Six Qualities of the Best Pricing Software

PriValEdge PowerPricer

Pricing Toolbox - overview

• Developed by professionals for professionals … pragmatic & operational

• Functionalities– Data management (Transactional data, CRM, Market research, competitive Intelligence, …)– Sophisticated analytics & modeling – Flexible & intuitive reporting / data visibility– Supports all aspects of pricing & Value management

• Platform & integration – Based On Microsoft’s Power BI Platform– ‘portable’ SQL + Office + Add ons toolbox for rapid implementation– Connectablility to your info sources (ERP / Oracle / Data warehouse..)– Tools can be ‘transported’ to your platform if & when necessary

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Pricing Toolbox

What it is

•Effective support to Pricing Performance improvement in companies

•An Integrated set of tools that can be adapted to your situation to effectively support all aspect of Pricing

– Data Collection management– Pricing & Value Analysis & insights– Monitoring & reporting– Modeling, simulation & Decision support– Implementation support

•A flexible set of Tools based on SQL & office tools supplemented by statiscal & modeling add-ons to support sophisticated analysis & modeling

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What it is not

A panacea that will by itself get your company to higher levels of pricing performance … it takes expertise & changing your ways of working

An off the shelf readymade solution to your pricing analytics & management needs… we believe nobody can offer that

A ‘black box’ that will take charge & manage your pricing for you… we believe that your expertise is key to making any pricing tool relevant & effective and that you should stay in charge

Pricing Toolbox - Overview

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Pricing & Customer Value reporting & Control

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Marketing & Sales support

Reporting Analysis

Traffi c LightsP& L Reports Objectives vs. Realized

Fin . Reports Corridors Exceptions Mngmt

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Relative Perceived Value

Customer Value Map

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Fair Value Line

ValueDisadvantaged

ValueAdvantaged

Performance Touring Handling AS

PRODUCT LEVEL PRICING TRAFFIC LIGHTS Price Change

Discount Change

Share Growth

% Rel Share vs Ref. Comp

% Premium vs Ref. Comp

Value Positioning

Win / Loss Indicator

Elasticity Measure GM % Fullfilment Overall

Action Required

BRIDGESTONE 97 13% 0 1 8% 9 13% 1,5 61% 94% 0,60024934 59% Y

BRIDGESTONE POTENZA RE92A AS 115 16% 0 1 8% 7 20% 1,5 60% 85% 0,57732634 58%

215/45R18 BW W BRIDGESTONE POTENZA RE92A AS #E440 107 16% 0 1 8% 7 15% 2,0 54% 85% 0,53853075 54%

BRIDGESTONE TURANZA EL400-02 77 12% 0 1 8% 9 8% 1,9 59% 97% 0,59126945 59%

215/45R17 BW Z BRIDGESTONE TURANZA EL400-02 #E402 73 19% 0 1 8% 7 7% 1,9 59% 92% 0,58842208 58% Y

215/45R17 BW Z BRIDGESTONE TURANZA EL400-02 #E329 82 11% 0 1 8% 7 6% 1,2 41% 86% 0,40759921 40%

P215/45R17 BW W BRIDGESTONE TURANZA EL400-02 #G432 103 8% 0 2 8% 7 8% 0,9 53% 85% 0,53514842 52%

BRIDGESTONE TURANZA EL42 109 8% 0 1 8% 9 7% 1,0 59% 87% 0,60924063 60% X

P235/45R17 BW W BRIDGESTONE TURANZA EL42 #C193 117 5% 0 1 8% 9 4% 1,2 58% 98% 0,59778409 60%

P235/50R18 BW V BRIDGESTONE TURANZA EL42 #E445 123 5% 0 1 8% 7 7% 1,6 45% 101% 0,46415437 46% X

P235/60R18 BW H BRIDGESTONE TURANZA EL42 #C010 82 3% 0 1 8% 7 8% 1,6 59% 84% 0,59362246 58%

P245/45R19 BW V BRIDGESTONE TURANZA EL42 #G447 137 1% 0 1 10% 9 6% 1,1 45% 85% 0,45843948 45%

BRIDGESTONE TURANZA EL42 RFT 95 1% 0 1 8% 9 4% 1,7 42% 99% 0,43203873 43%

205/55R16 BW H BRIDGESTONE TURANZA EL42 RFT #7334 94 1% 0 1 8% 8 2% 1,0 37% 101% 0,36211277 36% Y

225/45R17 BW H BRIDGESTONE TURANZA EL42 RFT #E446 119 2% 0 1 8% 9 3% 1,2 40% 85% 0,38266467 38% Y

225/45R17 BW H BRIDGESTONE TURANZA EL42 RFT #7335 98 3% 0 1 8% 9 1% 1,6 37% 101% 0,37233824 37%

225/45R17 BW H BRIDGESTONE TURANZA EL42 RFT #E330 78 5% 0 0 8% 7 1% 2,3 41% 88% 0,40485926 40%

BRIDGESTONE TURANZA ER30 86 6% 0 0 8% 9 1% 3,3 57% 100% 0,56939127 56%

205/45R16 BW W BRIDGESTONE TURANZA ER30 #7271 105 7% 0 0 8% 7 0% 4,9 55% 99% 0,53339714 54%


225/50R16 BW W BRIDGESTONE TURANZA ER30 #7270 78 6% 0 0 8% 7 0% 4,9 59% 98% 0,60021896 60% X


255/50R19 BW W BRIDGESTONE TURANZA ER30 #7275 103 7% 0 0 8% 9 0% 2,7 53% 90% 0,51685851 51% Y

255/55R18 BW W BRIDGESTONE TURANZA ER30 #C195 128 8% 0 0 8% 9 0% 3,5 54% 93% 0,53413606 53%

255/55R18XL BW Y BRIDGESTONE TURANZA ER30 #7269 116 7% 0 0 8% 7 0% 5,0 40% 85% 0,40320361 40%


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Key Tools Price evolutions Pricing & Value Waterfalls Price dispersion mapping Detailed variance analyses Time series Elasticities / Pricing

dynamics analyses

Reporting tools tools to help monitor, control & manage Pricing & support effective implementation of pricing policies

Pricing & ValueLeakages Management

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Key Tools Price evolutions Pricing & Value Waterfalls Price dispersion mapping Detailed variance analyses Time series Elasticities / Pricing

dynamics analysesC

Transaction analysis tools to help monitor, control & manage Pricing Performance & identify opportunities for improvement

Pricing & Customer ValueInsights, Budgeting & simulation tools

7

Stats & Simulations

Pricing Simulators Portfolio Simulator Network Simulator

D & R Savings Segm. & Clusters Regressions & stats

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Customer Value Map

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ValueDisadvantaged

ValueAdvantaged

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Key Tools Pricing & Value modeling &

simulation Portfolio simulation Network simulation &

optimization Simulation of impact of

alternative Pricing or D&R Segmrentation & clustering

tools Regression & statiistical

tools

Analytical & simulation tools to help support Strategic Decision making on Pricing & Value Strategies & implementation

Pricing & Customer Value Benchmarking

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Key Tools Share & competitive

performance monitoring Peer Pricing & Value selling

support Portfolio analyses Analyses of performance on

key Value attributes Campaign effectivenes

measurement & modeling Competitive & Pricing

Intelligence tools

Tools to help support Strategic Marketing & Sales with a value focus & Marketing effectiveness improvements

Value analysis & measurement Tools

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Value Analysis

EVC / EVIU Value Maps / curves CBC / Perceptions

Win / Loss Elasticities Price Points


PortFolio Ana.

Comp. Intell

Perceived Value Measurement0,50

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Customer Value Map

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Fair Value Line

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Product price occurence (in comparable sales situation)

Occurrences

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Key Tools Economic Value Modeling Value Map & Curves Choices Based Conjoint

Modeling & simulation Win / Loss analyses Elasticities nalyses &

simulation Price Points / Psycholgical

Pricing analyses

Tools to help Measure Value Perception & Willingness to pay & elasticities & to use Value as a base for Pricing

Pricing & Customer ValueProcess Performance tools

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Pricing Process Performance

Pricing BSC Pricing Diagnostic Pricing RACI

Pricing Thought Proc. Pricing Alignment Industry Pricing

Value Analysis

CBC / Perceptions

Price Points

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Customer Value Map

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Fair Value Line

ValueDisadvantaged

ValueAdvantaged

Region 2 1 2 3 4 5 6

Year-Month 1

Division 5

Strategy Map Mission Vision Strategy Measure Follow up Last Year Plan /TargetTrend / Result

Issues Initiative Responsible

Shared Pricing Methodology

Roll out Level2 Meth.

% target staffed trained

Weekly 58 68 65 Pricing Roadshow J W

optimization of promotions

Weighed Impact measure

Monthly 128 124 126 Test Platform PH

Product/Service innovation

% n+1 sales from New product

Monthly 5,9 6,0 6,0 Design to Value J S

Price/volume planning

Weighed Volume prediction error

Monthly -2,3% -2,5% -3,0%Elasticity study AC

rangeAA

Roll out Level 2 Pricing Toolkit

% Sales covered, new entities

Monthly 88% 96% 90% Toolkit Roll out GT

Discipline in conditions

% discount within Std

Weekly 82% 105% 112%

Pricing Corridor out layers (CA & %) Weekly -1,07% -1,2% -1,17%

Value Selling % usage of DTB Monthly 23% 58% 50% DTB Roll out GT

Sell in Sellout measured

% Key Products CA Monthly 46% 86% 80%

Strongest Brand reinforce Brand premium Quarterly 11,4 14,5 14,9Rebranding e

EuropeComm

Best Distrib. Presence

Distributor SoW & coverage

Monthly 36% 40% 35% Partnerhip Program Channels & PH

Price Point Management

%Sales at Price point (keyprods)

Monthly 34% 36% 39%

Targeted Offers % Wins Weekly 38% 35% 35% Sales call Targeting Sales & LL

Consumer ratingsPerceived Value index advantage

Twice a Year 143 129 145

Customer value satisfaction

# price/ value complaints

Weekly 0,99% 0,99% 0,97%

Best of Class Margin

Margin % Annually 50,7% 53,9% 61,1%Portfolio

rebalancingMktg & LL

Target Share 2012 Weighed share Monthly 21,9% 23,7% 26,8%

Growth Sales Growth Monthly 1,5% 8,6% 8,5%

Shareholder returns high

ROE Quarterly 46,5% 52,8% 54,6%

Cust

omer

How our customers see us, rate our performance & respond to it

Fina

ncia

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Bottom line impact & evolution of financial performance

Roll out level 2 systems, processes & tools

Test & improve lev3 tools in priority units

Develop distributor partnerships

Development of value based offers & features

Maximize growth whilst maintaining current margin levels

Gradually get Level 3 capability, leveraging current best practices

ACME Corporation - Pricing / Value Balanced Scorecard

Lear

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Capabilities Development to sustain our ability to change and improve

Proc

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business processes Improvement & roll out

North

2008

Access Control

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Tools to help follow monitor, control & gradually improve the strategic Pricing & Value management capabilities of the company

Key Tools Pricing Balanced Score Card Pricing Diagnostics &

Improvement Roadmap Pricing Processes & RACI Pricing Thought Process Pricing Alignment reports Industry Pricing analyses &

decision support

Data Capabilities

Data Capabilities

Security and Data Privacy

Data Storage and Management

Functionality

Data CapabilitiesSecurity and Data Privacy

• Secured environment– All data is stored as necessary in a completely secured environment

• Microsoft Business Intelligence solutions• MS SQL Server 2012 engine• Sharepoint Server 2012, Powerpivot 2013

– Only project related personnel has access to data:• Account Director• Project Manager• IS personnel 100% dedicated to project

• Data Privacy– All Data kept confidential and Private– Completely private space from other ongoing projects

• Server and Database• Internal Network space and resources

Data Capabilities



Functionality

Data CapabilitiesData Storage and Management

• MS Windows Server and SQL server technology fully adapted to meet customer/account needs:– Large data storage capability

• Able to adapt to any large size database

– Fully managed server environment with daily backups• Data protection and restore services to previous versions

– Adaptable core processing power and internal memory• Server Power adapted to size of database to match processing needs

– Fully dedicated server to customer / account

Data Capabilities



Functionality

Data CapabilitiesFunctionality

Connectivity and Data Integration

Multiple Platform Support:• Connection to nearly any data

source, from traditional relational sources including like Oracle, SQL Server, Sybase, DB2, Teradata, Access, and any ODBC-compliant platform.

• Connection to non-database sources (including Excel and SharePoint) and non-SQL systems (including Salesforce.com, Business Objects, and Oracle Business Intelligence platforms).

• Run SQL queries against any of these sources.

• Import Export Functionality


Data Automation

• Scheduled Data downloads and Uploads:

Download new data Upload modified data

• Automation of tasks:• Calculations

Applied logics and formulas to data.

• Data checks Data consistency

• Transports Transport to any other linked

system for further analysis.


Sync Validation

Scheduled synchronization:• Compare and synchronize data

between different data sources to ensuring consistency and validity.

• Internal quality process Automated Manual

• Rules validation Automated checks Reporting


Advanced Analytics

• Pre-build functionality for speedy data analysis

SQL queries Server Jobs

• Automated queries to perform cubed based data analysis

Immediately available reporting based on identified needs.

• Mathematical and Statistical functions through SQL services

Capability to add or update records on the go


Data Cleansing

• Identify and correct data inconsistencies:

Format Grouping Relationships Calculations

• Maintain original data on backup database for future queries

• Programmable cleansing procedures to always perform same actions once identified.

• Reports availability for data comparisons

Transactional Analyses

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Key Tools Price evolutions Pricing & Value Waterfalls Price dispersion mapping Detailed variance analyses Time series Elasticities / Pricing dynamics

analysesC

Transaction analysis tools to help monitor, control & manage Pricing Performance & identify opportunities for improvement

Tool 1: Price Evolutions(Illustrative)

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SK

U U

nit

Pri

ce

s (

$)

Tme Series (Weeks)

What it is: Analyses Prices (or D&R)

evolutions over time May be used for a single

product or a group of products, globally or by client segments / channel, or by account manager.

What it does: provide visibility and insights

on evolutions to identify trends / changes in dynamics or correlations & opportunities & threats that they represent

Corrective actions it may lead to: Improved / more rational pricing on objectives. Industry pricing actions to influence pricing dynamics Price structure rebalancing

The stakes: Together with other aspect of transactional analyses, typically results in bottom line improvement of up

4 % of sales in the first year

Plant Name (All)Industry Name (All)Custo Rev Segment Name 5_VLProduct Family Code (All)Product Grp Code (All)Prod Rev Segment Name (All)

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nov.-07 juin-08 déc.-08 juil.-09 janv.-10 août-10 févr.-11 sept.-11

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Ac13

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Ac16

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Ac18

Pricing

Full ScreenNormal Go to Financial Pivot

Go to Product Pivot

Go to Price Evolution

Go to SKU Elasticity

Go to Product Elasticity

Go to Customer Elasticity

Flexible tool integrated in Transactional analysis

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Tool 2: Dynamic Price Waterfall (Illustrative)

Dynamic Waterfall Analysis

60%

70%

80%

90%

100%

Results 100% 92.7% 14.1%

Leakages 7.3% 0.9% 1.0% 4.6% 1.4% 70.6%

Series1 93% 92% 91% 86% 85%

List Price Price

Concession Invoice Price

Options Warranty $ Financing Prompt

PayMargin/ COGS

Page 25Level 2 Tools

What it is: Detailed analyses of

leakages (by type) that take place between List price & Pocket Margin.

May be used at Product, Client, Segment or Market level

What it does: provide visibility and

control of ‘hidden’ discounts and costs to clarify the contribution margin on a given deal.

Corrective actions it may lead to: Rationalization of discount & client conditions policies. Improved control & exceptions management on Discounts & Client Conditions Sales force support & Monitoring

The stakes: Together with Price dispersion analyses, typically results in 2 to 4 % ROS improvement in first year

26

aa

aaaaaaaaaaaaaa

Fiscal Year (All) A Profile 102,8% 100,0% 0,0% 8,1% 0,9% 0,0% 5,2% 0,0% 7,1% 1,9% 2,0% 76,3% -41,2% 0,0% 0,0% 10,5% 6,5% 4,5% 13,6% Fiscal Year 2009

Fiscal Month (All) B Profile 102,6% 100,0% 0,0% 8,4% 0,9% 0,0% 5,8% 0,0% 7,0% 2,0% 2,0% 75,3% -40,1% 0,0% 0,0% 10,4% 6,4% 4,5% 13,9% Fiscal Month (All)

Region Name (All) A-B 0,2% 0,0% -0,3% 0,0% 0,0% -0,6% 0,0% 0,0% 0,0% 0,0% 1,0% -1,0% 0,0% 0,0% 0,2% 0,1% 0,0% -0,3% Region Name (All)

Acct Mngr Name (All) aa Acct Mngr Name (All)

Customer Name (All) aa Customer Name (All)

Industry Name (All) aa Industry Name (All)

Custo Rev Segment Name (All) aa Custo Rev Segment Name (All)

Material GrP Name (All) aa Material GrP Name (All)

Product Name (All) aa Product Name (All)

Prod Rev Segment Name (All) aa Prod Rev Segment Name (All)

Plant Name (All) aa Plant Name (All)

A Profile Selection B Profile Selection

Theo

retic

al Re

venu

esSa

les G

ross

Reve

nues

Volum

e Disc

ount

Early

Paym

ent

Disco

unt

Full T

ruck

Di

scoun

t

Othe

r Disc

ount

s

Discr

etion

ary

Invoic

ed Sa

les

Total

Reba

tes

Unbil

led Se

rvice

s

Unbil

led

Guarr

antee

s

Net S

ales

Cost

of Go

ods

Sold

Clien

t Tec

hnica

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sts Gros

s Mar

gin

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t Mng

mt

Costs

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ruitin

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Othe

r Mktg

Costs

NET N

ET M

ARGI

N

Dynamic Waterfall

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100%ADJUSTCOLUM

FULL USUAL

Pricing

Tool 3: Price Dispersion (Illustrative)

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National

0%

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20%

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40%

0 50,000 100,000 150,000

Avg

Dis

co

un

t Lack of control & discipline

Large accounts put at risk by unfair treatment

Large discounts given to small accounts/ not taken away from reduced

Standard volume discount

Av

era

ge

dis

co

un

t

Size of account (Yearly revenues €)

What it is: Analysis of discounts given as

a function of size of accounts. May be used for a single


What it does: provide visibility and control of

actual logic & discipline in the implementation of Client conditions & discounts.

Corrective actions it may lead to: Rationalization of discount & client conditions policies. Improved control & exceptions management on Discounts & Client Conditions Sales force support & Monitoring

The stakes: Together with Price dispersion analyses, typically results in bottom line improvement of up 4 % of sales

in the first year

Price Dispersion Tool

28

Disc. & Reb. Selection AllUnexplained Disc SelectedStdVolume Discount SelectedList to Max Price Disc. Selected Dynamic Dispersion Map - Y: Disc. & Reb. (% Gross Sales) , X: Gross Sales

Early Payment Discount SelectedFull truck Discount SelectedDiscretionary Discount Selected 30

Rebates SelectedUnbilled Services SelectedUnbilled guarrantees Selected 220% 10%Client Management Costs Selected 0%

Recruiting Costs Alloc Selected -140% 10%Marketing Costs Alloc Selected -43%

Max to Client Price Disc. Selected 1 1

12 911

-90 10

100% 2 000-90

a

aa

Fiscal Year 2009 a Fiscal Year 2010

Fiscal Month (All) a Fiscal Month (All)

Industry Name (All) a Industry Name (All)

Region Name (All) aCusto Rev Segment Region Name (All)

Acct Mngr Name (All) a 22 West 2_S 12 752 -47,51% 52,43% 47,57% 12 911 -5,06% 54,21% 45,79% Acct Mngr Name (All)

Customer Name (All) a 23 West 3_M 11 197 -45,09% 53,40% 46,60% 10 842 -3,96% 54,54% 45,46% Customer Name (All)

Market Name (All) a 2 Central 2_S 9 752 -54,42% 57,84% 42,16% 9 476 -4,18% 58,45% 41,55% Market Name (All)

Market Segment Name (All) a 3 Central 3_M 9 106 -53,63% 60,02% 39,98% 8 766 -3,78% 60,78% 39,22% Market Segment Name (All)

Customer Breath Name (All) a 12 North 2_S 8 683 -55,21% 59,48% 40,52% 8 822 -4,00% 60,60% 39,40% Customer Breath Name (All)

Custo Rev Segment Name (All) a 17 South 2_S 7 717 -49,86% 53,82% 46,18% 7 260 -2,98% 53,93% 46,07% Custo Rev Segment Name (All)

Material GrP Name (All) a 13 North 3_M 7 518 -50,55% 57,43% 42,57% 7 246 -2,92% 57,01% 42,99% Material GrP Name (All)

Product Family Name (All) a 18 South 3_M 6 956 -46,67% 55,16% 44,84% 6 596 -2,57% 56,50% 43,50% Product Family Name (All)

Product Grp Name (All) a 7 East 2_S 6 904 -56,40% 59,16% 40,84% 6 835 -3,18% 60,83% 39,17% Product Grp Name (All)

Plant Name (All) a 8 East 3_M 6 356 -56,01% 63,09% 36,91% 6 160 -2,82% 63,28% 36,72% Plant Name (All)

Prod Hier Name (All) a 24 West 4_L 3 291 -44,08% 57,92% 42,08% 3 415 -1,14% 55,29% 44,71% Prod Hier Name (All)

Prod Rev Segment Name (All) a 4 Central 4_L 3 022 -50,53% 62,25% 37,75% 2 706 -1,04% 61,17% 38,83% Prod Rev Segment Name (All)

Product Name (All) a TOTAL LOOK AT 93 254 -609,96% 56,78% 43,22% 91 034 -37,60% 57,50% 42,50% Product Name (All)

Change Type of Analysis 2

Gros

s Pro

fit (%

N

et S

ales

)

Gros

s Sal

es

D&R

& O

ther

M

ktg.

(% G

ross

Sa

les)

COGS

(% N

et

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s)

Gros

s Pro

fit (%

N

et S

ales

)

Gros

s Sal

es

D&R

& O

ther

M

ktg.

(% G

ross

Sa

les)

COGS

(% N

et

Sale

s)

MAP

Apply Zoom

Man

ual &

Aut

o Zo

omM

ap O

ption

s

DATA TABLE

East

Man

ual G

raph

Nº

South

North

South

Auto

Gra

ph N

º

Code

West

West

Central

East

North


Region

WestCentral

Central

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10

-4 000 -2 000 0 2 000 4 000 6 000 8 000 10 000 12 000 14 000 16 000

Dynamic Dispersion Map - Y: Disc. & Reb. (% Gross Sales) , X: Gross Sales

A B Profile A Profile B

Manual Y MAX

Manual Y MIN

X MAX

X MIN

Y MAX

Detected

X MIN

Detected

Y MIN

X MAXDetected

Detected

Apply

Speed

Apply

Speed

Speed

Speed

Apply

Apply

FULL SCREEN

USUAL SCREEN

Dynamic Dispersion MapY: Disc. & Reb. (% Gross Sales)

X: Gross SalesBubbles: Gross Profit

Top Ten Gross Sales D&R & Other Mktg. (% GroCOGS (% Net Sales)Gross Profit (% Net Sales)Gross Sales D&R & Other Mktg. (% GroCOGS (% Net SalesGross Profit

ADJUST AXESAUTO AXES

Region Custo Rev S

Pricing

Results

Lev

ers

Different levels of Levers delivering the same result: Inconsistent

Levers correlated to Results: Consistent

ResultsL

ever

s

Using the Pricing Toolbox, we measure The impact of Pricing Levers on Performance:Are they consistent?

Consistency Concept

Market- Discounts- Rebates- Sales Costs- Mktg. Costs- (Others Costs)

- Sales- Margin- SoW & MS- Value Perception- Customer Satisfaction- (Others Results)

Levers Results

Using the Pricing Toolbox, we measure The Pricing Levers’ Efficiency:Do they provide a positive ROI?

Evolution of Results

+

-

Evo

luti

on

o

f L

ever

s

+

-

+ Levers / ++ Results: Efficient

More Levers / Less Results: Black Hole

Less Levers / More Results: Managers’ Dream

MarketLevers

Results

Improving efficiency drives TOP LINE impact

Efficiency Concept

++ Levers / + Results: Inefficient

- Levers / -- Results: Inefficient -- Levers /

-Results: Efficient

Using the Pricing Toolbox, we measure The Pricing Levers’ Efficiency:Do they provide a positive ROI?

Evolution of Results

+

-

Evo

luti

on

o

f L

ever

s

+

-

+ Levers / ++ Results: Efficient

More Levers / Less Results: Black Hole

Less Levers / More Results: Managers’ Dream

MarketLevers

Results

Improving efficiency drives TOP LINE impact

Efficiency Concept

++ Levers / + Results: Inefficient

- Levers / -- Results: Inefficient -- Levers /

-Results: Efficient

Sales

So

W

Ineffective Implementation zones

Effective Implementation zone

Using the Pricing Toolbox, we measure Levers Level Effectiveness: Are we hitting the soft spot?

Effectiveness Concept

P=1

Market- Sales- Margin- SoW & MS- Value Perception- Customer Satisfaction- (Others Results)

Levers Results- Discounts- Rebates- Sales Costs- Mktg. Costs- (Others Costs)

So

W

P=1

Tool 5: Variance Analysis

What it is: Analysis of variance in sales revenues.

Price variance Volume variance

With additional detail on demand May be used for a single product or a

group of products, by Sales rep or by client segments / channel.

What it does: provide visibility of key evolutions of

revenues and drivers for variance. Helps monitor & manage pricing

strategy , campaigns & discounting policies

Corrective actions it may lead to: Price adjustments. Launch of campaigns & reactive actions Competitive actions

The stakes: Strong monitoring of Price & volume performance at any level – key driver to discipline & change

management

Revenue Variance(UnitPrice T2 * UnitVolume T2 ) - (UnitPrice T1 * UnitVolume T2 )

Price Variance(Unit PriceT2 - Unit PriceT1) * Unit VolumeT2

Menu-Tier Variance(MenuTier(T2)_OldUnitPrice x VolumeT2) - (UnitPriceT1 x VolumeT2)

Item-Price Variance(UnitPriceT2 x VolumeT2) - (MenuTier(T2)_OldUnitPrice x VolumeT2)

Promotional Item Price Variancetbd - will be a special component of item-price

Client Conditions & Discount Variancetbd - will be a special component of item-price

Volume Variance(Unit VolumeT2 - Unit Volume T1) * Unit PriceT1

Mix Variance(Unit VolumeT2 - (Unit Mix%T1 * Total VolumeT2)) * Unit PriceT1

Quantity Variance((Unit Mix%T1 * Total VolumeT2)-Unit VolumeT1) * Unit PriceT1

Variance Analysis tool – Impact Summary

34

REVENUE $172 212PRICING $394 409

TIER $361 927PRICE $32 482PROMO

VOLUME -$222 197PRODUCT MIX $135 047QUANTITY -$357 244

QTY PER CUSTOMER -$54 482TRAFFIC VOLUME -$302 761

NEW/CLOSED STORES $196 605CUSTOMERS/STORE -$499 366

Contribution to Revenue VariancePricing

Full ScreenNormal Screen

Variance Analysis tool – flexible analyses

35

AREA

REGION # Menu Items BE TotalT1 0,41 per Cust 2,37

T2 0,41 per Cust 2,36

(sample)

Daypart: All% SD Hot Mlk/Jce Kids Total BE Total

T1 ###### 1,9% 7,7% 1,4% 1,0% 14,7% 86,0%T2 ###### 1,9% 7,4% 1,4% 1,0% 14,5% 85,0%

Difference (#) -0,0% -0,3% -0,0% -0,0% -0,3% -1,0%Difference (%)

CD Other0,3%0,3%+0,0%

Cust. Count (total) BER TotalCompetitive Index

2,5%2,5%+0,0%

Impact / MnthWeather Index

9 608 658

Beverage Incidence Rates (Daypart = All)Uncontrollable Factors

CPR Index

Advertising index

Brand Loyalty Index (BLI)

-$499 366Cust. per Store Var

-$302 761

Total Hours of Operation

Opening/Closing Var

+$196 605Controllable Factors

Price Variance+$394 409

+$172 212

+$32 482

+$361 927

Menu-Tier Variance Change

Item-Price Variance

Dine-In (Net)

Product Mix Variance+$135 047

Volume Variance-$222 197

Qty Per Cust. Var

-$54 482

-$357 244Quantity Variance

9 402 908-$156 008

Comp. Rev Changes -205 750 -205 750-2,14% -2,14%

Total (Net)

+$1 252 523

KEY PRICING INDICATORS (KPI) SUMMARY

+1,6%

-4,1%

Loc. Accessibility Index

+3,3%

Carry Out (Net)

9 402 9089 608 658

-1,8%

+1,4%

+3,0%

+0,3%

+1,1%

-3,0%

-2,5%

-0,5%

Customer Count Var+$1 080 311

Tool 5: Time Series (Illustrative)

Page 36

SK

U U

nit

Pri

ce

s (

$)

Tme Series (Weeks)

What it is: Analyses Prices (or D&R)

evolutions over time May be used for a single


What it does: provide visibility and insights

on evolutions to identify trends / changes in dynamics or correlations & opportunities & threats that they represent

Corrective actions it may lead to: Improved / more rational pricing onbjectives. Industry pricing actions to influence pricing dynamics Price structure revbalancing

The stakes: Together with other aspect of transactional analyses, typically results in bottom line improvement of up

4 % of sales in the first year

Plant Name (All)Industry Name (All)Custo Rev Segment Name 5_VLProduct Family Code (All)Product Grp Code (All)Prod Rev Segment Name (All)

1,00

2,00

4,00

8,00

16,00

32,00

64,00

nov.-07 juin-08 déc.-08 juil.-09 janv.-10 août-10 févr.-11 sept.-11

Ac1

Ac10

Ac11

Ac12

Ac13

Ac14

Ac15

Ac16

Ac17

Ac18

Pricing

Full ScreenNormal Go to Financial Pivot

Go to Product Pivot





Flexible tool integrated in Transactional analysis

37

Levers Selection AllUnexplained Disc SelectedStdVolume Discount SelectedList to Max Price Disc. SelectedEarly Payment Discount SelectedFull truck Discount SelectedDiscretionary Discount SelectedRebates SelectedUnbilled Services SelectedUnbilled guarrantees Selected 230 10Client Management Costs Selected -64Recruiting Costs Alloc Selected -60 10Marketing Costs Alloc Selected -434Max to Client Price Disc. Selected 21 335 17

3 852-90 10589

1 5000 0

1 2 3 4 5 6 7 8 9 10 11 12aaaaaaaa 1 1 1 249 -140 -30,16% 41,02% 1 249 -140 872 1,09%a 2 2 3 138 -340 -28,15% 44,12% 3 138 -340 2 254 2,74%a 3 3 3 229 -358 -29,74% 41,12% 3 229 -358 2 269 2,82%a 4 4 3 077 -347 -28,58% 44,01% 3 077 -347 2 197 2,68%a 5 5 2 065 -235 -28,55% 45,85% 2 065 -235 1 475 1,80%

Year 2009 a 6 6 2 232 -247 -29,57% 43,42% 2 232 -247 1 572 1,95% Year 2009Month (All) a 7 7 2 067 -232 -30,65% 40,30% 2 067 -232 1 434 1,80% Month (All)Region Name (All) a 8 8 2 117 -242 -30,12% 42,64% 2 117 -242 1 480 1,85% Region Name (All)

Acct Mngr Name (All) a 9 9 1 583 -172 -28,97% 44,14% 1 583 -172 1 124 1,38% Acct Mngr Name (All)

Industry Name (All) a 10 10 2 633 -300 -29,80% 43,15% 2 633 -300 1 849 2,30% Industry Name (All)

Market Name (All) a 11 11 2 792 -315 -28,95% 43,49% 2 792 -315 1 984 2,44% Market Name (All)

Market Segment Name (All) a 12 12 2 638 -289 -29,82% 43,50% 2 638 -289 1 852 2,30% Market Segment Name (All)

Product Name (All) a 28 820 -3 217 -11,16% 43,13% 28 820 -3 217 20 361 25,15% Product Name (All)

Glob SoW Name (All) a 114 594 -12 636 -11,03% 63,85% 114 594 -12 636 127 229 100,00% Glob SoW Name (All)

Customer Name (All) a 25,1% 25,5% 101,2% 67,5% 25,1% 25,5% 16,0% 25,1% Customer Name (All)

Time Series - (Lines in Rigth Axe: Rebates-Columns in Left Axe: Gross Sales)

Apply Zoom

Man

ual &

Aut

o Zo

om

43

Gros

s Sal

es

Reba

tes

Disc

. & R

eb.

(% G

ross

Sa

les)

Gros

s Pro

fit

(% N

et S

ales

)

Gros

s Sal

es

Reba

tes

Map

Opti

ons

Net

Sal

es

Gros

s Sal

es

(% T

otal

)

Data Table

9

5

Manual Graph

Nº

678

Auto Graph Nº

Calendar Week Code

12

Calendar Week Name

12

10

TOTAL LOOK ATTOTAL PROFILETOTAL LOOK AT/TOTAL PROFILE

11

Manual Lines MAX

Manual Lines MINCol. MAXCol. MIN

Lines MAXDetected

Col. MINDetected

Lines MIN

Col. MAXDetected

Detected

ApplySpeed

ApplySpeed

Speed

SpeedApply

Apply

-400

-350

-300

-250

-200

-150

-100

-50

0

0

500

1000

1500

2000

2500

3000

3500FULL

SCREEN USUAL SCREEN

Dynamic Disband GraphLines in Rigth Axe: Rebates

Columns in Left Axe: Gross Sales

A-Z Gross Sales Rebates Disc. & Reb. (% Gross SaleGross Profit (% Net Sales)Gross Sales Rebates Net Sales Gross Sal

Pricing

Tool 6: Dynamic evolutions & elasticity (Illustrative)

Page 38

Ch

an

ge

in

Pri

ce

(%

)

Change in Volume (%)

What it is: Analysis of evolution of Price

(and – or D&R) and how they Impact Volumes or Margins.

May be used for a single product or a group of products, globally or by client segments / channel, or by account manager.


actual dynamics & relationships between price components & performance

Corrective actions it may lead to: Improved Pricing & client conditions policies. Earlier identification of competitive threats & changes in industry dynamics Targeted price adjustment based on expected impact

The stakes: Key to finer price adjustments & improved price realization

Disc. & Reb. Selection AllUnexplained Disc SelectedStdVolume Discount SelectedList to Max Price Disc. Selected Dynamic Evolution Map - Y: Net Price , X: Volume (Units)



Recruiting Costs Alloc Selected 0% 10000%Marketing Costs Alloc Selected -11%

Max to Client Price Disc. Selected 200% 1000%

5%

-90% 10000%

0%

100% 200%

-90%

a

aa




Region Name (All) a Region Name (All)

Acct Mngr Name (All) a 20 South 5_VL 1 708 -40,08% 56,70% 43,30% 1 513 -0,43% 54,25% 45,75% Acct Mngr Name (All)

Customer Name (All) a 15 North 5_VL 1 241 -41,13% 55,04% 44,96% 1 102 -0,34% 55,80% 44,20% Customer Name (All)

Market Name (All) a 19 South 4_L 1 808 -44,50% 57,28% 42,72% 1 580 -0,52% 56,90% 43,10% Market Name (All)

Market Segment Name (All) a 18 South 3_M 6 956 -46,67% 55,16% 44,84% 6 596 -2,57% 56,50% 43,50% Market Segment Name (All)

Customer Breath Name (All) a 14 North 4_L 2 204 -48,10% 57,27% 42,73% 1 992 -0,75% 58,24% 41,76% Customer Breath Name (All)


Material GrP Name (All) a 4 0 4_L 3 022 -50,53% 62,25% 37,75% 2 706 -1,04% 61,17% 38,83% Material GrP Name (All)

Product Family Name (All) a 21 West 1_VS 2 044 -51,31% 50,96% 49,04% 1 932 -0,81% 51,62% 48,38% Product Family Name (All)

Product Grp Name (All) a 9 East 4_L 1 974 -54,95% 64,78% 35,22% 1 718 -0,73% 63,79% 36,21% Product Grp Name (All)

Plant Name (All) a 1 0 1_VS 1 759 -59,30% 55,62% 44,38% 1 568 -0,77% 57,77% 42,23% Plant Name (All)

MAP

-2

0

2

4

6

8

10

12

14

-1 0 1 2 3 4 5 6

Dynamic Evolution Map - Y: Net Price , X: Volume (Units)


Pricing

Manual Y MAX

Manual Y MIN

X MAX

X MIN

Y MAX

Detected

X MIN

Detected

Y MIN

X MAXDetected

Detected

Apply

Speed

Apply

Speed

Speed

Speed

Apply

Apply

FULL SCREEN

USUAL SCREEN


Dynamic Evolution / elasticity Tool

39

Disc. & Reb. Selection AllUnexplained Disc SelectedStdVolume Discount SelectedList to Max Price Disc. Selected Dynamic Evolution Map - Y: Net Price , X: Volume (Units)



Recruiting Costs Alloc Selected 0% 10000%Marketing Costs Alloc Selected -11%

Max to Client Price Disc. Selected 200% 1000%

5%

-90% 10000%

0%

100% 200%

-90%

a

aa




Region Name (All) aCusto Rev Segment Region Name (All)

Acct Mngr Name (All) a 20 South 5_VL 1 708 -40,08% 56,70% 43,30% 1 513 -0,43% 54,25% 45,75% Acct Mngr Name (All)

Customer Name (All) a 15 North 5_VL 1 241 -41,13% 55,04% 44,96% 1 102 -0,34% 55,80% 44,20% Customer Name (All)

Market Name (All) a 19 South 4_L 1 808 -44,50% 57,28% 42,72% 1 580 -0,52% 56,90% 43,10% Market Name (All)

Market Segment Name (All) a 18 South 3_M 6 956 -46,67% 55,16% 44,84% 6 596 -2,57% 56,50% 43,50% Market Segment Name (All)

Customer Breath Name (All) a 14 North 4_L 2 204 -48,10% 57,27% 42,73% 1 992 -0,75% 58,24% 41,76% Customer Breath Name (All)


Material GrP Name (All) a 4 0 4_L 3 022 -50,53% 62,25% 37,75% 2 706 -1,04% 61,17% 38,83% Material GrP Name (All)

Product Family Name (All) a 21 West 1_VS 2 044 -51,31% 50,96% 49,04% 1 932 -0,81% 51,62% 48,38% Product Family Name (All)

Product Grp Name (All) a 9 East 4_L 1 974 -54,95% 64,78% 35,22% 1 718 -0,73% 63,79% 36,21% Product Grp Name (All)

Plant Name (All) a 1 0 1_VS 1 759 -59,30% 55,62% 44,38% 1 568 -0,77% 57,77% 42,23% Plant Name (All)

MAP

Map

Opti

ons

Man

ual &

Aut

o Zo

om

Apply Zoom

DATA TABLE

Gros

s Sal

es

D&R

& O

ther

M

ktg.

(% G

ross

Sa

les)

COGS

(% N

et

Sale

s)

Man

ual G

raph

Nº

Aut

o G

raph

Nº

Code



Region

South

Gros

s Sal

es

D&R

& O

ther

M

ktg.

(% G

ross

Sa

les)

COGS

(% N

et

Sale

s)

Gros

s Pro

fit (%

N

et S

ales

)

Gros

s Pro

fit (%

N

et S

ales

)

South

North

South

North

South

West

East

-2

0

2

4

6

8

10

12

14

-1 0 1 2 3 4 5 6

Dynamic Evolution Map - Y: Net Price , X: Volume (Units)


Pricing

Manual Y MAX

Manual Y MIN

X MAX

X MIN

Y MAX

Detected

X MIN

Detected

Y MIN

X MAXDetected

Detected

Apply

Speed

Apply

Speed

Speed

Speed

Apply

Apply

FULL SCREEN

USUAL SCREEN

Dynamic Evolution MapY: Net Price

X: Volume (Units)Bubbles: Gross Profit

Top Ten Gross Sales D&R & Other Mktg. (% GroCOGS (% Net Sales)Gross Profit (% Net Sales)Gross Sales D&R & Other Mktg. (% GroCOGS (% Net SalesGross Profit


Y: Net Price

Value analysis & measurement Tools

40

Value Analysis

EVC / EVIU Value Maps / curves CBC / Perceptions

Win / Loss Elasticities Price Points


PortFolio Ana.

Comp. Intell

Perceived Value Measurement0,50

1,50

0,50 1,00 1,50

Rel

ativ

e P

rice


Customer Value Map

ACME

Comp 1

Comp 2

Fair Value Line

ValueDisadvantaged

ValueAdvantaged

0

1

2

3

4

5

6

7

8

9

80 85 90 95 100 105 110 115


Occurrences

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

8,0

9,0

ACME

Comp 1

Comp 2

Full Screen

Normal Screen


Key Tools Economic Value Modeling Value Map & Curves Choices Based Conjoint

Modeling & simulation Win / Loss analyses Elasticities nalyses &

simulation Price Points / Psycholgical

Pricing analyses

Tools to help Measure Value Perception & Willingness to pay & elasticities & to use Value as a base for Pricing

Client Value

– “Rational”• Financial Value Measurement (FVM) /

Expected value in use (EVIU)• Cost to customer without product minus

cost to customer with product

– “Emotional”• Price elasticity• Perceived value of ‘qualitative’ attributes

FVM/EVIU

Simulation of client level impact

Transactional analysis / observed elasticities

Win / Loss analyses Key Buying Factors

Choice based conjoint/ Perceived price/value

Discount / Rebates elasticities

Analysis / ToolsLogic / Approach

Tool 7: Economic Value to Clients (Illustrative)

Page 42

What it is: Objective evaluation of

economic value to client of our offering versus next best competitive alternative.

Developed by target segment and or for individual clients.

Can be adapted to supply an interactive sales support tool

What it does: Analyses & visualizes the

Value of our offering

Actions it may lead to: Development of targeted offers (focusing on attributes that create value for clients) Can provide a very effective support tool for Sales force Targeted communication & marketing

The stakes: In period of High pricing turbulence (such as now), typically results in bottom line improvement of up to

4 % through better ability to communicate value to clients If used in the context pf a new product launch (or revamp), it often results in bottom line improvement

of 10% or more through value based pricing

Increased

Efficiency

Total Benefit

€123

€2260

€2137

Longer Life IncrMaintCost

ConversionCosts

Total Costs€300

€200 €500

TotalPrem.€1760

€369 Best Alternative

TotalValue€2029 !

EVC Tool – Synthesis table

43

EVC Tool – Value Waterfall

44

EVC Tool – Value Hierarchy

45

EVC Tool – Stakeholders Value Priorities

46

EVC Tool – Value Lever Logic

47

EVC Tool – Value Lever economic Model

48

Tool 8: Segmented Competitive Value Maps

Page 49

0.50

1.50

0.50 1.00 1.50

Re

lati

ve

Pri

ce

ValueDisadvantaged

ValueAdvantaged

Relative Value (Perceived /measured)

Fair V

alue

Lin

e

Competitor 1

Competitor 2Competitor 3

Competitor 4

Segmented Competitive Value Maps

(Segment X, Market B, 2008) What it is: Analysis & mapping of competitive.

Prices Value (perceived or measured)

May be used for a single product or a group of products, globally or by client segments / channel.

What it does: provide visibility and control of Value & Price

positioning of Products by segment. Helps define effective Value / Pricing

segmentationtegic

Corrective actions it may lead to: Price adjustments. Improved proved targeting of Price & Value proposition &segmentation Support to Sales force in Value Selling

The stakes: Varies considerably. Repositioning/ Retargeting of Value Proposition may often result in double digit

price increases or Volume increases

Value Map Tool -

50

Tool 9: CBC / Perception Analysis (Illustrative)

Page 51

What it is: T he most effective

methodology for measuring ‘Qualitative’ Value perception & willingness to pay & developing Price response / elasticity models

Attributes elasticity not limited to price but can include other key factors affecting WTP

What it does: Identifies & quantifies key

decision drivers Model the impact of changes in

price or performance on key ‘attributes’

Actions it may lead to: More accurate & effective price & value positioning. Identification & improvement of other levers that influence clients decisions Improved competitive tactics & positioning

The stakes: Performant approach to price optimization in many markets / industries.Typically results in bottom line

improvement of up to 10 %

Tool 10: Win / Loss Analysis (Illustrative)

Page 52

What it is: Systematic & regular

evaluation of reasons of Wins & losses (or significant changes in Share of Accounts at clients).

Criteria will include our & competitive prices but also conditions & buyer profile to identify drivers

What it does: Help identify & quantify key

decision drivers Helps optimize price

positioningActions it may lead to: More accurate & effective price positioning. Identification & improvement of other levers that influence clients decisions Improved competitive tactics & positioning

The stakes: Performant approach to price optimization in deal driven B2B environment.Typically results in bottom

line improvement of up to 4 %

Win / Loss analysis tool

53

Detailed modeling of ‘Win Probability’ as a function of Discount level

Tool 12: Price Points Analysis (Illustrative)

Page 54

What it is: Identification of Psychological

price points from a customers’ perspective & their impact on demand

Criteria will include our & competitive prices but also conditions & buyer profile to identify impact

What it does: Identification & measurement

of price points Estimated impact of potential

price realignments / price points optimizationActions it may lead to:

More accurate & effective price points positioning. Improve price alignments along the product range & vis a vis competition Improved competitive tactics & positioning

The stakes: Performant approach to price optimization impulse / image driven product ranges or industries with

high pricing rivalry

0

1

2

3

4

5

6

7

8

9

80 85 90 95 100 105 110 115


Occurrences

Marketing & Sales Support Tools

55

Key Tools Share & competitive

performance monitoring Peer Pricing & Value selling

support Portfolio analyses Analyses of performance on

key Value attributes Campaign effectivenes

measurement & modeling Competitive & Pricing

Intelligence tools

Tools to help support Strategic Marketing & Sales with a value focus & Marketing effectiveness improvements

Tool 13: Portfolio Pricing Dashboard (Illustrative)

Page 56


Dashboard providing indication of performance & guidance on Client portfolio.

Criteria used may vary by sector and based on strategic priorities

What it does: Monitoring tool Support to sales force in

execution of Pricing strategy

Actions it may lead to: Better targeting of pricing actions by sales force. Identification of Price increase opportunities or imminent price threats Improved monitoring of portfolio performance

The stakes: Higher effectiveness in Pricing execution. Typically results in bottom line improvement of up to 2%

Client Conditions Monthly Monitoring

Report

AM: John Smith –Client Portfolio

Total

Previous.year

Client Margin (YTD)

Vol.Band (Ann.)

Disc.Vol.

Band

Except.(N/Y &Auth)

Curr.Disc(%)

Disc.Ok’d(%)

Renego.(previous)

Client Rev. (YTD)

Renego.(next)

Growth(%)

IncentiveScore

(Sales Rep) Client

ABC

ACB

BAC

BCA

1.2M€

8.1M€

0.2M€

3.2M€

6%

32%

1%

-12%

31%

28%

29%

21%

L1

XL1

M1

L2

YTL

14%

17%

18%

25%

14%

18%

11%

18%

09/07

02/07

06/07

08/07

25

75

1

-20

L2

XL1

M2

L2

09/08

02/08

06/08

01/08

3.2M€ -2% 29% 17% 18% 354On Time6

Control 3Exception Handling

Monitoring 4Renegociations

Monitoring 5Calculation of

Salesman’s incentive

Control 2Net Price Check

Control 1Volume Band

Tool 14: Peer Pricing (Illustrative)

Page 57

What it is: Support to sales force by

providing contextual information on similar offers (price conditions, features & outcome).

Key is identification of comparable deals & collection of relevant information

What it does: provide visibility on what is

feasible / reasonable Provides reassurance & peer

pressure to performActions it may lead to: More effective pricing by sales force (better margins). Stronger emulation amongst sales force Elimination of ‘way over-/under- priced offers’

The stakes: Similar to Win/Loss - approach to price optimization in deal driven B2B environment. Typically results in

bottom line improvement of up to 4 %

Peer Pricing Tool

58

Tool 15: Portfolio Analysis / Price Structure Mapping (Illustrative)

Page 59

Product Performance (Protection index)

Product 3

Product 2

Product 3

Product4

Segmented Price Structure Maps

(Segment X, Market B, 2008)What it is: Analysis & mapping of segmented Product

range. Prices Product performance

May be used for a group of products, globally or by client segments / channel.

What it does: provide visibility and control of coherence of

product Price & Performance positioning. Can be used competitively to identify

competitive opportunities / threats

Corrective actions it may lead to: Price adjustments. Improved proved positioning of Products Rationalization of product range

The stakes: Depending on initial state 1 to 3 % improvement in average realized price

Fu

ll P

ric

e

/ H

a (

€)

Tool 16: Rating Performance / Value Curves

What it is: Analysis & mapping of competitive.

Value performance Performance on attributes

May be used for a single product or a group of products, globally or by client segments / channel.

What it does: provide visibility and control of Value

positioning of Products by segment. Identifies key attributes by segment Helps define effective Value segmentation

Corrective actions it may lead to: Value proposition adjustments Improved targeting of Price & Value proposition &segmentation Support to Marketing force in product development / Product attributes

The stakes: Varies considerably. Repositioning/ Retargeting of Value Proposition may often result in double digit


Weight 56 1 1 10 13 19

Ship Complete

Defects Range Service Shipment Date

Price

Region: CentralSegment: Price Driven

Competitors Value Graphs

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

8,0

9,0

ACME

Comp 1

Comp 2

Tool 17: Promotional Performance analysis (Illustrative)

Page 61

Dis

co

un

t O

ffe

red

c (

% L

ist

pri

ce

)

Sales Impact (% LT Lift)

What it is: Analysis or profit & volume

impact of promotions. can be used any type of

promotional / sales animation action to evaluate ROI of action.


actual performance of action, including stock effects & cannibalization, to provide improved vision of actual & relative performance

Corrective actions it may lead to: Re-adust marketing budget to support most effective actions. Best practice transfer (Test, Learn & generalize) Improved targeting of promotions

The stakes: 20 to 40% improvement in Marketing ROI

2009Row Labels Product Code Vol #VALUE! #VALUE! Gross Rev Product Code

Ac1 Ac1 1 695 2,63 2,63 4 181 Ac1 -6% 0% 43,02Ac1 Ac13 1 572 34,10 34,14 44 413 Ac13 -17% 0% 159,98Ac1 Ac15 1 170 39,45 39,42 57 360 Ac15 24% 0% 342,24Ac1 Ac16 1 363 42,16 42,17 56 952 Ac16 -1% 0% 159,69Ac1 Ac17 1 460 44,70 44,66 53 414 Ac17 -18% 0% -226,76Ac1 Ac18 1 331 47,18 47,31 73 339 Ac18 16% 0% -62,23Ac1 Ac19 1 534 50,00 49,85 66 983 Ac19 -12% 0% -42,85Ac2 Ac2 1 408 5,24 5,26 7 604 Ac2 3% 0% -8,74Ac2 Ac21 1 248 55,33 55,24 74 468 Ac21 8% 0% 48,24Ac2 Ac23 1 479 60,46 60,42 84 845 Ac23 -5% 0% -66,91Ac2 Ac24 1 375 63,08 62,90 88 276 Ac24 2% 0% 7,52Ac2 Ac27 1 416 70,99 70,84 108 300 Ac27 8% 0% 36,16Ac3 Ac30 1 406 78,91 78,88 119 755 Ac30 8% 0% 207,86Ac3 Ac31 1 181 81,35 81,36 120 448 Ac31 25% 0% -1861,22Ac3 Ac32 1 375 84,15 84,17 119 143 Ac32 3% 0% -216,68Ac3 Ac33 1 652 87,07 86,69 100 272 Ac33 -30% 0% -68,35Ac3 Ac34 1 547 89,32 89,10 119 633 Ac34 -13% 0% -53,16Ac3 Ac35 1 332 92,10 91,75 127 072 Ac35 4% 0% 10,27Ac3 Ac36 1 312 94,75 94,53 125 885 Ac36 2% 0% 6,56Ac3 Ac37 1 499 97,37 97,11 135 000 Ac37 -7% 0% -27,14Ac3 Ac38 1 256 99,62 100,07 124 493 Ac38 -1% 0% 2,07Ac3 Ac39 1 472 102,62 102,63 149 513 Ac39 -1% 0% 79,69

Ac1Ac13

Ac15Ac16

Ac18

Ac19

Ac2

-1%

-1%

0%

1%

1%

-40% -30% -20% -10% 0% 10% 20% 30% 40%

Price change (y) vs Volume Change (x) (2008-2009 - by Product )


Go to Financial Pivot

Go to Product Pivot





++

--2011 – Promotional Performance analysis

Detailed analysis of impact of promotions on volume & bottom line

62

Optimization of promotional effectiveness

Tool 18: Benchmarking & Competitive Intelligence

Page 63


monitoring & benchmarking of competitors ‘Sell-In’ & ‘Sell-out’ prices at relevant levels

Key ingredient of Pricing Intelligence

What it does: provide ability to react faster

& smarter to competitive price movements

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Category xxx - Average Daily Rate Comparison(as function of rental duration)

Corrective actions it may lead to: Better anticipation / faster reaction to changes in competitive prices Identification of Price increase opportunities or imminent price threats Stronger sales pitch


2 % through better anticipation of - / faster reaction to - price movements

Pricing Performance Management tools

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Pricing Process Performance

Pricing BSC Pricing Diagnostic Pricing RACI

Pricing Thought Proc. Pricing Alignment Industry Pricing

Value Analysis

CBC / Perceptions

Price Points

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rangeAA






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ROE Quarterly 46,5% 52,8% 54,6%

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Tools to help follow monitor, control & gradually improve the strategic Pricing & Value management capabilities of the company

Key Tools Pricing Balanced Score Card Pricing Diagnostics &

Improvement Roadmap Pricing Processes & RACI Pricing Thought Process Pricing Alignment reports Industry Pricing analyses &

decision support

Tool 19: Pricing BSC & Dashboards (Illustrative)

Page 65

What it is: Balanced scorecard – used to

monitor globally performance & development of pricing strategy.

Criteria used may vary by sector and level of analysis

What it does: provide visibility & control of

implementation of Pricing strategy

Corrective actions it may lead to: Better anticipation / faster reaction to changes in Industry Pricing Dynamics. Better & balanced monitoring & control of performance, faster ability to react Improved ability to manage change & performance improvement over the longer term

The stakes: Strong monitoring of Price Strategy performance & change management at any level – key driver to

Global performance

Region 2 1 2 3 4 5 6

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Weekly 82% 105% 112%






EuropeComm






Monthly 34% 36% 39%






Weekly 0,99% 0,99% 0,97%







ROE Quarterly 46,5% 52,8% 54,6%

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Pricing BSC – A key management tool

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Tool 20: Pricing Diagnostic & Roadmap (Illustrative)

Page 68

What it is: Diagnostic– evaluates current

level of performance vs Best practices on all aspects of Pricing management.

Roadmap : identifies key levers for improvement of pricing performance improvement & provides concrete recommendations & actions plans to follow to get there

What it does: Key tool to support

sustainable performance improvementCorrective actions it may lead to:

Clarifies where we are and where we need to go. Aligns & organizes the company around the required change management effort to achieve

improvement Helps prioritize & organize action for optimal effectiveness

The stakes: Best approach to achievable sustainable’ performance improvement

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Tool 21: Pricing Proccess RACI (Illustrative)

Page 73

What it is: Defines & organizes

participant roles & responsibilities in all pricing processes.

Defines calendar & organizes to ensure effective collaboration & consensus building

What it does: provide visibility, coordination

& control of all key pricing processes

Corrective actions it may lead to: Improved coordination of stakeholders. Conflict reduction, improved consensus building Improved prioritization / more rational arbitrage between alternative plans

The stakes: Effective management of Pricing & Value across the company

Pricing RACI - Overview

74

Pricing RACI – Country/Process detail

75

Tool 22: Pricing Thought Process (Illustrative)

Page 76

What it is: A ‘qualitative’ process to

support more rational / effective Pricing decision making – when data availability is insufficient.

A tool to capitalize on managers collective expertise to improve decisions & develop consensus

What it does: Provide a strong logical

framework to help focus discussion, rationalize them & facilitate consensus

Corrective actions it may lead to: Better Decision making. Improved consistency across divisions and time Improved consensus Development of Pricing & Value culture

The stakes: Improved Pricing management & consensus

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Tool 23: Pricing Alignment

Page 80

What it is: Visualization of positioning &

attractiveness if alternative packages as a function of nt usage

Key ingredient of Pricing coherence management

What it does: provide ability to improve

pricing coherence & better position offers to meet client usage characteristics

Corrective actions it may lead to: Better positioning of packages & prices Identification of Price increase opportunities Stronger sales pitch better fit to needs

The stakes: In segmented markets – with high price visibility, typically results in volume increases improvement of

up to 10 % through better fit of offer to needs

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Window

Shadow

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5-15% 40-65% Key, high visibility offers requiring precision pricing, based on perceived value (if possible) or on detailed, accurate competitive & costing info.

10-30% 15-25% Strongly related to window products in terms of perceived value & purchasing decision margin based pricing driven by window products

55-75% 10-45% incidental, low visibility products with low impact on perceived value or buying decision cost based pricing with high margin

Window - Shadow - Shade

Tool 24: Industry Pricing Dynamics Assessment (Illustrative)

Page 82


assessment of Industry pricing Dynamics.

Criteria used may vary by sector and for Commodities vs specialty


anticipation of industry level pricing movements

Corrective actions it may lead to: Better anticipation / faster reaction to changes in Industry Pricing Dynamics. Identification of Price increase opportunities or imminent price threats Improved monitoring of industry level indicators


4 % through better anticipation of price movements

Tool 24: Industry Pricing (Illustrative)

Page 83

Price dynamics assessment

84

Ariston Ariston Ariston

GT Corn GT Corn GT Corn

Channel Concentration 7 2,6 0,0 0 1

Channel Alignment with Example Corp (Loyalty) 10 2,7 0,0 -0,4 2

Customers Profitability & Willingness to Pay 6 2,8 0,1 -0,7 3

Consumers Profitability & Willingness to Pay 5 2,8 0,6 -0 4

Value Index / Cost to use advantage 5 4,6 0,1 0,2 5

Industry Concentration 8 4,0 0,6 0,7 6

Price Followership Likelihood & Reaction Delay 5 3,9 0,0 1,7 7

Price Premium against best Value Competitor 4 5,0 1,2 1,2 8

Competitive Costs Position 7 3,4 -0,1 -0,3 9

Forecasted Costs Evolution 10 3,9 0,7 0,8 10

Communication Leadership 7 4,4 -0,1 0,7 9

Competitive / Media Signalling 10 4,4 -0,1 1,3 10

Free Capacity Relative Position 10 3,8 0,3 3,8 11

Projected Supply / Demand Ratio 6 2,9 0,7 0,2 12

Channel Inventory Level 10 2,9 0,8 0,3 13

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Projected Market Price EvolutionAriston Ariston

Price Change RecommendationsDirectional increase recommended

10%

Current Period

Score

Current Period

Price Dynamics assessment

6 C's Pricing Drivers

Criteria to Monitor Weighting

Chg vs last period Chg from last Chg

0,02 -0,26

Capacity 2,6

3,6

Customer 2,7

Competitor 4,2

Costs 3,7Communication

Consumer 3,7

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Score Score

Since Last Period Since Last Price Change

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% change proposed

7% 18%

Value Sharing analysis & decision support

85

Statistics & simulation tools

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Stats & Simulations

Pricing Simulators Portfolio Simulator Network Simulator

D & R Savings Segm. & Clusters Regressions & stats

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Key Tools Pricing & Value modeling &

simulation Portfolio simulation Network simulation &

optimization Simulation of impact of

alternative Pricing or D&R Segmrentation & clustering

tools Regression & statiistical tools

Analytical & simulation tools to help support Strategic Decision making on Pricing & Value Strategies & implementation

Tool 25: Pricing Simulator (Illustrative)

Page 87


assessment of Industry pricing Dynamics.

Criteria used may vary by sector and for Commodities vs specialty


anticipation of industry level pricing movements

Corrective actions it may lead to: Better anticipation / faster reaction to changes in Industry Pricing Dynamics. Identification of Price increase opportunities or imminent price threats Improved monitoring of industry level indicators


4 % through better anticipation of price movements

Pricing Simulator – Single product

88

Pricing Simulator – Competitive dynamics

89

Tool 26: Portfolio Pricing Simulator (Illustrative)

Page 90

What it is: Decision support tools to

simulate / optimize pricing across a porfolio of Products or countries, taking into consideration elasticities, price corridors & potential competition between ranges

What it does: Optimization & coordination of

pricing across the portfolio

Corrective actions it may lead to: Implementation of price corridors. Differentiating offers to better serve different markets / optimoize value capture Targeted Price increases / decreases


4 % through better optimization & coordination of prices

Check / Uncheck AllAccuspray Accuspray barrel

Hyp BSCF/BCF StopperHyp NSCF/NCF StopperHyp TSCF/TCF StopperHypak Comp SCF OtherHyp Bulk Barrel LuerHyp Bulk Barrels NdlHyp Bulk Ndl ShieldHyp Bulk Plast CompsHyp Bulk PRTCHyp Bulk RNSHyp Bulk Stp/Byp StpHyp Bulk Tip CapsHyp SCF Barrel LuerHyp SCF Barrel NdlHyp SCF Barrel Ndl Physiolis

Hypak Plunger Rods Hypak Plunger RodsHypoint Needles Hypoint Needles

Monovial StopperMonovial VialsTS Needle GuardPreventisPreventis OtherRdf Bulk StopperRdf RTS Barrels LuerRdf RTS Barrels NdlRdf RTS StopperRdf SCF Barrel LuerRdf SCF Barrels Ndl

Rdf Components Rdf Comp OthersRdf Olunger Rods Rdf Plunger Rods

Uniject ReservoirSterifill Barrels S-fill SCF Brrl Luer

Sterifill Plungr RodSterifill Stppr

Preventis

Readifill Barrel

Sterifill Components

Product Selection for analysis

Hypak Bulk Barrels

Hypak Componets Bulk

Hypak SCF Barrels

Hypak Components SCF

Monovial

FULL SCREEN

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Go to Product Synthesis

Go to Impact Analysis

Go to Product Hypotheses

Go to Prodiuct Client Detail

Go to ImpactMenu

Go to MainMenu

Run Impact Analysis

Tool 26: Portfolio Pricing Simulator (Illustrative)

Region Scenario constraints

Country Min PTW Max PTWPublic Price PTW Margin %

Est. Share (%)

Profit Index

Revenue Index

### US TRUE CoPay Profit Optimization1 17,00 € 746,67 € 37,03 € 148,10 € 96% 51% 480% 442%

Canada #### No Reimb. Fixed price 5 28,79 € 32,79 € 41,34 € 28,79 € 80% 42% 100% 99%

North America 34,00 € 50,00 € 478% 439%

Germany #### No Reimb. Regional Corridor3 32,00 € 36,00 € 50,95 € 32,00 € 82% 43% 100% 100%

UK #### No Reimb. Regional Corridor3 32,00 € 36,00 € 37,77 € 33,57 € 83% 42% 100% 100%

France #### No Reimb. Regional Corridor3 32,00 € 36,00 € 57,17 € 32,00 € 82% 29% 99% 97%

Italy #### No Reimb. Regional Corridor3 32,00 € 36,00 € 50,56 € 32,00 € 82% 42% 99% 96%

Spain #### No Reimb. Regional Corridor3 32,00 € 36,00 € 55,55 € 35,58 € 84% 31% 96% 96%

Sweden #### No Reimb. Regional Corridor3 32,00 € 36,00 € 44,57 € 36,00 € 84% 45% 87% 92%

Russia #### No Reimb. Profit Optimization1 16,00 € 192,86 € 53,59 € 29,77 € 81% 44% 100% 100%

Europe 32,00 € 36,00 € 99% 98%

Australia #### No Reimb. Profit Optimization1 8,13 € 145,52 € 39,02 € 25,34 € 77% 43% 100% 100%

### Japan #### No Reimb. Profit Optimization1 8,13 € 20,47 € 22,80 € 20,45 € 83% 38% 97% 99%

### Korea #### No Reimb. Profit Optimization1 3,06 € 10,12 € 12,60 € 10,08 € 65% 44% 63% 79%

### China #### No Reimb. Profit Optimization1 8,13 € 53,15 € 22,76 € 13,39 € 74% 39% 100% 100%

APAC 16,25 € 40,00 € 98% 99%

Mexico No Reimb. Profit Optimization1 12,50 € 128,12 € 37,95 € 24,29 € 76% 67% 96% 96%

Brazil #### No Reimb. Profit Optimization1 -2,00 €Latin America 25,00 € 80,00 € 96% 96%

Grand Total 414% 372%

Per product results

Performance achieved in Scenario

Multi-country pricing optimization - modulated by country €)

Reimbursement Scenario

Price Constraints / Objective

Back to Integ

Country Level Pricing Options

Regional Corridor

Profit Optimization

Fixed price

Regional Corridor

Regional Corridor

Regional Corridor

Profit Optimization

Profit Optimization

Profit Optimization

Regional Corridor

Profit Optimization

Profit Optimization

Regional Corridor

Profit Optimization

Profit Optimization

OptIm

OptIm

OptIm

OptIm

OptIm

OptIm

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OptIm

OptIm

OptIm

OptIm

OptIm

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Recalc Full ScenCorridors

Synthesis

Tool 27: Retail Network Pricing Simulator (Illustrative)

Page 92

What it is: Systematic Daily price

optimization in highly price competitive environments

Can be used to optimize pricing in a network, taking inti consideration local competition & demand

What it does: Simulates / optimizes pricing

based on specific competitive conditions & capitalizing on historically measured elasticities

Corrective actions it may lead to: Improved daily pricing to support overall marketing strategy & objectives Faster reaction / anticipation of competitive moves

The stakes: 1 to 3% improvement in pricing realization… may be key in markets subject to very intense price

competition

Brand Teboil Criteria Weight Constr. (>) Profit ROS % SoC %TypFuel 98E ROS 50% 0,10% Optim. 6 397 € 2,4% 31,9%

Date 04/01/2010 SoC 50% 18,00% Initial 4 509 € 2,3% 28%

Row Labels Nb Comp Prev PrcRev Prev Marg VarCost / LtrGr Profit Min Pr MaxPr PriceGross Profit Station Price

Mod Revenue SoC ROS %

Gross Profit

Aura 3 ##### 6 682 € 388 € 1,542 € 94 € 1,605 € 1,739 € 1,661 € 118 € Aura 1,661 € 5 743 € 46,0% 2,1% 118 €Espoo 6 ##### 37 978 € 2 654 € 1,462 € 1 320 € 1,538 € 1,666 € 1,551 € 1 494 € Espoo 1,551 € 49 623 € 28,5% 3,0% 1 494 €Hämeenkyrö 3 ##### 6 434 € 455 € 1,471 € 147 € 1,540 € 1,668 € 1,579 € 151 € Hämeenkyrö 1,579 € 6 719 € 39,6% 2,2% 151 €Hämeenlinna 6 ##### 2 772 € 271 € 1,465 € -37 € 1,535 € 1,663 € 1,543 € 340 € Hämeenlinna 1,543 € 12 690 € 24,5% 2,7% 340 €Heinola 3 ##### 3 233 € 229 € 1,516 € -22 € 1,569 € 1,700 € 1,602 € 27 € Heinola 1,602 € 5 196 € 30,0% 0,5% 27 €Helsinki 6 ##### 11 852 € 924 € 1,475 € -1 € 1,532 € 1,660 € 1,543 € 723 € Helsinki 1,543 € 37 160 € 21,0% 1,9% 723 €Huittinen 2 ##### 5 972 € 426 € 1,448 € 143 € 1,584 € 1,629 € 1,584 € 144 € Huittinen 1,584 € 4 982 € 51,6% 2,9% 144 €Hyvinkää 3 ##### 11 792 € 767 € 1,412 € 397 € 1,491 € 1,616 € 1,544 € 491 € Hyvinkää 1,544 € 10 063 € 54,2% 4,9% 491 €Ilomantsi 3 ##### 5 897 € 414 € 1,512 € 172 € 1,581 € 1,713 € 1,626 € 170 € Ilomantsi 1,626 € 5 883 € 42,5% 2,9% 170 €Jämsä 2 ##### 5 095 € 330 € 1,509 € 91 € 1,564 € 1,694 € 1,628 € 95 € Jämsä 1,628 € 4 571 € 46,7% 2,1% 95 €Janakkala 4 ##### 6 578 € 548 € 1,478 € 205 € 1,552 € 1,681 € 1,594 € 205 € Janakkala 1,594 € 7 532 € 36,8% 2,7% 205 €Juva 3 ##### 3 472 € 274 € 1,493 € 54 € 1,547 € 1,676 € 1,591 € 91 € Juva 1,591 € 5 045 € 36,8% 1,8% 91 €Kaavi 4 ##### 5 179 € 401 € 1,506 € 101 € 1,579 € 1,710 € 1,612 € 117 € Kaavi 1,612 € 6 316 € 36,2% 1,9% 117 €Kankaanpää 2 ##### 4 914 € 334 € 1,518 € 110 € 1,573 € 1,704 € 1,639 € 113 € Kankaanpää 1,639 € 4 560 € 50,5% 2,5% 113 €Kärsämäki 4 ##### 1 722 € 149 € 1,463 € 75 € 1,535 € 1,663 € 1,545 € 134 € Kärsämäki 1,545 € 3 919 € 25,7% 3,4% 134 €Kauniainen 2 ##### 3 636 € 304 € 1,481 € 91 € 1,538 € 1,666 € 1,592 € 107 € Kauniainen 1,592 € 4 591 € 45,1% 2,3% 107 €Kaustinen 4 ##### 4 202 € 413 € 1,494 € 101 € 1,571 € 1,702 € 1,610 € 124 € Kaustinen 1,610 € 6 056 € 35,3% 2,1% 124 €Kempele 2 ##### 5 526 € 385 € 1,517 € 139 € 1,573 € 1,704 € 1,639 € 144 € Kempele 1,639 € 5 239 € 51,3% 2,7% 144 €Kerimäki 3 ##### 1 678 € 154 € 1,519 € 4 € 1,571 € 1,702 € 1,636 € 29 € Kerimäki 1,636 € 2 495 € 19,6% 1,2% 29 €Kiiminki 2 ##### 1 590 € 286 € 0,546 € 35 € 0,639 € 0,692 € 0,666 € 33 € Kiiminki 0,666 € 1 584 € 44,7% 2,1% 33 €Kokkola 5 ##### 12 538 € 979 € 1,487 € 388 € 1,561 € 1,691 € 1,626 € 307 € Kokkola 1,626 € 10 536 € 17,7% 2,9% 307 €

Brand: Teboil Fuel: 98E - ROS vs Share of Choice, by station (bubble size proportional to revenues)

Station level Data

Optimization PerformanceOptimization Parameters

Aura

Espoo

HämeenkyröHeinola

Helsinki

HuittinenHyvinkää

Jämsä

IlomantsiJanakkala

JuvaKaavi

Kärsämäki

KauniainenKaustinen

Kerimäki

Kiiminki

Kokkola

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

0% 10% 20% 30% 40% 50% 60%

Optimize Multi-Stations pricingROS %

SoC %

Quality

Station Level Price Impact

Price Share

Station Level Optimization

Station Level Decision

Station Profile Database

Competitive Pricing DB

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Network Optimization

Network Pricing Simulator – Competitive database

93

Location Brand ServQ LocQ From toEst Margin 2010

Fixed Costs Est Profit 2010

Ähtäri ABC 4 7 1/1/10 ####### 765 446 € 634 141 € 131 306 €

Ähtäri Neste 7 6 1/1/10 ####### 600 348 € 552 411 € 47 937 €

Ahvenanmaa/ÅlandShell 2 4 1/1/10 ####### 523 166 € 513 961 € 9 205 €

Ahvenanmaa/ÅlandSt1 2 5 1/1/10 ####### 604 869 € 527 374 € 77 496 €

Alajärvi Neste 7 6 1/1/10 ####### 580 282 € 551 339 € 28 943 €

Alajärvi Shell 7 5 1/1/10 ####### 556 772 € 511 229 € 45 543 €

Alavus ABC 6 5 1/1/10 ####### 1 156 361 € 1 166 020 € -9 659 €

Aura ABC 6 8 1/1/10 ####### 606 556 € 552 489 € 54 067 €

Aura Shell 5 3 1/1/10 ####### 379 495 € 355 500 € 23 995 €

Aura Teboil 7 8 1/1/10 ####### 698 248 € 665 290 € 32 958 €

Espoo ABC 4 7 1/1/10 ####### 2 802 155 € 2 580 634 € 221 521 €

Espoo Neste 7 4 1/1/10 ####### 2 789 870 € 2 610 026 € 179 844 €

Espoo Shell 2 7 1/1/10 ####### 2 647 168 € 2 150 629 € 496 539 €

Espoo St1 7 8 1/1/10 ####### 5 175 726 € 4 886 357 € 289 370 €

Espoo Teboil 5 5 1/1/10 ####### 3 062 354 € 2 916 488 € 145 866 €

Espoo Ysi5 5 5 1/1/10 ####### 3 246 528 € 3 165 562 € 80 966 €

Eura ABC 6 6 1/1/10 ####### 533 067 € 480 939 € 52 129 €

Eura Neste 7 6 1/1/10 ####### 597 229 € 586 904 € 10 326 €

Forssa ABC 2 6 1/1/10 ####### 565 716 € 533 519 € 32 196 €

Forssa Shell 6 4 1/1/10 ####### 564 044 € 552 906 € 11 138 €

HämeenkyröABC 8 7 1/1/10 ####### 928 792 € 868 337 € 60 454 €

Quality Impact Analysis


Price Share Trade-Off


Station Level Decision Support



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Brand Teboil

Row Labels Qual Shr ImpactServQ Ind LocQ Ind Qual Shr ImpactServQ LocQ Qual Shr ImpactMod Q Shr Impact SUMMARY OUTPUTAura 5,6% 117% 126% 5,6% 116,7% 126,3% 5,6% 5,4%Espoo -2,7% 100% 83% -2,7% 100,0% 83,3% -2,7% -2,4% Regression StatisticsHämeenkyrö -6,5% 80% 71% -6,5% 80,0% 70,6% -6,5% -6,3% Multiple R 0,992269Hämeenlinna -5,7% 129% 43% -5,7% 128,6% 42,9% -5,7% -5,1% R Square 0,984598Heinola -15,9% 43% 33% -15,9% 42,9% 33,3% -15,9% -15,3% Adjusted R Square0,984027Helsinki -7,4% 71% 71% -7,4% 70,6% 70,6% -7,4% -7,2% Standard Error0,008709Huittinen 6,4% 123% 127% 6,4% 123,1% 127,3% 6,4% 6,1% Observations 57

Hyvinkää 7,0% 111% 141% 7,0% 110,5% 141,2% 7,0% 6,8%Ilomantsi -1,9% 120% 75% -1,9% 120,0% 75,0% -1,9% -1,5% ANOVA

Jämsä -10,7% 40% 67% -10,7% 40,0% 66,7% -10,7% -10,9% df SS MS F Significance FJanakkala 9,0% 108% 171% 9,0% 107,7% 171,4% 9,0% 10,8% Regression 2 0,261807 0,13090368 1725,99507 1,1608E-49Juva -2,3% 117% 60% -2,3% 116,7% 60,0% -2,3% -3,9% Residual 54 0,004095 7,5842E-05Kaavi 2,7% 145% 84% 2,7% 145,5% 84,2% 2,7% 2,4% Total 56 0,265903Kankaanpää -3,3% 108% 67% -3,3% 107,7% 66,7% -3,3% -3,9%

Kärsämäki -7,9% 47% 86% -7,9% 47,1% 85,7% -7,9% -7,5% CoefficientsStandard Error t Stat P-value Lower 95% Upper 95%Kauniainen -3,2% 67% 120% -3,2% 66,7% 120,0% -3,2% -0,7% Intercept -0,24419 0,004335 -56,329908 1,1861E-49 -0,2528846 -0,2355021Kaustinen 7,8% 145% 123% 7,8% 145,5% 123,1% 7,8% 7,9% X Variable 10,103344 0,003434 30,094693 2,0088E-35 0,0964593 0,11022865Kempele -1,5% 100% 92% -1,5% 100,0% 92,3% -1,5% -1,1% X Variable 20,140246 0,003522 39,8241346 1,0348E-41 0,1331856 0,1473065

Kerimäki -5,2% 40% 107% -5,2% 40,0% 107,1% -5,2% -5,3%

Kiiminki -4,8% 40% 100% -4,8% 40,0% 100,0% -4,8% -6,3%

Kokkola -1,5% 109% 86% -1,5% 108,7% 86,2% -1,5% -1,1%

Modeled vs Measured impact of Service & location quality on normalized share (2010, Brand: Teboil ) Regression Results

-20,0%

-15,0%

-10,0%

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5,0%

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15,0%

20,0%

25,0%

-20,0% -15,0% -10,0% -5,0% 0,0% 5,0% 10,0% 15,0% 20,0%

Start Regression

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Brand Zone A24 KouvolaTypFuel DI

Row Labels Zone Date Average of Rel Share Average of Rel Price Rel Share Rel Price SUMMARY OUTPUTA24 Kouvola 01/01/2010 64% 100,7% 64% 101%A24 Kouvola 02/01/2010 48% 101,8% 48% 102% Regression StatisticsA24 Kouvola 03/01/2010 58% 101,2% 58% 101% Multiple R 0,977051A24 Kouvola 04/01/2010 52% 101,6% 52% 102% R Square 0,954629A24 Kouvola 05/01/2010 91% 99,6% 91% 100% Adjusted R Square0,954504A24 Kouvola 06/01/2010 88% 99,7% 88% 100% Standard Error0,040874A24 Kouvola 07/01/2010 76% 100,3% 76% 100% Observations 365A24 Kouvola 08/01/2010 51% 101,5% 51% 101%A24 Kouvola 09/01/2010 50% 101,5% 50% 102% ANOVAA24 Kouvola 10/01/2010 87% 99,9% 87% 100% df SS MS F Significance FA24 Kouvola 11/01/2010 68% 100,6% 68% 101% Regression 1 12,76001 12,76001 7637,68 7E-246A24 Kouvola 12/01/2010 81% 99,9% 81% 100% Residual 363 0,606452 0,001671A24 Kouvola 13/01/2010 95% 99,5% 95% 99% Total 364 13,36647A24 Kouvola 14/01/2010 90% 99,7% 90% 100%A24 Kouvola 15/01/2010 75% 100,1% 75% 100% CoefficientsStandard Error t Stat P-value Lower 95%Upper 95%Lower 95,0%Upper 95,0%A24 Kouvola 16/01/2010 56% 101,1% 56% 101% Intercept 24,31444 0,2692 90,32125 7E-251 23,7851 24,8438 23,7851 24,8438A24 Kouvola 17/01/2010 107% 99,2% 107% 99% X Variable 1-23,4824 0,268696 -87,3938 7E-246 -24,0108 -22,954 -24,0108 -22,954A24 Kouvola 18/01/2010 72% 100,4% 72% 100%A24 Kouvola 19/01/2010 61% 100,9% 61% 101%A24 Kouvola 20/01/2010 88% 99,5% 88% 100%

Impact of relative Price position (X) on relative share (Y) (2010, Brand: A24, Station: Kouvola) Regression Results

70%

80%

90%

100%

110%

120%

130%

140%

98% 98% 99% 99% 100% 100% 101% 101% 102% 102% 103%

Start Regression

Full Screen Normal








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Network Pricing Simulator – Decision support

96

Station & Date Optimization Performance

Profit ROS % SoC % Criteria WeightBrand Zone Teboil Punkalaidun Optimized 374 € 1,9% 52,8% ROS 30% > 1,7%

Date 04/01/2010 Initial 356 € 2,2% 42% SoC 70% > 19%

Row Labels Nb Comp Price Mod Revenue Share Index SoC ROS %Gross Profit

95E 2 1,541 € 7 768 € 0,93 46,3% 1,2% 91 € 1,544 € 37,7% -9,1%98E 2 1,532 € 3 966 € 1,06 52,9% 1,7% 67 € 1,565 € 44,6% -8,4%DI 2 1,254 € 8 423 € 1,18 58,8% 2,6% 215 € 1,300 € 52,6% -0,4%Grand Total 2

20 157 € 52,8% 1,9% 374 €

Teboil Punkalaidun - performance by type of fuel

Optimization parameters

Constraints

Optimize Station level pricing

95E98E

DI

-6%

-4%

-2%

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ROS %

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Network Pricing Simulator – Detailed Simulation

97

TRUE TRUE TRUE TRUE TRUE TRUE

Teboil ABC Neste Seo Shell St1 Teboil ABC Neste Seo Shell St1

Serv Q Today 6 3 7 8 2 2 Changes to Serv QLoc Q Today 2 5 8 4 5 4 Changes to Loc QFuel Prices today Changes to Fuel Prices

95E 1,672 € 1,703 € 1,679 € 1,706 € 1,672 € 1,673 € 95E -0,010 €

98E 1,706 € 1,782 € 1,773 € 1,724 € 1,756 € 1,706 € 98E -0,060 €

DI 1,462 € 1,506 € 1,502 € 1,464 € 1,478 € 1,484 € DI

Share of Choice Teboil ABC Neste Seo Shell St1 223 2895E 11,4% 9,0% 32,1% 20,0% 14,5% 13,1% June

98E 16,7% 6,2% 24,6% 27,1% 6,7% 18,8% Hämeenlinna

DI 14,6% 7,8% 26,0% 30,6% 11,9% 9,1%Criteria Weight

Revenues 34 309 € 20 608 € 72 340 € 64 479 € 30 251 € 31 812 € Return on Sales 70% > 1,0%

Margin 2 273 € 1 949 € 6 306 € 4 971 € 2 422 € 2 240 € Share of Choice 30% > 10,0%

Fixed Costs 584 € 1 002 € 2 196 € 1 558 € 889 € 623 €

Profit 766 € 200 €- 821 € 1 027 € 204 € 400 € Profit ROS % SoC %Simulated 766 € 2,2% 13,6%

ROS 2,2% -1,0% 1,1% 1,6% 0,7% 1,3% Initial 375 € 1,5% 11,5%

SoC 13,6% 8,1% 28,5% 26,8% 12,4% 13,9%

Station : Hämeenlinna - Date: 28 June - Price simulation / Optimization

Simulated Performance

Changes (+ or -) from base scenarioCompetitive Scenario Today

Projected Impact on Performance

ConstraintsOptimization parameters _

Location

Month

Hämeenlinna

June

Day 28

Sim

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Update

Optimize

Save Prices

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Network Pricing Simulator – Network Optimization

98

Brand Teboil Criteria Weight Constr. (>) Profit ROS % SoC %TypFuel 98E ROS 50% 0,10% Optim. 6 397 € 2,4% 31,9%

Date 04/01/2010 SoC 50% 18,00% Initial 4 509 € 2,3% 28%

Row Labels Nb Comp Prev PrcRev Prev Marg VarCost / LtrGr Profit Min Pr MaxPr PriceGross Profit Station Price

Mod Revenue SoC ROS %

Gross Profit

Aura 3 ##### 6 682 € 388 € 1,542 € 94 € 1,605 € 1,739 € 1,661 € 118 € Aura 1,661 € 5 743 € 46,0% 2,1% 118 €Espoo 6 ##### 37 978 € 2 654 € 1,462 € 1 320 € 1,538 € 1,666 € 1,551 € 1 494 € Espoo 1,551 € 49 623 € 28,5% 3,0% 1 494 €Hämeenkyrö 3 ##### 6 434 € 455 € 1,471 € 147 € 1,540 € 1,668 € 1,579 € 151 € Hämeenkyrö 1,579 € 6 719 € 39,6% 2,2% 151 €Hämeenlinna 6 ##### 2 772 € 271 € 1,465 € -37 € 1,535 € 1,663 € 1,543 € 340 € Hämeenlinna 1,543 € 12 690 € 24,5% 2,7% 340 €Heinola 3 ##### 3 233 € 229 € 1,516 € -22 € 1,569 € 1,700 € 1,602 € 27 € Heinola 1,602 € 5 196 € 30,0% 0,5% 27 €Helsinki 6 ##### 11 852 € 924 € 1,475 € -1 € 1,532 € 1,660 € 1,543 € 723 € Helsinki 1,543 € 37 160 € 21,0% 1,9% 723 €Huittinen 2 ##### 5 972 € 426 € 1,448 € 143 € 1,584 € 1,629 € 1,584 € 144 € Huittinen 1,584 € 4 982 € 51,6% 2,9% 144 €Hyvinkää 3 ##### 11 792 € 767 € 1,412 € 397 € 1,491 € 1,616 € 1,544 € 491 € Hyvinkää 1,544 € 10 063 € 54,2% 4,9% 491 €Ilomantsi 3 ##### 5 897 € 414 € 1,512 € 172 € 1,581 € 1,713 € 1,626 € 170 € Ilomantsi 1,626 € 5 883 € 42,5% 2,9% 170 €Jämsä 2 ##### 5 095 € 330 € 1,509 € 91 € 1,564 € 1,694 € 1,628 € 95 € Jämsä 1,628 € 4 571 € 46,7% 2,1% 95 €Janakkala 4 ##### 6 578 € 548 € 1,478 € 205 € 1,552 € 1,681 € 1,594 € 205 € Janakkala 1,594 € 7 532 € 36,8% 2,7% 205 €Juva 3 ##### 3 472 € 274 € 1,493 € 54 € 1,547 € 1,676 € 1,591 € 91 € Juva 1,591 € 5 045 € 36,8% 1,8% 91 €Kaavi 4 ##### 5 179 € 401 € 1,506 € 101 € 1,579 € 1,710 € 1,612 € 117 € Kaavi 1,612 € 6 316 € 36,2% 1,9% 117 €Kankaanpää 2 ##### 4 914 € 334 € 1,518 € 110 € 1,573 € 1,704 € 1,639 € 113 € Kankaanpää 1,639 € 4 560 € 50,5% 2,5% 113 €Kärsämäki 4 ##### 1 722 € 149 € 1,463 € 75 € 1,535 € 1,663 € 1,545 € 134 € Kärsämäki 1,545 € 3 919 € 25,7% 3,4% 134 €Kauniainen 2 ##### 3 636 € 304 € 1,481 € 91 € 1,538 € 1,666 € 1,592 € 107 € Kauniainen 1,592 € 4 591 € 45,1% 2,3% 107 €Kaustinen 4 ##### 4 202 € 413 € 1,494 € 101 € 1,571 € 1,702 € 1,610 € 124 € Kaustinen 1,610 € 6 056 € 35,3% 2,1% 124 €Kempele 2 ##### 5 526 € 385 € 1,517 € 139 € 1,573 € 1,704 € 1,639 € 144 € Kempele 1,639 € 5 239 € 51,3% 2,7% 144 €Kerimäki 3 ##### 1 678 € 154 € 1,519 € 4 € 1,571 € 1,702 € 1,636 € 29 € Kerimäki 1,636 € 2 495 € 19,6% 1,2% 29 €Kiiminki 2 ##### 1 590 € 286 € 0,546 € 35 € 0,639 € 0,692 € 0,666 € 33 € Kiiminki 0,666 € 1 584 € 44,7% 2,1% 33 €Kokkola 5 ##### 12 538 € 979 € 1,487 € 388 € 1,561 € 1,691 € 1,626 € 307 € Kokkola 1,626 € 10 536 € 17,7% 2,9% 307 €

Brand: Teboil Fuel: 98E - ROS vs Share of Choice, by station (bubble size proportional to revenues)

Station level Data

Optimization PerformanceOptimization Parameters

Aura

Espoo

HämeenkyröHeinola

Helsinki

HuittinenHyvinkää

Jämsä

IlomantsiJanakkala

JuvaKaavi

Kärsämäki

KauniainenKaustinen

Kerimäki

Kiiminki

Kokkola

-6%

-4%

-2%

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2%

4%

6%

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Optimize Multi-Stations pricingROS %

SoC %

Quality


Price Share


Station Level Decision



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Tool 28: D & R Savings model (Illustrative)

Page 99

What it is: Interactive simulation of

potential impact of changes in D&R policies Who is affected? How much? Potential impact on demand & volumes.

Support to sales force in explaining / implementing price changes on their portfolio


anticipation of industry level pricing movementsCorrective actions it may lead to:

Better planning / evaluation & selection of D&R changes. Improved & faster implementation Improved fairness

The stakes: 40 to 8 month delay in Implementation 20 to 60% fewer ‘exceptions’

Estimating the impact of new Pricing Policy

Page 100

Evaluating Impact by Customer

101

Max. Disc. & Rebates % 15,0%

Year (All)

Month (All)

Region Name (All)

Industry Name (All)

Acct Mngr Name (All)

Glob SoW Code (All)

Market Name (All)

Market Segment NamePrice Driven

Customer Name (All)

Customer Breath Name(All)

Custo Rev Segment Name(All)

Product Name (All)

Material GrP Name (All)

Product Grp Name (All)

Prod Hier Name (All)

Prod Rev Segment Name(All)

Product Family Name(All) 7 139 205 74 082 396 9,6% 15,0% 6 165 641 8,3%973 564

Disc. and Reb. Savings NOKTotal D&R (Current)

New D&R % G.S.

D&R Applying Max %

Maximum D&R %

D&R % G.S.R. (Current)

Sales Gross Rev.

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-20 0 20 40 60 80 100 120 140 160 180

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Customers Gross Sales Revenues

Gross Sales Revenues & D&R Actual vs. Limit

Cust. Gross Sales Rev

Pricing

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Tool 29: Segmentation & Clustering

What it is: Segmentation of Clients / Consumers,

based on. Attributes sought Potential & willingness to pay

May be used for a single product or a group of products, globally or by channel.

What it does: Helps define effective Value / Pricing

segmentation Help visualize weights / stakes &

priorities by segment.

Actions it may lead to: Development of targeted offers. Support to targeting by sales force Targeted communication & marketing

The stakes: Varies considerably. Segmentation & adaptation of Value Propositions may often result in double digit


0

10 000 000

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30 000 000

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Value Driven

Price Driven

Delivery Driven

Service driven

Speed Driven

Quality driven

1 2 3 4 5 6

Comp2

Comp1

ACME

Segmentation & Clustering – Market research insights

103

Segmentation & Clustering – Behavioral Segmentation

104


105


106

Tool 23: Statistics & Regression Tools (Illustrative)

Page 107

What it is: Statistical tools to support in

depth analysis & modeling of Pricing & Value Clustering CBC / Discrete choice Logit Regressions ..

What it does: Enables true insights &

sophisticated modeling

Corrective actions it may lead to: Understanding causalities / Identififying trends Ability to model / predict Continous improvement based on historical data

The stakes: Insights / price response modeling is at the root of Price optimization

Statistical tools to prodide insights on causality

108

Segment (All)SegmentName (All)Region EastAcct Mngr (All)

Pricing

0,50

1,50

0,50 1,00 1,50

Rel

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Customer Value Map

ACME

Comp 1

Comp 2

Fair Value Line

ValueDisadvantaged

ValueAdvantaged

Value Map Seg/RegWeight 56 1 1 10 13 19

Ship Complete

Defects Range Service Shipment Date

Price

Competitors Value Graphs

0,0

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ACME

Comp 1

Comp 2

Value Graph Segment0

10 000 000

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30 000 000

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50 000 000

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Value Driven

Price Driven

Delivery Driven

Service driven

Speed Driven

Quality driven

1 2 3 4 5 6

Comp2

Comp1

ACME

Segment Share

7 2 9 1 0 87 2 9 1 0 8

3 3 1 1 7 2 73 3 1 1 7 2 7

1 0 0 8 3 9 11 0 0 8 3 9 1

1 1 0 4 1 4 81 1 0 4 1 4 8

9 9 6 9 0 0

3,0

3,5

4,0

4,5

5,0

5,5

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Share of Wallet vs Rating - ACME

SoW vs Ratings

3,0

3,5

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6,0

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7,5

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0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Share of Wallet vs Rating

SoW vs Rtg Clients

y = 4,0565e0,7579x

R² = 0,1959

3,0

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"Share of Wallet (x) vs Rating (y)" FULL SCREEN

USUAL SCREEN

Performance reporting & monitoring

109


Reporting Analysis

Traffi c LightsP& L Reports Objectives vs. Realized

Fin . Reports Corridors Exceptions Mngmt

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Customer Value Map

ACME

Comp 1

Comp 2

Fair Value Line

ValueDisadvantaged

ValueAdvantaged



Discount Change

Share Growth



Value Positioning



Action Required

BRIDGESTONE 97 13% 0 1 8% 9 13% 1,5 61% 94% 0,60024934 59% Y




215/45R17 BW Z BRIDGESTONE TURANZA EL400-02 #E402 73 19% 0 1 8% 7 7% 1,9 59% 92% 0,58842208 58% Y



BRIDGESTONE TURANZA EL42 109 8% 0 1 8% 9 7% 1,0 59% 87% 0,60924063 60% X


P235/50R18 BW V BRIDGESTONE TURANZA EL42 #E445 123 5% 0 1 8% 7 7% 1,6 45% 101% 0,46415437 46% X


P245/45R19 BW V BRIDGESTONE TURANZA EL42 #G447 137 1% 0 1 10% 9 6% 1,1 45% 85% 0,45843948 45%


205/55R16 BW H BRIDGESTONE TURANZA EL42 RFT #7334 94 1% 0 1 8% 8 2% 1,0 37% 101% 0,36211277 36% Y

225/45R17 BW H BRIDGESTONE TURANZA EL42 RFT #E446 119 2% 0 1 8% 9 3% 1,2 40% 85% 0,38266467 38% Y



BRIDGESTONE TURANZA ER30 86 6% 0 0 8% 9 1% 3,3 57% 100% 0,56939127 56%



225/50R16 BW W BRIDGESTONE TURANZA ER30 #7270 78 6% 0 0 8% 7 0% 4,9 59% 98% 0,60021896 60% X




255/55R18XL BW Y BRIDGESTONE TURANZA ER30 #7269 116 7% 0 0 8% 7 0% 5,0 40% 85% 0,40320361 40%


0,0

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ACME

Comp 1

Comp 2

Full Screen

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Key Tools Price evolutions Pricing & Value Waterfalls Price dispersion mapping Detailed variance analyses Time series Elasticities / Pricing dynamics

analyses

Reporting tools tools to help monitor, control & manage Pricing & support effective implementation of pricing policies

Tool 31: Flexible P&L Reporting (Illustrative)

Page 110

What it is: Regular reports ensuring

coherence with Finance & enabling insights on impact of pricing on overall financial performance

Ability to zoom or group flexibly by product / segment / regions

What it does: provide visibility accountability

for Pricing performance Provides early warning of

threats & improved visibility for opportunities

Corrective actions it may lead to: Better anticipation / faster reaction to changes. Identification of Price increase opportunities or imminent price threats Improved monitoring & control of performance

The stakes: Improved control & faster reaction

Month (All)Region Code (All)Market Name (All)Industry Name (All)Custo Rev Segment Name (All)Product Family Code (All)Product Grp Code (All)

2007 2008 2009 2010 % Gr (10/09)

Theoretical Revenues 1) 94 832 963 92 711 698 117 583 738 113 518 393 -3,5%Unexplained Discount -2 986 736 -2 790 767 -2 990 030 -2 789 994 -6,7%

Gross Sales 91 846 227 89 920 931 114 593 708 110 728 399 -3,4%

Total Discounts -13 692 016 -12 291 691 -17 870 605 -15 830 026 -11,4%Invoice Revenues 78 154 211 77 629 239 96 723 104 94 898 374 -1,9%

Total Rebates & freebees -10 396 467 -10 114 566 -13 041 436 -12 537 011 -3,9%Net Revenues 67 757 744 67 514 674 83 681 667 82 361 362 -1,6%

COGS -37 778 327 -38 043 193 -45 991 374 -45 737 252 -0,6%Total Client & Mktg costs -21 873 956 -22 296 836 -27 826 188 -28 026 613 0,7%Other Logistical CostsNet Margin -13 768 496 -15 122 192 -17 962 084 -19 429 116 8,2%Net Margin % -15% -17% -16% -18% 11,9%D&R as Pct of Theo Sales 29% 27% 29% 27% -4,8%

Pricing

Full ScreenNormal

Go to Financial

Go to Product

Go to Price

Go to SKU

Go to Product

Go to Customer

Tool 32: Pricing Traffic Lights (Illustrative)

Page 111

What it is: Systematic & regular review

of pricing performance at detailed with indicators / early warning system to identify opportunities & threats & know where management attention should focus.

What it does: Saves management times by

providing key synthetic info & warning systems

Corrective actions it may lead to: Better anticipation / faster reaction to opportunities & tgreats Management attention better focused on real issues Faster &eralier issue resolution

The stakes: Agility & competitive leadership



Discount Change

Share Growth



Value Positioning



Action Required

BRIDGESTONE 100 13% 0 1 8% 9 13% 1,5 60% 94% 0,6 60%





215/45R17 BW Z BRIDGESTONE TURANZA EL400-02 #E329 83 23% 0 0 8% 8 49% 1,3 37% 99% 0,4 38% X


BRIDGESTONE TURANZA EL42 98 41% 0 0 8% 7 31% 1,1 58% 99% 0,6 57%


P235/50R18 BW V BRIDGESTONE TURANZA EL42 #E445 125 58% 0 0 8% 7 18% 0,8 60% 84% 0,6 58% Y


P245/45R19 BW V BRIDGESTONE TURANZA EL42 #G447 127 32% 0 0 10% 7 14% 1,0 59% 85% 0,6 60% X






BRIDGESTONE TURANZA ER30 84 29% 0 0 8% 7 5% 0,5 59% 83% 0,6 58% Y







255/55R18XL BW Y BRIDGESTONE TURANZA ER30 #7269 120 18% 0 0 8% 8 23% 1,1 42% 99% 0,4 43% X


BRIDGESTONE TURANZA ER300 88 20% 0 0 8% 7 20% 0,9 39% 100% 0,4 40% X

235/55R17 BW W BRIDGESTONE TURANZA ER300 #F355 126 23% 0 0 8% 9 21% 1,0 58% 102% 0,6 59%


Pricing

Pricing Traffic Lights (Illustrative)

112



Discount Change

Share Growth



Value Positioning



Action Required

BRIDGESTONE 100 13% 0 1 8% 9 13% 1,5 60% 94% 0,6 60%





215/45R17 BW Z BRIDGESTONE TURANZA EL400-02 #E329 83 23% 0 0 8% 8 49% 1,3 37% 99% 0,4 38% X


BRIDGESTONE TURANZA EL42 98 41% 0 0 8% 7 31% 1,1 58% 99% 0,6 57%


P235/50R18 BW V BRIDGESTONE TURANZA EL42 #E445 125 58% 0 0 8% 7 18% 0,8 60% 84% 0,6 58% Y


P245/45R19 BW V BRIDGESTONE TURANZA EL42 #G447 127 32% 0 0 10% 7 14% 1,0 59% 85% 0,6 60% X













255/55R18XL BW Y BRIDGESTONE TURANZA ER30 #7269 120 18% 0 0 8% 8 23% 1,1 42% 99% 0,4 43% X


BRIDGESTONE TURANZA ER300 88 20% 0 0 8% 7 20% 0,9 39% 100% 0,4 40% X

235/55R17 BW W BRIDGESTONE TURANZA ER300 #F355 126 23% 0 0 8% 9 21% 1,0 58% 102% 0,6 59%


Pricing

Tool 33: Pricing Objectives vs Realized(Illustrative)

Page 113

What it is: Detailed monitoring & control

of performance vs objectives Earlier identification &

resolution of potential issues / slippages


anticipation of evolving performance & possible corrective actions required

Corrective actions it may lead to: Better anticipation / faster reaction to changes in performance Performance measurement & incentives management

The stakes: Key to achieving level 2 of performance More proactive management of performance

(All) Objective vs. Realized Top Invoice Sales Objectives Year (All)

Cust. Name Cust. Number Objective Realized1692 521650 0 1448641968 555379 0 1368221695 506527 0 1176991974 526000 0 1095701727 555376 0 980461946 521607 0 970071946 521607 0 970072076 553933 21000 1095931819 520119 0 857371995 500730 0 854961700 521606 0 831582007 523324 0 761901711 555377 0 707652160 506610 0 665311968 506711 0 657091968 506711 0 657091916 507987 0 629941700 520133 23000 831582009 525928 30000 880301830 521633 0 567271960 525894 0 545481670 521651 0 537911671 520134 0 532401726 523335 0 523662047 520136 0 51722

Year 2008Acct Mgr (All)Region (All)Segt (All)Size Seg (All)

-20 000

0

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40 000

60 000

80 000

100 000

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140 000

160 000

-20 000 0 20 000 40 000 60 000 80 000 100 000 120 000 140 000 160 000

Objective vs. Realized Performance Rebate by Customer

Realized (RUB)

Obje

ctive

s (R

UB)

Under Objective

Over Objective

Full ScreenNormal Pricing

Tool 34: Financial Performance reporting (Illustrative)

Page 114

Month (All)Region Code (All)Market Name (All)Industry Name (All)Custo Rev Segment Name (All)Product Family Code (All)Product Grp Code (All)Prod Rev Segment Name (All)

Column Labels 2009

Row Labels Product Family Name VolAvg Price 2008

Avg Price 2009 Rev 2009 Prod Hier Vol Gr Pr Gr

Apparent elast

Ac1 Access Control 15 852 34,15 34,31 542 959 Access Control 0% 0% 0,37Ac2 Access Control 15 563 59,34 59,18 945 212 Access Control 3% 0% 9,70Ac2 Supplies 10 66,24 SuppliesAc3 Access Control 15 425 83,30 82,10 1 253 386 Access Control -1% -1% -0,72Ac4 Access Control 7 005 91,72 92,00 578 539 Access Control -10% 0% 32,75Ac5 Access Control 1 518 13,17 13,14 15 395 Access Control -23% 0% -109,76Ac6 Access Control 1 430 15,78 15,75 23 648 Access Control 5% 0% 24,92Ac7 Access Control 1 337 18,37 18,42 23 146 Access Control -6% 0% 22,33Ac8 Access Control 1 371 21,00 20,96 32 079 Access Control 12% 0% 64,50Ac9 Access Control 1 573 23,68 23,65 34 561 Access Control -7% 0% -47,18Ba1 Barriers 144 443 3,60 3,68 517 506 Barriers -3% 2% 1,25Ba2 Barriers 145 489 6,05 6,12 879 665 Barriers -1% 1% 1,11Ba2 Security / Protection 171 7,16 Security / ProtectionBa3 Barriers 147 459 8,59 8,65 1 286 061 Barriers 1% 1% -1,28Ba4 Barriers 71 809 9,37 9,09 636 824 Barriers -2% -3% -0,80Ba5 Barriers 13 461 1,36 1,36 17 778 Barriers -3% 0% 19,89Ba6 Barriers 14 118 1,63 1,63 18 333 Barriers -21% 1% 38,38Ba7 Barriers 13 616 1,90 1,90 24 984 Barriers -4% 0% 24,57Ba8 Barriers 13 341 2,18 2,17 32 928 Barriers 14% 0% 35,46Ba9 Barriers 11 783 2,44 2,44 32 647 Barriers 14% 0% 57,90Co1 Consulting / Advice 564 4359,80 4282,87 2 428 385 Consulting / Advice 1% -2% 0,30Co2 Consulting / Advice 595 7624,84 7302,13 4 556 528 Consulting / Advice 5% -4% 1,15

Co3 Consulting / Advice 597 10555,82 10586,90 6 235 685 Consulting / Advice -1% 0% 4,55-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

-60% -40% -20% 0% 20% 40%

Price change (y) vs Volume Change (x) (2008-2009 - by Product )

Pricing



Go to Product Pivot






Go to Product Pivot






of financial performance & impact of price changes

Earlier identification & resolution of potential issues / slippages


anticipation of impact of policy changes & possible corrective actions required

Corrective actions it may lead to: Better monitoring / faster feedback to impact of new policies Improved planning & faster readjustments when required


Tool 35: Pricing Corridors Management (Illustrative)

Page 115

European Price Corridor Market AA (€/Litre)

Prod A

Prod BProd C

Prod DProd E

Prod F Prod GProd H

Prod I

Prod J

Prod A

Prod B Prod C

Prod DProd E

Prod F Prod G Prod H

Prod I

Prod J

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

0 2 4 6 8 10 12

Product Range

Sel

l-In

Pri

ce Haut corridor

Prix Mini Validés 2007

What it is: Implementation of maximum

price differences to ensure pricing coherence across neighboring countries of client segments

Prevention of parallel trade

What it does: provide visibility to relative

price levels to ensure coherence & avoid risk of disruption to distribution channels

Corrective actions it may lead to: Better coherence / fairness of pricingFacilitates channel management


Tool 36: Pricing Exceptions Management (Illustrative)

Page 116


of ‘pricing exceptions’ granted & of the fair process of exceptions management

Improves pricing fairness & coherence

Saves time in management of exceptions


accountability for exceptions é ensures that they are used effectively

Corrective actions it may lead to: Better / fairer / more effective management of prices & client conditions Performance measurement & incentives management


Revenue Management Tools

117

PriValEdge Revenue Management Process Map

Page 118

• Develop reservations scripts and protocols

• Plan long-term park/ hotel development

• Select key TO partners• Determine oversale cost

• Develop macro-economic forecasts of demand

• Define market positioning and overall pricing policy

• Create global advertising plan

• Analyse & define strategic market segments

• Define and analyse customer segments

• Track costs by segment

• Revise reservation agent scripts and up-sell/cross-sell approaches

• Negotiate TO and other dedicated allocations

• Arrange for transport. capacity

• Revise and maintain forecasting models and parameters

• Develop initial time-series forecasts

• Create seasonal pricing calendars by country

• Define price tiers• Determine segment

“strategic values”

• Negotiate group and convention sales

• Monitor TO realization• Determine individual

availabilities

• Project impact of promotions

• Track booking/cancellation curves

• Adjust forecasts

• Establish targeted promotional pricing programs

• Sell/Up-sell/Cross-sell• Monitor conversion rate

• Determine individual availabilities

• Proactively manage overbooking

• Walk-in response

• Revise reservation agent scripts




Strategic Tactical Operational Real-time

MarketSegmentation

DemandForecasting

OfferManagement

Capacity / Availability

Management

Booking Mmgmt

PriValEdge Revenue Management Tools & DSS

• Develop reservations scripts and protocols

• Plan long-term park/ hotel development

• Select key TO partners• Determine oversale cost

• Develop macro-economic forecasts of demand

• Define market positioning and overall pricing policy

• Create global advertising plan

• Analyze & define strategic market segments

• Track costs by segment

• Revise reservation agent scripts and up-sell/cross-sell approaches

• Negotiate TO and other dedicated allocations

• Arrange for transport. capacity

• Revise and maintain forecasting models and parameters

• Develop initial time-series forecasts

• Create seasonal pricing calendars by country

• Define price tiers• Determine segment

“strategic values”

• Negotiate group and convention sales

• Monitor TO realization• Determine individual

availabilities

• Project impact of promotions



• Establish targeted promotional pricing programs


• Determine individual availabilities

• Proactively manage overbooking

• Walk-in response

• Revise reservation agent scripts




Strategic Value AuditTool

Up-sell /Cross-sell

Scripting Tools

TO Allocation

Tool

Price Elasticity Model

Group/Conv.Acceptance

Tool

Forecasting System

AvailabilityOptimizer

Strategic Tactical Operational Real-time

MarketSegmentation

DemandForecasting

OfferManagement

CapacityManagement

Booking Mngmt

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