RETAIL, REDEFINED NOVEMBER 2013

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 2 THE RECESSION WAS A WAKE-UP CALL 2009 Zzzz

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 3 THE CHALLENGE FOR GROWTH

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 4 CPG STILL SPUTTERING FOR GROWTH IN NORTH AMERICA United States Nielsen: MarketTrack - Total Tracked Sale 52 wks ending October 19, 2013 Canada Dollars Nielsen: ScanTrack - Total Tracked Sale 52 wks ending October 26, 2013 Units Dollars Units

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 5 Source: Nielsen MarketTrack, National All Channels – YTD 44 weeks to October 19, Total Tracked Sales excluding Fresh Random Weight Slow growth, driven only by inflation CPG GROWTH SLOWING OVER THE PAST 5 YEARS

Copyright ©2012 The Nielsen Company. Confidential and proprietary IS SHAPING UP TO BE A SLOW GROWTH YEAR Source: Nielsen MarketTrack, National All Channels – YTD 44 weeks to October 19, Total Tracked Sales excluding Fresh Random Weight Slow growth, driven only by inflation

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 7 NOT ALL REGIONS ARE CREATED EQUAL 52 week Regional CPG Performance Source: Nielsen MarketTrack, National All Channels – 52 weeks Ending October 19, Total Tracked Sales excluding Fresh Random Weight The Prairies lead regional growth – twice the National average

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 8 TRENDS IMPACTING GROWTH Economy still fragile Cautious Consumer Cyclical Changes Value Motivators Retail, Redefined Evolving Consumer Structural Changes

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 9 VALUE REMAINS A KEY DRIVER OF SALES $$$

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 10 SINCE BEFORE THE RECESSION, % OF RETAIL SALES SOLD WITH A PRICE CUT HAS INCREASE 10 POINTS % Dollars Sold on TPR Quarterly Periods Source: Nielsen MarketTrack, National GB+MM+DG - 12 week periods ending June 29,, 2013 An increase of $3.9 billion But total sales only increased $3.5 billion

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 11 IT’S IMPORTANT TO REALLY UNDERSTAND “INCREMENTAL” Past ParadigmPurchase Behaviors Store Switch Brand Switch Non – Promoted Volume Subsidized Volume Incremental Volume Non – Promoted Volume Subsidized Volume Time Switch Market Expansion Nielsen Innovation: Promotion Source of Volume

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 12 IT’S IMPORTANT TO REALLY UNDERSTAND “INCREMENTAL” Past ParadigmPurchase Behaviors Store Switch Brand Switch Non – Promoted Volume Subsidized Volume Incremental Volume Non – Promoted Volume Subsidized Volume Time Switch Market Expansion New Paradigm Nielsen Innovation: Promotion Source of Volume

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 13 WHILE PROMOTIONS ARE INCREASING RAPIDLY, THE BENEFITS ARE NOT WHAT THEY SEEM Manufacturer Benefit Retailer Benefit HIGHLOW HIGH PROMOTIONAL IMPACT FRAMEWORK Retailer Growth Subsidization Manufacturer Growth Mutual Growth 22% 42%22% 14% Source: Nielsen Promotional Source of Volume Models

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 14 ” “ OUR STRATEGY NEEDS TO CHANGE It’s not about how low can I go, but how low do I need to go in order to stay profitable and create win-win scenarios

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 15 TRADITIONAL RETAIL UNDER ATTACK

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 16 TRADITIONAL CPG ARE CHANNELS RELATIVELY FLAT Conv & Gas*+0% Grocery-1% Drug-1% Mass Merch-5% less Zellers +3% Source:Nielsen Homescan Channel Watch – Canada - 52 weeks to September 28, 2013 *Convenience Tract 52 weeks to August 24, 2012 * Excluding Cigarettes

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 17 ELECTRONIC, DEPARTMENT AND OFFICE SUPPLY STORES REPORT THE GREATEST LOSS Conv & Gas*+0% Grocery-1% Drug-1% Mass Merch-5% less Zellers +3% Electronic-12% Department -12% Office Supply-11% General Merch -4% Hardware/DIY -2% Source:Nielsen Homescan Channel Watch – Canada - 52 weeks to September 28, 2013 *Convenience Tract 52 weeks to August 24, 2012 * Excluding Cigarettes

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 18 E-COMMERCE, CROSS BORDER AND ETHNIC GROCERY LEADS RETAIL GROWTH IN CANADA Online +41% U.S. Stores+17% Ethnic Grocery+14% Pet Specialty +8% Warehouse +7% Health Food +7% Conv & Gas*+0% Grocery-1% Drug-1% Mass Merch-5% less Zellers +3% Electronic-12% Department -12% Office Supply-11% General Merch -4% Hardware/DIY -2% Source:Nielsen Homescan Channel Watch – Canada - 52 weeks to September 28, 2013 *Convenience Tract 52 weeks to August 24, 2012 * Excluding Cigarettes

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 19 ONLINE SHOPPING GAINING MOMENTUM Online Shopping +41% 1.5% share of Tracked Sales  0.3% share of food (+150%) 39% of households (+30%)  15% Buying Food (+106%) Spending $344 per year  $111 Food (+21%) $1.8 Billion Source: Nielsen Homescan, National Total Expenditures, 52 Weeks Ending September 29, 2013

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 20 FUTURE GROWTH WILL BE FUELED BY CONSUMER PREFERENCE FOR ONLINE SHOPPING Source: December 2012 Nielsen PanelViews Media Survey 30 % Of consumers prefer virtual store shopping over traditional retail shopping year olds 72%

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 21 US Online CPG Sales ($ Billions) % of CPG sales ONLINE IN THE U.S. FORECASTED TO BE 5% OF CPG SALES IN 2 YEARS – AMAZON LEADING CONVERSION 5% of CPG sales Conversion Rates By Retailer (Based on Site Visitation & Site Purchasing) Source: Nielsen NetView Panel Analysis, January 2013 Amazon converts ~50% of site visitors Brick & mortar ‘multichannel’ retailers convert 1 in 5

Copyright© 2013 The Nielsen Company. Confidential and proprietary. 22 ONLINE GROCERY SALES TO DOUBLE IN FIVE KEY EUROPEAN MARKETS BY 2016 Source: Reuters Britain, France, Germany, Switzerland and the Netherlands Joanne Denney-Finch, chief executive, IGD Reuters (Berlin), Oct. 23, 2013 Online retailing in food and consumer goods is growing at a phenomenal rate across Europe. Technology is empowering people, fundamentally changing the way they buy groceries

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 23 SOME E-ROAD BLOCKS FOR CONSUMERS do not believe assortment is greater online Source: Nielsen Homescan, Panel Views Survey U.S. Q feel the grocery store is more convenient feel online retailer sites are difficult to use agree prices are higher online do not trust products sold online 74% 56% 27% 25% 14%

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 24 DECREASING TRIPS BUT INCREASING TOUCH POINTS SHOP HERE

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 25 MORE LOYALTY CARDS, BUT FEWER TRIPS Source: Nielsen Panel Views 2013 Loyalty Card Study: Homescan Total Expenditures – 52 wks to September 19, % of Canadians 94%97%+ Avg. # of Cards Trips Per Year %

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 26 THE LOYAL, DISLOYAL SHOPPER Source: Nielsen Homescan: Top 10 Banners in Ontario - Avg $ Share of Requirements 52 weeks to Sept 19/13 Average Loyalty to Store 14% Need to understand what and where your shoppers are spending the other 86% The Opportunity

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 27 SHOPPING TODAY IS MORE ABOUT THE EXPERIENCE Source: Nielsen Global Omnibus Survey Q1 2011, Q % Value for Money 59% Promotions 55% Price 53% Quality Fresh Produce 48% Quality Meat Department 48% Variety and Selection 26% Exclusive Events Loyalty Programs

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 28 KEY TAKEAWAYS Promote for Win-Wins: It’s not about spending more, it’s about promoting and pricing smarter for sustainable growth and profitability for both the manufacturer and the retailer Mix of Old and New: Online is growing but on a small base. The role of digital needs to be integrated with the overall shopping experience Know your shopper: In order to build loyalty, it’s important to understand what consumers are buying outside of the store to meet new unmet needs and demand.

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 29 THANK YOU! Stay Connected to Consumer and Media Trends For the latest insights, visit nielsen.com Download our app: Nielsen Top10 Questions regarding the content of this presentation, contact: Carman Allison,