5889-Rombouts Tesco Presentation-V4

2017 Tesco

Range Review

Single Origins Exceptional
Coffees
Slow Roasted

120 Year
Heritage

Direct Trade



Index Page 4
Page 4
Tesco & Rombouts Page 5
Supplier Performance Page 11
Roast & Ground Coffee Category Page 15
Single Serve Coffee Category Page 18
Rombouts National Support Plan Page 20
Tesco Promotional Planner
Commercials

Roasted with Love Since 1896

www.rombouts.co.uk 3

Tesco & Rombouts

Founded in Belgium in 1896, we are a family owned & run coffee roaster. We
source, roast & have supplied great coffee to UK coffee lovers for over 50 years!

2017 Objectives
• G row the Roast & Ground category : We believe that our opportunity

is worth around £1.7m
• Develop the Single Serve Segment : There is a potential for 16% growth

Supplier Performance : Observation:
• All KPIs are up
52 wks to Tesco wk 36
year on year
4
• Like for Like sales
are growing

• Rombouts is a
reliable supplier

• Tesco and Rombouts
have been trading for
over 20 years

Roast and ground category

Roasted with Love Since 1896 5

www.rombouts.co.uk

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28-Feb-162v8s-F.ePb-r1e6 vvsio. PuresviYouesaYrear

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Tesco Ground Coffee Category

28-Feb-16 vs. Previous Year

TOTAL MARKET | Total Tesco | GROUND COFFEE | 52 w/e | Previous Year

TOTAL MARKET | Total Tesco | GROUND COFFEE | 52 w/e | Previous Year TOTAL MARKET | TOTAL MARKE

Observations:
• The Average price in the market has declined although Tesco have managed to increase it by 1.4%
• Tesco attracted less new customers than the rest of the market
Why did Tesco attract less customers?

6

» H ow We See The Category

Actual | TOTAL MARKET | Spend (£000) Actual | TOTAL MARKET | Spend (£000)
52 w/e | 28-Feb-16 12 w/e | 28-Feb-16

+16.3%

Actual | Total Tesco | Spend (£000) Actual | Total Tesco | Spend (£000)
52 w/e | 28-Feb-16 12 w/e | 28-Feb-16

-11%

Costa Observations:
Percol • T he category is flat, but there are some movement between
Rombouts
Taylors the segments
Lavazza
Douwe Egbert • While Standard and Espresso segments are attracting less
Lyons customers, the single origin has been driving the category
Illy
Starbucks • T esco have not maximised sales of origin coffees
Plantation Wharf
Private Label The Tesco single origin segment hasn’t followed the market, why?

7

» Identification Of An Opportunity :

SingIdleeOnritgiifnicSaetgimonentof an opportunity :

Origin Segment

TOTAL MARKET | TOTAL GROUND COFFEE| Origin | 52 w/e | Previous Year

TOTAL MARKET | TOTAL GROUND COFFEE| Origin | 52 w/e | Previous Year TOTAL MARKET | TOTAL G

of an opportunity : Single

nt TOTAL MARKET | TOTAL GROUND COFFEE| Origin | 12 w/e | Previous Year

w/e | Previous Year TOTAL MARKET | TOTAL GROUND COFFEE| Origin | 12 w/e | Previous Year

8

Tesco Is Not Profiting From The
Growth, Why?

• T he Single Origin segment across the current market accounts for 26% of the category
• However in Tesco this segment has only 16% of the facings
Furthermore
• Tesco own label Single Origin coffees account for 12% of these facings
• The Branded Single origins are currently under-represented (4% in visited Superstores)

Can a new range of Single Origin Branded Coffee grow the category?

Driving The Opportunity

What if the Single Origin segment gets its fair-share within Tesco?
Turnover = Frequency x Price per Unit x Qty x Penetration x Household
Currently : £8.1m = 3.4 x £2.73 x 1.3 x 2.60% x 26m
Potential : £9.8m = 3.4 x £2.95 x 1.3 x 2.98% x 26m

Opportunity worth £1.7m

This will be achieved through increased penetration and a premiumization
of the segment.

9

» O ur Recommendation:

Rombouts Coffee Origin Range

Singles Origin coffees with specific tastes and great stories from Asia, Americas & Africa
Direct Trade, Fairtrade & Organic Certified
Suitable for Cafetiere and filter
RRP : £3.99

» Customer Rational

• M ore people are looking for specific tastes and origins. Perfect for customers interested in
where their coffee is sourced from

• Direct trade coffees, Organic and Fairtrade Certified
• Suitable for cafetière and filter
• Premium and exclusive origins with competitive RRP

10

single serve coffee category

Roasted with Love Since 1896 11

www.rombouts.co.uk

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28-Feb-16 vs. Previous Year

T2O8T-FAebL-1M6 vAs.RPKreEviTous| YTeoatr al Market | One Cup Filter | 52 w/e | Previous Year

TOTAL MARKET | Total Market | One Cup Filter | 52 w/e | Previous Year TOTAL MARKET | TO

ingle Serve segment

Previous Year •  The category has lately attracted new buyers
TOTTAOLTAMLAMRAKREKT•E |TT|OTTTOhATeLALMdMeAARcRKlKiEnETeT|| oOOfnneethCCeuuppaFFivltieeltrer|ar12g| 1we2/epw| r/Piecree|vioPiusrsedvYieroaiuvr sinYgeatrhe segment d

tracted new buyers
e price Oisbsderrvivatiniognst:he segment down

• R ecently the category has been attracting new buyers + 6.4% last 12 weeks
• The decline of the average price has driven the segment down and needs to be addressed

10

» Tesco Single Serve Segment

Tesco Single Serve Segment

TOTAL MARKET | Total Tesco | One Cup Filter | 52 w/e | Previous Year

TOTAL MARKET | Total Tesco | One Cup Filter | 52 w/e | Previous Year TOTAL MARKET | Total

Serve SegmentContains som•e  lowTseamspcleosiziesdaatattracting new buyers to the segment
TOTTAOLTAMLAMRAKREKT••E  T| T| oHTTothotaaelwl TTeepessvuccoeroc|r,Oh| OntahenseCeeuCdpfuerFepicltqeFrreuil|tae1e2snrewc| /1yeo2|fiswPthr/iemeCevoino|ptaauinPrssvorsYeoevmerveaiainlroowsgguizseaesmdapYtlpeaeraicr e is limiting the g
evious Year

yers to thObesesrevagtmionesn: t
s improvi•nTgesco is attracting new buyers to the segment
the aver•aTghee ppurriccheasiesfrleimqueitnincygistihmeprgovriongwth

• H owever, the decrease of the average price is limiting the growth

How can we grow the segment further?

11

Driving The Opportunity

Turnover = Frequency x Price per Unit x Qty x Penetration x Household
Currently : £2.4m = 4.5 x £2.24 x 1.39 x 0.65% x 26m
Potential growth : £2.8m = 4.64 x £2.36 x 1.43 x 0.69% x 26m

Potential growth +16% / £400k

• Penetration +5 %: Media Campaign + NPD + Sampling
• Purchase Frequency +3%: “One Cup to Go campaign”: 8000 Re-usable Take-Away cup
• Sales Activation +3%: On-pack gratuity ( 3 months activity)
• Average Price +5 %: Improve balance OL/ Branded + Premiumization + Less price cut
• Basket size +2.5%: Multi-buys promotions – Less Price cut

» How Can We Improve The Customer Offer?

1. Develop the finer food shoppers offer

• Single Origin OCF
• Rejuvenate customer base

2. Improved balance - Branded & O/L.

• Optimise store distribution
• Optimise merchandising

3. “Tesco Original” to be converted into

“Tesco Italian”
• Strong anchor for Italian coffees
• Less duplication with “Rombouts Original”

12

How Can We Grow The Segment?

Why is average price falling?
• Price Cut promotion
• The proportion of OL and coffee bags have increased
Observations:
• Tesco OCF over-represented (80% facing / 70% market share )
• While Branded are under-represented (20% of the facing / 30% market share)
Furthermore
• Tesco OCF have a store listing 2.5 times bigger than Branded

Can we improve the balance between Branded & Own Label to grow
the average price ?

Tesco Extra Osterley Nov 2016

13

» Our Recommendation

++

RRP £2.69 RRP £2.69 RRP £2.69 RRP £2.99

Classic Blends plus Origin Coffees which are Organic & Fair Trade.

» Customer Rational

• O ne Cup Filters are an easy and convenient way to brew coffee
• One Cup Filters provide a good option to trade-up from instant

and premium instant coffee

• More people are looking for specific tastes and origins.
• Premium and exclusive origins with competitive RRP

14

Rombouts national
support plan

Roasted with Love Since 1896 15

www.rombouts.co.uk

» 2017 “One Cup To Go” National Media Campaign

Objectives –
• Develop the “On the Go” Consumption
• Increase sales during activity
• Increase the purchase Frequency post activity

Mechanic –
• B uy 4 One Cup Filters

= Free Take Away Cup

On-pack gratuity In-store Support
Free Take Away Cups Shelf Talkers

PR Campaign Promotion
B2C & B2B Buy 2 for £4

On-Line
Campaign
FB + Ad-words + Ads

16

» 2017 Discover Rombouts Sampling Campaign

One Cup Filters classic blend
Sampling of 50k targeted consumers within predetermined regions to develop better
brand and product awareness. Intention to grow sales in Express & Metro stores.
Single Origins
We would commit to do various in-store samplings to support new listings

» Rombouts “Out & About” Campaign

On Pack promotion to support One Cup Filters and promote their use while “Out & About”;
Camping, on picnics & in the office.
Tie up with national outdoor retailer for prizes and discounts.
Rombouts sponsorship of 2017 Picnic Concerts, including wet and dry sampling to 45k+
target consumers. National advertising & PR campaign

17

Tesco Promo Planner

Description P16 P17 P1 P2 P3 P4 P5

Classic Multibuy Multibuy Multibuy
Blend Any 2 for Any 2 for Any 2 for
One Cup
Filters £4.00 £5.00 £5.00
RRP £2.70

Single Multibuy Multibuy Multibuy
Origin Any 2 for Any 2 for Any 2 for
One Cup
Filters £4.00 £5.00 £5.00
RRP £3.00
Price Cut
Classic Price Cut Linksave Price Cut Save £0.50 Linksave
Blends Tin Save £1.00 filter coffee Save £1.00 filter coffee
Price Cut
ground + papers Save £0.50 + papers
coffee = 50p OFF = 50p OFF
RRP £3.50
Linksave
Single Price Cut Linksave Price Cut filter coffee
Origin Save £1.00 filter coffee Save £1.00
Ground + papers
Coffee + papers = 50p OFF
RRP £4.00 = 50p OFF

Premium Price Cut Linksave Price Cut Price Cut Linksave
Tins Save £1.00 filter coffee Save £1.00 Save £0.50 filter coffee

RRP £4.50 + papers + papers
= 50p OFF = 50p OFF

Filter Papers Linksave Linksave
RRP £1.20 filter coffee filter coffee
+ papers = + papers =

50p OFF 50p OFF

In-Store Shelf Shelf
Support Barkers Barkers

Rombouts Rombouts “One Cup to Go” Campaign + PR Campaign Offices
Media Sampling
Activity

Increase Penetration

18

P6 P7 P8 P9 P10 P11 P12 P13 P14 P15

Linksave Multibuy Multibuy Multibuy
Rombouts Any 2 for Any 2 for Any 2 for
coffee +
Monin Syrup £5.00 £5.00 £5.00
= 50p OFF

Linksave Multibuy Multibuy Multibuy
filter coffee Any 2 for Any 2 for Any 2 for

+ papers £5.00 £5.00 £5.00
= 50p OFF

Linksave Multibuy Multibuy Multibuy
Rombouts Buy Any 2 Buy Any 2 Buy Any 2
coffee +
Monin Syrup for £5 for £5 for £5
= 50p OFF

Linksave Multibuy Multibuy Multibuy
filter coffee Buy Any 2 Buy Any 2 Buy Any 2

+ papers for £5 for £5 for £5
= 50p OFF

Linksave
Rombouts
coffee +
Monin Syrup
= 50p OFF

Shelf Encourage stock-up 19
Barkers
Basket Increase basket size

Commercials Weight

Description 10 FT
10 FT
Original One Cup Filters 10 FT
Italian One Cup Filters 10 FT
Colombian One Cup Filters 10 FT
Decaf One Cup Filters 10 FT
Ethiopia Sidamo One Cup Filters 10 FT
Cuba One Cup Filters 227 g
Laos One Cup Filters 227 g
Ethiopia Sidamo ground coffee 227 g

Cuba ground coffee 227 g
Laos ground coffee
227 g
Italian Style ground coffee Tin
250 g
Cachet d’Or ground coffee Tin
250 g
Supremo d’Arabica ground coffee Tin
40FT
Crystal d’Arome ground coffee Tin
40FT
Coffee Filter Papers N4

Coffee Filter Papers N2

20

SRP Size Cost RRP Margin

4 £6.19 £2.70 43%
4 £6.19 £2.70 43%
4 £6.19 £2.70 43%
4 £6.19 £2.70 43%
4 £6.97 £3.00 42%
4 £6.97 £3.00 42%
4 £6.97 £3.00 42%
6 £13.40 £4.00 44%
6 £12.84 £4.00 47%
6 £13.92 £4.00 42%

6 £11.82 £3.50 44%

6 £12.00 £3.50 43%

12 £29.52 £4.50 45%

12 £31.35 £4.50 42%

10 £3.60 £1.20 70%

10 £3.40 £1.20 72%

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Rombouts Coffee GB Ltd. Manhattan House, 140 High Street, Crowthorne, RG45 7AY
T. 0845 604 0188 | F. 0845 604 0189

[email protected] | www.rombouts.co.uk