to manufacturing. that they override whatever you do and the "It should be no surprise, therefore, brand needs to find a way back into them; that integrated communications are Build consumer memory witness PG Tips. more likely to trigger successful recall structures and purchase, driving a significantly The long-term creation of Emphasise penetration, not loyalty distinctive brands does not A central 'truism' I was taught early in my greater return on investment." need to come from a one-off career was that 20% of my customers account TV commercial. If you delve for 80% of my sales and so I should focus on into your brand archive it is brands, and I suspect you will remember keeping them. I remember being bewildered likely that, at its most successful, your brand/ a piece of iconic advertising or packaging when it was more like 20:50, having to recheck advertising was built on a meaningful human that made them distinctive in your mind's my numbers as I presumed I had made an insight and executed consistently over many eye. That advertising, e.g. Guinness Sea error. years (rather boring for the marketer trying to Horses, Cadbury Gorillas, or perhaps Jonathan make a name for him- or herself). Successful Warburton and the Muppets, had a substantial There was no error. Your brand(s) will show impact on consumer recall and consequent brands ensure that core messages and imagery similar characteristics meaning that the other sales because it stood out from the mundane. are consistently applied across a myriad of 80% of your shoppers have more importance This might lead you to conclude that your touch-points, particularly in-store, to ensure in the revenue equation than you might have focus is differentiation but it is the brand's that consumer memory distinctiveness that is the driver. structures are rigorously built and reinforced "Too often, colleagues complain that the over time. It should be short-term overwhelms the long, impacting Invest in product differentiation no surprise, therefore, Product differentiation through superior actual that integrated on the company's ability to build sustainable or perceived performance ensures satisfaction communications are shareholder value." Death knell or rebirth? Building FMCG brands in the age of the discounters 31

hitherto considered. A deep analysis of 'heavy' a greater chance of supporting your customers' from building strong product pillars with buyers may well find that 'heavy' is a rather desire to be a preferred shopping destination. economic scale to protect you from retailer transient concept year on year, whilst true whimsy. loyalists will inevitably be 'rewarded' through Innovation: plan for the long term your overall marketing mix (being the most Support your innovation with a clear pre-disposed to your brand). Executives who pursue the 'throw-it-at-the- articulation of brand architecture and strategic wall-and-hope-some-sticks' approach to initiative frequency (what and when!) over For many brands/sub-brands, prioritising innovation are essentially saying that they the next 5 – 10 years. You will be able to penetration is a matter of common sense since prefer the freedom to be 95% wrong (the oft isolate and fully define those areas where a they have relatively low penetration rates (less quoted innovation failure rate) compared to more scientific approach to R&D might give than 50%) and scarce resources. At the risk of the 50% - 70% wrong of those who demand you something of protectable value. Too stating the obvious, driving penetration also more rigour. The 'as much as possible' option often, colleagues complain that the short- equals more shoppers meaning that you have also has the risk of diverting your attention term overwhelms the long, impacting on 32 Consumer Focus

"Too many 'campaigns' are on optimising category profitability. Tesco/ BCG took a comparatively simplistic approach allowed a single airing before to modeling its category reset, and this should being declared a failure with act as a wake up call to embrace and drive an the brand team returning to area that has been ignored for too long. the drawing board." In conclusion the company's ability to build sustainable UK retailers need strong, distinctive brands shareholder value. with differentiated products…now. The product quality of many brands is arguably not good enough to support these customers Unleash the power of data in their hour of need, and to the eventual detriment of brand owners. It is an obvious statement: 'We must extract every penny from the P&L from retail sales Our authors from Deloitte showed that value to operating profit'. However, you won't successful profitability stems from your be alone in unhappily condoning +/- 20% business philosophy rather than your process forecasting accuracy whilst your promotional or systems. Get back to basics. Eulogise RoI analysis might still be an aspiration rather financial performance as the reward for having than reality. With the variety of data sources/ a superior marketing mix. economic scale (aka consumer reward) that are manipulation tools available, there are nigh on impossible for a retailer to delist? Do you really understand your market substantial opportunities here. landscape and consumers? Do you have Are you treating your innovation funnel as Consider recasting your category team into a truly distinctive brand built through a funnel? Do you have a balanced project a Category Strategy and Advanced Analytics exceptional creative talent? Does it make you portfolio? Team. Give them a data and insight role laugh, cry, cheer…? Do you really love your bringing together marketing mix modeling, product? And do your consumers? Have fun. Embrace data. forecasting and trade spend optimisation and you will create a powerful advisory group who Are you disciplined in execution, ensuring The leading retailers will continue to can support inter-disciplinary decision-making consumer memory structures are consistently flex ranging to better compete with the (better marketing and joint business plans for built and reinforced? Are you building brand/ discounters. Large or small, make sure you are a start) as well as consulting with customers sub-brand/product pillars with substantial one of the winners. Private label decline: a chance for Spanish retailers 33

Market snapshot

SPAIN Private Spain's recovery has continued apace over the last 18 months, and by the end of the year its economy is expected to have expanded by 2.7%. The country still has the highest unemployment in the western world, however, and analysts label decline have pointed to that as well as domestic political uncertainty and international economic tensions as being a key reason behind a fall in consumer confidence a chance for at the start of the year. Despite this underlying sense of foreboding about the future, low interest rates as well as the falling oil price have given Spanish consumers greater spending power, Spanish retailers and strong retail sales driven by food and non-food categories as well as a booming tourist trade, will likely help Spain be one of Europe's fastest growing nations, ahead of France and Germany. Ecommerce sales have also risen to record levels showing how the shopping habits of Spanish consumers Private label decline: a chance for retailers and manufacturers are gradually becoming more aligned to their peers in Europe. to reinvest in product innovation. >>

Between 2009 and 2013, developing portfolios of low cost private label market has now stabilised amidst this more Spain's private label goods. Mercadona, for example, introduced favourable climate, with retail sales climbing market grew by over 64 private label yogurt varieties between 2010 at a faster rate than in previous months and at 30% as the economic and 2012 alone; an indicative strategy that above the expected growth rate for the year. crisis effectively helped the business remain profitable during forced retailers to offer the 'great recession'. The last few years of living through austerity, consumers more low however, has ingrained a culture of frugality cost alternatives to branded goods. Led by Spain's economy, however, is gradually leaving into the mind-set of the Spanish consumer. supermarket chain Mercadona, a fierce price its troubled past behind. This is evident in the Shopping for value is still a major priority war began in the Spanish grocery trade as fact that the country has recently recorded its for people and amidst a retail environment stores actively removed unprofitable branded ninth straight quarter of positive GDP growth, swamped by heavily discounted private product lines, and focused instead on while unemployment has also fallen to its label goods and a never-ending cycle of lowest level in four years. promotional offers, almost half of shoppers, With more consumers according to a recent study, still actively seek "…stores actively removed unprofitable again enjoying the stability discounts. Yet the revived economy is leading branded product lines, and focused of permanent employment, to subtle changes in the sector, in particular consumer confidence has by heralding the return of branded goods instead on developing portfolios of low risen and spending has manufacturers, who want to lure 'better-off' cost private label goods." increased. The FMCG consumers back to brands. 34 Consumer Focus

to do so, however, they must invest in further distinguishing their products from the branded equivalents. Likewise, branded goods manufacturers must embed new ideas and quality into products, something which has seemingly been lost in the race to reduce prices.

What has been apparent during the last few years is that businesses in the consumer products industry that have moved forward amidst the enduring burden of austerity have been those that have developed successful innovation programs; innovation therefore, is still the key ingredient that will guarantee success in Spain's retail environment. Industry analysts are also calling for greater collaboration between retailers and manufacturers to meet the needs of consumers, but also to find ways to ensure collective profitability by nurturing healthy Although Spain still leads Europe in terms of the price difference between private and competition through a mixture of discounted the size of its discounted private label market, branded goods is shrinking. That is clearly and standard priced goods, and private and with over half of grocery products falling into an unsustainable model for retailers and branded labels. this category, a recent study confirmed that manufacturers and therefore only a third of Spanish consumers intend something must change. "By tapping into the changing psyche of to buy private label products over the next Retailers still want to create 12 months. Private label spend in Spain had the Spanish consumer, brands are being successful private label already declined between 2013-2014, in line portfolios and reap the rewards positioned as 'affordable' and sold at with a broader European trend, yet whereas of higher margins. In order lower prices." retailers and manufacturers in the UK and Germany, for example, are finding ways to reintroduce more standard prices to reset the balance, Spanish-based firms are still trying to satiate discount hungry consumers with offers.

By tapping into the changing psyche of the Spanish consumer - who stills wants to spend cautiously but believes their increased wealth and stability means they can enjoy the 'well known' products again - brands are being positioned as 'affordable' and sold at lower prices; and consequently branded goods manufacturers are regaining market share. A good example of this in action was the launch of the small ¤1 Cornetto by Unilever Spain, in 2015. Analysts believe, however, that this type of activity is potentially damaging in the long term, as it could diminish the premium aspect of brands and train consumers to focus only on price, while ignoring other 'brand attributes' like health or convenience.

With the grocery trade in Spain seemingly committed to driving its discount agenda, Featured interview >>

MIGUEL CHAPA, MARKETING DIRECTOR AT BEL SPAIN

Miguel Chapa Marketing Director at Bel Spain

Bel Group is the French multinational owner of a range of iconic global cheese brands including Babybel, The Laughing Cow, Kiri, Leerdammer and Boursin. We caught up with Bel Spain's Marketing Director Miguel Chapa Monteagudo to find out how the business has experienced rapid growth in Spain over the last few years despite challenging market conditions. >>

Bel Spain began a journey of to address various factors. These included transformation a few years ago. Why how to better understand its consumers, was this journey necessary? improving its customer engagement both on Undoubtedly, the difficult economic conditions and offline, and working towards building in Spain over the last few years have severely better relationships with external partners. At impacted the growth of branded goods makers the same time it needed to invest in its own such as Bel. This was particularly apparent people, as it was clear that they would be the within the context of the cheese industry, key to the business achieving the objectives of where Bel primarily operates. The cheese its transformation. category in recent times has become more and more commoditised and has been in desperate During the last three years and despite need of a 'step change' to better address enduring difficult market conditions, new trends and challenges. So, to combat Bel has been one of the fastest growing prevailing economic conditions and remain FMCG companies in Spain. What has competitive in a rapidly changing market, been the key to Bel's success? Bel needed to transform its approach and leverage the expertise of different departments That's right, while FMCG in Spain grew by Miguel Chapa Monteagudo across the business, working collectively 2.6% during the last three years, the organic Marketing Director at Bel Spain 36 Consumer Focus

growth of Bel was 12.7% according to Nielsen. behind our premium price point. So, as well The strategy which has ultimately helped Bel as highlighting the quality, convenience and grow ahead of the market is fourfold. Firstly, nutritional factors behind our brands, we have Bel has redefined the marketing strategies also tried to associate them with childhood 'moments of consumption' such as the mid-morning "Understanding the potential of cheese school break or the to become associated with healthy afternoon 'merienda'. snacking has been critical to Bel's Mums are bombarded success over the last few years." by so many unhealthy snacking options for their child and we've worked category, in particular, which offers the for its core brands and leveraged consumer hard to establish the fact that if they choose and shopper insight to better align its brands most attractive opportunities for food Bel, they are guaranteeing that their child will with trends impacting consumer behaviour. manufacturers. The demands of modern life be eating healthy snacks throughout the day. Secondly, Bel has invested in improving have led many people to change their eating on and offline communications, providing habits and research has shown that food is consumers with a better all-round 'experience' Generally, is healthy living and dieting now generally consumed more frequently of its unique brands across multiple channels. still an underdeveloped market in during the day, but in smaller portions. The Thirdly, Bel has gained a greater understanding Spain? combination of healthy snacking and the fact of point of sale (POS) and developed activation that consumers don´t want to sacrifice on strategies to improve product visibility in- Certainly in Spain, as well as in other taste and pleasure, is a megatrend which will stores. Finally, in line with Bel's core values of European markets, there is still a great deal of continue to dominate the food industry for the 'dare', 'commitment' and 'taking care of people', opportunity for brands to grow by tapping into foreseeable future. At Bel, we want to make the business is being inspired to transform its the healthy eating trend and it's the snacking sure that throughout the day consumers who operational processes to better meet the needs select our snacking brands get the nutritional of its employees as well as its external partners. balance they need to stay healthy. Embedding an association between the moments and Child nutrition is a big trend in the experiences of daily consumption and food industry and one that Bel has the nutritional properties of our sought to leverage. How has products is decisive to achieving Bel successfully sold cheese brand loyalty moving forward. snacks to mothers who might La Vaca que Ríe Light is an associate them with not example of this in action. being healthy? It's a snacking brand specifically targeted Understanding the potential of at women and we're cheese to become associated delighted that there is with healthy snacking has now strong appeal for been critical to Bel's success the product because of over the last few years. The its healthy, low calorie, reality is that cheese already tasty and nutritious has an excellent reputation qualities. It is becoming for its nutritional properties, a popular mid-morning compared to other snacks and afternoon snack for that are consumed at similar women at work and at times during the day. Cheese home. We believe that the has also always been a preferred snack for Spanish people of all ages; 'dairy goodness' integral to our in fact, 82% of Spanish households product range is a strong asset regularly consume processed cheese. At which goes a long way towards the end of the day, it is the quality and origin satisfying the current and future needs of our ingredients which are the key factors of consumers. Miguel Chapa, Marketing Director at Bel Spain 37

"…the business is seeking to leverage its becoming global leaders time, the business was actively seeking in ecommerce solutions people with engineering backgrounds. I had current digital capabilities as well as hire and too. It's vitally important no intention of pursuing a marketing career, build partnerships with other 'digital talent'." for the FMCG trade to however, my first role at Carrefour was in stay abreast of these purchasing and category management which developments. Bel aims to partner with the meant that I had a lot of interaction with people You mentioned that embedding digital most advanced retailers, which are typically in the key account management and trade capability is a key priority for Bel. those that are willing to support Bel's digital marketing side of the business. I quickly took What's the business up to in this area? focused brand activation at the POS. an interest in those types of roles and, after Embedding digital capability is an integral acquiring a master's degree in marketing, was component for ensuring Bel remains able to transition to the 'other side'. Life in the Bel has been hiring talent from competitive now and in the future. Our two retail industry certainly helped me develop outside the business to help with main priorities in this area are people and a sense of pragmatism, which I believe is an transformation, bringing in people technology. Focusing specifically within the essential business skill. I've found the move from big FMCG brands. What's the marketing function, the business is seeking to into FMCG more dynamic overall, mainly attraction for individuals from 'blue leverage its current digital capabilities as well due to the strategic and creative elements of chip' backgrounds? as hire and build partnerships with other 'digital the work. Looking back, there was clearly some synergies, from the start, between my talent'. This will help us to better understand The values I mentioned earlier are a real interest in engineering and marketing. The how to best exploit the most relevant and motivation for people who join Bel. Our values term engineering is derived from the Latin cutting edge tools across the digital marketing are not just simply theoretical or ephemeral 'ingenium' which means 'to invent' and that's mix. The marketing department is also tasked either, but rather they are tangible business basically what marketing people do. with educating and leading change across the attributes that you can literally 'breathe in' rest of the organisation. The rapid evolution when you walk through the door. Furthermore, of technology, alongside globalisation and our recruitment process is very transparent; What kind of leader are you? How do demographic confluence is all part of a new we want to give those considering joining Bel you get the most out of your team? social paradigm which is affecting every as much insight as possible into who we are I'm a very value driven person and I try industry. Making the necessary adjustments to and what we do. People appreciate that kind to constantly lead by example and imbue align Bel to this new paradigm is a critical step of honesty and it adds to the attraction. As Bel's values into my team. I believe in the business needs to take in order to define well as digital skills, Bel is also keen to attract empowering other people and operate in a its future strategies. We have really only just individuals who are strategic, pragmatic and system where everyone is clear about their begun our journey and acknowledge that this creative and we believe people with those role and responsibilities. Furthermore, I transition will be painful, but are confident that qualities can thrive within Bel's culture. I joined encourage collaboration as well as strategic the outcome will be that we become a better Bel three years ago having previously worked thinking, pragmatism, innovation and and more competitive organisation. for bigger multinationals and I find every day creativity as I believe those attributes are here more exciting than the last. key to creating a motivated and successful Ecommerce hasn't matured in Spain yet; working environment. Above all else though, I want my people to have fun. I do adapt my most Spaniards still prefer to shop in You originally trained as an engineer. management style if I think it's necessary, but store. How does Bel work with retailers What made you then dedicate your generally that summarises my approach. to maximise sales on and offline? career to FMCG and Marketing? The adoption of ecommerce in Spain has In the late 1990s following the completion of certainly been slow compared to the rest of my engineering degree, I joined Carrefour Europe. I was actually involved in the launch of because, like many big corporations at that Carrefouronline in Spain in 2002, yet fourteen years later Spanish FMCG sales via ecommerce channels only account for one percent of the total market. I do think, however, that adoption and growth of ecommerce in Spain will be much quicker over the next few years. Global brands such as Amazon and Alibaba have a much greater presence here now and businesses are also discovering how Google and Facebook, for example, as well as being fantastic marketing tools are also fast Industry comment >>

BOSTON CONSULTING GROUP

Fashion and Luxury A New Era of Opportunity

Over the past five years, the global fashion and luxury sector has delivered extremely strong value creation, thanks to rising incomes in many emerging markets and a recovering global economy. >>

In 2015, The Boston entire group of consumer sectors, see “The Consulting Group Return of Growth,” the BCG 2015 Consumer conducted its annual Value Creators Series, November 2015.) study of the total shareholder return (TSR) The Drivers of TSR Most of the top- of nearly 2,000 publicly performing companies were able to create traded companies in 27 industry sectors, value primarily through sales growth and of which 41 were in the fashion and luxury improved valuation multiples, with smaller sector.1 (See Value Creation for the Rest of contributions from improved margin Us, BCG Value Creators report, July 2015.) performance. (See the exhibit, “The Fashion During the five-year period from 2010 through and Luxury Top Ten, 2010–2014.”) For 2014, the fashion and luxury companies in the example, Under Armour, which tied with sample returned an annualised TSR of 25%. Fawaz A. Al Hokair for first place, generated The sector ranked first overall among the five 29 percentage points of TSR from sales growth consumer sectors we analysed—consumer and 31 percentage points from changes to its durables and retail (which tied for second), multiple, with little or no contribution from any travel and tourism, and consumer nondurables other levers. Under Armour is also notable were the other four—and first overall among in that it is one of four companies to make a all 27 industry sectors. (For an overview of the repeat appearance on the top ten list, along Fashion and Luxury: A new era of opportunity 39

This shift has directly affected the sales of luxury products—particularly watches, small leather goods, and business attire, all of which had been commonly purchased as gifts or perks. We believe that, in the long term, the economic shift in China represents a necessary correction rather than a more profound crash. The country still holds tremendous potential for fashion and luxury companies, provided that they can withstand some turbulence as the current correction unfolds. In the near term, one bright spot from the correction is that mid-level fashion and accessory brands— accessible luxury players, such as Coach and Michael Kors, along with “fast fashion” players, such as Zara and H&M—may benefit. The smaller indulgences that these companies offer are more moderately priced and thus with Sports Direct International (which finished in 2014, the revenues for those companies more within reach of a wider segment of the third), L Brands (fourth), and Hugo Boss (fifth). plateaued as well. Businesses are now trying Chinese population. In addition, a growing to drive growth by improving same-store sales interest in health and wellness will lead to Turbulence in China As in prior years, the rather than opening new stores. In addition, growth opportunities for sports and outdoor top performers in the sector were primarily frugality and anti-corruption reforms in China companies. mass-apparel companies, rather than high- have hurt specific segments in the fashion fashion labels. That is partly due to flattening and luxury industry. Gift-giving practices Digital Opportunities We believe that growth in emerging markets—particularly among private companies have slowed, digital represents a foundational shift in in China. During the past decade, as that and the custom of sending even small gifts the way fashion and luxury goods are sold, country's wealthier population increased in to government officials or employees of and that it will serve as a means to drive size and affluence, many fashion companies state-owned enterprises for the Chinese New value creation for the foreseeable future in were able to grow significantly by opening Year or the Midautumn Festival has largely two ways. The first is through ecommerce. new stores in the region. Yet when growth in vanished. What's more, the use of public funds Digital sales represent a major opportunity, China slowed and consumption rates eased for any purchase is now heavily scrutinised. particularly for high-end fashion companies. In

TSR Disaggregation¹ Company Location2 Average Market Sales Margin Multiple Dividend Share Net debt 2015 annual value3 growth change change4 yield change5 change TSR6 TSR (%) ($billions) (p.p.) (p.p.) (p.p.) (p.p.) (p.p.) (p.p.) (%) 1 Fawaz A. Saudi Arabia 58.4 5.5 29 0 23 7 0 0 –24 Al Hokair 2 Under Armour United States 58.4 14.5 29 1 31 0 –1 –2 40 3 Sports Direct Int United Kingdom 48.7 6.6 15 11 15 0 –1 9 9 4 L Brands United States 46.7 25.3 6 7 20 12 2 0 9 5 Hugo Boss Germany 43.2 8.6 10 6 17 5 0 5 2 6 Foot Locker United States 42.1 8 8 24 6 4 2 –2 28 7 Titan India 40.9 5.4 22 2 17 1 0 0 –13 8 Signet Jewelers Bermuda 38.3 10.5 11 7 21 1 1 –3 5 9 Hanesbrands United States 36.5 11.2 7 8 11 1 –1 11 8 10 Ross Stores United States 36 19.7 9 5 20 1 3 –2 6 40 Consumer Focus

the past several years, many such companies continue to build on that progress. More have resisted rolling out ecommerce sites on accessible luxury companies, such as Coach the grounds that buying goods online is not and Tory Burch, generate a much higher a true luxury experience. But increasingly, percentage of their sales through ecommerce convenience is the ultimate luxury. The than their competitors do and can serve as challenge is to create a differentiated models for this approach. experience for consumers. The second opportunity offered by digital One potential solution for many high-end is the use of analytics and data to develop a fashion companies is to augment their online more detailed picture of customers in order offerings with designer profiles, photo essays, to better meet their future needs. We expect videos, and other content that captures the that more high-fashion and luxury brands rich heritage underlying their products. will use data and analytics to inform key Another solution is to create differentiated decisions along the value chain. For example, offerings through exclusivity. Restricting in company-owned stores, customer data can access to confirmed customers— or those be used to revamp assortment planning and who are likely to make a high-end purchase— merchandising on a regional basis. For online can change the way consumers experience sales, companies can use data to tailor more a website or perceive a mobile offering. relevant, personalised marketing offers. That said, finding the right balance between European countries. Currently, Sports Direct exclusivity and inaccessibility is tricky, and Sports Direct International (third in our TSR is doubling the size of its warehouse in the many companies will struggle to achieve it. ranking) is an example of a brick-and-click UK in order to serve online customers more company that has managed to transform effectively. In addition, most high-end companies need its business model and adopt a truly omni- to close the gap with mass retailers in terms channel approach. The company has grown Fashion is always in flux, and markets expand of omni-channel execution. Increasingly, the by acquiring retailers and brands, such as and contract, but the basics of value creation ability to purchase, pick up, and return goods Everlast and Slazenger, and by strengthening do not change. Companies that can balance through any channel—whether online or off— its own labels. But it also experienced a boost strong growth with attractive margins, is becoming a baseline requirement. Some in online sales recently after introducing quick employ digital, and meet their customers' fashion brands have taken steps to improve online check-out solutions, such as click-and- needs will generate steady, reliable returns their omni-channel execution, but they must collect, as well as websites for its customers in for their investors. Fashion and Luxury: A new era of opportunity 41

Note 1. TSR is a metric that encompasses all sources of value that accrue to shareholders. It includes changes in sales, margins, and valuation multiples, along with all sources of free cash flow to investors and debt holders, such as changes in dividends, net debt, and the number of shares outstanding. About the Authors Ketil Gjerstad is a partner and managing director in the Oslo office of The Boston Consulting Group. He co-ordinates the shareholder value topic for consumer companies. You may contact him by email at [email protected].

Olivier Abtan is a partner and managing director in the firm's Paris office. You may contact him by email at [email protected].

Vincent Lui is a partner and managing director in BCG's Hong Kong office. You may contact him by email at [email protected].

Sarah Willersdorf is a partner and managing director in the firm's New York office. You may contact her by email at [email protected].

The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. They partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Customised approaches combine deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organisation. This ensures that their clients achieve sustainable competitive advantage, build more capable organisations, and secure lasting results. Founded in 1963, BCG is a private company with 82 offices in 46 countries.

For more information, please visit bcg.com. Sources: S&P Capital IQ; annual reports; BCG analysis.

Note: n = 41 global companies with a market valuation greater than $4.5 billion as of December 31, 2014. 1 Contribution of each factor shown in percentage points of five-year average annual TSR. Any apparent differences in TSR totals are due to rounding. 2 Location refers to the location of the company's corporate headquarters. 3 As of December 31, 2014. 4 Change in EBITDA multiple. 5 Share change refers to the change in the number of shares outstanding, not to the change in share price. 6 As of September 9, 2015. 42 Consumer Focus Extending our reach Extending our reach 43

Nigel Wright regularly fulfils recruitment assignments for clients around the world. >>

In the last 24 months it has won retained work in all six continents, across 30+ international territories. Many of Nigel Wright's international clients have planned for the future by seeking to achieve long term growth in emerging markets. As a result Nigel Wright has been instrumental in assisting clients to build new business units in key strategic markets such as Asia, the Americas, Africa and the Middle East. Nigel Wright now has dedicated teams responsible for the EMEA, Asia-Pacific, US and Latin American regions.

Europe

Middle East & Africa

The Rest of the World Featured interview >>

ANNEKATRIN OTT, TWININGSOVO INTERNATIONAL MARKETS (IM) HR DIRECTOR

Learnings from working in centralised and decentralised organisations: implications for HR and talent management

Nigel Wright speaks to TwiningsOvo International Markets (IM) HR Director, Annekatrin Ott, about her experiences of operating in centralised and decentralised business models. >>

Amongst the Companies can usually expect better, faster SKUs worldwide, it tries to tailor its products, many challenges decision making without the input of a 'global' which consist of a variety of specialist teas associated with centre. Regardless of which model is adopted, and hot drinks, to the multitude of different expanding overseas however, the impact on HR practitioners is consumer tastes that exist in the countries that and establishing significant, especially if they're moving from it currently serves. Its aim over the next four operations in one system to the other. years is to double its operating profits across its new and often complex territories, main locations (India, Italy, the UK, Brazil and determining and implementing the Annekatrin Ott is someone who knows exactly Nigeria). most appropriate business model to how challenging this can be. Having spent help facilitate growth is certainly one of most of her 15 year HR career working in As Annekatrin explained, because the market the most difficult to overcome. large multinational companies with centralised positioning is slightly different in each territory in order to capture the nuances of the local The decision is largely twofold; introduce models, in 2013 she was appointed HR customer base, the management of the local a centralised model with consistent Director for TwiningsOvo IM, a decentralised market business units is also 'entirely localised' frameworks and aligned processes or; opt for division of Twinings, to reshape and invigorate a decentralised system without a functional its people agenda. In joining TwiningsOvo core, and enable processes and frameworks to IM Annekatrin explained that although the evolve at the local level. opportunity to experience life working within a different business model was fantastic from Both models can be beneficial. Centralised a career development perspective, at first she systems, once alignment has been established, felt like she'd 'been hung upside down'. can often make decision making faster which in turn can lead to significantly cost saving. Yet TwiningsOvo IM is responsible for delivering decentralised models also promise speed and Twinings and Ovaltine brands to over 100 cost efficiency; working with local suppliers markets around the world. The decentralised can be cheaper in the long run and if processes business model stems from its customer and are tailor-made for the specific territory. product driven culture. With hundreds of Annkatrin Ott, Twinings Ovo International Markets (IM) HR Director 45

Profile

Annkatrin Ott is an internationally experienced HR Director with a track record in leading change and transformation.

After initially training as a psychotherapist years Annkatrin took on a variety of senior at The University of Bonn, Annkatrin strategic roles at Vodafone Group across its took an internship at Harvard Medical European and emerging market operations. School's Children's Hospital in Boston, This included three years based in Mumbai before returning to Hamburg to work at as Head of Organisation Effectiveness and the Ginsterhof Psychiatric Clinic. During Change, and culminated in a role as Head this time, Annkatrin completed a distance of HR Group Transformation & Operations, learning MBA at the prestigious Bradford based in its London HQ. School of Management. Since 2013, Annkatrin has been HR Director, In 2001, she embarked on a new career in International and Emerging Markets at human resources management at global TwiningsOvo, a division of Associated British energy supplier, E: ON. As part of E: ON's Food. She is responsible for reshaping leadership development programme, for and invigorating the people agenda of four years Annkatrin worked on rolling the International Markets business unit, out various cultural change projects across which will allow it to double its operating For over fifteen years she has developed the organisation, before leaving in 2005 to profits by 2017. The International Markets a reputation for building enduring and join telecommunications services provider Business Unit is TwiningsOvo's largest profit mutually beneficial relationships and Vodafone. successfully delivering improvements in Annkatrin Ott contributor serving over 100 international efficiency, effectiveness and executive Initially joining as Manager for Organisation markets, with key locations in UK, Italy, development. and Change, over the following seven Nigeria, India and Brazil.

in the sense that 'processes, frameworks management, the business units tended to within four years, she needed to improve and practices are developed and adapted by have a 'silo mentality'. talent acquisition and management within country managers rather than being prescribed the business units. Due to the decentralised from the centre'. Without a centralised HR The reality was, however, that across the five nature of TwiningsOvo IM, however, it was function the different international business main territories the business had struggled very difficult for her to influence decision units had developed frameworks and with many of the same issues, such as makers on the ground. She highlighted, 'the processes to suit local needs, or in the case of identifying the required skills needed to overriding culture was that the local market is emerging markets where HR operations were grow, yet as Annekatrin found, 'no one was king and any attempt to impose a huge array outsourced, relied on the tools and approaches sharing their concerns or frustrations at not of elaborate tools and processes would likely of third party suppliers. being able to find the right talent'. Her further raise high barriers to engagement, as they investigations led her to believe that the lack of would be immediately perceived as not fitting The result was that when Annekatrin joined, consistency in talent management processes with local needs'. there were multiple frameworks and processes and frameworks across the territories was likely in operation across the five territories, with hindering recruitment, as well as internal talent Her challenge, therefore, was to attempt to little or no consistency between them. moves and development agendas. engage with the local market managers and Critically for Annekatrin, the most noticeable find ways to instigate subtle changes over and perhaps trying aspect of this operating Because methods that were not working a long period of time, intended to improve model was the lack of internal 'conversations' weren't being checked against a common talent attraction and management, while still taking place across TwiningsOvo IM's core framework of standards, and there were no operating in the decentralised system and markets. In her words, 'because the local avenues for sharing best practice, Annekatrin mind-set. It was Annekatrin's experience of markets operated autonomously, when it realised that if TwiningsOvo IM was going working within centralised HR models that came to factors such as recruitment and talent to hit its target of doubling operating profits became invaluable at this point. Having seen, 46 Consumer Focus

With conversations now taking place across the different territories, the international HR team was then able to leverage the expertise developed in one country and use it to build capacity and understanding in others. Focusing on rudimentary areas of recruitment, Annekatrin highlighted, for example, how she encouraged the exchanging of job descriptions between countries. Brazilian candidates were interviewed for roles originally designed in Nigeria and Nigerian job descriptions were also used as the basis for new opportunities launched in the Indian market. This process also involved, for example, senior commercial people from Brazil interviewing candidates for the roles based in Nigeria.

According to Annekatrin, getting the TwiningsOvo IM business units to adopt simpler tools like this was possible as they seemed 'less threatening and the psychological first-hand, international developing market difficulties they had in finding talent in their barrier is therefore lower'. This, in Annekatrin's words, 'helped create greater transparency divisions being 'bamboozled' by best-in-class own markets, as well as the solutions used across the business, as well as a sense of HR tools that were created centrally, yet when to overcome difficulties, and then acting on feeling valued through perceived joined- rolled out to local markets were evidently too this information to introduce 'best practice' complicated, Annekatrin knew her approach at up responsibility, ultimately leading to the changes at the local level. This, as Annekatrin TwiningsOvo IM had to be different. business units becoming 'more sophisticated in highlighted meant that the managers how they approached recruitment and talent Starting from the basis that, ultimately, the management'. underlying principles and issues of talent themselves actually became 'the agents of management are very similar, regardless of change' rather than actions being directly This enabling style of HR was also extended to geography or division, she began 'stripping dictated and implemented by HR. Talent third party suppliers on the ground in-country. the HR models right back' and building basic conversations were also extended to include TwiningsOvo IM is dependent on third party tools (scaled down from the best in class who to best send to leadership programmes suppliers in emerging markets and Annekatrin tools) that would act as 'catalysts to facilitate from the different markets, thus ensuring the explained how she travelled to meet face to the business towards greater maturity'. She maximum intended value of training. face with stakeholders to talk about talent explained: 'Whether it's finding the best talent, training and developing staff or creating diverse and inclusive cultures, for these areas to be delivered successfully there needs to be comparable roles and grading, capability frameworks, hiring strategies and development paths – basically we needed to define 'what good looks like for us'.

The first thing that Annekatrin set out to do was establish avenues where international managers could share their experiences and frustrations of finding talent, thus creating 'an environment of conversations'. She knew that, by talking to each other, the managers, without realising at first, would begin creating their own common standards for recruitment and talent management by comparing the Annkatrin Ott, Twinings Ovo International Markets (IM) HR Director 47

a great deal of patience, admitting that real momentum was only achieved when 'managers realised that they were not being pushed but rather guided'. She continued, 'Eventually, people were generally more forthcoming and appreciated how a step by step approach of gradual implementation could actually be flexible to their needs. Having a long term approach also means people see the impact and change in quality over time'. With these positive changes in place, the next stage of the process is to continue to embed talent management practices across the territories, with the view to eventually having the frameworks in place for TwiningsOvo IM to needs and try to influence best practices Annekatrin's experience at TwiningsOvo IM confidently move talent between its different in those markets. This approach, which is has demonstrated that in a decentralised jurisdictions. generally uncommon for HRDs especially system, HR can succeed by operating on when dealing with complex jurisdictions like a strategic level to encourage openness Annekatrin noted that if she ever moved Nigeria and Brazil, helped TwiningsOvo IM and collaboration and drive a flexible but back into a centralised business model she stand out in the marketplace. harmonised people agenda. She highlighted, would certainly focus more on encouraging 'good and aligned HR in a business stakeholder engagement, especially in As Annekatrin explained: 'The aim is to environment like TwiningsOvo IM needs emerging markets, and acting more like a build a base of knowledge and best practice a common language, common standards business partner 'who understands the local exchange with our third party suppliers and and common goals. Across a decentralised issues, flexes processes and tools as needed, acknowledging that we depend on them being business in predominantly developing and comes up with new ideas'. She added that the best they can be, rather than seeing them markets, however, you need to create a careful 'taking a long-term perspective is important simply as service providers'. She noted that it balancing act between central and local and too. Tools and processes can hide the fact that also further facilitated positive change across make sure the tools, frameworks and processes influencing and educating is a long journey the international business units by allowing HR are simpler for it to work'. and requires imagination.' She concluded, to get a better understanding of local needs, 'A flexible approach to HR can stretch the while gaining more credibility and trust among Annekatrin was quick to point out, however, understanding of its role in any centralised or the local managers. that it can be very frustrating and requires decentralised business'. Featured interview >>

ANDREW WHITEHAIR, HEAD OF EBAY CLASSIFIEDS, DENMARK

Digital convenience user expectations of tomorrow

The American multinational corporation eBay is a world famous provider of B2C and B2B ecommerce and sales services, with over 150 million active users across the globe. The Danes, in particular, are certainly no strangers to this veritable online giant. >>

eBay Classifieds Group (eCG), eBay's specialist classified adverts division, which owns a number of sites that allow users to upload free or paid-for adverts of products and services, has been active in the Danish market for seven years following its acquisition of two of the country's leading automotive and general classifieds websites, Bilbasen Bilinfo and DBA, in 2008. Due to these acquisitions, eCG is now the Danish consumer's first choice for trading automobiles online. In this article, Lars Herrem chats to Andrew Whitehair, Director of Motors at eCG Denmark, about what the modern user expects from digital services today, as well as what users should expect from digital services tomorrow. Digital convenience: User expectations of tomorrow 49

Andrew Whitehair, Director of Motors at eBay Classified Group (eCG) Denmark (Bilbasen/ Bilinfo/DBA) After an early career with Nissan Motor Corporation developing IT applications in the UK and Germany, as well as launching and running his own IT management consultancy for two years, Andrew joined 2nd Byte, What attracted you to the opportunity complicated and requires people to navigate a UK based specialist automotive at eCG Denmark? a wide selection of used and new vehicles, as digital agency in 2000, as Head of well as decide which of a car's many different Having led several leading automotive online IT and Operations. After five years, features and attributes will be the most businesses in the UK, I decided to join eCG beneficial to them. Added to these factors he stepped up to become Managing Denmark in 2013 for the opportunity to, on is that cars require regular maintenance and Director of the business and led the one hand, manage a market leading online repair. It is therefore natural for consumers to 2nd Byte through its successful sale business and, on the other, get involved in want to deal directly with specialists such as to Auto Trader, the UK's leading international projects and strategy for one of car dealers, yet consumer trust in car dealers automotive site in 2006. the world's biggest internet companies. The is historically poor. Transferring the process challenge was also exciting as, prior to me of buying a car online, where there is no Over the next six years Andrew played joining, the market for trading automobiles face-to-face interaction, makes the trading a key role on the leadership team at in Denmark had become more competitive of cars, in my opinion, the most difficult and Auto Trader, responsible for all digital and eCG had also begun to lose the trust of complex online service to deliver. The internet B2B product development, managing local car dealers. My main priority, so far, has creates transparency and this has changed the 100 staff across five locations. He therefore been to reconnect the business with balance of knowledge between the dealer and joined eBay in 2013 and today its customers and re-establish the brand's the consumer. The rapid shift from desktop to manages all aspects of Denmark's reputation as an innovative connector of mobile has accelerated this shift still further largest automotive website and dealer buyers and sellers. We're also developing and car dealers need to adapt quickly to this the next generation product range to help very different trading environment while services business. Andrew lives in car dealers engage more fully with the digital continuing to deliver a high level of customer Charlottenlund with his wife and world. service. two of his three teenage children; his eldest son studies in the UK. His interests include spending time with How is trading cars different to trading Is embedding digital convenience in other consumer products online? your products and services a key part family, world affairs, traveling, skiing, cycling and following Crystal Palace Cars are different to most consumer products of this? football club. because they are often the most expensive Absolutely, consumers increasingly demand and emotive purchases people make. that technology is easy to use and information The purchase journey is usually long and is readily available and we therefore must be 50 Consumer Focus

committed to offering them products and the large amounts of complex data it collects How has eCG Denmark maintained its services with these qualities embedded in into powerful insights. Firstly, we utilise data to position as a market leader? them. Buying a car can be complicated, time create a hypothesis before quickly testing our Focusing on understanding the needs and consuming and full of risk. Historically, it has hypothesis in the real world on sample groups behaviours of all types of active, as well as involved consumers doing hours of research of customers across our different platforms. reading magazines and papers combined This provides us with more 'granular' data, potential, customers has been central to our with visiting several car dealerships. This has which in turn informs product development. success. This approach enables us to offer changed dramatically with consumers now Our market leading mobile app was conceived a very personalised service by providing researching mainly online. Our technology after taking on board customer information targeted communication and solutions aims to make this process as easy as possible gained from digital analytics. Tools like this which meet the needs of today's consumer. by giving people access to the information help to empower our customers, by providing Admittedly, being part of eBay gives us a they need and easily accessible at their them with powerful and easily accessible unique advantage, because we also gain a convenience. information to aid their purchase journey. real insight into developments and trends in Consumer satisfaction is obviously a key metric for eCG How do you keep track of what the Denmark, and eBay in general, consumer expects? "…consumers increasingly demand and the whole worldwide that technology is easy to use and One of the biggest advantages of trading business relies on several KPIs, online is that you can track the behaviour one of the most important information is readily available and we of your customers. Digital analytics play a being the Net Promoter Score therefore must be committed to offering key strategic role in most businesses today (NPS), to track how satisfied and, as the market leader, eCG Denmark is customers are with its products them products and services with these investing heavily in big data analytics to turn and services. qualities embedded in them." Digital convenience: User expectations of tomorrow 51

other markets, allowing us to build solutions early investment in mobile apps a few years for tomorrow. For example, the global SEO ago helped leverage our position as market team helps my local team understand changes leader. We want to empower our customers Market snapshot in best practice and how we can apply them by giving them the ability to make informed, locally. The fact is, though, that as market timely decisions with products that can be leader, customers depend on us to be a used anywhere, at any time. This requires a trend setter. Innovation, therefore, is a vital recognition that not all customers are the same. DENMARK component of our organisation. We also invest Denmark's economy has been in the a lot of time on thought leadership activities Many businesses want to emulate eBay spotlight of late. US presidential hopeful to help the industry understand the trends. in terms of its platform and world class Bernie Sanders was using the country For example, we hosted a digital dealership logistics capability, among other factors. as an example of social democracy conference in the autumn where we brought Does eBay look to any other businesses in action as he tried to persuade together key people from the industry to reflect and business models for inspiration? Americans to make him their next, and discuss how the sector needs to adapt to Absolutely, eBay has maintained its global and first ever socialist, commander a digital world. My role is to build a business market position by continually innovating and in chief. This scrutiny, however, has focused on bringing together world class we are always on the look-out for good ideas drawn attention to the fact that things expertise, but with an operating model that is and trends. A recent example of this is our in Denmark are perhaps not as rosy as flexible enough to adapt to rapid change. partnership with local Danish CRM system Sanders would like voters to believe. provider, Easi´r. eCG Denmark needed to The reality is that Denmark is still an "Mobile devices and social media are two upgrade its existing export driven market economy at the whim of global market fluctuations. technologies that are having the most Lead Management and CRM system A decline in trade activity with significant impact on consumer behaviour." for car dealers. Lead neighbours Germany and Sweden Management and CRM over the last 12 months, has led systems are not an area to a reduction of Denmark's 2016 What technologies do you anticipate where we profess to have specialist knowledge growth forecast to 1.3% from 1.8%. being the most 'disruptive' to current or expertise, therefore we sought an external The slowdown of China, Russia and business practices over the next few partner. Easi´r is based in Aarhus and has Brazil hasn't helped matters either years? spent years developing ground breaking and Denmark has adopted negative interest rates as a protective measure. Mobile devices and social media are two Lead Management and CRM solutions, Employment growth remains strong, technologies that are having the most incorporating social media and gaming however, and as real income increases significant impact on consumer behaviour. techniques into its software to make it more along with consumer sentiment, Mobile devices (e.g. watches, phones, tablets engaging for users. eCG Denmark, as well as other businesses internationally, are now consumer spending will likely have a etc.) are creating a world which is always using Easi´r products. My philosophy is that positive impact on overall economic 'switched on'. People now expect to be able businesses must continually look outwards if performance in Denmark this year. to access information about products and they want to survive and grow. Change should services and interact with businesses anyplace, be embraced and partnerships can often anytime and anywhere. This, combined deliver better and faster customer value. with the rapid growth of social media, has the best and safest experience for our radically changed the consumer journey. The customers. On the whole, though, consumers traditional 'sales funnel' concept is effectively Are your customers ever reluctant to understand that in order to receive a truly share their data? obsolete today as consumers now have a personalised digital service, they have to give far more complex purchase journey, much Naturally, some customers worry about up certain information. We must ensure that of which is online. At eCG Denmark, we are how we plan to use their data and people the customer is in complete control of that therefore committed to developing omni- should always pay attention to our terms and transaction and can decide how close they channel solutions, where our customers conditions before agreeing to give permission want you to get, while explaining to customers can use our products to start their purchase to access their personal information. Data what´s in it for them. As consumers get journey on their mobile phone, continue it protection is an area of the law that eBay more and more used to personalised digital on a desktop computer, and complete it on a takes very seriously and as part of the global solutions, eventually they will get frustrated tablet. Adapting early to disruptive technology business, eCG Denmark has access to a lot by tools that don't use their data to offer them can create significant business advantage. Our of professional advice to ensure we provide increased relevance. 52 Consumer Focus

What can the user expect from digital in building integrated online services which some of the best digital solutions have come solutions in the future as well as from have led to the creation of a pervasive online from the Nordic countries: Companies such as eCG Denmark in particular? culture. People here in Denmark, as well as Mobile Pay, Skype and Just Eat, to name a few. Sweden, Norway and Finland expect to find a Digital solutions will continue to become If the Nordic states can continue to develop wide range of information and services online, more personalised, simpler to use, further legislation and policies to attract investment, and this obviously creates demand for high optimised to the technology platform (e.g. quality solutions. Combined with what I would as well as the best digital talent from around watch, phone, TV, etc.) and more integrated describe as an innate 'entrepreneurial spirit' in the world, then it will continue to be a fantastic across different platforms to create a truly this region of the world, it is no surprise that region in which to build online businesses. seamless experience for consumers. Solutions that use data to prompt and guide users via notifications, alerts and recommendations will also be prevalent as the boundaries between social interaction and commerce become more and more blurred. Within the motors business FACT BOX at eCG Denmark we have defined four strategic areas to inform our future product innovation. The first is to provide 'inclusive' Facts about BilBasen solutions that are personalised and adapt to • BilBasen is the leading online trading their user; secondly we want to embed 'data platform for buying and selling used cars, love', using data to constantly seek out ways to with more than 620,000 unique monthly • eBay Classifieds' local brands permit trade improve customer experience and share data users in everything from smartphones and to empower our customers; equally we want to design furniture to children's clothing and be 'proactive', leveraging systems to guide and • The 620,000 unique users make over 3.4 cars or even the perfect housing prompt customers which will help speed up million visits to the site each month co-operative the purchase process and finally eCG Denmark must be 'trend driven', with the ability to • Since the launch of BilBasen's app in July • The Danish eBay brands consist of: differentiate between fad and trend and help 2011 there have been around 700,000 • DBA, the largest online trading platform customers take advantage of new trends. recorded downloads for both mobile and with 1.7 million monthly users tablet devices What is the outlook for businesses • BilBasen, the leading online trading • BilBasen's app has around 145,000 unique platform for buying and selling used cars seeking to hire, retain and develop users, who access the app around 1.1 digital talent? million times per month • Bilinfo, the Danish car dealer preferred Business is about people and finding people tool for administration, advertising and with the right skills, experience and attitude; • BilBasen became a pioneer of online sale of cars these are the key to success. The best people, trading when it was first launched in 1996 • DBA, BilBasen and Bilinfo are all based therefore, will always be in high demand. locally in Denmark and known and In order to attract the best, it's important to • There are usually approximately 54,000 respected by eBay for their innovative have a clear mission and a vision that people cars for sale on BilBasen at any one time approach to ecommerce can be inspired by; the business must then communicate how people can be part of that Further information about BilBasen: • In Denmark, the three Danish eBay story. This is obviously something that eBay • BilBasen: www.bilbasen.dk Classifieds brands employ 160 people to invests a lot into and that filters down to eCG ensure that consumers are always the top Denmark; we spend a lot of time training and • BilBasen Facebook page: www.facebook. priority and that the brands deliver the best developing skills and communicating to the com/bilbasen.dk?fref=ts user experience market about the rewarding careers we offer. • BilBasen Blog: blog.bilbasen.dk Further information: How does Denmark, and the Nordics in general, compare to the rest of the Facts about eBay Classifieds Group • eBay Classifieds Group: world in terms of ecommerce capability www.eBayclassifiedsgroup.com • eBay Classifieds Group is part of eBay, the and adoption of technology? world's largest online trading platform with • DBA: www.dba.dk The Nordic countries are all extremely 'tech 157 million active users savvy'. The governments have invested heavily • BilBasen: www.bilbasen.dk • eBay was founded in 1995 by Pierre Omidyar with HQ in San Rose, California • Bilinfo: www.bilinfo.dk The best kept secret: Nutricia 53

Nutricia ”the best kept secret”

Insight into Nutricia, an exciting company that dares to think innovatively and successfully attracts talent from several different industries. >>

Many of the businesses related products, as well as supplying that Nigel Wright innovative solutions for the healthcare and works with in the broad medical services industries. consumer industry are well-known brands. As Since 2007, Nutricia has been part of global you would expect, when food-products giant Danone, a brand and vacancies for these companies are advertised, company that is obviously well known they quickly generate a lot of applications. to consumers. Despite this association, There are a great deal of other companies, however, Nutricia has still remained 'under however, that don't have the luxury of the radar' as an employer of choice for anyone widespread brand recognition to attract talent working outside of the clinical nutrition or wider healthcare sectors. Certainly, during and must work harder to gain the interest of Kieran Youngman the best people. the recruitment of several key positions at Nutricia Advanced Medical Nutrition Nutricia over the last few years, Nigel Wright One relatively unknown brand which has, in has consistently found that few people in recent years, successfully hired some of the the market have heard of Nutricia when first Sweden, Kieran Youngman. Kieran was based best global talent in the consumer industry approached about opportunities with the in Geneva working for Proctor & Gamble's Oral is Nutricia Advanced Medical Nutrition. The company. Care division when he was approached by business, which was actually founded 120 Nutricia in 2010. Having spent the previous 12 years ago, specialises in advanced clinical One individual who had never heard of years with the global consumer products giant nutrition R&D for adults and children and Nutricia prior to joining the business almost working across various strategic European offers consumers a broad range of health six years ago is current country manager for sales and marketing roles, he was in high 54 Consumer Focus

The fast paced environment at Nutricia is made yet after over five the work is very stimulating. He noted that manageable, in Kieran's view, because the years of success at the opportunity to enrich the lives of other Nutricia, he's never people is always rewarding and it helps work is very stimulating. He noted that the looked back. give employees increased energy, drive opportunity to enrich the lives of other people is and motivation. He added that aside from During his time always rewarding and it helps give employees the overall culture of the organisation, with the company, his colleagues are a continuous source of increased energy, drive and motivation. Kieran has inspiration, being that they tend to come been given the from a broad range of industry backgrounds, demand at the time and was considering opportunity to develop his skills across several and bring a variety of valuable skills and several exciting job offers. areas at both a local and regional level. He experiences to the team. explained that the company is characterised Following what he described as an inspiring by a unique entrepreneurial spirit, flexibility Although Nutricia recognises that industry recruitment process, Kieran chose to join and a strong commitment to the development experience is important, it deliberately Nutricia in Sweden. He explained that his of each individual employee. He added that makes an effort when hiring new people to decision was largely influenced by the it continuously encourages and challenges its bring in those with direct clinical nutrition impression he got of the company following employees to think long-term while having industry involvement, as well as individuals extensive research he conducted into the more concrete short-term goals and offers from other complementary sectors such as business and its history, as well the Nutricia multiple functional, local and international FMCG. Around 20% of Nutricia employees management team, who he said were clearly careers to high performing individuals. in the Nordic region have previously worked driven by a genuine passion for the brand. in FMCG and as Kieran explained, bringing Kieran admitted that this move away from his The fast paced environment at Nutricia is in talent with different ways of thinking helps traditional FMCG 'comfort zone' was a risk, made manageable, in Kieran's view, because to enrich the organisation. Two examples The best kept secret: Nutricia 55

include Mette Drakenberg (placed as Nordic regardless of brand reputation, that have Marketing Director and now currently Country clear values and a great culture where the Manager Norway) who moved from Philips employees are genuinely interested and Consumer over three years ago; and Jonas motivated in the tasks they perform. Karlsson (Senior Brand & Channel Manager) who joined Nutricia after a successful career at A number of the candidates Nigel Wright has Orkla Confectionery & Snacks in Norway. placed at Nutricia over the years have moved Market snapshot from outside of the clinical nutrition industry Regardless of background, Kieran explained to join the business. We firmly believe that that all Nutricia staff share a common desire to daring to take the risk and moving to an SWEDEN try new things and continuously develop their unknown category, brand or industry can be skills. Learning by doing is highly valued at incredibly rewarding when embarking on Unlike its Scandinavian peers Sweden has the company and employees regularly happily your next career move. We recommend that experienced somewhat of an economic test themselves by engaging in tasks where more job seekers should dare to challenge boom during the last few years with the solution is not yet known. Kieran has themselves when evaluating new potential rising exports helping it grow between seen many examples of this during his time at employers. It's worthwhile doing extra three and four times faster than Norway Nutricia, and commented that he is truly proud research and not acting too hastily to turn and Denmark. With its reputation for to work with such tenacious and intelligent down unknown companies. abundant generosity, however, it's contemporaries around the world. no surprise that Sweden has so far It's worth noting that not long after this welcomed more refugees per capita With almost 30 years of experience identifying interview took place Kieran Youngman than any of its European neighbours and hiring talent for some of the world's best confirmed that he would be starting in a new during the current migrant crisis. It is the companies, Nigel Wright is very familiar with role at Nutricia, after receiving a promotion knock on effect of this characteristically the key factors candidates value the most to the position of Global Category Director, liberal move which is causing some when choosing a new employer. Yes, it's based at Nutricia HQ in Amsterdam. We uncertainty about Sweden's economic undoubtedly true that big brands are attractive expect many other great candidates we have prospects moving forward. Providing employers, but time and time again we see placed at Nutricia to start new challenges in accommodation, job training and new that the winners in the battle for attracting the near future, as they continue their journey jobs for 163,000 new entrants is proving and retaining talent are those organisations, at this great business. more costly than expected and could prove unsustainable. This is exacerbated by a potential housing crisis, facilitated in large part by the country's low interest rates. Consumers are spending though and retail sales will grow again in 2016, by around 4%. All eyes will be on Sweden over the coming months to see how the country copes with its multitude of challenges. Featured interview >>

PAAL HANSEM, FOUNDER AND CEO AT FRESH FITNESS AS

Paal Hansem Founder and CEO at Fresh Fitness AS

Fresh Fitness is a Norwegian gym franchise and national elsewhere – and initially people just weren't convinced that they would get the same level success story, boasting 27 centres and over 77,000 members. of quality as they would in a premium or We caught up with CEO Paal Hansem, who explains how more expensive establishment. In the fitness industry, a new gym will typically attempt to his ten year career in the grocery industry has helped him sign up as many members as possible prior to successfully grow the business to become Norway's leading opening. When opening our first centre, we found this approach impossible. So, instead chain of discount gyms and why he believes Fresh Fitness's of focusing on pre-sales we invested in raising 'low cost high quality' proposition has the potential to make the profile of our brand, as well as organising a free open-day launch event, where people the company the biggest fitness franchise in Scandinavia. >> could come and try out the facility. This proved

What attracted you to for developing the Fresh Fitness concept. I the CEO opportunity? travelled across Europe investigating other low cost fitness providers and different operating I was approached about models and finally created and then launched the opportunity to Fresh Fitness in autumn 2010. establish a new fitness chain in 2009 and at that time, I was running What were the biggest challenges you faced in the initial start-up phase of the my own consulting company and actually company and how did you overcome considering opening a low cost gym myself. them? My past experience as Regional Director at REMA 1000, Norway's biggest discount The biggest challenge early on was retailer, meant it was actually a great fit for me overcoming public scepticism. Our proposition as well as an exciting opportunity. Following is to deliver high quality at the lowest price my appointment, I was given responsibility – about a third of the average price offered Paal Hansem, Fresh Fitness AS Paal Hansem, Fresh Fitness AS 57 58 Consumer Focus

"Around one million people in Norway ensure we expanded our used to managing multiple sites as well as large chain as fast as possible, numbers of people. Fresh Fitness now has 600 now regularly attend a gym and that gaining market share employees nationally, but thankfully, unlike a number has increased by 30% since 2009." and achieving national lot of founders of start-up businesses, I was coverage. So, we are prepared for the complexities and challenges the biggest player in the that this kind of rapid transition entails. The to be a big success, and we actually broke discount market and have a great reputation other key learning that I was able to bring even after our first three months in business. for offering high value at a low cost. What with me was the importance of establishing a we will see over the next few years is more fun and winning culture, which is something Five years on, what's the competitive consolidation, as a lot of smaller players REMA 1000 is well known for. No matter what environment in Norway like for Fresh become part of bigger franchises. role employees undertake at Fresh Fitness – Fitness? whether they're cleaners or personal trainers What transferable skills and knowledge – everyone sees the higher meaning of what Around one million people in Norway now have you taken from your work in the it means to work for our brand and it's now regularly attend a gym and that number retail industry and into the fitness regarded as a really fun and rewarding place has increased by 30% since 2009. The sector? to work. fitness market in Norway today is extremely fragmented, however, with over half of the The obvious and overarching factor was What new challenges does the fitness overall sector made up of small local discount knowing how to develop a low cost, high industry bring in comparison to the centres. Because we were the first low cost quality brand and service. There were retail sector? chain, though, we now have the advantage probably three specific things I had done or of scale - 27 centres across the country to be had been part of in the past that helped me It's clearly a different value proposition to precise - whereas most of our competitors progress this agenda quickly in my role as buying groceries, but other than the obvious only have one or two gyms limited to one Fresh Fitness CEO. Firstly, I actually renewed factors, the actual philosophy of 'getting the particular area. Sweden's Fitness 24/7, for the franchise operating manual at REMA 1000; most out of every penny' as well as the core example, launched here a few years ago, but so I understood the need to establish, early on, challenges that impact your business the most they have subsequently only opened 7 centres a clear road-map of 'how we do things around are fairly similar. To do this successfully you nationally. We knew that time was of the here' at Fresh Fitness which could be easily need to be efficient and look for cost savings essence when we launched the Fresh Fitness replicated across all new centres. My role as all of the time and be completely focused on concept and a lot of work has been done to REMA 1000 Regional Director also meant I was delivering a high quality service. You also need to hire the right people who completely buy into this way of working. At Fresh Fitness I always say to my managers, 'If you can't hire the absolutely right person, then you'll have to do the job yourself'. Making the wrong hire is too costly in this industry as well as in retail because, ultimately, it's the people delivering the service who make a difference to your brand.

In terms of customers, do you target fitness enthusiasts or people who do very little exercise?

We specifically appeal to individuals who want to achieve a better all-round lifestyle and I'm proud to say that, to date, we've managed to persuade 50,000 people to become gym members for the first time in their lives. Our customers are not tied into a contract and the low prices and welcoming environment we've created means people who are usually intimidated by gyms, or find them to be too expensive, suddenly see an opportunity to Paal Hansem, Fresh Fitness AS 59

our people. Since 2014, everyone who has joined Fresh Fitness - even if it's someone only teaching one fitness class per week - has Market snapshot attended the Fresh Academy, a series of introductory sessions aimed at embedding our philosophy, vision, values and service standards, as well as providing new employees NORWAY with an understanding of our history and what our objectives are moving forward. This Undoubtedly, the Norwegian economy's internal schooling is actually another idea I historical dependence on oil has been brought with me from REMA 1000, and it's the cause of its apparent freefall during proved to be very effective in helping us to the last two years; by the end of 2015 maintain the distinct culture of the business. the economy had effectively hit rock bottom, with growth as well as consumer What ambitious plans do Fresh Fitness confidence reaching six year lows. Yet, have over the next 12 months to sustain there is finally some let-up for the country the level of growth? as recent indications suggest that the seemingly perpetual downturn will The personal training market has a lot of have run its term by the end of the year. potential and that is an area of the business Glimpses of better times ahead can be that we are activity developing. We also have a seen in the fact that unemployment has get fit in a place that is more aligned to their small retail operation in some of our gyms and been falling in some regions, and new needs and expectations. We've also had some that is likely to be an area of the business we vacancies opening up in sectors not tied success in attracting customers away from will seek to expand in the future. into the oil and gas supply chain reveal 'premium brand' gyms. These people are often that they have begun to turn a corner. individuals who only go to the gym to maybe One factor, however, that we have to Significantly, spending on the high use a running machine or lift weights and constantly monitor is how we can leverage street has remained positive, especially therefore the comparable cost savings they new technology to help us grow. Measuring among Norway's wealthy demographic. make to do something fairly simple, regularly, the impact of your training regime or your Critically, it will be important for Norway means the decision to move is very easy for diet is something which is clearly important to further diversify its economy to protect to our customers. It was itself against future oil shocks, as it recently reported that continues to recover. "We specifically appeal to individuals who 40,000 new health apps want to achieve a better all-round lifestyle were launched last year and I'm proud to say that, to date, we've and it's very challenging to decide what we and The Gym Group in the UK. Outside of managed to persuade 50,000 people to can use to our benefit. this sector, another discount business model become gym members for the first time There are a great deal that really stands out in Norway is my former in their lives." of devices or apps that employer REMA 1000. Similarly, IKEA offer allow people to track high quality products at low prices, and have different activities and I an impressive innovation pipeline. I'm also think a device or piece always impressed with H&M for the same them. People who don't move to Fresh Fitness of software that captures multiple different reason. These established companies, despite are usually those who have a more demanding metrics - 'an all-in-one fitness measurement being in totally different industries, act as good role models as they have the same basic fitness regime or a close relationship with a package' - will be the panacea technology that philosophy as Fresh Fitness. particular personal trainer elsewhere. We don't proves to be a game changer in the next few actively target those people. years. How do you keep yourself busy outside of work? As the business has grown, how have What other businesses do you look to you ensured the entrepreneurial spirit for inspiration? and agility is maintained? I spend a lot of time with my family; I have In the fitness industry, there are various two young children who keep me very busy. It's certainly been difficult, but a key part of companies with a similar proposition to Fresh I enjoy hiking and skiing, which complement our success has been down to the investments Fitness. Some of the best I've come across are the exercise I tend to do most days at work in we have made in training and developing FitX in Germany, Basic-Fit in the Netherlands the gym! Case Study >>

HOVIS LIMITED

brand and its portfolio of products. With the emphasis on brand and innovation, its plan included provisions for raising the credibility of Hovis by 'winning over health-conscious customers', offering more 'on-the-go' options and capitalising on new flavours to offset the broader decline in the bread category.

In August 2014, it was announced that former Diageo Marketing Director Philip Gladman and his team of seven from Flintlock would join Hovis to kick start the Marketing and Innovation agenda. As well as creating the new structure for the Hovis marketing Hovis function, one of the team's other deliverables was to recruit the long term marketing department.

In October 2014, Nigel Wright was appointed Limited to lead the recruitment of ten critical roles Nigel Wright leads a multi-assignment project focused within the new marketing team at Hovis. Hovis on building the marketing function at newly formed selected Nigel Wright due to its reputation and Hovis Limited. >> network within the private equity community, as well as its in-depth understanding of the dynamics of the broader consumer industry. About the client Executive Chairman Nish Kankiwala was appointed by Gores Group in April 2014 to Hovis is an iconic The challenge help reinvigorate the Hovis brand. Premier British bread and flour Foods and Gores Group also announced a To successfully achieve the objectives set out manufacturer which joint £200m five-year investment programme by its new owners, Hovis needed to quickly dates back to the 19th to upgrade Hovis' operational infrastructure establish a team of experienced brand and innovation marketers who understood the century. It is one of the UK's best loved brands, and factories, as well as providing the business challenges the business faced and who could cementing its place in the hearts and minds of with up-weighted marketing spend. have an immediate impact on driving value and the public with its famous 1973 TV commercial growth for the brand. 'Boy on a bike'. It employs approximately 3,800 Since agreeing the sale of Hovis, as well as the five year investment plan, the Hovis people at ten bakeries, six flour mills and two Prospective candidates needed to have regional distribution centres across the UK. brand is no longer part of the broader Premier core discipline knowledge, likely developed Foods commercial strategy. Hovis Limited is through early training within a large blue Hovis was acquired by Premier Foods in a unique standalone joint venture with a new chip environment, as well as experience of 2007. In recent years, however, the ambient single minded focus. Gores Group is entirely managing a P&L. Although perhaps used to food giant chose to focus on developing its committed to supporting Hovis Limited in once working within a process driven culture, they again becoming a sustainable and growing core brands including Bisto, Mr. Kipling and also needed to demonstrate the ability and business. desire to perform with increased autonomy Sharwood's. In January 2014, Premier Foods and responsibility in a leaner, more fluid and agreed to sell a majority stake of Hovis to US agile environment. private equity outfit Gores Group, creating Background a new vertically integrated company, Hovis In acquiring Hovis, Gores Group aimed to Nigel Wright's initial brief included ten roles Limited, as a joint venture. bring fresh outside thinking to the Hovis comprising a Brand and Innovation Director, Case study: Hovis Limited 61

an MS&P Director, a Head of Insights and Head of Category and Shopper Activation, as well as Marketing Manager roles covering core brand and innovation. Additionally, Nigel Wight was asked to identify candidates for two new commercial roles – a Grocery Director and a Convenience and High Street Director – who would enable Hovis to get closer to its customers.

The challenge was twofold. On the one hand, a large number of candidates would have to be identified and assessed to ensure only the best candidates were being put forward. Secondly, in going to market, it was essential that Because this project involved a large development of the new marketing function prospective candidates were made fully aware number of different roles at several levels, by endorsing various changes to the initially that Hovis Limited was a unique standalone various teams in different locations worked proposed team structure. For example, Hovis joint venture where Gores Group had full collaboratively on the assignments. They decided to remove the brand director role autonomy and ownership. included Nigel Wright's Executive Search team therefore allowing the innovation director and UK Consumer Sales and Marketing team to be clearly recognised as the most critical in London, our internal marketing function in position reporting into the CMO. This enabled Nigel Wright Solution Newcastle upon Tyne, as well as Hovis' internal Nigel Wright to engage more high calibre We recommended an eight week recruitment team in High Wycombe, tasked candidates in the market. process focused on an executive search with filling a number of junior roles within the and professional networking strategy new structure. Nigel Wright was instrumental in successfully complemented by a proactive marketing identifying outstanding talent for all of the campaign. The executive search phase All teams communicated with each other assigned roles within the agreed timeframe. involved targeting specifically agreed regularly and worked hard to update Our marketing campaign was also successful in organisations and utilising our broad networks candidates on their progress, ensuring persuading these individuals that Hovis was a within the consumer industry, as well the wider continued engagement and guaranteeing that business worth considering at a time of change private equity community, to source referrals the 'employer brand' of Hovis was managed and perceived upheaval for the business, for potential candidates. in the most positive manner. Client update as well as within the context of heightened meetings were also held every week with competition for talent in the UK food industry. A significant factor in the success of this Hovis' Head of HR to make sure the process project was Nigel Wright's proactive marketing was meeting its objectives and that all On the back of these campaigns, Nigel campaign. Led by our internal marketing stakeholders were informed of its progress. Wright's partnership with Hovis continues team, the strategy consisted of creating a today. microsite and candidate pack and managing a During the frequent meetings with Hovis, branded email campaign. This aided candidate Nigel Wright was able to add value to the engagement by articulating the story and potential of newly formed Hovis Limited, as well as enabling us to expertly sell the Client testimonial opportunities and extend their reach beyond "This was a very challenging project but Nigel Wright performed our own networks. brilliantly to ensure that all of the candidates were an excellent The marketing campaign specifically sought to fit for each of the roles. Their impressive networks, in-depth leverage the fact that this was an opportunity to create a legacy, developing one of the industry knowledge and collaborative way of working were the all-time great British brands, as part of a wider factors that led to success. The types of candidates that Nigel transformation programme led by Hovis' new Wright has successfully placed at Hovis Limited all bring broad owners. We made it clear that Premier Foods was now very much focused on growing its industry and category experience that will no doubt give the own portfolio of iconic British brands and that business a clear edge in the market." the creation of a standalone Joint Venture was a positive development for both businesses. Phillip Gladman: Founder, Flintlock Featured interview >>

PEDRO DIEZMA, CEO AT ZERINTIA TECHNOLOGIES Pedro Diezma CEO at Zerintia Technologies

Nigel Wright caught up with Pedro Diezma: author, explorer, Which Zerintia solution are you most proud of to date? motivational coach and technology innovator, to talk about the Over the years we have amassed an enviable role his firm Zerintia is playing in the development of cutting amount of internal knowledge and expertise, edge Wearable Technology. He also chats about his passion which puts us in a privileged position to be able to anticipate and then capitalise on the for personal development and his adventures in Mongolia latest market trends and develop disruptive searching for Genghis Khan's tomb. >> technologies. One solution I am particularly proud of is our Google Glass platform,

For the interested What role does Zerintia Technologies play in layman, could you briefly this burgeoning market? explain what 'Wearable Zerintia is a recognised global expert in Technology' is? Wearable Technology and the Internet of Things Wearable Technology (IoT). Launched ten years ago, our firm has is the term used to built its reputation through the development describe the various accessories and garments of bespoke Wearable Technology solutions, you can buy that, when your wear them, including devices and software add-ons, capture your biometric data or enhance your for companies operating in the healthcare, ability to perform a particular task. Wearable industrial, retail and logistics sectors. We Technology has actually been around for many also offer additional consultancy services to years – take the calculator watch, for example, firms seeking to leverage the broad range launched in 1980 – but the latest Wearable of Wearable Technology solutions available Technology craze began around three years today. At the heart of our business is innovation ago when Google developed its first Google - we are passionate about technology and Glass prototype. Today there is a growing enjoy experimenting with and improving our number of exciting products in the market and solutions every day. Regardless of the type of the pervasiveness of this technology, I believe, solution we bring to market, our aim is always shows that people are embracing a future twofold: improve the life of individuals and help where technology has effectively become an organisations become more efficient through the integral part of their natural environment. optimisation of business models and processes. Pedro Diezma, CEO at Zerintia Technologies Pedro Diezma, CEO at Zerintia Technologies 63

only be available for use in the business and medical worlds.

In terms of sector, where are the best opportunities for Wearable Tech companies? Wearable Technology has applications for companies operating in B2C and B2B markets. B2C, and particularly the fitness industry, has seen the biggest growth so far and there is even a degree of saturation in that market now, which is making it difficult for Wearable Tech companies to exploit opportunities. In B2B, the industrial and manufacturing sectors represent big opportunities for Wearable Tech firms, especially in 'high risk' environments like mining and oil and gas, where wearables can play a key role in ensuring the safety of employees performing complex tasks like assembling equipment. The same applies to the medical field, where wearables have been used by surgeons performing operations. developed in collaboration with Emertech, Google stopped producing its Google Glass Zerintia is very much focused on serving the prototype in 2015. Was the project a failure? which enabled Red Cross workers wearing corporate and healthcare sectors, where Google Glass devices, and with the assistance Does Google Glass still have a future? there are still a great deal of unexplored of drones, to see real-time information on When the Explorer testing programme opportunities. In the USA, around 1% of firms medical emergencies in the field, such as those finished, Google announced it would stop are currently using wearables but we expect caused by natural disasters. producing the Google Glass prototype that number to have increased to 10% within and begin a new design phase focused on the next five years. What ambitious plans do you have for the perfecting the product now that it better understood the user experience. The media business over the next 12 months? A 2015 survey by Vanson Bourne found that distorted this announcement, however, by almost 50% of British consumers believe Currently, we are excited about the imminent claiming that the prototype had been a failure. Wearable Tech is 'just a fad'. Is this something launch of Real Time Healthcare, the first ever Google perhaps didn't help matters by creating to worry about? Wearable Technology software for use in the a lot of hype around Google Glass. For around I don't think it's something to worry about. The treatment of chronic patients and the elderly. two years there seemed to be daily updates products available now simply represent the Developed in collaboration with Oracle, this from Google beginning, or lauding the software was conceived in response to the the first layer disruptive 'world "…we're hoping to launch a new increasing strain on healthcare systems in if you like, changing' potential the developed world, in large part due to the smart watch which will integrate of a period ageing population, and the need for better of Google Glass, with this software, enabling hospitals of human and faster treatment for patients. In addition so when the evolution product was finally and insurance companies to more to this, we're hoping to launch a new smart that will see removed from the watch which will integrate with this software, effectively monitor patients." us become shelves, inevitably enabling hospitals and insurance companies to ever more people perceived more effectively monitor patients, in line with integrated with technology. At the end of the this as the product failing to live up to its day, the aim of all Wearable Technology is to the medications and behavioural guidelines inflated potential. It definitely has a future enhance human beings and big companies prescribed by their doctors. Furthermore, though; images of the new model, the Google like Intel, Samsung and Google understand we are also working on new technology for Glass Enterprise Edition, are already circulating this and are already investing billions of the aeronautic and industrial sector – again online. This new model has an upgraded dollars into developing the next generation of utilising smart glasses and drones – that we prism, enabling users to see information more Wearable Tech devices. Over time, Wearable hope will transform certain business processes clearly, an improved processor (Intel) and a Technology will become diminutive - almost in those sectors. longer-lasting battery. This product will initially invisible to the human eye - and even better 64 Consumer Focus

integrated with our body. There are already on the potential dangers "B2C, and particularly the fitness industry, 'smart drugs' that can enhance your ability to associated with the mis- has seen the biggest growth so far and concentrate and 'electronic skin grafts', where use of technology. There people can have sensors inserted under their is a flip-side though, there is even a degree of saturation in that skin which perform tasks such as monitoring because movies can also market now, which is making it difficult heart and brain activity. Remember, many trigger our imagination people still thought the internet was 'just a fad' and help us visualise for Wearable Tech companies to exploit in the early 1990s! exciting futures with opportunities." flying cars, interstellar There is a lot of scaremongering associated travel and longer life- with the ever increasingly intrinsic relationship spans, giving us hope for a better future people to make an informed opinion about we have with technology. Science fiction, for ahead. Some of the Wearable Technologies them. What I would like to see instead is more example, has a tendency to depict dystopian depicted in the movie Back to the Future, such time dedicated to communicating the benefits rather than utopian futures. Do you believe we as hover boards and self-adjusting clothing are of the incredible devices being developed for should be worried? now a reality. the medical industry. This is technology that can truly transform people's lives. For example, There's no doubt that movies and the media sensors that allow us to better monitor vital in general can have a huge impact on people's What, in your view, needs to be done to signs and data from our bodies which in perceptions and behaviours. A classic example better communicate the potential benefits turn can detect the early signs of disease, is the movie Jaws - people were afraid to of Wearable Tech products and the uses of automatically alert emergency services in swim in the sea after seeing it! I do think technology in general? the case of an accident and even anticipate it's vitally important to be wary of the fact I think there needs to be a shift away from epileptic seizures. The other perhaps under that technology can be used for unethical the media obsession with the launch of new reported area is the progress which is being purposes. This is certainly what the potential consumer-end devices, particularly within the made in nanotechnology and particularly the futures depicted in movies like Minority fitness industry. Those products have generally use of graphene, a revolutionary material Report, Blade Runner and I, Robot did – they been well-received in the market and I think which is leading to some incredible inventions. acted as a warning and helped us to reflect there is enough information out there now for Those are things that I believe more people should know about.

How much of the R&D and innovation that takes place in Wearable Technology is essentially driven by the military, before eventually filtering down into uses for the consumer? Certainly some of the advances in Wearable Technology have been driven by military innovation and today around 5-10% of overall research and development in the field is attributed to the military. The military does follow its own rules though, so it doesn't develop technology with the view to eventually making it publically available. Although there are some instances where it has adapted commercial products, most notably smart glasses, for use in battle scenarios, in the main it focuses on its own projects such as 'Future Soldier' and has developed technology such as the Powered Exoskeleton - wearable body armour which enables soldiers to move faster and lift more weight, as well as monitor their vital signs and movements. Pedro Diezma, CEO at Zerintia Technologies 65

"In the USA, around 1% of firms are currently advancement and specifically, start-ups. I am currently of field based writing my first historical novel, inspired by my using wearables but we expect that number to research. Since travels in Mongolia, Peloponeso in Greece and have increased to 10% within the next five years." its inception Languedoc in France. in 1904, it has served as a meeting point for explorers and Aside from Wearable Technology, what other What are you currently reading? as a body that actively encourages public technology products or trends do you monitor interest in exploration. The club has a number I usually like to read two books simultaneously; with interest? What is your favourite piece of of famous alumni such as Neil Armstrong, one philosophical or spiritual in nature and technology that you own? Roald Amundsen and Matthew Alexander the other being a technical or scientific based The next technological revolution will be Henson. I was admitted as a member in 2013, book. Currently, I'm reading Don Miguel Ruiz's defined by three distinct technologies; following field research I carried out in Avraga The Four Agreements about the concept of wearables is one, and the others are virtual in Mongolia, searching for the location of the personal freedom inspired by the wisdom reality and 3D printing. Zerintia is monitoring missing tomb of Genghis Khan. of the ancient Toltec empire in Mexico. The each of these areas closely, and has already other is Stephen Hawkings' The Grand Design. worked on several 3D printing prototypes. What inspired you to write 'El renacer del The Apple Watch is currently my favourite héroe?' Are you planning to publish anything device, mainly because I can use it to track my Which individuals or businesses do you look to else in the future? sporting activities, although there are many for inspiration? As well as following my passion for technology other smart watches in the market which offer The film director James Cameron is one. I the same level of quality as Apple. Another and its role in improving lives, I have done a admire his dual approach to storytelling, device I use is GoPro, which again I use to lot of research into personal and professional delving into the past to bring forward a vision record my day-to-day activities as well as development techniques and use this of transcendent events in history, but at the adventures overseas. knowledge to provide motivational coaching to individuals and teams. Based on my same time always having the ability to reveal experiences, and inspired by books written by a prescient vision of the future. He's also a You're a member of The Explorers Club? What other business gurus, I set out to embody my renowned marine explorer. The other person is that? What discoveries led to you being vision and ideas into a book of best practices I look up to is Richard Branson. I had an accepted a member? for personal success. In 2013 I actually opportunity to see and hear him speak at a The Explorers Club of New York is an published a sequel to El renacer del héroe, conference in London once and his message is international society dedicated to the which focused more on the world of business clear: live life with intensity and passion. 66 Consumer Focus The bio-report 2016

Andreas Plietker, Heiko Hintze, Johannes H. Mauss, Liane Maxion, Managing Director Vice President Europe Sales former CMO and Managing Board Member at Bio-Zentrale Sports at Yogi Tea GmbH Director at Haus Rabenhorst at Naturata AG

Sales of organic products in Germany have continued to 1.2 million vegans in Germany - the upward trend of organic produce in Germany will increase significantly over the last few years, highlighting a continue to have an impact in the food and clear change in German consumption habits. >> drink sector in 2016. Furthermore, because of this rapid development in the organic trade Between 2013 and 2014 associate organic goods as offering a 'high market, the issue of the procurement of raw materials has also become a hotly debated overall sales of organic quality' alternative to non-organic food and topic. Producers, for example, must tackle produce climbed from drink – quality being a key selling point for challenges such as sourcing the 12,000 tons ¤7.55 billion to ¤7.91 those concerned about their health and of soybeans required to meet the demand for billion as the average wellbeing. These changing consumption alternative meat and milk products alone. German household habits are also reflected in the fact that meat spent 4.8% of its total income on food, drink alternative products experienced 10% growth In the following discussion, Falko Götz and other organic goods. Sales in specialist in 2014. Significantly, this growth was largely Ehlerding chats to four key decision makers organic trade shops grew by 9%, and while due to the fact that two thirds of the overall from Germany's organic industry and there was a slight decline (1%) in organic sales sales of meat alternative products are now addresses typical issues as well as other key in discount stores and other smaller operators; attributed to organic food and drink brands. trends likely to impact the industry in 2016. the chilled, milk and dairy categories helped sales of organic products in supermarkets and With more and more drugstores increase by 6% and 5% respectively. Germans swapping "Bio-Zentrale continues to invest in traditional meat-eating developing its export capability by hiring the Undoubtedly, this trend has been driven diets to become dedicated by a growing number of health conscious vegetarians or vegans – best available talent while offering existing consumers in Germany who increasingly there are already around employees training in key areas." The bio-report 2016 67

Internationalisation is very much stocks to better defend against fluctuations in on the agenda for German based the market. organic companies in 2016. What is Market snapshot • Liane Maxion, Board Member your business doing to strengthen at Naturata AG its operations as it seeks to further When raw materials are scarce it is very expand overseas? GERMANY difficult; often the raw materials for some • Andreas Plietker, Managing products are not available at all. Despite While battling against the negative Director at Bio-Zentrale these challenges, however, Naturata is able to impact of Chinese and emerging Bio-Zentrale continues to invest in developing maintain the high quality of its products. When market decline, Germany's usually people buy Demeter certified products, they its export capability by hiring the best available strong domestic demand took an talent while offering existing employees expect the very highest quality and to not meet unexpected hit leading up to Christmas, training in key development areas such as the expectations of consumers in this regard with unemployment also rising slightly languages. would be fatal for the Naturata brand. in line with a drop in exports. These The business also leverages the combined factors were undoubtedly exacerbated What have been the most effective expertise of Bio-Zentrale and the wider by the VW emissions scandal. Despite sales channels in recent years? Which KTG Foods Group, seeking out synergies this particularly challenging economic channels represent the biggest where both companies can benefit through period, Germany's economy began 2016 opportunity for future growth? collaborative efforts. favourably, surprising many analysts. • Andreas Plietker, Managing However, global vulnerabilities have • Johannes H. Mauss, former CMO and Director at Bio-Zentrale finally caught up with Germany and Managing Director at Haus Rabenhorst Historically, Bio-Zentrale has developed forced some agencies to offer more Haus Rabenhorst distributes its products, distribution channels with food retailers and pessimistic growth projections than which include specialist organic juices and to a lesser extent with drugstores. The Bio- previously stated for the year. While gluten and lactose free foods, in over 36 Zentrale brand has grown disproportionately in exports have indeed declined, private countries. In most of those countries we work food retail and there is still growth potential for consumption, spurred on by high with importers and we are continuing to focus Bio-Zentrale in that sector through developing employment and low fuel costs is being developing sustainable partnerships in Asia and launching new and innovative products. and Europe where there is a strong demand heralded as the country's new mainstay for our three main brands: Rabenhorst, • Heiko Hintze, Vice President of growth. Consequently, consumer Rotbäckchen and 3Pauly. Europe Sales at Yogi Tea GmbH confidence is expected to remain high Yogi Tea is currently sold in specialist organic over the year and this will undoubtedly Quality is an important attribute for food and health food retailers, drugstores, continue to have a positive impact on people who buy organic food and selected supermarkets and hypermarkets. Germany's FMCG market. drink. As the market continues to There continue to be interesting growth grow rapidly, how is your business prospects in these areas, particularly in the specialty trade, as well as within food services. seeking to maintain the high quality In other European countries outside of of its products? Germany, pharmacies and parapharmacies also In Germany, Haus Rabenhorst products • Heiko Hintze, Vice President offer interesting points of entry for distribution are market leaders within pharmacies and Europe Sales at Yogi Tea GmbH expansion. health food stores and are also available in drugstores and selected food retailers, as All Yogi Tea products are marked with the EU well as through our own online store. Growth Eco Label. This means that they are certified • Liane Maxion, Board Member within drugstores and food retailers is very high-quality herbal and spice teas; produced, at Naturata AG dynamic. We are not currently looking at any processed and stored in a strictly controlled Naturata is active in Germany, Austria and other channels. organic environment. Similarly, the suppliers Switzerland through its online store. The of our organic ingredients are certified natural food market still represents the biggest companies of organic farming and verified by potential growth area for the business and we Do the different channels need to be official inspection bodies such as the IMO. plan to continue investing in this area in the managed in different ways? Yogi Tea's own internal quality requirements DACH region. for raw materials are actually higher than those • Heiko Hintze, Vice President required by the specifications. In addition, • Johannes H. Mauss, former CMO and Europe Sales at Yogi Tea GmbH we have increased the safety of raw materials' Managing Director at Haus Rabenhorst Yes, Yogi Tea's retail partners all have different 68 Consumer Focus

expectations and therefore we must utilise superior quality as well as environmentally option in the future? channel-specific concepts to make sure that friendly products. The business is constantly • Andreas Plietker, Managing we meet those diverse expectations head- trying to improve productivity and reduce Director at Bio-Zentrale on. An example would be to avoid using inefficiencies in the manufacturing process, aggressive promotional activities in some and we have a continuous programme of Bio-Zentrale already has established private circumstances. In addition, we have a targeted technical optimisation and investment in new label agreements in place and recognises approach to selecting our distribution partners. technologies. All of this ensures that Yogi Tea further opportunities in this industry, Significantly, they must be willing to be flexible maintains its high quality while enabling us to particularly through leveraging the potential with regards to volume expansion. In some offer retailers and consumers stable prices. of our advanced manufacturing systems and additional bottling facility, as well as through instances, we reject any volume expansion logistics. It's good for the Bio-Zentrale brand options if we think they could jeopardize our • Johannes H. Mauss, former CMO and and good for business. long term growth. Managing Director at Haus Rabenhorst If an ingredient is too expensive and would • Heiko Hintze, Vice President lead to us not being able to offer retailers a fair How do you achieve a healthy profit price, we wouldn't invest in it. Our customers Europe Sales at Yogi Tea GmbH margin amidst the rising costs of raw rely on us to always offer the highest quality Our main priority is to continue growing the materials and the growing demand products though, so we would instead seek Yogi Tea brand; there is still a great deal of from consumers for high quality an alternative while maintaining 100% quality. potential to develop Yogi Tea and we believe products at reasonable prices? There are no exceptions. concentrating resources on maximising our efforts in this area is best for the business • Andreas Plietker, Managing • Liane Maxion, Board Member moving forward. Director at Bio-Zentrale at Naturata AG Bio-Zentrale's association with KTG Foods This is currently the biggest challenge for • Liane Maxion, Board Member Group means our supply of raw materials is Naturata. The cost of raw materials is rising at Naturata AG guaranteed at a low cost. We are therefore and it's becoming increasingly difficult to keep Naturata is not currently active in the private able to offer retailers high quality, acceptable prices low. We counteract this by optimising our label industry and has no plans to develop prices and good profit margins. supply chain and working closely with suppliers opportunities in that area. to develop workable solutions. Compromising on quality is never an option for us. • Heiko Hintze, Vice President • Johannes H. Mauss, former CMO and Europe Sales at Yogi Tea GmbH Managing Director at Haus Rabenhorst Yogi Tea is a premium brand and as such Does your business have any private Haus Rabenhorst has experimented with we are completely focused on delivering label agreements? If not, is that an private label agreements in the past, but has The bio-report 2016 69

since formed the view that private label doesn't business for more than 210 years and has 120 • Heiko Hintze, Vice President really fit with our business model. employees who are proud to call themselves Europe Sales at Yogi Tea GmbH 'Rabenhorsters'. New employees must be able It's important that our employees identify to fit into this strong culture, which means In terms of hiring, what are the with the Yogi Tea brand as well as the wider being adaptable and having good social skills most important characteristics organic food and drink industry. Professional while not being too 'career-minded' in their your business seeks to identify in experience in that industry is obviously attitude. advantageous but if potential candidates? candidates can demonstrate • Heiko Hintze, Vice President "The cost of raw materials is rising and a genuine affinity with our Europe Sales at Yogi Tea GmbH brand and our sector then it's becoming increasingly difficult to Yogi Tea is a special brand with a long history they're welcome to apply. and determining someone's cultural fit is vitally keep prices low. We counteract this by Experience working in important for the business when it makes a optimising our supply chain and working smaller companies is another important attribute we look new appointment. Candidates, therefore, closely with suppliers." for in potential candidates. must have an affinity with the key attributes of the brand such as 'organic quality', 'Ayurveda' How does your business deal with the • Johannes H. Mauss, former CMO and and 'yoga'. Being able to demonstrate a issue of skill shortages in the organic Managing Director at Haus Rabenhorst genuine openness towards other cultures is sector? Are you able to identify and A lot of people, including myself, have joined attract the right kind of people from also important. In addition to these personal the organic sector from the conventional food the wider food industry? qualities, candidates must have relevant job industry. Consequently, the organic sector has experience and functional expertise, a team- • Andreas Plietker, Managing grown and become more professional. So, orientated approach, hands-on mentality and Director at Bio-Zentrale hiring people from outside the organic sector good initiative. Skill shortages are a reality in the organic should definitely be encouraged. sector, but we are able to overcome this • Liane Maxion, • Liane Maxion, Board Member issue by hiring people from the so-called Board Member at Naturata AG at Naturata AG 'conventional' food industry who we deem Cultural fit and the ability to develop good to have an affinity with what we stand for as Our recruitment policy is not in any way rigid, working relationships in a small team a business. We then integrate these people we will consider any motivated candidate environment are key factors for us. with our more experienced staff and quickly regardless of which sector they're from. bridge any gaps in their knowledge. We also What's important for us is finding people who • Johannes H. Mauss, former CMO and have dedicated in-house training programmes have a genuine desire to make a difference. Managing Director at Haus Rabenhorst and take pride in bringing young people up Often, those people are moving from larger Rabenhorst has been an established family-run through the ranks. companies into smaller businesses like ours. 70 Consumer Focus

What is your business doing to adapt to people's changing diets and in particular the growing number of vegans in Germany? • Andreas Plietker, Managing Director at Bio-Zentrale The majority of our products are already vegan and we work alongside our retail partners to develop targeted 'point of sale' promotional activities to increase sales such as creating engaging displays, writing recipes and analysing shelf placement performance. We also seek to integrate any relevant emerging nutritional trends into new products.

• Johannes H. Mauss, former CMO and Managing Director at Haus Rabenhorst We analyse trends very closely and if they are relevant to our brand we are able to react very quickly to integrate them into our product range.

• Liane Maxion, Board Member at Naturata AG

The Naturata product range is 100% vegetarian though, we promote product offers through not be fully offset by cost savings and has and around 90% vegan. This is not because we creating engaging displays as well as via led to extensive price negotiations and price are reacting to any emerging nutritional trends, adverts and other marketing materials. These adjustments in the market. Furthermore, however, but rather because the principles of all help retailers at the point of sale. Bio-Zentrale has been through an internal vegetarianism and veganism have always been restructure with the national sales team taking central to Naturata. To help consumers, our over responsibility for two KTG Food brands as vegan products are clearly labelled with the Your business has an established and, well as integrating new people into the existing well-known Vegan Society seal. one could say, fairly niche customer team. Last year we began implementing a new base. What are you doing to try and CRM solution to help facilitate these changes. How does your business work with reach a more mainstream audience? • Heiko Hintze, Vice President retailers to ensure organic products • Johannes H. Mauss, former CMO and Europe Sales at Yogi Tea GmbH are visible at the point of sale and Managing Director at Haus Rabenhorst Over the last two years we have grown rapidly that communication to the customer We've been established for a long time and and have subsequently had to make various is clear? have consequently built up a large customer internal adjustments, such as establishing a base. Because we sell very niche and premium • Andreas Plietker, Managing new operating structure and integrating new health products, however, we're never going Director at Bio-Zentrale processes, to accommodate this growth. We to be a mainstream brand and therefore don't We spend a lot of time analysing shelf have also expanded our teams and created target the mainstream market. placement performance and work closely with new positions within the business and have our retail partners to make sure displays are had to work hard to integrate these new interesting and engaging. Nationally, in 2015, What are the main challenges your people into the company. there were around 15,000 active in-store business has faced during the last 12 • Johannes H. Mauss, former CMO and displays and we also conducted 1,700 in-store months? taste tests with consumers. Managing Director at Haus Rabenhorst • Andreas Plietker, Managing The biggest challenge for us has been the • Heiko Hintze, Vice President Director at Bio-Zentrale procurement of raw materials. Although Europe Sales at Yogi Tea GmbH The rising cost of raw materials and the demand for organic food has been growing With each retailer there are different knock-on effect this has had on prices has steadily over the last 12 months, the rate of opportunities to be leveraged. Generally certainly been a major issue for us. This could growth is likely to slow. The bio-report 2016 71

"There is a growing demand for Bio-Zentrale aims to • Liane Maxion, Board Member be at the center of at Naturata AG convenience organic food, so you will see these emerging trends. Vegan as well as 'free-from' foods will become more product ranges in smaller containers Together with KTG more and more widespread. specifically designed for the mobile Foods we are the largest grower of soybeans in consumer who wants to 'eat on the go'." Germany and already What activities are you most excited have a number of about in 2016? • Liane Maxion, Board Member exciting superfoods, a range we plan to • Andreas Plietker, Managing at Naturata AG expand further. We also firmly believe in the Director at Bio-Zentrale In addition to rising commodity prices, the 'from farm to plate' agenda and are a strong In 2016 we're further investing in the power general availability of raw materials has been advocate for driving change with regards to of innovation as we seek to bring more new a constant challenge for Naturata and has how raw materials are sourced, processed and products and product lines to the market, in made it difficult for us to maintain our large marketed. co-operation with other great organic brands. range of products. For example, spelt, which is • Heiko Hintze, Vice President used in our pasta, was in short supply and we • Heiko Hintze, Vice President were forced to discontinue some of our pasta Europe Sales at Yogi Tea GmbH Europe Sales at Yogi Tea GmbH products. Thanks to our close relationship Living a healthy lifestyle and being conscious We're launching some great new products as with the supplier, however, we didn't have of your body are trends that will continue to well as offering some attractive promotions in to discontinue the full range. Many other impact the tea market, with herbal as well 2016 as we seek to further inspire consumers and improve their our overall experience organic brands on the other hand had to as spiced teas being obvious growth areas. of our brands. We expect to continue the Yoga continues to be a sporting phenomenon completely discontinue spelt-based products. success we've had in our target markets and We communicated directly with retailers and and another area where our brand can seek distribution channels in Europe. consumers and made them aware of the issue to leverage opportunities. Consumers also early on. continue to seek out natural, organically • Liane Maxion, Board Member farmed products and, again, our brand is well at Naturata AG positioned to meet these demands. What trends do you expect to see in Naturata is 40 years old in 2016. We're 2016? very proud of this and the fact that we've • Johannes H. Mauss, former CMO and continuously grown in the fast-changing and • Andreas Plietker, Managing Managing Director at Haus Rabenhorst often turbulent organic market. The business is Director at Bio-Zentrale There is a growing demand for convenience confident about the next 40 years of its journey. In addition to the growth of veganism and organic food, so you will see more product vegan products, I expect retailers will likely ranges in smaller containers specifically • Johannes H. Mauss, former CMO and increase the number of 'superfoods' they designed for the mobile consumer who wants Managing Director at Haus Rabenhorst stock. We will also continue to see the further to 'eat on the go'. The flexitarian diet - one that There's definitely some surprises in store; development of regional food standards and is plant based with the occasional inclusion of for example, the Rotbäckchen brand has an the importance of the issue of transparency. meat – will also become more prevalent. exciting new range coming out in 2016. Let us know what you think... >>

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