Snapple 2010 Annual Report Download - page 9

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Q&A
7
Jim Johnston and Rodger Collins:
GROW PER CAPS
Following more than 15 years with the company, Jim Johnston was appointed president
of Beverage Concentrates in 2007 and assumed additional responsibility for Latin
America Beverages in 2009. Rodger Collins joined DPS as part of the acquisition
of the Dr Pepper/Seven Up Bottling Group in 2006, assuming the role of president
of Packaged Beverages in 2008. In the Q&A below, they discuss the company’s plans
for increasing the per-capita consumption of our priority brands.
Why is growing per-capita consumption a priority for DPS?
JJ: Expanding our brands beyond their regional heartlands is our single biggest growth opportunity at DPS.
With the priorities and plans we have in place, we believe we can grow consumption of our brands significantly
over the next 10 to 15 years.
RC: Our Victorville facility became fully operational in early 2010, completing our hub-and-spoke supply chain
model. With that and other infrastructure improvements in place, we’re in a great position to close distribution
gaps and increase the availability of our brands.
How are you working with customers to improve execution of your plans?
JJ: The feedback from our customers is clear: They want fewer points of contact and aligned decision making
at our company. Over the past year, we’ve restructured our national accounts organization companywide to serve
our customers better and provide greater coverage to more accounts. We can now deliver expanded support,
including category management, shopper marketing, and revenue and margin management, to deeper tiers of
customers and provide insights to help our customers grow the categories in which we compete.
RC: We created our Packaged Beverages segment through the integration of our company-owned DSD (direct store
delivery) business and our warehouse direct business, which manufactures and sells Hawaiian Punch, Clamato,
Mott’s juice and apple sauce, premium CSDs and mixers. Our regional and national account teams are offering
a single face to the customer, focusing on full-portfolio selling
—
we have no more specialists. Our sales teams
have total responsibility for volume, mix, revenue and margin in their accounts, enabling them to work more
closely with retailers to standardize the execution of programs that have been shown to deliver value.
Will you focus on specific brands?
JJ: As our flagship brand, Dr Pepper stands out as having great potential for growth. We can leverage the brand’s
broad appeal to bring its consumption levels in underdeveloped markets up to its national average by simply making
Dr Pepper easier to find at retail and keeping it top of mind with consumers.
RC: Consumers shouldn’t have to search for any of our brands. We have opportunities throughout our portfolio,
not just with CSDs, to expand availability nationwide. Consumer tastes are constantly evolving, and executing
against a wide variety of products across the LRB (liquid refreshment beverage) landscape is what we do best.
With our “Win the West” efforts and movement into Hispanic markets, we’re getting our whole portfolio into more
consumers' hands than ever.
What areas of expansion have the most potential?
RC: We’re underpenetrated in the high-margin areas of single-serve and immediate consumption, but our five-year
cold drink strategy is expected to yield approximately 35,000 incremental cold drink asset placements per year
through 2013. Out-of-home drinking occasions have been on the decline because of economic pressures, but the
total amount that people are drinking hasn’t changed. Bringing consumers back to CSDs by getting the flavors they
want in front of them on more occasions is helping us close the gap.
JJ: We’re also expanding single-serve availability in fountain. Over the past five years, we’ve added nearly 180,000
new availabilities for our brands. Of those, more than 140,000 installations were for Dr Pepper and Diet Dr Pepper,
including 29,000 incremental valves in 2010 alone. Research shows that when these products are available on
a fountain unit, it drives incremental purchases across the total beverage category.
GROW PER CAPS