Zero Movers in REXMarch 2012

Key Messages

Distribution is a critical building block in the 2012 Food plan

Achieving the goal of increasing distribution an average of 2 items per store in Food will contribute to a growth of $23M in factory sales in 2012

Driving distribution supports Hershey’s increased media spend and delivers both brand and category growth

Zero movers in REX is a new capability that allows our retail team to target and correct authorized, store specific, distribution voids on a cycle basis

Programs + Execution = Results!

Achieve ConversionAchieve Conversion

Sweat the Execution

Deliver Today. 2012 Sales Imperatives

2012 FOOD GOAL Grow Share and Deliver Profitable Sales of $1.73 Billion, or +3.4%.

IIDrive InnovationDrive Innovation

Deliver Net New DistributionDeliver Net New Distribution

Achieve Gold Standard Prescriptive Sell

Own Entry Anchor Display; Announce the Season

Create Seasonal Solution Center Displays

Leverage seasonal usage occasions

Win SeasonsWin Seasons

Execute Holistic IC Promoted Pricing Strategy

Secure everyday, permanent UScan placement

Increase Display on key Packs via TSI Tool

Optimize Everyday Price through Multiples

Increase Confection Relevance and Space

Achieve Category Captainship at Top 8 Customers

FE, In-Aisle, Seasons

Deliver Customer Distribution Targets; Total +2

Be First; Be Best

75% ACV in 8 Weeks; 80% in 12 weeks

In-Store, On-Display, In-Ad

Develop Continuity Support into Year 2

Distribution is a critical building block in the 2012 Food plan

GrossSales$M

1,675

33

53

24

23 7

(29)

(35)(19)

2012Plan

2011(Restated)

Advert

isin

g

Inn

ovatio

n

Seaso

ns

Dis

trib

utio

n

Pro

mo/M

erc

h

Can

nib

aliza

tio

n

Leaky

Buck

et

Pri

ce/C

onv

1,733

+3.4%

Source: Nielsen FDMxC 52wk Ending 1/28/2012 vs YrAgo

CMG Dollar Sales % Chg

FDMxC: 52wk Ending 1/28/2012

HERSHEY’S media investment drives brand & category growth

Cate

gory

Hers

hey’s

11.2%

2.0%7.0%8.0%10.4%

Hershey

Category

7.3%

4.4%

Hershey $ % ChangeFDMxC 52wk Ending 1/28/2012

2006

100

2007

106

2008

158

2009

253

2010

345

2011

371

2012

451

Hershey’s US Working Media Index

Driving distribution supports the increased media spend on core brands in 2012

+21% vs 2011

Zero Movers in REX: What is it?

Capability that allows retail team to drive distribution and thus drive sales and share at store level

Process identifies authorized items, for each store, that have had no movement through register in last 4 weeks then loads those items into REX

– Store level zero movers

Data comes directly from Nielsen for each individual store

– REX will be updated the Sunday prior to each new cycle with new data for each store

RSRs will utilize REX to close distribution voids that appear for each store

– All items loaded into this capability are AUTHORIZED for every store within that customer

Nielsen and REX will validate distribution monthly and a comprehensive roll-up report will be available to retail leaders

Zero Movers in REX Test: Retail Call to Action

Beginning Monday, March 26th, retail teams will check distribution in various Food store calls by referencing the Zero Movers items once per cycle (see slide 10)

Action codes listed in REX will report findings

– OOS: item is tagged but not in store

– Authorized Not Tagged: Item is authorized but not currently cut into store plan-o-gram

– Not Authorized*: Item is not available in store plan-o-gram due to set size or no authorization code available on CAL

• *Note: All items appearing within Zero Movers ARE authorized

If item is already in distribution; Check the “Dist” flag next to Action Code

The following action codes are for WalMart stores Only:

– Inv Found-Stocked; Oh Matches Telxon; PI Found-Adj Made; PI Found- No Adj Made

Zero Movers in REX Tutorial

Store Cycle View Route List View Cycle Activities View

1. Select store from route list view 2. Start Call3. Go to Activities

4. Select Zero Movers from Activities view

1

3

4

Zero Movers in REX Tutorial

Action Codes:

2 OOS-Suggested Order

3 Authorized-Not Tagged

4 Not Authorized

Note: Every item included IS

authorized for each store

Zero Movers

5. Locate Zero Mover item(s)

If Zero Mover item is in distribution

6. Place check mark under Dist

5 6

If Zero Mover item is not in distribution

7. Enter appropriate Action Code from drop down menu

7

Food Customer Implementation Cycle Breakdown

*Giant Eagle began in Cycle 2

Cycle 4 Cycle 5 Cycle TBDFood Lion Ingles SafewayHannaford Tops SuperValu

Marsh Weis DemoulasWinn Dixie Dierbergs

Meijer GiantHy-Vee Stop & ShopBi-Lo

WegmansShoprite

Price ChopperRoundy'sSchnucksRaley's

Albs LLCStater BrosSaveMartBashas

Giant Eagle*

Action Steps

DSMs should cover the Zero Movers capability during March conference call

RSRs & RSMs must successfully synchronize REX Sunday night prior to each new cycle in order to download customer specific data

Utilize Zero Movers capability each cycle in various food customers (as referenced in slide 10) to ensure 100% distribution

Address and correct all Zero Movers for each store with your KDMs

– Order product

– Correct balance on hand

– Locate product in backroom

Communicate all feedback and successes of Zero Movers capability to Melinda Demos