INTER QEEICE COBBESPONDENCE PHILIP MQRRISUSA 120 PARK AVENUE, NEW YOAK, NY 10017 5592 DISTRIBUTION DATE: July 15, 1991 To: Iva.e+~ FROM: Marketing Inlormalion Analysis' Joseph Auremma SUBJECT: SMILYS YOLUME INCENTIE PBQGBAMEYALIATQK The following prellminary report utilizes PM's Rapid Fact database (0 analyze the volumershare May Smilty's Volume Ircentive Program . This program began on impact of tne iirsl Six weeks 0l Ihe Ist, executing thirteen week cycle of rolating Philip Morns Full Margin promoions wilh endcap, Margin volume gains achieved during the temporary display and teature advertisement Full promotion cycle can quality Smitty s for retailer incentive bonus, which increases with performance At Ihe accouni"s request, all promotions are executed from mid-week (Wednesday Ihrough Note: Tuesdayk. Since thc account s scanning data is only avaiiable for week-end periods (Monday through Sunday) , an individual promotion's firsUcumulalive response may be understated Therefore, while the overal program perormance can be measured cumulalively, the response of each Individual promotion will be evaluated basea on Ihe second week ol the execulion; SUMMABX Total Philip Moris Full Margin volume Increased +4.7% during the first six weeks the Smitty'$ Volume Incentive Program; lative to ihe pre-promotional Irend. This increase applied to the graduated payment schedule oifered to Smilty'$, would not qualify the account for an incentive bonus payment (A minimum of 10% is required for bonus payment} . sign licantly versus year-ago levels (-16% as Total Induslry volume , which was declining reported by InfoScan} prior t0 the stan of the Volume Incentive Program; increased 3% Both Full Margin and Prce Value contributing evenly dunng tne Iirst Six weeks 0l the program: to his volume increase Full Margin expcrienced +0.3% volume gain; ticd I0 Ihe increased PM Full Margin business Price Value volume increased +2.4%0, primarily due to Sub-Generic growth and higher coupon Cambridge (5$4.00). values 0n Doral (53.50) and The Marlboro Racing Sweepstakes/52.00 Price Reduction promotion was successiul in generaling incremental brand volume (+32.1%) and share (+7.7 Points) Marlboro cid not experience volumalshare pay-back in the two weeks following the brand" promotion despite the execution of the Merit "Travel Kit" promotion immediately iollowing the Marlboro event: Mariboro"5 response t0 Ihe Racing Sweepslakes/52.00 Price Reduciion promotion executed in Smitty'$ was similar t2 the brand's response t0 the same promolion in a Iest conducted In Schnucks supermarkels in St; Louis (volune +48.2* , Share: +6 points}. Mert's volume (+8.7%} and share (+0.4 points) increased above the brand': pre-program trends during execulion of Ihe Merit "Travel Kil" promolion, Ihe second promotion in the prcgram's For two weeks tollowing this promotion, Mert's volumelshare remained thirteen week cycle indicating that the brand did not experience pay-back during these above pre-program trends 1 weeks Importanlly, Mert experienced signilicantly higher promotional response aunng recent participation in Smitty"s "Shoppers Passport" Programn Irequent shopper program offering "mcmber" cuslomcrs scanned savings on sclectca products, occmbcr 1990, Mert experenced +16.196 volume or +0.7 share point increase with 52.00-olt caron promolion in laling February 1991, Merit experencing this program: volume gain of +62,5% transl inio +2,5 share points with simultaneous $0.50-off packiS2.00-oli carton promoiion:
INTER QEEICE COBBESPONDENCE 120 PARK AVENUE, NEW YOAK, NY 10017 5592 PHILIP MQRRISUSA DISTRIBUTION DATE: July 15, 1991 Iva.e+~ To: FROM: Marketing Inlormalion Analysis' Joseph Auremma SUBJECT: SMILYS YOLUME INCENTIE PBQGBAMEYALIATQK The following prellminary report utilizes PM's Rapid Fact database (0 analyze the volumershare impact of tne iirsl Six weeks 0l Ihe Smilty's Volume Ircentive Program . This program began on May Ist, executing thirteen week cycle of rolating Philip Morns Full Margin promoions wilh endcap, temporary display and teature advertisement Full Margin volume gains achieved during the promotion cycle can quality Smitty s for retailer incentive bonus, which increases with performance Note: At Ihe accouni"s request, all promotions are executed from mid-week (Wednesday Ihrough Tuesdayk. Since thc account s scanning data is only avaiiable for week-end periods (Monday through Sunday) , an individual promotion's firsUcumulalive response may be understated Therefore, while the overal program perormance can be measured cumulalively, the response of each Individual promotion will be evaluated basea on Ihe second week ol the execulion; SUMMABX Total Philip Moris Full Margin volume Increased +4.7% during the first six weeks the Smitty'$ Volume Incentive Program; lative to ihe pre-promotional Irend. This increase applied to the graduated payment schedule oifered to Smilty'$, would not qualify the account for an incentive bonus payment (A minimum of 10% is required for bonus payment} . Total Induslry volume , which was declining sign licantly versus year-ago levels (-16% as reported by InfoScan} prior t0 the stan of the Volume Incentive Program; increased 3% dunng tne Iirst Six weeks 0l the program: Both Full Margin and Prce Value contributing evenly to his volume increase Full Margin expcrienced +0.3% volume gain; ticd I0 Ihe increased PM Full Margin business Price Value volume increased +2.4%0, primarily due to Sub-Generic growth and higher coupon values 0n Doral (53.50) and Cambridge (5$4.00). The Marlboro Racing Sweepstakes/52.00 Price Reduction promotion was successiul in generaling incremental brand volume (+32.1%) and share (+7.7 Points) Marlboro cid not experience volumalshare pay-back in the two weeks following the brand" promotion despite the execution of the Merit "Travel Kit" promotion immediately iollowing the Marlboro event: Mariboro"5 response t0 Ihe Racing Sweepslakes/52.00 Price Reduciion promotion executed in Smitty'$ was similar t2 the brand's response t0 the same promolion in a Iest conducted In Schnucks supermarkels in St; Louis (volune +48.2* , Share: +6 points}. Mert's volume (+8.7%} and share (+0.4 points) increased above the brand': pre-program trends during execulion of Ihe Merit "Travel Kil" promolion, Ihe second promotion in the prcgram's thirteen week cycle For two weeks tollowing this promotion, Mert's volumelshare remained above pre-program trends indicating that the brand did not experience pay-back during these weeks Importanlly, Mert experienced signilicantly higher promotional response aunng recent participation in Smitty"s "Shoppers Passport" Programn Irequent shopper program offering 1 "mcmber" cuslomcrs scanned savings on sclectca products, occmbcr 1990, Mert experenced +16.196 volume or +0.7 share point increase with 52.00-olt caron promolion in this program: February 1991, Merit experencing volume gain of +62,5% transl laling inio +2,5 share points with simultaneous $0.50-off packiS2.00-oli carton promoiion: