Family Dollar Shopper Strategy

1. Family Dollar Shopper Strategy Beth Egan Shopper Marketing Director, CCNA Marketing – HQ Department Info.shoppermarketing@coca-cola.com

2. Content & Connection Planning: Family Dollar Example

3. We Follow 4 Critical Steps To Create An Effective Shopper Strategy Identify WHOthe shopper is Understand WHATis important to the shopper Determine HOWthe brand best fits with the shopper needs Plan WHEREto engage shoppers along their path to purchase

4. Step 1: Identify WHOThe Shopper Is Begin with the brands consumer core targetand understand her feelingsand attitudes Identify the target consumption occasion Determine who most often purchases the brand for the occasion Identify the store and mission where the purchase occurs

6. The Family Dollar Shopper Has Been Affected By Negative Macro Forces Falling Income + High Inflation + High Unemployment = Feeble Consumer Confidence • The median household income in the U.S. has fallen for the last three years; due to stagnating income and food price inflation • Median income was 7% less in 2010 compared with 2000, while the cost of living continued to increase. • Disposable personal income stagnated between 2009 and 2010, stemming from declining median household incomes. Consumer Confidence Conference Board Overall Index

7. But Make No Mistake: She’s Strong, Resilient And Resourceful And Always Finds A Way, Through Thick & Thin Demographics: Psychographics: • Shops at FDOabout twice a month, spending shy of $15 per trip • Accounts for roughly 70% of total FDO revenue • 85% female • 7 out of 10 report HH income of $40K a year or less; more than halfreceive government benefits outside of SS • 8 out of 10 are above 45 years of age • Median = 56 years of age • She wants the best for her family and likes to spend time at home with them • She feels a bit let down (by society, by government) but in no way hopeless. Her support network is very important to her – friends, family, community • As a caregiver, she wants to be able to create special moments at home – even if only once in a while • 31% of shoppers agree they have spent more on entertainment, year over year. Over 30% on watching movies together. • This shift to investing into the home shows a new archetype – the cocooner • Notable for being focused on bringing the family together for entertainment, family projects and being involved with non-household family members

8. She’s Also Proud Of Being A Smart Shopper… “Consumers are proud of the deals they get and often tell friends and family about them. Whereas buying items at a discount once had implications that a lack of disposable income (i.e., a lack of success) stood in the way of paying full price, in a post-recession era, not only is bargain shopping no longer something to hide—it’s something to brag about.” – Fiona O’Donnell, Senior Lifestyles & Leisure Analyst

9. …Because SMART Shopping Helps Her Create Moments That Matter At Home Cocooners are in no way hopeless in their situation. They are proud of what they have achieved, especially within the Hispanic shopper segment. They are confident, relaxed and in control in the shopping environment. They are Super Moms. They treat trips to store as a challenge to get the best deals, the best price and the brand names their family will love Happiness is not found in dollars & cents – it’s found in connecting with others Budget shopping is SMART SHOPPING AND IT HELPS CREATE THE MOMENTS THAT MATTER

10. We Want To Help Her Create Special Moments At Home For Her Family Consumer Target Consumption Occasion Leisure At Home (Outside of Family Meals) Multicultural Families on Low Income Who Most often Purchases? Store & mission where purchase occurs Super Mom = Heavy FDO Shopper

11. Step 2: Understand WHATIs Important To To The Shopper Understand how they feelduring the shopping mission Identify what’s important to them as shoppers how that translates to purchase decisions Learn how Family Dollar performs against most important purchase drivers Identify Strengths & Barriers

12. Overall, The Heavy Shopper Expresses Positive Feelings About Family Dollar… • Heavy Shoppers have a very positive outlook on their experiences at FDO. Describing the experience as ‘nice’ and saying they ‘love the experience’ due to “quality products at a cheaper price” • There seems to be a relationship between fun and low prices. Heavy Shoppers value ‘deals’ and ‘feeling smart’ along side ‘ good offers’ which all add to the experience. Q7: Please explain briefly how you feel about shopping at Family Dollar. How is the experience of shopping at Family Dollar for you? Please be as specific as possible.

13. …And Feels In Control, Confident, Relaxed/Calm and Trusting When Shopping At FDO Feelings when Shopping at Family Dollar Q9: Please rate the way you feel when shopping at FAMILY DOLLAR for your household (for example, for snacks, beverages, household cleaners, paper products, etc.) using the table below – TOP BOX SHOWN

14. The Heavy FDO Shopper Wants To Shop A Store That Consistently Carries The High-Quality Sodas And Snacks She Wants At A Low Price In A Safe Shopping Environment Top 5 CSDs and Snacks Purchase Drivers – Heavy FDO Shoppers Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN

15. The Heavy FDO Shopper Recognizes FDO As A Conveniently Located Store That Offers Low Prices and Great Sales In A Family Friendly, Easy To Shop Environment Top 5 Family Dollar Performance Attributes – Heavy FDO Shoppers Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

16. We Compared Purchase Driver Importance And FDO Performance To Identify Strengths, Barriers & Gaps… Introducing The Driver Importance & Performance Matrix Driver Importance & Performance Matrix EVALUATE Not important today, but FDO performs well. Discuss if these can be turned into comparative advantage or need to be ignored STRENGTH These attributes should be part of our value proposition High FORGET Do not communicate or invest money to develop BARRIERS & GAPS We ought to overcome performance gaps to drive purchase FDO Performance Low Low Driver Importance High Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

17. …And Thus Learned About Things We Can Leverage And Things We Have To Address FDO Heavy Shopper - Driver Importance & Performance Matrix – CSDs & Snacks Conveniently Located EDLP Good Sales Family Friendly Easy to Get In/Out Convenient Hours Friendly/Comf. Atmosphere Good variety Easy/Quick Checkout Clean Shopping Area Product Sizes Safe shopping environment Org./Easy Shop FDO Performance Familiar Layout Consistently has products on shelf Brand Names Private Label Helpful Employees Accepts Manuf. Coupons Quality Products Fun to shop Good to grab quick meal/bev. Clean Restrooms Good loyalty program Driver Importance Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

18. …And Thus Learned About Things We Can Leverage And Things We Have To Address (Contd.) FDO Heavy Shopper - Driver Importance & Performance Matrix – CSDs & Snacks EVALUATE Family Friendly Friendly/Comfortable Atmosphere STRENGTH EDLP Conveniently Located Good Sales Easy to Get In/Out Convenient Hours Easy/Quick Checkout High Private Label* Brand Names* Accepts Manuf . Coupons* Familiar Layouts* Helpful Employees* Safe Shopping Environment* Clean Shopping Area* Good Variety* Offer Sizes I Buy* Organized/Easy to Shop* Consistently has the Products I Want on the Shelf*` FDO Performance FORGET Good Loyalty Program Clean Restrooms Good to Grab a Quick Meal/Beverage Fun to Shop BARRIERS & GAPS Quality Products Low High Driver Importance Low *Borderline drivers could be placed in both quadrants Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

19. …And Thus Learned About Things We Can Leverage And Things We Have To Address (Contd.) • LeverageFDO strengths, specifically low prices/sales & convenience(location, shop, hours) • Evaluate family/family friendly as differentiating factor • Addressthe perceptionof not carrying quality products as #1 barrier • Reassureshoppers they will findthe quality sodas and snacks they want in a clean, organized and safe shopping environment Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

20. Step 3: Determine HOWThe Brands Best Fit With Their Shopper Needs Understand the core positioning and brand attributes of each partner brand Develop the sweet spot that aligns the occasion and shopper needs with all relevant brand attributes

21. Two Brands, One Occasion, One Shopper

22. Our Shopper • FDO Shopper • She wants to savor little moments with her family • She is constrained by budget

23. The Occasion: Leisure At Home Snack Time • Is about bringing the family together • Creating a break from the daily routine • Leisure At Home Snack Time

24. Family Dollar • Family Dollar helps you say “yes” • Provide the optionsthe family wants, at Family Dollar Low Prices

25. Coca-Cola • Coca-Cola enhances moments of Happiness • Builds trust through established high quality reputation

26. Two Brands, One Occasion, One Shopper = ONE Core Creative Idea Helping Her Say Yes To More Moments of Happiness

27. Step 4: Plan WHEREto engage Shoppers along their path to purchase Identify the most influential media nodes for the core shopper Determine which media nodes will be activated along the path to purchase Based on the shopper profile, determine what is the optimal messaging by media node

28. We Sought To Understand How Different Media Nodes Affect The Purchase Decision Of Core FDO Shoppers Top Media Nodes – Incidence & Influence – Core FDO Shoppers Incidence Influence Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy) at [Family Dollar/Elsewhere], did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products at [Family Dollar/Elsewhere]? TOP BOX – VERY INFLUENTIAL

29. After Analyzing Incidence And Influence We Categorized Media Nodes Into BucketsMUST And RAMP UP Will Be Critical To Our Shared Media Connections Plan Incidence And Influence Matrix RAMP UP These media nodes are not used very frequently, but when they are, they’re very influential MUST These media nodes are used frequently and have high impact in the purchase decision High AVOID These media nodes are not as relevant as others SCALE DOWN These media nodes are consumed frequently, but do not affect purchase decisions as much Influence Low Low Incidence High Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy), did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products? TOP BOX – VERY INFLUENTIAL

30. The Shared Media Connections Plan Will Integrate MUST And RAMP UP Media Nodes Incidence And Influence Matrix – Core FDO Shoppers RAMP UP MUST Twitter Coupon - Mfr Ad - Radio Family Member Text – Friend/Family Email - Store Coupon – Receipt Circular - Mail Circular - Newspaper Ad – Bus Stop FDO website FDO Facebook Coupon - Site Sign - Shelf Friend Influence FDO Employee Email - Mfr Online Forum Circular - Store Billboard Text - Store Ad – Online Ad – Newspaper/Mag Sign – Store Entrance Ad – TV Sign – Store Window Sign – End of Aisle Incidence Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy), did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products? TOP BOX – VERY INFLUENTIAL

31. The Shared Media Connections Plan Will Integrate MUST And RAMP UP Media Nodes (Contd.) Incidence And Influence Matrix – Core FDO Shoppers RAMP UP Twitter Ad – Radio, Bus Stop Text – Friend & Family Email – Store FDO Facebook Coupon Site MUST Family Members & Friends Circular – Mail & Newspaper Coupon – Manufacturer’s and Receipt Sign – Shelf FDO Website High Influence AVOID Text from Store Ad – Billboard, Other Online Online Forum Email – Manufacturer FDO Employee SCALE DOWN Sign: Store Entrance, Window, End of Aisle Circular – Store Ad – Newspaper/Mag, TV Low Low Incidence High Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy), did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products? TOP BOX – VERY INFLUENTIAL

32. While Messaging For MUST Media Nodes Should Be Centered Around Value And Deals… Emotional Benefits Functional Benefits Product Attributes Perfect Occasion Value/Low Price Specific Deal General Deal Family & Friends ✓✓ ✓ Circular – Mail & Newspaper ✓✓ ✓ Manufacturer’s Coupon ✓✓ ✓ Coupon - Receipt ✓✓ ✓ Sign - Shelf ✓✓ ✓ FDO Website ✓✓ ✓ ✓✓ = Primary Message ✓ = Alternative Message Q17: You indicated that INSERT ANSWER FROM 16 was important to you. The content of the message was about: (please check all that apply)

33. …RAMP UP Media Nodes Will Accommodate A Full Range Of Message Types… Emotional Benefits Functional Benefits Product Attributes Perfect Occasion Value/Low Price Specific Deal General Deal Twitter ✓ ✓✓ Ad - Radio ✓✓ ✓✓ ✓✓ ✓ ✓ Ad – Bus Stop ✓ ✓ ✓✓ Text – Friends & Family ✓ ✓✓ ✓✓ Email - Store ✓ ✓✓ FDO Facebook ✓ ✓✓ Coupon Site ✓ ✓ ✓✓ ✓ ✓✓ = Primary Message ✓ = Alternative Message Q17: You indicated that INSERT ANSWER FROM 16 was important to you. The content of the message was about: (please check all that apply)

34. The Task: Develop An Integrated Shared Media Connections Plan ILLUSTRATIVE Pre-Shop Shop Post-Shop Search Select/Deselect Buy Shopper is looking for best value for money. Clear price communication is key Store location is the key driver when choosing where to shop Shopper Insight Shoppers preferred store is influenced by peers choice Shopper is thinking about items they might have missed Shopper focused on core categories Establish FD as a snack destination as evidenced by shoppers’ choice Communication Objective Reinforce affordability of bundled offer Increase awareness of Family Dollar ubiquity Drive impulse through solutions Last reminder to buy Key Message “Complete Perfect Snack” “Hungry & Thirsty? Grab-n-Go” “We are NEAR YOU” “We snack @ FD” “Best Value” Connection OOH Radio Store Window Secondary Display Shelf Rail T-Dangler Checkout lane Cooler Facebook, Twitter Connection Source: from Family Dollar, from Coca-Cola, Developed Jointly

35. Shared Media Connections Plan Preliminary Media Nodes Along The Path To Purchase Pre-Shop Shop Post-Shop ✓ ✓ Family & Friends ✓ ✓ Twitter Traditional ✓ ✓ Circular – Mail & Newspaper ✓ Ad - Radio ✓ Ad – Bus Stop ✓ ✓ Text – Friends & Family Digital Activated as WOM ✓ Sign – Shelf = Destination Rack ✓ Email - Store ✓ ✓ FDO Website ✓ ✓ ✓ ✓ FDO Facebook Store Entrance Checkout

36. THANK YOU For additional information please visit the Shopper/Customer Marketing Community at www.KOSCMarketing.com