Slide 1: AB InBev Investor Seminar 2018
ABInBev INVESTOR SEMINAR 2018
Slide 2: Legal Disclaimers
Legal Disclaimers Certain statements contained in these presentations that are not statements of historical fact constitute forward-looking statements, notwithstanding that such statements are not specifically identified. In addition, certain statements may be contained in the future filings of the
Slide 3: Anne Stephens
• Born in Johannesburg • Graduated from the University of the Witwatersrand ANNE • 20 years in our company STEPHENS • My favorite beer is Michelob Ultra Pure Gold Global VP • I’m most proud of the internal belief Segmentation, in growth that the Category Category & Expansion Framework has Portfolio
Slide 4: What beer is and what it can do
What beer is and what it can do Sour Sweet Bitter Still Fizzy Transparent Cloudy Opaque Savoring Refreshing
Slide 5: How people generally perceive beer
How people generally perceive beer Bitter Masculine Unsophisticated Unpretentious
Slide 6: Share of beer category
G Share of beer category er m a U ny kr ai n Au e st ria N Fra et n he ce rla nd Po s la nd Sp U ai n ni te U d Ki SA ng do Source: Canadean 2017 highest volume beer markets C m an a Au da st ra l N ia ig Lager er ia C Ital ol y om Wheat R bia om an ia Stout Ve Pe ne r u z Ar uel ge a nt in Tu a rk
Slide 7: 3 Interlocking Strategic Frameworks to drive organic growth
3 Interlocking Strategic Frameworks to drive organic growth What I want to tell you about today Internally we call it A story about how beer evolves Market Maturity Model as markets mature… A vision for how the beer category could Category Expansion Framework and should be structured as a result… A
Slide 8: 3 Interlocking Strategic Frameworks to drive organic growth
3 Interlocking Strategic Frameworks to drive organic growth What I want to tell you about today Internally we call it A story about how beer evolves Market Maturity Model as markets mature… A vision for how the beer category could Category Expansion Framework and should be structured as a result … A
Slide 9: The nature of consumption in Low Maturity Markets
The nature of consumption in Low Maturity Markets Occasions bias Index to total Social male 305 Relax alone 213 Party 143 # of alcohol categories 1.6 in past month repertoire Source: Proprietary quantitative survey: Category Guidance in 24 markets 2017; Index is % for Low Market Maturity relative to
Slide 10: Low Market Maturity
Low Market Maturity Up to $3,000 Household consumption expenditure per capita (2005 constant currency) 2–3 liters Per capita consumption pure alcohol 60% Abstinence 40–80% Beer share of formal alcohol Informal alcohol & concentrated spirits markets Source: Beer: Plato Logic, Spirits: Euromonitor, Ot
Slide 11: Key consumption driver profile in Middle Maturity Markets
Key consumption driver profile in Middle Maturity Markets Occasions bias Index to total Social male 90 Social mix gender 101 Meal 119 # of alcohol categories 2.0 in past month repertoire Source: proprietary quantitative survey: Category Guidance in 24 markets 2017; Index is % for Low Market Maturity
Slide 12: Middle Market Maturity
Middle Market Maturity $3,000–$2,0000 Household consumption expenditure per capita (2005 constant currency) 4–7 liters Per capita consumption pure alcohol 48% Abstinence 50–80% Beer share of formal alcohol Broad spirits and beer prominence Source: Beer: Plato Logic, Spirits: Euromonitor, Other: Euro
Slide 13: The nature of consumption in High Maturity Markets
The nature of consumption in High Maturity Markets Occasions bias Index to total Social mix gender 112 Relax alone 132 Relax family 204 # of alcohol categories 2.6 in past month repertoire Source: proprietary quantitative survey: Category Guidance in 24 markets 2017; Index is % for Low Market Maturi
Slide 14: High Market Maturity
High Market Maturity $20,000 and more Household consumption expenditure per capita (2005 constant currency) 8–10 liters Per capita consumption pure alcohol 26% Abstinence 35–50% Beer share of formal alcohol Beer, spirits and wine environments Source: Beer: Plato Logic, Spirits: Euromonitor, Other: E
Slide 15: The Market Maturity model helps understand relative performance
The Market Maturity model helps understand relative performance Low Maturity Middle Maturity High Maturity Per capita consumption drinks Czech Republic Germany Latvia Austria Slovakia Slovenia Poland Finland United Kingdom Portugal Denmark Bulgaria Australia Romania Spain Switzerland United States C
Slide 16: Market Maturity Model also indicates what is most likely to happen next
Market Maturity Model also indicates what is most likely to happen next Long-term real growth in US GDP per capita 1871-2009 GDP per capita adjusted for inflation using 2005 dollars Low Maturity Middle Maturity High Maturity 50 000 Trendline Walmart starts to grow 2007 45 000 Mom & pop stores Real G
Slide 17: Drivers of future change
Drivers of future change Repertoires Occasions Channels Blurring lines Social media Digital retail Health & wellness Older consumers Sustainable supply chains Novelty obsession Multi-cultural Older consumers
Slide 18: Market categorization informed by the Maturity Model
Market categorization informed by the Maturity Model L1 L2 L3 Frequency and Premiumization High Primary source Accessibility of growth premiumization category redefinition Market share C1 C2 C3 Premium share Low Differentiation Premium share Primary source premiumization of growth Low Medium High Ma
Slide 19: 3 Interlocking Strategic Frameworks to drive organic growth
3 Interlocking Strategic Frameworks to drive organic growth What I want to tell you about today Internally we call it A story about how beer evolves Market Maturity Model as markets mature… A vision for how the beer category could Category Expansion Framework and should be structured as a result… A
Slide 20: Beer competes for occasions progressively with…
Beer competes for occasions progressively with… Medium Low High Men social Relax alone Party Mixed gender Meals Family relax social Maturity Informal alcohol Traditional spirit Spirits White mixed Wine, Wine, Occasions & traditional spirits, CSDs CSDs, evolution spirit white wine, spirits cider Comp
Slide 21: Other categories provide variety in a logically structured way
Other categories provide variety in a logically structured way Stretch price expectations Offer Offer ease and variety Mixed gender Masculine Offer refinement refinement Create accessibility
Slide 22: Other categories provide variety in a logically structured way
Other categories provide variety in a logically structured way Stretch price expectations Offer ease Offer functional and variety Younger Older refinement Create accessibility
Slide 23: Beer needs to provide its variety: Starting with Classic Lager
Beer needs to provide its variety in a similarly deliberate way Starting with Classic Lager Originates through consolidating regional players offering thirst quenching lager for men Offers national identity, brotherhood & sociability, the best of men European heritage – brewed in each country, conso
Slide 24: Beer needs to provide its variety: Stretch the Price Ladder
Beer needs to provide its variety in a similarly deliberate way Stretch the Price Ladder Global heritage – brewed in another country: “IMPORTED” Originates through local premiumization, Local heritage - “Interesting” product imports and excise break/ propositions: malt value packs and brands Alterna
Slide 25: Beer needs to provide its variety: Easier Drinking proposition
Beer needs to provide its variety in a similarly deliberate way Add an Easier Drinking proposition Originates through easier Natural / Outdoors drinking and more mixed gender propositions Lighter and Easier
Slide 26: Beer needs to provide its variety: Sophisticated and Sweet
Beer needs to provide its variety in a similarly deliberate way Extend to Sophisticated and Sweet Goes with food Competes with white wine and CSDs Natural Mild Refreshing
Slide 27: Beer needs to provide its variety: Savoring, full, refinement
Beer needs to provide its variety in a similarly deliberate way Extend to savoring, full, refinement Malt Ales Goes with savoring, Wheat and flavored Easy drinking lager Classic lager refinement, special times
Slide 28: Current way consumers understand beer
Current way consumers understand beer Mass Imported Affordable Craft Local Expensive
Slide 29: 3 Interlocking Strategic Frameworks to drive organic growth
3 Interlocking Strategic Frameworks to drive organic growth What I want to tell you about today Internally we call it A story about how beer evolves Market Maturity Model as markets mature… A vision for how the beer category could Category Expansion Framework and should be structured as a result… A
Slide 30: Growth champions is a system for organic growth
Growth champions is a system for organic growth 3. 1. CATEGORY EXPANSION EFFICIENCY EXPANSION Close Bench- gap marking 2. Growth 4. Efficiency 2. Toolkits champions Plan champions Toolkits 1. 3. Bench- Close marking gap
Slide 31: Opening gaps: Measuring performance against the primary growth potential
Opening gaps: Measuring performance against the primary growth potential of the cluster Gaps opened vs other markets L1 L2 L3 in cluster & “Ideal” profile Frequency and Premiumization Key performance metrics developed High Accessibility and tracked premiumization category redefinition 1. Share of pr
Slide 32: Codifying and stretching toolkits to address category expansion opportunities
Codifying and stretching “toolkits” to address category expansion opportunities Route-to-Market & Speciality / emerging Trade execution toolkits customer toolkits brand toolkits Revenue management Brand positioning Global brand toolkits toolkits territories toolkits
Slide 33: Growth champions is a system for organic growth
Growth champions is a system for organic growth CATEGORY EXPANSION Investing for growth 3. Close gap 2. Growth 4. Prioritizing the Toolkits Plan future champions 1. Bench- marking
Slide 34: AB InBev has proven its capability to use learning systems to deliver
AB InBev has proven its capability to use learning systems to deliver EFFICIENCY EXPANSION 1. Enviable record on cost reduction Bench- 1 marking without performance reduction 6 Year track record in CoS 4. Efficiency 2. 2 cost management Plan champions Toolkits Capability transferred successfully to
Slide 35: 3 Interlocking Strategic Frameworks to drive organic growth
3 Interlocking Strategic Frameworks to drive organic growth What I want to tell you about today Internally we call it A story about how beer evolves Market Maturity Model as markets mature… A vision for how the beer category could Category Expansion Framework and should be structured as a result… A