hot topics presentation brazil march 2010

8/8/2019 Hot Topics Presentation Brazil March 2010

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Delivering

Sustainable Growth

Brazil Business Unit

March 2010


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2

Key messages

We are delivering solid results leveraging on a rich heritageand a strong and balanced portfolio

Brazilian NARTD market provides multiple opportunities forKO sustained growth over the next decade

We have a disciplined strategy to continue winning in the

future


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Brazil: A Key Market for KO

Large and developing country

8.5 million km ~190 MM inhabitants

~ US$ 1.6 trillion(1) in GDP

Solid macroeconomic fundamentals

Expected GDP growth in 2010: ~5-6%(2)

Low inflation expectations: ~4-6% (2)

Real income gains

Better income distribution

Continued credit expansion

Stable institutions

2010 Presidential elections not likely to produce majorchanges in social/economic polices

Key institutions - e.g., Central Bank and Anti-trust

Agency - becoming more equipped and independent

Hosting mega global events 2014 FIFA World Cup and

2016 Olympic Games

1.7 Bn Unit Cases

KOs 4th largest market(7% of Global Volume )

KO Per Capita:205 8oz. servings

(1) Source: Tendncias consultancy

(2) Source: Boletim Focus (Brazils Central Banks weekly research)

Coca-Cola Brazil at FY 2009:


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Strengthened system partnership

Winning in the Brazilian market (continued)

CVD

WATER JVs

SSDs

Restructured strategies leveraging on

segmented approach and Revenue

Growth Management (RGM)

Built mega brands

Executed successful acquisitions

Strengthened our execution capabilities

Establish customized business models


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We have a disciplined strategy to continue

winning in the future

Accelerate

Innovation

Grow SparklingLeadership

Rapidly GrowStill Beverages

StrengthenSystem

Capability

GrowSparkling

Leadership

RapidlyGrow StillBeverages


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9

Affordability: Opportunity to be captured by

accelerating returnables

EMERGING MIDDLE CLASS COMPETITORS

SHOPPER CONSUMER

LOVE:

DAILY:

69%

12%

68%

5%

Low Socio-Economic Level (SEL) teens

have lower levels of consumption

Source: Internal Data

Increase % of

incomecommitted to

basic goods

Access tonew kinds of

goods

Lowermoney

availability

$

Greater coordination of

B-brands through Afebras

Increasing distribution andhousehold penetration

60% 56% 50%

26% 29% 34%

14% 15% 16%

2004 2007 2011

A/B (High SEL)

C (Mid-SEL)

D/E (Low SEL)

Households per Socio-Economic Level (SEL - %)

Entrance ofIndustria San

Miguel (Ajegroup)

Source: IBGE

Key for

transactions

GrowSparkling

Leadership

High SELs

(AB)Mid-Low SELs

(CDE)


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10Source: Nielsen Jun09 & Latin Panel YTD Jun09

Four phases to ensure that returnables follow

the right path

Rib. Preto

Braslia

Fortaleza

Goinia

Recife

Sor

POA

Uber

BH

SP

RJPinda

Macei

CWB

Numeric Distribution

KO Returnable Multiserves x B-brands

CDE Household

Penetration

KO Returnable

Multiserves

Habit building

through

recruitment

KNOW

Increase

frequency

ACCEPTReinforce &

sustain

frequency

LIKE

LOVEReturnable

Attitude

GrowSparkling

Leadership


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BPPO

ShopperExperience

Shopper

Promotions

Strategy

Phase 1

Know

Through Affordability

Habit Building

Through Recruitment

CC RGB (1)

1,0L or 1,25L

Repurchase Promo

Meals

Phase 2

AcceptIncrease

Frequency

CC RGB CC RefPet

Through Meals & Recognition

Loyalty Promos linked w/ Meals

CC RGB &

Phase 3

LikeReinforce & Sustain

Frequency

RefPet Flavors

RGB/RP

RGB

Phase 4

Love

+ Occasions

Establish Returnable

Attitude

RefPet Flavors

Tie with sustainability

platform Live Positively

1,0/1,25L 1,5/2,0L

offering value proposals with different BPPO

& shopper experience for each phase.

1,0/1,25L 1,5/2,0L RGB/RP1,0/

1,25L

1,5/

2,0L

GrowSparkling

Leadership

(1) RGB = Returnable Glass Bottle


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Growth Model:

RapidlyGrow StillBeverages

Strengthen Still Beverages joint venture growth model

InvestmentModel

InnovationProcesses

Go ToMarket

SupplyChain

OrganizationStructures

All stages developed and operated in partnership between TCCC and bottlers

Creation of Still Beverages Joint Venture leveraged results (3-year CAGR):

- 2006-2009 (after JV creation): +86%(1)

(1) JV products (including juices, energy drinks, tea, flavored milk excludes water) and Leo Junior acquisition


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Products

Equipment

Packaging

Cooler

Aquarius

Fresh

PET 250ml

Consumer

Engagement

AccelerateInnovation

Strengthen and accelerate innovation pipeline

Leveraging global pipeline

Streamlining internal processes

Developing new capabilities

Approach w/ Moms

Digital

Gladiator

Rack


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hot topics presentation brazil march 2010

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