The 60th GLOBAL SUMMIT

Seizing opportunities in the face of disruption

THE EXECUTIVE SUMMARY

15th - 17th June 2016 Cape Town International Convention Centre CAPE TOWN, SOUTH AFRICA

1 «We all have the same goal in mind and «Food safety is a commitment you make it’s food safety for our consumers. throughout your whole organization.” That’s just a reality.» Danny Wegman - Wegmans Mike Robach - Cargill

«Data is precious but human capital is what will make the difference.» «It’s our job to set high standards. Eric Legros - Majid Al Futtaim Retail Transparency brings consumer trust.” » Denise Morrison - Campbell Soup Company

«A company is successful overtime if it creates shared value for society.» Paul Bulcke - Nestlé THIS WAS THE 60TH

“More people today are dying of obesity than hunger.” Jonathan Farnell - EAT Fondation GLOBAL SUMMIT «We need to infuse more confidence in our economy and look for areas of growth.» Cyril Ramaphosa - Deputy President of South Africa

«Human capital will soon be something to make war over.» «People is the most challenging asset. Vivienne Ming - Socos Training and development are the key.» Hans Anggara - Alfamart

2 3 THE GLOBAL SUMMIT 2016 IN NUMBERS

The Global Summit of The Consumer Goods Forum is the business event that unites CEOs from some of the world’s 800 most successful retailers, manufacturers and service providers. 300 This unique event is the essential destination where 800+ successful FMCG leaders, from over 50 countries, gather under one roof every year. It is where CEOs talk to CEOs with additional input from global and regional experts. It is COMPANIES 45 the place to voice and discuss the key issues and challenges facing our industry now and in the future. It is the event DELEGATES COUNTRIES where the global agenda for the consumer goods sector is set.

Seizing opportunities

AND 50BR in the face of disruption JOURNALISTS 38 We are living in an age when consumers trust many discount retailers more than their long established competitors. SPEAKERS When they trust social networks of their anonymous peers far more than well-known retailers and brands. When we are all willing to benefit from the physical touch and human service offered by physical stores, but prefer to part with our money online. When unknown start-ups are seen as better for you, better for the planet and better for society than big businesses.

We are living in an age of disruption. And beneath all disruptions lie opportunities. TOP COUNTRIES The 60th Global Summit, the industry’s best global CEO event, brought together innovators, CEOs from our industry and leaders of new business models, from emerging and developed markets, to share their experiences and challenge us to see disruption from new vantage points.

SOUTH AFRICA USA FRANCE UK GERMANY SWITZERLAND

MORE THAN 300 ARTICLES ABOUT THE GLOBAL SUMMIT 2016 135 COMPARED TO 2015

The Consumer Goods Forum (“the CGF”) is a global, parity-based industry network that is driven by its members to encourage the global adoption of practices and standards that serves the consumer goods industry worldwide. It brings together the CEOs and senior management of some 400 retailers, manufacturers, service providers, and other stakeholders across 50 countries, and it reflects the diversity of the industry in geography, size, product category and format. Its member companies have combined sales of EUR 3.5 trillion and directly employ nearly 10 million people, with a further 90 million related jobs estimated along the value chain. It is governed by its Board of Directors, which comprises 50 manufacturer and retailer CEOs.

For more, please visit: www.theconsumergoodsforum.com. 4 5 A Voice from Asia: The Alfamart Journey 14:45 THE OFFICIAL PROGRAMME HANS ANGGARA - ALFAMART 19 Modern Retailer in the Middle East 15:15 ERIC LEGROS - MAJID AL FUTTAIM RETAIL 20

Wednesday 15th June Retail in Africa: Contrasts and Contradictions 16:30 RICHARD BRASHER - PICK N PAY STORES LIMITED 21

Welcome to The Global Summit of The Consumer Goods Forum Positioning Walmart for the Future 14:30 GARETH ACKERMAN - PICK N PAY STORES LIMITED 17:00 8 DOUG McMILLON - WALMART 22

Doing Business on the African Continent Bringing Efficiency to the Market Place 14:40 CHRISTO WIESE - PEPKOR 17:30 9 JUNLING LIU - NEW PEAK GROUP 23

Consumer Goods for Better Lives Consumer Trust One Year After New York 15:00 DAVE LEWIS - TESCO 18:00 10 PETER FREEDMAN - THE CONSUMER GOODS FORUM 24 A Special Welcome to South Africa 15:30 th CYRIL RAMAPHOSA - DEPUTY PRESIDENT OF SOUTH AFRICA 11 Friday 17 June Lessons to Be Learned from Disruptive Communication 16:00 Creating Shared Value Sustainably SIR MARTIN SORRELL - WPP 12 09:00 PAUL BULCKE - NESTLÉ 25 The Land of Business Opportunity – A Snapshot of the African Political Landscape Food Safety: Global View for a Global Issue 17:00 ZELDA LA GRANGE - FORMER PRIVATE SECRETARY - OFFICE OF THE PRESIDENT NELSON MANDELA 13 09:30 DANNY WEGMAN - WEGMANS MIKE ROBACH - CARGILL 26 Reasons to Believe in Africa – The Rise of the Bright Continent 17:30 MUHTAR KENT - THE COCA-COLA COMPANY 14 Let’s Be Challenged by the Next Consumers' Generation 11:00 TOM GORMAN - BRAMBLES th JULIE HAMILTON - THE COCA-COLA COMPANY Thursday 16 June ENACTUS STUDENTS 27

Empowering Healthier Consumers Fireside Conversation 12:00 09:15 WALTER ROBB - WHOLE FOODS ROB DAVIES - MINISTER OF TRADE AND INDUSTRY OF SOUTH AFRICA 28 DENISE MORRISON - CAMPBELL SOUP COMPANY JONATHAN FARNELL - EAT FOUNDATION Opportunity and Transformation in a Fast-Changing Retail Landscape 15 14:15 DICK BOER - AHOLD-DELHAIZE 29 The Digital Disruptors Have Their Say 10:00 Leading Retail in India VIVIENNE MING - SOCOS 14:45 KISHORE BIYANI - FUTURE GROUP 30 MICHAEL FERTIK - REPUTATION.COM KATE SAYRE - FACEBOOK 16 The Courage to Lead 15:15 FRANÇOIS PIENAAR - FORMER SOUTH AFRICAN RUGBY TEAM 31 Positive Impact, Real Business: Young Entrepreneurs in Emerging Markets Share Their Story 11:30 AFFIONG WILLIAMS - REELFRUIT Closing Remarks - HEADBOY INDUSTRIES INC. 15:45 LUDWICK MARISHANE 17 GARETH ACKERMANN - PICK N PAY STORES LIMITED 32

A Digital Model to Global Success 14:00 DANIEL ZHANG - ALIBABA 18 Special Sessions 34 6 7 GARETH ACKERMAN CHRISTO WIESE Chairman Chairman Pick N Pay Stores Limited Pepkor & Co-Chair The Consumer Goods Forum

«The CGF has to play a key role « When the sun rises, whether you in sustainability improvements are a lion or a gazelle, you had for the world.» better be running fast. »

WELCOME TO THE GLOBAL SUMMIT DOING BUSINESS ON THE AFRICAN CONTINENT OF THE CONSUMER GOODS FORUM

Gareth Ackerman opened the He told The Consumer Goods Forum who had less. The Consumer Goods Christo Wiese said he was an Africa by the end of the century. first was to select with care the 60th Summit. He said that he and that it was coming together with Forum had to play a key role in optimist, but that the continent And by being late participants, countries in which you operated. Co-Chair Denise Morrison were greater strength than ever before, sustainability improvements for suffered from a bad press. It was Africans could leapfrog in terms of Thorough research would stand delighted to welcome delegates to with increased membership, a the world. This was the perfect in the nature of the media to focus technology. The use of smartphones you in good stead, and he advised Cape Town, and said that he was stronger programme and more subject for the 60th Summit, and on the sensational and in the short was forecast to increase to 50% by identifying those countries with a especially happy that the Summit impactful work. In the past 12 he said the line-up of speakers was term, Africa offered a rich menu 2020 compared to 2% in 2010. progressive attitude towards foreign took place in his home town. months, great progress had been distinguished not just by its quality of poverty, corruption, abuse and direct investment and a growing Alluding to the rain outside, he made on all fronts. The Forum was but its geographic breadth, and the crooked leaders. But the pressures The obstacles to realising this middle class. Second, you needed said he was not going to apologise establishing a new board in South highest number of women leaders. of daily reporting meant that the potential were headed by a lack a long term commitment to the for the weather because the entire America, and was establishing a media were not always able to pull of adequate infrastructure. continent. When Shoprite entered region had been experiencing a stronger base in South Africa. Ackerman said he wanted to back to look at the wider context, Weise explained that Zambia was the rest of Africa the principals had drought. The issues of food safety Sustainability was ever-present acknowledge and thank a number of all leading to the impression of a almost exclusively dependent on agreed the development was for and security were never more in members’ minds, whether with people. His father had been chair of backward continent. hydroelectric power, but because their children and grandchildren, real and present than in such regard to food safety and security, the old CIES for a number of years, of the recent drought, water levels not for themselves. In the end, they circumstances. climate change and deforestation and was in the hall with his mother. Although it was important to make had shrunk dangerously low and had ended up making higher returns or the social agenda, with specific He expressed his thanks to the a clear distinction between Africa’s Zambians only had four hours than in their home market, but Ackerman said that he, his family attention to the issue of forced sponsors of the Summit, the Summit potential and the clear realities of of electricity a day. Neither had that had sometimes required their and colleagues loved being part labour. These challenges were all Committee and the local Task doing business in it, the potential red tape and bureaucracy been building the roads to get people to of Africa. It was a continent with especially acute in South Africa, Force as well as the South African was indeed extraordinary. It was materially reduced, although there their stores. huge diversity and optimism, and which had also experienced rapid National Convention Bureau and all the second largest continent after were encouraging signs with regard he hoped delegates would feel that migration and urbanisation. the attendees, speakers and staff. Asia – the land mass of Africa is so to graft and corruption, notably from Wiese cited an African saying. Every from the city and the region during He and Denise Morrison wished great that you could fit China, India, President Buhari in Nigeria. morning a lion wakes and thinks it the Summit. Their tremendous The industry had to be more all an inspiring and successful the whole of Europe, the United And Africa had to start to buy from must run faster than the slowest challenges were matched by efficient at getting goods to its Summit. States and Argentina into Africa and sell to itself. Currently less gazelle. And every morning, a enormous opportunities. customers, and especially to those and still have space left. It already than 20% of all trading was intra- gazelle wakes up and thinks it had accounted for $3 trillion in GDP and African. better be able to run faster than the 60% of the world’s uncultivated fastest lion. The moral? When the arable land as well as being very Wiese offered some advice for those sun rises, whether you are a lion or rich in natural resources. Its 1.2 wishing to do business in Africa a gazelle, you had better be running billion people would grow to 4 billion based on personal experience. The fast.

8 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 9 DAVE LEWIS CYRIL RAMAPHOSA Chief Executive Officer Deputy President Tesco South Africa

« Informed, satisfied consumers « By 2050 we would not have enough were the most important food to feed the planet. » stakeholders in any business. »

CONSUMER GOODS FOR BETTER LIVES A SPECIAL WELCOME TO SOUTH AFRICA

Dave Lewis spoke principally in his there was very little consumer which fields to pick when – and when Deputy President Ramaphosa said and reconciliation for the country the drive to end forced labour and capacity as chair of Champions waste, but significant loss in the to open up store capacity for crop that it was a special occasion for and he had kept all South Africans, modern era slavery by promoting 12.3, the body set up to engage with supply chain. In the developed flushes. Sourcing further afield, they South Africa and the continent as black and white, on course to decent working conditions around Sustainable Development Goal 12.3 world, it was the other way round. In had eliminated restocking points a whole that The Consumer Goods accomplish their difficult transition the world. of the United Nations 2030 Agenda North America and Europe, consumers between Spain and the UK, getting Forum had come to Africa for the to a national democratic society out for Sustainable Development, but he in their homes were throwing away produce into stores two days earlier to first time. It was also appropriate, of the ashes of apartheid. He added South Africa had explained in some detail how Tesco some 95-115kg of waste per capita cut down code life waste. as its people were beginning to bear fought back against what could were making their contribution a year. witness to the birth of Africa as a Ramaphosa said business could sometimes feel like an unfair to eliminating by half per capita With regard to consumers themselves, great consumer market. play a vital role in creating decent share of economic challenges, global food waste at the retail and In the UK, retailers typically they had simplified coding itself to employment and underpinning and said that collaboration had consumer levels. accounted for the smallest proportion show just one date, and cut «Buy Ramaphosa said that it was in entire national economies. been a vital part of that effort. of waste directly, but it was important 1 Get 1 Free» promotions in fresh the DNA of South Africans to Informed, satisfied consumers were Recently, the three major rating Coming to a retail role after nearly they had their house in order. At categories. They had introduced embrace and manage change. Cape the most important stakeholders agencies had scrutinised the 3 decades at Unilever, he realised Tesco they measured and published packaging innovations to keep food Town, the mother city, had gone in any business, and he said that country’s finances and debt very he had understood only a fraction of waste monthly, recently adding fresher longer, as well as providing through centuries of disruption consumer-focused businesses had closely, and they had faced the risk the food chain. Learning more had bakery to the numbers after long education to adult customers and to from colonialists in the 17th and to be responsive to the financial of downgrading to junk status. By stirred up quite a few emotions, not standing methodological debates. their children with their Eat Happy 18th century, slavery through the pressures under which their bringing government, business all of which were positive. It was Bakery and produce accounted for programme. 19th century and segregation and customers found themselves. leaders and organised labour embarrassing to explain why retailers the largest proportion of some 1% apartheid in the 20th century. Personal income and therefore together, and by going to New York did some of the things they did; of throughput going to waste. They Lewis asked retailers to stop debating Indeed, these had been times of expenditure continued to shift and London to make their plan and sometimes you saw things you were had committed no edible food would measurement techniques and both disruption and resistance. for individuals and families on their solidarity clear, they had just ashamed of. By 2050 we would not go to waste before the end of 2017 just sign up for the transparency Ramaphosa said he continued to be an ongoing basis. He applauded received word that while Fitch, S&P have enough food to feed the planet and had developed an open system initiative in order to measure moved by the memory of standing the Forum’s putting consumers at and Moody’s saw there were real – except that already we were smartphone app to enable charitable progress; he asked manufacturers next to Nelson Mandela, holding the heart of the value chain, and challenges for the country, they wasting a third of what we produced. distribution which others were to partner with retailers to reduce up the microphone as he made his observed that its members were would not downgrade the country’s But as an optimist who believed in welcome to share. waste in the supply chain, review famous address from the balcony of able to spend most of the year debt because they recognised the power of people to change things, promotional strategies to help Cape Town City Hall. Mandela had competing vigorously with each South Africa had strong, stable Lewis said he wanted to go beyond Tesco had revisited quality and consumers waste less and help delivered another and more pleasant other but still come together once a and independent institutions in its the negative. consistency criteria, introducing in joint efforts to educate and disruption with his message of hope year to break bread. He commended business and society. “wonky food” options in store as redistribute where waste was truly Lewis said the problem was not well as improving systems for linking unavoidable. simple. In the developing world sales directly to farms to determine 10 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 11 SIR MARTIN SORRELL ZELDA LA GRANGE Founder & CEO Former Private Secretary WPP Office of the President Nelson Mandela

« Education is the most important of all «Doing good is good business.» weapons with which to change the world. »

LESSONS TO BE LEARNED THE LAND OF BUSINESS OPPORTUNITY FROM DISRUPTIVE COMMUNICATION A SNAPSHOT OF THE AFRICAN POLITICAL LANDSCAPE

Martin Sorrell said the world was was lower than production – while communications as companies Zelda La Grange recounted a or other set of circumstances. Her On the matter of respect, La Grange characterised as much by its new the demand for talent exceeded tried to integrate further, becoming number of memories from her time experience of working alongside observed that when the South normal state as by being disruptive: supply. That would only get worse; more global, more local – and less working with President Nelson him had not enabled her to answer African Rugby Football Union it was one in which both real and UNESCO had shown the world regional. Regional organisations Mandela. She emphasised his those questions, but she observed had mounted a legal challenge nominal GDP growth were low, with would continue to age until at and managers only really had the commitment to education, which he had lived according to a strict set to the President’s appointment of little or no inflation, little pricing least 2060. Third, the rise of the power to say no, both upwards and he said was the most important of of morals and principles daily. He a Commission of Inquiry into its power and a near universal focus Internet was marked by inexorable downwards. Seventh, he noted all weapons with which to change made sure that even in the smallest financial affairs, he had insisted on on cost reduction as the means disintermediation, shortening supply how finance and procurement had the world. In the 1990s she became things, people could see what attending the courthouse in person. to competitiveness. Shareholder chains and eroding long standing become the dominant functions, known as the source of invitations he was like and draw their own On arrival, he walked right up to the sentiment and diminishing oligopolies. There were currently with marketing taking the back to the most expensive breakfast conclusions. opposition lawyers and chatted with executive lifespan were leading to two dominant forces in the digital seat. Eighth, government was you would ever had. The President them in Afrikaans. a very short term attitude. He noted landscape in the form of Google playing a bigger and bigger part would read about corporate results She had learned lessons from him When she had asked him why he how the S&P500 was effectively and Facebook. In 2016 WPP would in civil society; often in a national one day and then invite the CEOs about discipline, respect, honesty had afforded them so much respect, shrinking, going from earnings spend over $5bn with Google, and market, government was their to breakfast the following morning, and integrity. In 1998, the President the President had told her two distribution and share buybacks of $1.5bn with Facebook. Fourth, biggest client. Ninth, sustainability invariably convincing them to had been chairing a meeting at things. First, you never allowed the 60% in 2009 to over 100% more there was a major rebalancing and purpose were ever more support the building of a rural the Southern African Development enemy to determine the grounds recently. occurring between media use and relevant to consumers and school for $5,000 to $8,000. Commission in Mauritius. Robert for battle. Second, the way in which media spend in marketing. Mobile employees. And tenth, a new wave Mugabe entered the room about an you approached a person would He suggested ten phenomena remained underexploited, just as of consolidation and convergence Upskilling people was the hour late. Without mentioning any always determine how that person represented the key sources of print was massively over-indexed. in media industries was under way, investment South Africa needed the names, the President launched into subsequently treated you. disruption for WPP and its clients. Fifth, there was a transformation in with more to come. most, not least because just about a 20 minute impromptu speech First, New York might continue the relationship between retailers any other investment was more about the discourtesy of arriving La Grange concluded by recounting to be the centre of the world, but and manufacturers because If the audience was in any doubt as subject to market and commodity late, and of thinking rank excused the President’s belief that it was there was a discernible shift in manufacturers had the technology to the speed of change required to fluctuations. people from valuing the time of easier to change others than change multiple directions: to the east to reach directly to the consumer keep up with this level of disruption, others. He flatly contradicted there yourself. He had truly believed that in China, south to Latin America over the top of the retailers. Sorrell reminded them that half of La Grange said that Mandela was being such a thing as “African if he could influence one person a and south-east towards Africa WPP’s business hadn’t even existed the most revered statesman of our time”. day, he could change the world. And and the Middle East. Second, in Sorrell’s sixth phenomenon was 15 years before. time. Invariably she was asked what he did. most industrial areas, demand the rising relevance of internal he would have said or done in one

12 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 13 DENISE MORRISON MUHTAR KENT Chief Executive Officer Campbell Soup Company Chairman & CEO & Co-Chair of the CGF The Coca-Cola Company JONATHAN FARNELL Chief Executive Officer EAT Foundation « By 2025, Africa’s population would WALTER ROBB represent 25% of the global population.» Chief Executive Officer Whole Foods

REASONS TO BELIEVE IN AFRICA EMPOWERING HEALTHIER CONSUMERS THE RISE OF THE BRIGHT CONTINENT

Muhtar Kent said that a brand was He added that Coca-Cola’s business more sustainable supply chains Jonathan Farnell said that the in the DNA of the Campbell Soup and said that, as consumer goods a promise, and a good brand was a could only prosper if people were by helping small scale African EAT Foundation brought together Company, it had had to be activated companies, they could use their promise kept. In that sense, brand thriving, and that their commitment farmers improve their yields, expand over 500 of the key players in the in a more contemporary way. She power with producers to raise the Mandela was extraordinary. He to playing a role in what he environmental growing and double food chain to break down barriers had really gone to work on the bar. added that Coca-Cola had been described as the golden triangle the income of some 50,000 farmers. between different stakeholders in company’s purpose and assembled believing in Africa for more than of government, business and civil the food chain and improve nutrition a cross-functional team of leaders Morrison related how her company 90 years, investing more and more society was therefore enlightened Kent said he had just came from worldwide. He reminded the Forum to work out how to articulate it had decided to improve the health in recent times: some $6bn in the self-interest. As a company and Rwanda where Coca-Cola had of the unprecedented magnitude in a way that really resonated. It and wellbeing of its headquarters first decade of this century, and as an industry, it was vital to find launched a water project called of the situation the world faced. had been the most galvanising home town in Camden, New Jersey. on course to commit $17bn in the solutions to big challenges. He Ekocenter, a social enterprise model We were in the wake of an obesity thing she had ever observed in an In a public-private partnership second. highlighted a number of initiatives. of community development. It epidemic and yet also faced organisational setting. they had committed to reducing the was based around a kiosk broadly significant areas of malnourishment 40% obesity rate to 20% within Kent said the greatest asset of Recently, Melinda Gates had asked similar to a 20 foot container (and the two sometimes Robb also emphasised the the next ten years. She noted how Africa was its people. It had the why, if it was possible to get a Coke equipped with basic services for overlapped). Our food production importance of purpose. That of public budget pressures made the youngest population in the world, anywhere in the world, it was not solar energy, clean water and systems were just about adequate to Whole Foods Market was all about challenge harder because nutrition with 65% of people under 35. By possible to get medicines to people internet connectivity. Part of the feed the world’s growing population, fresh food, love and respect, and education was often the first item to 2025, Africa’s 2.4 billion people in hard to reach places. Coca-Cola facility was first line medical but only if we stopped throwing the belief that full health was not be cut, and physical education the would represent 25% of the global had played a leading role in Project support, to whom clean water was 30% of our production away. And so much the absence of something, second. population. And the health and Last Mile with Minister of Health provided free of charge. To date they what we chose to put on the plates but the presence of something. affluence of those people were in Ghana and Tanzania to improve had 100 Ekocenters and expected of the population would have a They had built steadily on the basis Robb said it was also important to improving rapidly. Child mortality medicine availability by 30%, another 177 by the end of the year. tremendous impact on the planet, of offering food with no additives revisit the prevailing relationship was down sharply, malaria deaths putting to work one of the most The water reclamation potential they especially as increasing wealth saw and no preservatives, increasingly between quality and price. Not all were down by more than 60% and diverse distribution systems in the provided were just one part of Coca- diets pivoting towards meat and using third party verification to set food was created equal. There maternal HIV transmission was on world and their expertise. Cola’s commitment to becoming ultra-processed food. and maintain standards. They had was a cost to good food and it was the way to being eradicated. fully water neutral by 2020. a passion for transparency and important to resist a race to the Inflation had been tamed, mobile In another initiative, Source Africa, Farnell then joined Walter Robb accountability, in turn driven by bottom. He noted that in the USA, telephony was transforming they had worked with TechnoServe and Denise Morrison for a panel consumer hunger to know where people spent just 9% of GDP on food markets, and better governance was and the Gates Foundation to discussion moderated by Alex their food came from. He applauded versus 15-16% in Europe. yielding exponential improvements. drive the building of better and Thomson. Morrison said that the steps the Campbell Soup although health and wellbeing were Company had made to do the same

14 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 15 VIVIENNE MING Founder & Executive Chair AFFIONG WILLIAMS Socos Founder & CEO MICHAEL FERTIK Reelfruit Founder LUDWICK MARISHANE Reputation.com Founder & MD KATE SAYRE Headboy Industries Inc. Global Head of Consumer Goods Strategy Facebook

THE DIGITAL DISRUPTORS HAVE THEIR SAY POSITIVE IMPACT, REAL BUSINESS: Moderated by Michael Chui, Partner, McKinsey Global Institute YOUNG ENTREPRENEURS IN EMERGING MARKETS SHARE THEIR STORY Michael Chui introduced the camp somewhere within about three your stuff somewhere else. And Moderated by Michael Chui, Partner, McKinsey Global Institute session by showing analysis which minutes. Another application they finally there was analytics, where demonstrated that digitisation had had built allowed autistic children Hadoop and MapReduce were doing a very uneven effect on industries to be taught in real time how to for analytics what Excel had done Michael Chui introduced founders Netherlands and Germany to bring his most useful tool – using cut and once you took into account how read human emotions. She said for numbers – which was to allow Affiong Williams and Ludwick their products to those markets. paste and Gmail in an internet café, well companies were applying there was a fine line between data generalists to do what previously Marishane to tell the stories of their Their next steps included expanding he had managed to assemble a text it. Those who were doing it best privacy implications and creating required specialists. He also said businesses. factory capacity so they could meet document he could import into Word were accelerating away from the real benefits: for instance, setting he had noticed some certain signs increased demand in the years and then Excel. Doing business in competition, and the laggards were up a model to predict diabetes sugar of failure in legacy businesses – of Williams said her company, ahead, and diversify to different Africa meant you learned to think falling further behind. In his famous level crises in advance, or using which appointing a Chief Digital Reelfruit, was the first company types of products responding to differently. quotation, William Gibson had got it just the sensors on a cellphone to Officer was one, and the CEO not to launch dried fruit as a snack in market trends. right: the future was already here, track covertly mood states and thus understanding the difference Nigeria. Her market opportunity was In order to get funding, he had except it was unevenly distributed. anticipate potentially dangerous between the CIO and the CTO was tremendous. Nigeria had the largest Marishane said he had started become a serial business plan He said that data and artificial manic episodes in serious cases of another. population and economy in Africa. his company in his first year at competition entrant, in total intelligence were not on the horizon bipolar disorder. But she had also wanted to reverse university in order to deal with winning some $100,000 which so much as competitive weapons Kate Sayre said there was an a trend, which was Nigeria’s the hygiene challenges of many he had used to develop and then already in use today. Michael Fertik said a lot of what unprecedented opportunity to make tendency to export raw materials Africans who used the sponge bath improve a working prototype to Silicon Valley talked about was new meaning for brands, but to and import most of its refined food method. Trying to wash with limited a very high level of efficacy. It Vivienne Ming said her work had almost designed to make people succeed companies had to adapt products. She believed there was an water and using conventional had made him a minor celebrity started in the intelligence services feel unnecessarily stupid. He said to changes in behaviours and opportunity to create a world class detergents typically left people on business television, but he trying to understand how data most of what was going on could be where people were spending time. product that could sell on any shelf very soapy, and even so, also used struggled to sell it locally because analytics could make sense of facial related to just three big ideas. Second, there were new marketing in the world. very scarce water which might be it was regarded as a poor man’s expressions well enough to know Search, which for the purposes technologies to adopt as soon as better kept for drinking. He was product. In order to keep the whether people were lying. She had of this discussion was effectively possible. And third, they had to Since launch in 2013 they had determined to produce a solution company going he had learned to repurposed that technology for the Google, was still mostly text-based accelerate testing and learning. introduced four products and sold which was more practical. Looking increase the mark up, add the word United Nations Orphans Reunited but would soon extend to visual She said there was a lot of talk in 300,000 packets in three years. around the world he found a product “premium” and sell it overseas programme, which used scanned and audio sources. Storage was Silicon Valley about how technology They had an impressive roster called One Rinse, but that only for specialised use. Recently, his photographs of children in camps more or less the cloud. Fertik said could make us better, but we also of customers, including United partially solved the problem, not the company had realised that the local globally to tell parents, uncles and the cloud needed to be demystified: needed to make technology better Airlines, Delta, SPAR, Shoprite and root cause. He started work on a gel consumers most ready to adopt aunts and grandparents definitively it was basically your data on a for people. hotel chains such as Radisson which could do this, protected it and new solutions were the young, and whether their children were in a UN server in another guy’s office, or Blu and Southern Sun. They had then had to write a business plan. they had successfully embarked international interest from the He explained how his cellphone was upon marketing through schools. 16 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 17 DANIEL ZHANG HANS ANGGARA Chief Executive Officer Chief Executive Officer Alibaba Alfamart

“In many ways, China is at «People is the most challenging asset. the vanguard of e-commerce.” Training and development are the key.»

A DIGITAL MODEL TO GLOBAL SUCCESS A VOICE FROM ASIA: THE ALFAMART JOURNEY

Daniel Zhang described the deployed to help a series of partners had appeared in a Maybelline Hans Anggara introduced delegates of different cultures which were to operate true community stores. unprecedented scale of Alibaba’s do business more easily anywhere livestream which sold 10,000 units to the Alfamart Bee, their mascot, dominant in different regions, Many of their sites had vacant business. Of China’s $600 billion in the world. Alibaba needed that to in two hours, but perhaps more who was small but friendly and notably ones which were Christian space on the second and third in e-commerce revenues in 2015, happen since strictly speaking, it importantly, had 5 million people cute, lived in a communal society and Hindu. floors, and they had started to use their platforms had accounted did not own or sell anything. watching. In the digital world, and provided plenty of value and them for community gatherings and for $485 billion. Their growth Alibaba would increasingly supplant benefits.The bee symbolised the Alfamart and its older competitor, for beauty and cooking contests. expectations for the market meant He described the origins of the the conventional distribution company’s commitment to fulfilling Indomarket now accounted Downstairs, they were expanding they aspired to be the first retail 11/11 shopping festival, originally channel with a platform giving collective goals. for twice the market share of their value added services for the company to generate $1 trillion in a purely Chinese phenomenon to brand partner manufacturers a hypermarkets and supermarkets community. Their Albi kiosks offered revenue by fiscal 2020. mimic Black Friday which had much broader connection with Anggara said that Indonesia itself with their minimart format. payment points, financing, phone now become global. In 2015 they consumers, both offering direct was a complex system in every Starting only in 1999, Alfamart now top up, ticketing and e-commerce. Much of their growth could had accounted for $14.3 billion sales and continuous customer sense: 18,000 islands with more operated 11,359 stores under their be accounted for by offering in sales on this one day, shipping engagement. than 253 million people living on main format, typically operating Specifically with regard to a seamless experience to a 400 million packages and setting them. It was a young country being over 90 to 100m² with some 4,000 the empowerment of small generation of new, young users who multiple new world records for sales Zhang added that future growth principally driven by consumption SKUs. Their vision was based on entrepreneurs, some 2,000 of the had rapidly adopted the Internet on a single day. Consumers from was also predicated on two wings – growth; more than 50% of its people five elements: to be the largest 11,359 stores were used as hubs and mobile technology: 700 million 214 countries shopped with them, those of globalisation and of rural were under 30 and that proportion minimart player and be globally to distribute to micro, small and people in China were internet users, registering 140,000 orders a second development. Their acquisition was projected to reach 60% by competitive, to be widely owned medium businesses engaged in and some 90% of them were mobile at peak time. of Lazada in South East Asia had 2020. Conversely, the economy (some 28% of the network was in traditional grocery, supporting outlet users. Equally, of Alibaba’s users, augmented strong businesses in faced significant challenges with the hands of franchisees), to have renovation, retail management only 2% were aged 50 or older. Zhang explained how media use markets like Russia and Israel. But infrastructure a major constraint. a powerful distribution network training and sharing product In many ways, China was at the was increasingly integrated with within China, half of the population Traffic congestion was widespread (already 32 warehouses with trend information. But some of the vanguard of e-commerce. commerce. For this year’s 11/11 still lived in 600,000 rural villages and contributed to inefficiencies; 235,000m² of space), to empower most dramatic changes Anggara festival they had engaged Kevin with fewer than 1,000 households these were magnified the further small entrepreneurs and, critically, described related to digitization, Zhang said it might be more Spacey to reprise his role from in each. Identifying young Taobao you went from Java island (hence a to fulfil their customers’ needs and where smartphone apps for accurate to describe Alibaba as a House of Cards to encourage partners locally allowed Alibaba’s pack of cement in Papua could cost expectations. customers and social media assets data company, because they viewed Chinese shoppers to buy, and partners to sell into these villages. twenty times the price at origin). were matched by an innovative new their various businesses – video they were increasingly using They had already managed to cover Finally, though predominantly Anggara added that, consistent 3D virtual reality franchisee store streaming, social media, Android live streaming to sell specific some 15,000 villages. Muslim, the country had a number with that vision, they also wanted concept. brower, Taobao and TMall – as use products. For instance, Angelababy cases to create data which could be (the Chinese Kim Kardashian)

18 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 19 ERIC LEGROS RICHARD BRASHER Chief Executive Officer Chief Executive Officer Majid Al Futtaim Retail Pick N Pay Stores Limited

«We need to share common values: being «If you’re just too focused on the target bold, passionate and together.» you will end up missing it.»

MODERN RETAILER IN THE MIDDLE EAST RETAIL IN AFRICA: CONTRASTS AND CONTRADICTIONS

Eric Legros explained that Majid because the proportion of trade In order to win the competition with Richard Brasher said that as a increasingly much more effective, where 94% of households receive Al Futtaim was based on the carried out by modern formats was the traditional trade, Legros added relatively new resident of South as was life expectancy. Higher less than $24,000 a year in income, founder’s vision of creating great still relatively limited in many of they had to recognise that they were Africa, he had realised that education was available to nearly with a quarter surviving on less moments for everyone, every these countries (10% or less in not only capable of great service but negotiating the balance between a million students in South Africa, than $2,400 a year. However, day. Thus what characterised the countries like Pakistan and Iran), were also sometimes really strong optimism and pessimism about and life expectancy had increased having great values without strong company was providing wonderful the company could meaningfully price competitors. What would the region could subtly imply the by nine years just during the period performance only allowed you a customer experiences, whether in aspire to double its size in the next really make the difference was only important question was about 2000-2005. limited lifespan to do the right their malls or their directly operated five years. They were opening 30 new human capital. The hypermarket a return on assets. Of course, thing. stores. They operated 20 malls in stores just this year. had to match the experience of the everyone in the room was in the Brasher emphasised the sheer the Middle East, 180 cinemas, 25 traditional market and had to offer business of business and making diversity of South Africa, whether Three and a half years ago Pick entertainment centres and 170 Of course the region also the best baker, the best butcher and a profit was important, but he also assessed in terms of racial origin or N Pay had embarked on a major Carrefour stores. The latter were typified the VUCA environment of the best grocer in town. said Africa was a place where 1.2 language spoken. English might be turnaround during which their currently trading in 16 of the 38 volatility, uncertainty, complexity billion people lived, getting up each the language of business, politics first priority had been to stabilise countries for which the company and ambiguity. A big part of Legros recognised that the morning and going to bed each and the media but it only ranked decline, then change its trajectory had the franchise, with the most the company’s response was to geographical breadth of their night with hopes and ambitions. fourth out of eleven in the list of to growth and then finally to build a recent market entries being in match speed of expansion with franchise required the company Africa was about people as much as languages spoken at home after platform for sustainable long term Kazakhstan and Kenya, and Legros quality of operations and, in turn, to deal with two different cultures about spreadsheets. Zulu, Xhosa and Afrikaans. The 2 growth. That was bearing fruit, addressed most of his remarks to robust selection and development in the company. One was high million immigrants to the country with turnover up 7% annually and this business. processes for a new generation modernity; in Dubai and Qatar, As other speakers had noted, nearly had effectively brought another 4-5 profit 26% annually over the last of managers. They aspired to be consumers wanted the latest and 60% of the population was under widely spoken languages with them. three years. As the business grew, Legros said that the key a true university of retail, and best product with the most recent 25. GDP growth had resulted in a so did their contribution to the characteristics of the region related were building their own leadership technology. But at the same time, marked reduction in poverty so that As a retailer, Pick N Pay had always society around them. That included to its growth potential, with the institute, their own professional growth in newer markets required a people living on less than $1.25 prided itself on anti-discriminatory making their systems available emergence of a new middle class training schools and investing in real pioneer mentality. What united a day had reduced in number by practices and this applied as to independent traders as well as targeting higher levels of wellbeing, new e-learning technologies to these two cultures were common 25% in a decade. That was by no much to their serving the widest their internal employment practices. education and health. Already standardise their programmes values: being bold, being passionate means perfect, but four of the five possible range of customer as it did Brasher said he was proud they growth in the region was running across the region. and being together. countries with the largest one year to their labour and management paid as much as they could afford, in the range 8-11% per year. And gains on this measure globally practices. It required real agility not as little as they could get away were in Africa. And education was to serve customers in a population with.

20 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 21 DOUG McMILLON JUNLING LIU President & Chief Executive Officer Co-Founder & Chairman Walmart New Peak Group

«The company’s dream is to create «Mentally you have to start thinking a platform whereon Chinese people about what the future is going could access decent healthcare to look like and lean in into it.» at reasonable cost.»

POSITIONING WALMART FOR THE FUTURE BRINGING EFFICIENCY TO THE MARKET PLACE

Doug McMillon said that the first the size of Walmart really had to McMillon explained how they were Junling Liu talked about his they significantly improved supply transformation. Current patient word that came to mind when lean in on such thinking if it was to taking the assets they had currently, experiences leading two rapid chain efficiency by going to collect experiences in China were very poor. he thought about Walmart was change at all. looking at those which were still growth internet businesses in goods on a milk run rather than He explained that his mother, who “change”. The company had a relevant and adding onto them a China. Some eight years ago, he relying on inbound logistics from had a long term heart condition, history of it and the founder had One major change had been with new digital business across the and his colleagues had founded suppliers, who tended to save had been compelled to spend half believed in it to the point that it was regard to associates. In recent company. Then they had to make Yihaodian (a word translating as short term costs by bulking up and a day a month queuing first to see the only constant at Walmart. That years, Walmart had made a more those things connect to each other “number one store” in English) thus sending too much. They also a doctor for a repeat prescription change took place around some than incremental investment in so they were truly seamless. to deliver supermarket groceries used drop ship vendors for more and then queuing again to get constant moorings. The company’s wages and learning. Announcing a to consumers’ homes. Their very expensive and more bulky products, her prescription. By establishing purpose remained to lower the cost $2.7 billion package of spending A third area of dramatic change first day of trading had not been as well as decentralising their and registering their own internet- of living for everyone, giving people in 2015 and 2016 had initially led had now been under way for some so auspicious; there were only 20 warehouse system for the highest mediated hospital, New Peak the opportunity to save and have to a loss of some $20 billion in years, and that was paying more orders and they all transpired to volume SKUs, pre-stocking them could integrate the consultation a better lifestyle. And its culture stock market valuation, but down attention to societal expectations have come from members of staff. nearer customers’ homes. Taken and prescription processes with continued to rest on service to the the line stores were engaged and and the power Walmart had to make But by 2011 they were the fastest together, these measures allowed fulfilment in a closed loop platform. customer, respect for the individual, getting faster at processes, with a the world a better place for all growing retailer in the Asia-Pacific them to take delivery time down Subsequently they had branched striving for excellence and acting better cashflow stream from stores stakeholders. Being a big company region with 100 million registered from 24 hours to 3, and for costs to out to a B2B arm to facilitate with integrity. and thus the means for Walmart to they could have a lot of impact, and users and 10 million unique daily be reduced from 30 RMB to 7 RMB. the transfer of medicines from invest and make transformational had already diverted 75% of their users with customer satisfaction pharmaceutical companies to McMillon said these were timeless change happen. He also pointed out global waste from landfill. rates of 99%. Liu said that, conversely, they hospitals, doctors and clinics, and values, but that as you looked more that Walmart associates were no had organised really significant in the latest development, they closely at how they were lived out just in stores; 2,500 people worked McMillon said that in all of this, The front end benefits for customers promotions – including setting an were offering the infrastructure by associates, customers and the for the company in Silicon Valley it was easy to see Walmart for its were easy to understand, but how officially accredited new Guinness necessary to bring e-commerce to communities in which they lived, the and they had associates in India current size and not its growth had they coped developing the back World Record for selling the most existing drugstores, and extend their level of change had to be radical. He working on logistics, the mobile app potential, but the company was end? To start with, not so well: milk in 24 hours. Buying in 30 effective range from 3-4,000 SKUs said he assumed the world would and other forms of new technology. prepared for $45-60 billion in new inventory days were 120 to start containers, they sold out in 52 to something closer to 100,000. Liu be one where 100% of customers Today’s Walmart already did not look sales in just the next three years. It with. In due course they managed to minutes; two months later, they did said that the company’s dream was had a smartphone, where 100% like yesterday’s. was still very much a company with reduce this to 18 days by employing it again but sold 100 containers’ to create a comprehensive platform were interested in using voice whom you could do business to get vendor managed inventory and worth in the same kind of time. whereon ordinary Chinese people activated interaction technologies The second big area was in what growth. better demand forecasting. They could access decent healthcare at and where 100% were prepared to customers saw, for they wanted also understood the importance Now, Liu said, he believed another reasonable cost. use self-driving cars. A company to save time as well as money. of the first, as opposed to the last, industry – that of healthcare – was mile. Relying on small suppliers, about to go through a comparable 22 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 23 PETER FREEDMAN PAUL BULCKE Managing Director Chief Executive Officer The Consumer Goods Forum Nestlé

«Since the last Summit in NY, «We as an Industry are touching the words 'consumer trust' kept resonating an amazing amount of consumers; and we’ve been focusing we must be a force of good.» on implementation.»

CONSUMER TRUST ONE YEAR AFTER NEW YORK CREATING SHARED VALUE SUSTAINABLY

Peter Freedman said that he had commitment to action, build the easily connected. So the Forum had Paul Bulcke said he was not going terms of three intersecting areas: Water was the most precious resource been struck how often it was, during “how to” elements, help members worked with 7 global leading edge to speak about environmental nutrition, rural development and of all, and at the heart of Nestlé’s the year since the last Summit in implement them and finally engage providers to provide members with sustainability in isolation but rather water. In nutrition, the company business. Water programmes, like New York, that the words “consumer with stakeholders to communicate an open API and a new standard how business could stay involved had been developing products which those for food and nutrition, were trust” kept resonating. The work progress. approach to interoperability. for the long term. The mission for were fortified with micronutrients. long term commitments. Providing of The Consumer Goods Forum was That meant they would have the The Consumer Goods Forum is better Products like stock cubes were a treatment plants and local access very much about helping companies These steps were absolutely critical. ability to exchange agreed product business for better lives, and being potential vehicle for iron, tackling to water were accompanied by long build consumer trust and during Unless the Forum and its members information across borders and good for society is what business had anaemia in pre-school children. In term reductions in water usage that last year, they had been went through each, consumers organisational boundaries to be always been, creating shared value. total, some 200 billion products in manufacturing. All of this work focusing on implementation. would call them. available to shoppers at the end of globally were fortified by Nestle. had still to be consumer-centric, the value chain. Africa showed what creating shared But nutrition was as much about respecting different tastes and Freedman reviewed some of the The other word he had heard value sustainably was about. It was education as formulation of products. common concerns globally. initiatives undertaken by the Forum. repeatedly was “transparency”. The API would enable companies to definitely a continent of opportunity The Healthy Kids program was He drew attention to the elements of This was an easy word to use, but collect the right data at the right and growth, but how did you go operating across the world, touching In all of this activity, business and The Consumer Goods Forum Model harder to put into practice because time. The interoperability technology beyond that? You needed the right over half a million children in sub- societal engagement were combined for Change: to first identify the need even when the necessary data existed, the need for its use was mindset. Nestlé was 150 years old Saharan Africa alone. The company for the long term, and based on for action, then coalesce around a existed, they typically were not growing and the future had arrived. this year, a 90 billion Swiss Franc also provided cooking lessons to respect for society, the environment company with operations virtually mothers at wet markets. and diversity. But Bulcke said all all over the world selling 1.3 to 1.4 economic activity created value for billion products a day. In Africa Rural development was intimately society and at some point civil society Nestlé was 100 years old in South linked with local raw material had lost sight of this fundamental Africa this year. The company had 26 sourcing. Two thirds of Nestlé link between financial and societal factories in Africa, and a research products used such ingredients, up value. By communicating clearly and and development centre in Abidjan. from just a half a few years ago. transparently, companies could show One example was the company how the United Nations’ Sustainable Creating shared value was a sharing plantlets for coffee with Development Goals could be served fundamental concept at Nestlé local farmers, training some 13,000 by business that was conducted which combined both a what and farmers to get better, stable yields. responsibly. a how. It was a conviction that to Similar programs existed to promote be successful over time, you had grain quality locally, increasing the to create both shareholder value volume of locally sourced grains by and create value for society as 28%. well. The company looked at this in 24 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 25 DANNY WEGMAN TOM GORMAN Chairman Chief Executive Officer Wegmans Brambles MIKE ROBACH JULIE HAMILTON VP Corporate Food Safety Global Chief Customer & Cargill Commercial Leadership Officer & Service VP The Coca-Cola Company ENACTUS STUDENTS

LET’S BE CHALLENGED BY FOOD SAFETY: GLOBAL VIEW FOR A GLOBAL ISSUE THE NEXT CONSUMERS' GENERATION

Danny Wegman said people all over up of a combination of large and used by anyone, anywhere and was Tom Gorman said challenging no energy food preservation and life from 3 to up to 21 days. They the world both enjoyed fresh food small companies, but the challenge available for systematic, progressive United Nations aims to cut food improved sanitation. were in production and now renting and were concerned about their faced by the industry – represented implementation. Wegman said that waste required everyone in the their solution to small vendors for health. The one big disruption in by GSFI – was to bring all of these one reason for participating in GFSI industry to work together and stay The Enactus programme used $5 a week, and selling to farmers for that system came from pathogens. players together acting in common. was the range of risk involved. He focused together. Julie Hamilton five basic steps: project team $2,000. He showed a film in which a New In discussion with Mike Robach stressed that fresh produce was observed it would also require formation from amongst university Jersey woman described the fatal of Cargill, Wegman stressed that really important for people’s health, members of The Consumer Goods staff, students and business Enactus representatives from Brazil effects of listeria on her unborn safety was not a competitive issue; but it was also potentially very risky Forum to work with a range of other leaders; team development; presented two further projects. The child, and related the account of a it was in everyone’s interests to because there was no kill step in the stakeholders, and introduced teams a needs assessment with Desfrutando project tackled retailer customer who had been hospitalised share best practices. Robach food chain. from Enactus in Morocco, Kenya mutual, collaborative guidance produce loss through bruising. By with suspected E. coli. agreed that it was pre-competitive and Brazil. They said that their provided by various stakeholders; processing these fruit and passing and observed that 25 years ago, the Robach added that governments name stood for the longer phrase entrepreneurial action undertaken new raw materials to individual By owning their own organic farm, ground beef producers of the United around the world were aware how “Entrepreneurial action for others to develop solutions and then women entrepreneurs, training Wegmans understood the challenges States got together to fight E. Coli closely the food business had creates a better world for us all.” subjecting these to competition, them to produce and sell new food of operating properly and the costs after the Jack in the Box outbreak. worked together globally and were leading up to the Enactus World products, they had been able to of compliance. It also allowed Cargill now had a line of irradiated beginning to realise there was Enactus representatives from Cup, where the very best of 4,000 develop more than 50 new recipes. them to talk to other suppliers beef marketed through Wegmans something in this for them as well. Morocco said small actions taken at projects a year were showcased. with credibility. Wegmans had which could safely be eaten raw. They had an obligation to provide community level could make a big The Sumaúma project concentrated been investing in food safety since Wegman said that ultimately, oversight, which GFSI members difference, harnessing the power An Enactus team from Kenya on fruit from the Amazon, exploring 1998, basing HACCP processes on customers wanted to know the respected, but equally they should of business and entrepreneurship. presented a waste reduction the culinary potential of still little a solid retailing operations base. truth. Telling them explicitly to cook make sure their oversight systems They explained how the Enactus solution. Agriculture was the known species. By producing Establishing a solid food safety ordinary ground beef to 160 degrees were based on the same goals programme involved 69,000 backbone of the Kenyan economy, fruit pulp and empowering the culture required significant and Fahrenheit to make it safe actually and principles. That in turn would participating students in 38 but 40% was lost in food waste. community to produce new recipes, continuing commitment by the CEO increased sales. greatly enhance freedom to operate. countries developing sustainable Just a 1% reduction in post-harvest they were able to produce new and senior leadership, and food Just this week, GFSI had signed an solutions on a project basis, growing loss could lead to economic gains income of $20,000 for a rural safety experts acting as coaches Robach said GFSI’s operations agreement with the United Nations consistently across the world for of $40m. The Enactus project community of 20 people while rather than as the police. across multiple borders, based on Industrial Development Organization 36 years. The representatives presented to the Forum involved a focusing research attention on sound science, allowed Cargill to for better co-ordinated content and on the stage from Morocco, for solar powered cold storage room uncovering more of the potential Wegman said his family had been ensure their factories and customers delivery of training programmes for instance, had worked on clean efficient for small scale farmers and of the most biodiverse area on the involved with food safety for many operated with safe practices. The food safety. and affordable energy solutions, vendors, which increased storage planet. years. The food industry was made manual they had produced could be

26 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 27 ROB DAVIES DICK BOER Minister of Trade and Industry Chief Executive Officer South Africa Government Ahold-Delhaize

«The African consumer goods market is expanding: be here if you want «We need the healthy living trend to be to be part of the future.» owned by us as retailers.»

OPPORTUNITY AND TRANSFORMATION FIRESIDE CONVERSATION IN A FAST-CHANGING RETAIL LANDSCAPE

In conversation with Alex Thomson, more opportunities still. A pan- Davies said that the need to move Dick Boer said that with the Forum for more value, the sense that time and convenience, in fresh. Their Rob Davies said that there was African free trade agreement up the value chain had led the in Cape Town, he first wanted to is a luxury, the desire for living ability to marshall food knowledge plenty of evidence that the growth would be game-changing. government to launch regular plans celebrate the fact that 10 years ago, better and going digital. If he had also allowed them to be effective frontier after Asia was Africa, Creating large markets would be of immediate action for supporting Ahold-Delhaize had established to concentrate on two, they would specialist media owners, both in and that this was driven by in turn accompanied by changes in industrialisation. There were some the Albert Heijn Foundation to put be the third and fourth of these. And printed and online channels. demographics and the growth of the infrastructure which actively linked success stories, notably in the 5% of purchase cost in Africa to he also believed that change was in middle class. In South Africa, there different African countries to each automotive sector. The clothing growers across Africa. That helped their DNA, because they already had Digital change was reflected in the had been significant changes in the other. and textile industry in South Africa build capabilities locally. As an a history of driving transformation roles within the organisation. More wake of democratic transformation. had been bleeding to death before example, fresh cut fruit from Ghana from within. than 1,000 people now worked on The continent was going through In an answer to questioning about they changed the incentive model. was prepared by 3,000 people in digital around the world, focusing a period of disruption, however, difficulties for overseas businesses The relationship between retailers factories there, and in store in the Their omnichannel transformation both on mobile interfaces and on because the end of the commodity getting access to the South African and manufacturers had changed as Netherlands within 24 hours. had started almost 30 years ago the distribution backbone to support supercycle had accelerated a market, Davies mentioned the retailers learned to look for faster and included the acquisition of the business. Track and trace transition already under way creation of a one-stop inward response locally than importing He commented briefly on the Ahold- Peapod.com and bol.com. functionality allowed customers towards industrialisation and away investment body to streamline everything from abroad. And in Delhaize merger, having shown Bol.com had taught them a great to see where the delivery van (or from simple extractive industries. approvals, headed by the President. agro-processing they had developed a video which demonstrated the deal, because they sold 11 million delivery electric bike in Amsterdam) Digitising company registration, and more specific solutions. remarkable similarities in their joint items online, and a significant was on its journey to their home. But Companies were investing in South working with banks and the revenue history over almost 150 years. He proportion came through third party it also allowed Ahold businesses to Africa as the most industrialised services, already allowed much more Davies said investors in South said both were characterised by vendors. They were thinking about be much more personalised in their country in the continent and as a rapid progress in getting under way Africa had already generated operating great local brands within opening up their network to other shopper interfaces. For instance in base for expansion into the rest legally, while within the same one- good outcomes, but that being common beliefs. food vendors as well. They believed the Peapod app, they were tailoring of Africa. There was a free trade stop framework they were looking better about making decisions they could achieve a sustainable proposed shopping lists to historic agreement amongst 17 countries at the issues of business visas. and communicating them faster The macro trends facing the food 6-7% of their sales online by 2017 purchasing habits and health in the Southern Africa Free Trade That process had been simplified, would make the environment business were profound: a fragile because they owned the supply needs. Other applications could Area. Another initiative looked and the government recognised more business-friendly still. His economy prone to shock, major chain in fresh and regarded it include helping customers with to link 26 countries up the east that where there were clear skill government was committed to demographic change and the as a real lever for growth. That exercise and integrating their diet side of the continent, and in due deficiencies locally, visas needed to making the experience of doing disruption of new technology. But meant sometimes they could catch and lifestyle, because as a food course, a continental free trade be expedited. business in South Africa and beyond on the other hand, Boer said he still up. Having missed the meal box retailer, they were at the centre of agreement. That would create a more positive one. believed in the potential of existing market initially, they had become that personal ecosystem. Being food retail companies to identify the number 1 in the Dutch market able to connect with consumers at and deal with the specific trends within 6 months of launch. And the point of need allowed both the facing the consumer goods industry. there were huge opportunities for retailer and its suppliers to provide He characterised those as a drive innovation, improving accessibility relevant solutions at the right time. 28 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 29 KISHORE BIYANI FRANÇOIS PIENAAR Founder & Former Captain Group Chief Executive Officer South African Rugby Team Future Group

«By 2021, Indian consumer spending «Rugby is a hooligan’s game would reach $3.6 trillion.» played by gentlemen.»

LEADING RETAIL IN INDIA THE COURAGE TO LEAD

Kishore Biyani said that India stores were originally designed to the Future Group saw an opportunity François Pienaar opened by quoting the courage to lead. The famous Rugby World Cup win in accounted for 17% of the world’s look like Indian bazaars but had to build its own food business. Muhammad Ali: “Don’t tell me I 1995 was less remarkable than it population but only 3% of its subsequently started to resemble Being a retailer had been good am the greatest, I am the double Pienaar said three things stood out might have appeared, because the land mass. Even if in the modern stores anywhere else in the world, training for thinking in multiple greatest.” Pienaar said Ali was one of about sport. It was personal. It was squad was in very good shape and world it was not known for trade, it harnessing new design and categories at the same time, and four kings in his life: the others were very time specific, because players knew how to win. But Australia were had a very long history of leading innovation hotspots. They studied the group was integrating vertically, Bruce Lee, Elvis Presley and Nelson trained harder and longer than they the favourites. Mandela visited the global trade flows. In the Middle memetics, semiotics and design building its own food manufacturing Mandela. played but everything depended squad before their first game, and Ages, India was the Land of the thinking to interpret and act on facilities. on a couple of hours on Saturday made a huge impact upon them by Golden Bird, and attracted waves developing trends. At the same time, He said rugby was a hooligan’s afternoon. And it had an unyielding knowing the name of every player. of invaders – who in turn, tended to he noted that Indian consumption In subsequent questions from Alex game played by gentlemen, played human resources policy based solely Pienaar said that afterwards, the stay. patterns were still more based on Thomson, Biyani said his inspiration in 120 countries in the world. The on performance and the coach’s players would have run through walls lunar and solar calendars than the had been as much from books as World Cup was played in front of opinion. for him. They beat the Australians, the Now the country was at another Gregorian one. the trade – he had opened his first huge crowds, and was now the third favourites, with ease. But then they historic inflection point. Biyani store without visiting anyone else’s biggest sporting event in the global In his own life, Pienaar had relied on had to face Jonah Lomu in the final. said India was an exceptionally Biyani explained that the Future (although he had now been to see sporting calendar. But even if people sport to get him scholarships and The team was waiting to go out when young country, with a Millennial Group had started as a fashion many of them). Inventiveness, going knew nothing of rugby, he was sure entrance to university. It brought him Mandela again appeared, wearing generation of some 400 million. business and branched out. Some with the flow, positivity and humility there would have been a time when to a new world. As a child, he had the Springboks shirt. It was an It was a generation without guilt 90% of their apparel stores were were key to the company’s success. most people would have become learned that Nelson Mandela was a intense game which went into extra about consumption. By 2021, Indian own brand. Given that barely 10% Making mistakes in such an absorbed by one or other moment in bad, evil man. But at the same time, time. The crowd, 99% white, started consumer spending would reach of the Indian food market was environment was inevitable, so the sport: perhaps Bannister’s first four his release allowed South Africa back singing an African song, Shosholoza, $3.6 trillion. However, India was branded at all, they also believed company also had to learn how to minute mile, Bob Beamon’s two foot into international sport. Three months and the team got the winning drop also the most diverse country in the that a phase of expansion would fail fast and change fast. India had extension of the long jump record, Ali after his release, Nelson Mandela kick. For the first time the nation had world, with 29 states and some 72 follow where both existing and new started to share more global habits beating Foreman, Nadia Comaneci asked to meet the new South African truly come together. major festivals, each of which was brands would start to take more and be transformed by technology. scoring 10.0 seven times or Usain rugby captain. He had sat outside his an excuse for consumption. market share. Anyone trying to The India of five years’ time would Bolt slowing down as he broke the office with sweaty palms. Mandela Hollywood had got much wrong in the bring existing products to India and not be the same as the India of world record. Perhaps especially Jesse greeted him in Afrikaans, took his film Invictus. It was not so specially The Future Group had spent its hoping to change habits, however, today, and technology would shrink Owens, winning four gold medals in hand and walked Pienaar into his down to Pienaar; there were other first decade building anetwork might be better advised to adapt space requirements, save time front of Hitler. As Nelson Mandela had office. They had an extraordinary leaders, and the team was much of stores in multiple formats to India and its tapestry of eating and increase the amount of social said, sport had the power to change conversation for an hour. Afterwards, more socially enlightened than its and its own shopping malls. The habits and cooking practices, and interaction and information sharing. the world, to inspire, to wake hope Pienaar sat silently in his car, aware depiction. If it had been down to one where there was only despair, and that he had felt safe and in the man and the courage to lead, that to speak to children. It sometimes presence of a wide, authoritative man was Nelson Mandela. challenged its participants to have leader. 30 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 31 GARETH ACKERMAN THE CONSUMER GOODS FORUM WOULD LIKE TO THANK Chairman THE OFFICIAL SPONSORS OF THE GLOBAL SUMMIT 2016 Pick N Pay Stores Limited FOR THEIR GENEROUS SUPPORT & Co-Chair The Consumer Goods Forum

«We have all been driven to think seriously about disruption.»

CLOSING REMARKS

Gareth Ackerman thanked delegates societies in which they lived and He thanked Peter Freedman and for attending the Global Summit. worked. his management team for the He hoped they had managed to serious amount of work they did all gather something of the energy and Ackerman said they had all been year, Amaya Bloch-Lainé and her potential of Africa. driven to think seriously about event team for the Summit, and disruption and at corporate level Alex Thomson for his moderation. Over the past three days, delegates should be revisiting their strategic Ackerman thanked the sponsors had been informed and inspired. plans. He hoped the challenge and partners for helping make the From The Consumer Goods Forum of Africa had been an inspiring Summit possible, and reminded perspective, they had learned about counterpart, along with the delegates of the Deputy President progress on all of the pillars but message that people were more of South Africa’s request that as they had also been challenged to do important than spreadsheets. consumers themselves, they should THE CONSUMER GOODS FORUM IS ALSO VERY GRATEFUL TO more, and be better citizens in the spend freely in Cape Town. THE OFFICIAL MEDIA AND STRATEGIC PARTNERS OF THE GLOBAL SUMMIT 2016 FOR THEIR SUPPORT

MEDIA PARTNERS STRATEGIC PARTNERS

32 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 33 MARK CURTIS SPECIAL Chief Client Officer & Co-Founder CHRISTOPHE BECK SPECIAL SESSIONS Fjord Executive Vice President SESSIONS TEO CORREIA Ecolab & President Senior Managing Director Nalco Water Accenture Consumer Goods & Services

THE INVISIBILITY PARADOX FOR BRANDS: HOW TO THE INTERNET OF THINGS: HYPE VERSUS REALITY. THRIVE IN THE THIRD ERA OF DIGITAL HOW TO TURN DATA INTO ACTIONABLE INSIGHTS THAT DELIVER VALUE Mark Curtis argued that technology individuals and comprehend in terms He noted how important it was was driving a shift between of their relationships with each other. for these brands to be able to fit Christophe Beck described the Beck said that their work at Ecolab now deployed in some 36,000 water what was visible and what was He contrasted this with 12, which within other, dominant interfaces: Internet of Things as the means was about trying to move this future systems around the world and they invisible in consumers’ lives, and was reckoned to be the number for instance, Spotify making itself by which everyday objects had reality as close as they could for estimated they had saved some that conversely, some unchanging of close family and friends whose function within the Uber experience, network connectivity, allowing them their 1.3 million customers around 142 billion gallons of water (or the features of the human brain and how death would cause an individual, or the environment of a Ford or BMW. to collect and exchange data. That the world, connecting them to annual drinking equivalent of over we constructed and remembered significant and enduring grief, and As a general rule, he added, in was an extraordinarily wide range of 26,000 engineers. They helped make 400 million people). relationships meant there would be 2,000 – the number of people whose most brands there was a service objects – it extended from aircraft 27% of the world’s processed foods significant pressure on incumbent faces you could at least recognise. struggling to get out. Sportswear engines and toasters to cows in safe, as well as assuring some Beck said their ambitions were brands to maintain their current manufacturers like Adidas and Nike field, each with devices which could 42% of milk suppliers and some 45 to go much further and by 2030, share of mind and wallet. Applying these numbers to brands were going beyond making apparel record and share data. More than a billion restaurant meals a year. In saving the drinking needs of 1 offered some intriguing insights, and equipment to build network trillion devices would be connected total they helped manage some 1.1 billion. He described a transition Some products and activities especially if you then separated them platforms more generally dedicated to the Internet in this way by 2022. trillion gallons of water. driven by technology: from big data were just coming off the “thinking out in terms of two dimensions: love to fitness lifestyle. to predictive analytics; from data list”, whether they were being and frequency of use. Perhaps those Most of us were familiar with some One of their most significant capture to global process control; managed by digital assistants or brands we both loved and used all Network effects favoured a shift of the early B2C applications for initiatives related to water from open networks to secure automated subscription services. the time were analogous to the 12 from pipes – value chains of the the IOT such as Amazon Dash and management was the descendant of networks; from regular checks to But just as these transactions were people whose loss we would deeply type we were used to – towards home environment monitoring and a very early experiment in connected real time monitoring and a model becoming invisible, so others were mourn. Curtis noted how many of platforms. If you wanted to know management. But Beck said some technology, using trace materials based on service to one based on becoming visible. Data visualisation the brands in his top right quadrant whether your company was capable 70% of potential savings were in in water to allow data collection in on-site expertise. techniques not only made utility were digital and mediated by his of building a platform, you had fact in the B2B space, of which food real time. Their Trasar system was and other self-care apps easy to mobile phone. to ask whether your brand was safety represented a significant Beck said that in reality, the understand, but often drove far authentically social, whether proportion. Already it was possible train had left the station and it higher levels of use and engagement. your ecosystem was one ripe for to imagine tracking from one end was going very fast, but with the disruption, whether you had an of the food chain to the other, and right partners, it was possible Curtis explained how anthropologist abundance of content and whether plants which would reuse 100% for companies to catch it at the Robin Dunbar had developed an currently you were operating of water because none would ever next stop. Even so, the pace was insight about neocortical capacity in in a space characterised by leave or leak, applications which daunting in an environment where different primates to identify how fragmentation and choice. would allow hospitals to detect the long term could be described stable the number 150 was and anticipate infection, or as 18 months. for those people we could oil exploration which both remember as was safer.

34 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 35 BRENDA KOORNEEF SPECIAL Business Executive, Group Marketing STEVE MATTHESEN SPECIAL SESSIONS & Corporate Strategy - Tiger Brands Global President of Retail Vertical SESSIONS JOSÉ CARLOS GONZALEZ-HURTADO Nielsen President of International IRi SHRINK TO GROW: HOW TO USE ANALYTICS AND NAVIGATING THE NEW RETAIL AGENDA TECHNOLOGY TO OPTIMISE YOUR LINE-UP Steve Matthesen said that in the face in the order of 2.5 times per week. account, consumers globally were of a more complicated world, there On the supply side, the efficiency more concerned about fresh produce, José Carlos Gonzàlez-Hurtado said volume growth of 18% in the retail they had again increased sales were some dangerous myths going advantage of larger stores was being convenient locations and stores there was a universal desire in the space, with a value growth of more volumes. About a quarter of these around which required refuting. rapidly eroded by new technology. having the products they wanted, industry to get people into the than 23%. could be attributed to new attributes The growth of small formats was and being in stock. And when it store, but too many products to fit and 75% were straight substitution First was the idea that emerging striking, and was linked to the came to price, they were prepared to into it. He said there were about a They had tried to solve a more where Tiger could be confident that markets had run their course and hitherto unexpected survival of the pay significantly more for innovation. million SKUs in the United States but complex problem with regard to the an alternative would successfully were no longer the source of future traditional trade in many markets. only about 9,000 SKUs in the average jam category, where Tiger was the play the same role as the brand and growth. But although in the very Those stores typically experienced Fourth was the idea that grocery supermarket. Moreover, bricks and clear national leader but was facing SKU it replaced. Interestingly, she short term emerging markets might 28 visits a month from their regular players didn’t need to worry about mortar retailers were taking active a very static market. They had to noted that their premium brands only be providing a single additional customers, of whom 68% arrived on e-commerce because people steps to reduce their assortment understand how to make sense of offered relatively little differentiation percentage point of growth, the foot. would never buy food online. The breadth. In the UK alone in 2015, the their brand portfolio, led by national amongst each other in some outlook for the next ten years was reality was that the rapid growth of major supermarkets on average took leader All Gold and flanked by a accounts. something like twice the rate of The third was that promotions are connected commerce was inevitable. about 5% of their SKUs out. In the value brand and a brand extension. growth for developed markets. This the best way to drive sales. Globally In the USA, direct to consumer face of this pressure, manufacturers IRi’s assortment tool allowed them In summarising, Gonzàlez-Hurtado was where the young people were. over half a trillion dollars were brands already had 10% of share in found themselves facing something to disaggregate each of these said that what differentiated Millennials accounted for 24% of spent annually on trade promotions, certain categories, and FMCG online of a prisoner’s dilemma, trying to into a series of attributes, and winners from losers was focusing these populations, two thirds of and the long term trend continued sales were growing at over 20% a work out whether they could preserve then relate those attributes to on what mattered: not just looking people were in urban markets and to be to more events with lower year. The role of the physical store some individual advantage while sales. Their analysis also showed at the shelf and optimising relative there would be an emerging markets effectiveness. Even though this would change as some categories adding more complexity to the that different retail customers rotation, but rather, understanding middle class of 3.2 billion by 2050. might appear primarily a problem moved online, challenging the system as a whole. had ended up with quite different what mattered for the shopper. That Even if you took a very limited view for manufacturers, there were plenty historic importance of the centre of assortments of the various SKUs required them to “kill the bad guy” and just concentrated on the very of covert costs for retailers involved the store for generating profit. Brenda Koorneef explained how from each brand. By rationalising – the existing product hierarchies richest customers, the opportunities in excessive promotions. In any Tiger Brands had used analytic the range and then optimising the which tended to dominate our mental were huge: the top 10% in India were case, taking stated preferences into Matthesen’s strategies for success techniques in conjunction with IRi allocation of the remaining SKUs, models for brands and categories 100 million people. were to adopt converse positions to help them identify whether there – as well as assembling a true 360 on each of these myths, making a were any SKUs they could remove degree view of consumers on a single The second was that bigger long term commitment to emerging from their ranges. She provided an IT platform. And finally, he said, any continued to be better. What markets, recognising the need example relating to their Oros range tool had to be extraordinarily easy consumers were telling Nielsen, for convenience, building rather of beverage concentrate, where they and quick to use. Long experience however, was that big stores were than discounting brands and had managed to cut 7 SKUs to (and unsuccessful pleading on hard to shop. And around the understanding the different cost 3, and not just gained from his part) had taught him the world, not everybody had drivers and factors for success cost benefits by reducing lesson that nobody would cars or storage space. of online. complexity but also use a cumbersome tool, The global average managed to regardless of how much for fresh food achieve it had cost. shopping was

36 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 37 THE STORE TOUR PARTNER’S PROGRAMME

Cape Town top-notch retailers hosted Summit delegates in their stores and offered a unique opportunity to interact The Consumer Goods Forum and Danone were delighted to welcome the Global Summit life partners to a unique with store managers and understand the eclectic local markets! Cape Town experience and to witness the rich heritage seen through the diversity of culture, architectural treasures, and authentic, world-class cuisine. From metropolitan areas with stores that hold their own against food retailers across the world, to small towns and township areas, there are retail groups that cater to all levels of society. The diversity of the retail sector reflects the Engaged in an intimate talk with Zelda La Grange, the former private secretary of Nelson Mandela, during diversity of the lives of the some 40 million people who call South Africa home. breakfast, the Global Summit partners experienced a tour through the historical sites and new leisure spots of the “Mother City” and exchanged with chef Cass Abrahams during lunch time. Delegates discovered how retailers use this diversity to move their businesses in new and exciting directions, and meeting the challenge of giving customers what they want. Kindly hosted by Kindly hosted by

38 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 39 I-ZONE

I-NSPIRATION I-NNOVATION I-NFORMATION At the heart of the Global Summit, the I-Zone showcases the most cutting-edge creative ideas from the retail and consumer goods industry. The stylish display area offers a window on the most innovative concepts that each participating company has to offer, adding genuine value to the sector. The I-Zone provides GREAT INSPIRATION while focusing on TRUE INNOVATION. A select number of companies share with Summit delegates the latest innovations which add new value to the retail and consumer goods industry. The I-Zone is a world-class window of the best concepts being developed by The Consumer Goods Forum members.

40 The 60th Global Summit - Executive Summary The 60th Global Summit - Executive Summary 41 Working Together for Identify Focus Areas - Commit to Action Support Implementation - Build� how to� & Share Solutions Efficiency & Positive Change Engage External Stakeholders

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