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Next Generation Product Identification (NGPI)

Partnership Framework

Update - October 9 - GSMP, Lisbon

Agenda topics

•

Project team and key contacts

•

Project update

•

MO integration

NGPI project structure NGPI Core Team

Overall project leadership

GS1 Expert Team

Internal functional expertise

Industry

•

Gerd Wolfram, Metro/Retailer - Chair

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Barron Witherspoon, P&G/Manufacturer - Chair

•

Mike Yorwerth, Tesco/Retailer

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Greg Buckley, PepsiCo/Manufacturer

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Jim Flannery - Grocery Manufacturers Association

• • • • • • •

Organizational connectivity

•

Ruediger Hagedorn - TCGF

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Malcolm Bowdon - GS1

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Lynda Costa - GS1 Mary Wilson - US Andrew Osborne - Europe Juan-Felipe Ochoa - Colombia Richard Jones - Australia Malcolm Bowden - Data Excellence Scott Gray - Technical liaison Michael Sarachman - GSMP

Name

Ylva Heivert Gerd Wolfram Armand Schins Afrererico Santos Mike Yorwerth (tbd) Paul David Kathy Welch Katrin Recke Charmaine Wiggins Patrick J. Walsh Fintan Hastings

The NGPI project team consists of 36 CGF Board member companies

Company

ICA Metro AG Royal Ahold Sonae Tesco Stores Ltd.

Wal-Mart Stores, Inc.

Wegmans Food Markets AIM FMI - Food Marketing Institute FMI - Food Marketing Institute Food Drink

Country

Sweden Germany Netherlands Portugal GB USA USA USA Belgium USA USA Europe

Representation across Manufacturers, Retailers, & key Stakeholders

Derek Nighbor Jeanne Iglesias Jim Flannery Lynda Costa Malcolm Bowden Scott Gray Andrew Osborne Christian Przyolla Ulrich Schaefer Indigo Wolters Mary Wilson Ruediger Hagedorn John M. (Mike) Wallace Jeffrey A House Lynette Shawd Akikazu Sato Detlef Koenigs Susanne Holzhausen Ryan C. Richard A. Sven Dianett David Sheldon Robin Kidd Andrew Whitman Greg Buckley Kathrin Kiesel Rich Wilson Barron Witherspoon Ettore Piccirillo Caroline Fricke Jose Antonio Barco Ted Schultze Food & Consumer Products of Canada (FCPC) GMA GMA GS1 GO GS1 GO GS1 GO GS1 UK (for Europe) GS1 Germany GS1 Germany GS1 Germany GS1 US The Consumer Goods Forum Abbott Campbell Soup Company General Mills Kao Corporation Mars GmbH Mars GmbH Mondelez Hermann Hagemeyer, GmbH Nestlé Nestlé Nestle Nutrition PepsiCo Henkel The J.M. Smucker Company Procter and Gamble Company Unilever Accenture Accenture Symbology, Inc.

CAN USA USA USA Belgium USA GB Germany Germany Germany USA France USA USA USA Japan Germany Germany USA Germany Switzerland Switzerland USA USA USA USA Netherlands UK 4

On behalf of Industry, Robin Kidd is making significant contributions!

Delivering change in the past Leading change for the future

We have a lot at stake…

NGPI has the potential to produce one of the most significant, truly

transformational decisions

our

industry will undertake

since

1971…

Magnitude of impact and the need for change

Brand integrity

and

Consumer trust

is a key driver

-AND Business value

: conservatively, there is a cost avoidance upward

$

7 Billion annually

At a very high level, this is the functionality the Industry needs...

More Consumer Information Accurate Data On-line & Mobile

Provide consumer information relevant to each product package variation (B2C) Ensure information of package and web are aligned, easy to use, and trusted (EU Regulations/Digital)

Facilitate Online Order Fulfillment from Stores

Support order picking for package variations to fulfill online orders accurately

Low Disruption to POS & Supply Chain

Support supply chain and POS checkout (B2B) activities with minimal disruption

All without changing the GTIN for every variant to avoid unnecessary costs

NGPI face-to face meeting… September 23-24, 2013

NGPI momentum continues… strong

Industry alignment

is secured across Retailers, Manufacturers, and other key stakeholders

'Next Generation’ Product Identification Project

Dusseldorf Key Takeaways

September 23-24, 2013

Meeting Summary

Introduction

On the 23th and 24 th of September, 2013, the NGPI Project Team met in Dusseldorf to discuss and agree preliminary recommendations to the Consumer Goods Forum Board in December, 2013

Our key objective was to develop a recommendation to the CGF board, by answering the following questions:

What information do we need to carry?

How do we carry it?

How do we test it to see if it works?

How do we implement it?

The Future Consumer & Trading Partner Information Strategy is the Driving Force of the NGPI Project The overarching NGPI goal is to enable better communication of product information for consumers and trading partners.

The Consumer and Trading Partner Information Strategy is therefore designed to: – Define new Data Items that will improve “package-level” product identification and product information communication to support emerging Digital Commerce and Regulatory requirements. AND – Avoid the need to change the GTIN in order to communicate accurate “label-level” product information during a "soft transition" due to a minor product formulation or packaging change.

Our analysis suggests industry could realize greater benefits by providing more product information to stakeholders across the value chain

Potential value from new data items Proposed information strategy data items Data Items Product Variant Number Manufacturers

 Increased speed to market; streamlined  Communication

URL Expiry date Lot Number

 Increased control over information provided

Serial Number Potential Benefits Retailers

 Increased accuracy of online order fulfilment  Increased capability for tracking / tracing  Reduced waste of spoiled products  Increased capability for tracking / tracing

Consumers

 Accurate product information ordered online  Increased confidence in product quality and traceability  Mobile app-based reminders of when to use products  Increased reliability of additional information  Increased confidence in product quality and traceability Copyright © 2013 Accenture. All rights reserved.

In addition to the GTIN, the NGPI Project Team has Identified Five Data Items as the Most Desirable to Include in a Future Information Strategy

It is proposed that GS1 standards be made available for these Data Items, at the product level Additional Data Items

From static …

1 Package Variant Number 2 URL

 A code that contains any additional information that is package specific, known as a PVN  A unique web address for a product where the consumer can find more information about the product

3 Expiry date

 The period of time items are given before they can be considered unsuitable for sale, use or consumption

4 Lot Number

 ID number assigned to a lot of material from a single manufacturer

5 Serial Number

 Unique code that contains manufacturer’s information

… to dynamic data

Of the Five, the PVN is the only Data Item for Which GS1 Standards have not been Previously Defined

The group agreed some key parameters for the development of a PVN standard:

• The PVN shall be used to identify the package-version of a product package during a “soft transition” due to a minor change to product formulation or packaging.

• Changing of the PVN shall not be used to trigger the re-introduction or listing of an item. • The PVN will require its own use and allocation rules, which will complement existing GS1 GTIN Allocation rules.

• Use of the PVN could be made more straightforward with further clarification of the current “minor change” GTIN Allocation rules.

The existing URL standard also requires further investigation:

• Confirm the syntax and scope of the URL, e.g. is it a full URL to an individual product or a company level URL which can have GTIN+PVN+serial, etc., to get to an individual product Copyright © 2013 Accenture. All rights reserved.

GS1 2D Carriers Have Been Identified as the Most Capable of Delivering The Desired Future State

GS1 2D Carriers can hold the GTIN, as well as the additional Data Items “Ability” of carrier to deliver Additional Data Items Package Variant Number URL Expiry date Lot Number Serial Number 1D EAN/ UPC No No No No No 1D GS1 DataBar Yes Short URLs Some items Some items Few items Either 2D GS1 QR Code or DataMatrix Yes Yes More items More items More items

It was also noted that, while consumers are already using “native” QR codes, these are not capable of carrying the GTIN.

Industry is polarized in implementing 2D scanning – pervasive use of a 2D GS1 Carrier at retailer POS is as much as ten years away

Almost half of all respondents plan to install 2D scanners within five years, while half will wait more than 10 years, or not install 2D scanners at all The intention to install image-based scanning in the future

Survey 1 Survey 2

# of respondents 25

Preliminary Board Recommendation

The Next Generation Product Identifier Project is about providing consumers with the information they want, as effectively as possible

The NGPI Team proposes that the CGF Board:

• Supports the use of PVN at the consumer package level as a means to improve the “label-level” product information disclosure to consumers without increasing the frequency of GTIN changes and the resulting supply chain disruption costs • Suggests that industry maintain support for current GS1 GTIN allocation rules and commit to define and support related allocation rules for use of PVN • Supports accelerating the adoption of the 2D GS1 Data Matrix / QR code at the consumer package level with a goal to achieve global adoption

within 10 years

• Enables industry to build the capability to utilize the GS1 DataBar at the POS and throughout the supply chain, in the meantime, as an additional choice to today’s EAN/UPC, thus enabling new capability while we work toward adoption of the 2D GS1 Data Matrix / QR code

DISCLAIMER: All work of The Consumer Goods Forum (TCGF) is carried out in accordance with TCGF Antitrust Guidelines, and in compliance with all competition laws, thus ensuring independence of activity, collaboration only on non-competitively sensitive issues, and confidentiality of information.

Next Steps

Industry Proposes to Undertake Targeted Pilot Projects as proof-of-concept for our Recommendations to the CGF Board

Key features

• Pilot projects will be conducted by “pilot pairs” – retailer / manufacturer combinations – across representative markets • Each pair will have the opportunity to select the use cases of interest to test • At a minimum, the portfolio will include both brick & mortar and e-commerce use cases, and PVN • We will seek to achieve use case, data item, sub-segment and geographic diversity in the pilot project portfolio • Participants commit to collecting data and providing feedback to the standards development process Copyright © 2013 Accenture. All rights reserved.

Timeline

• Planning (Sep-Dec 2013) – Develop pilot project charter – Establish governance structure – Establish pilot pairs – Outline pilot terms of reference by mid-end November • Testing (Jan-Mar 2014) – Begin projects in January – End project (or at least have generated useful results) in March • Reporting (Apr-Jun 2014) – Facilitate extended team meeting to review findings in April – GS1 board meeting in May, present preliminary findings; key inputs to future standards development and draft implementation plan – CGF board meeting in June, present findings and next steps 22

Together with Regional Liaison Groups & Industry Associations, the NGPI Project will develop a guideline for local Rollout and Implementation

Key features

• Deployment will be led by geography, whether national, multi-national or regional • Deployment roadmap development will be shared between the markets by the NGPI Core Team • The process will live within the decision matrices of the markets in question • Market / regional champions will be required in each market • User guides will be developed by market, or group of markets • Sunrise dates will be set by

industry / region

for 1D GS1 DataBar (it is recommended that there be no sunset date on use of the EAN/UPC barcode) • Incorporation of the PVN and other relevant data items into GS1 Services Standards, e.g. GDSN, GS1 Source • GS1 will recommend a global sunrise date to industry for mobile phones use of GS1 standards once OMA and GS1 standards alignment is achieved Copyright © 2013 Accenture. All rights reserved.

We are on target to deliver pre-reading materials for the December CGF Board meeting by November 1 st

Jul Aug Sep Oct Nov Dec H1 2014 H2 2014 Mobilisation A Case for Action

Extended team engagement

B Future Information Strategy C Future Carrier Strategy D Pilot Project Design E Plan for Implementation Stakeholder Engagement Milestones

OpExCom Meeting

Oct .17

OpExCom Meeting

Nov. 1

Circulate Board Pre-read

Project Management and Communication

Targeted CEO engagement

Dec. 3

CGF Board Meeting

Phase III

Immediate next steps – high level overview

Immediate next steps Milestone / Activity

Enter GSMP (Business needs, Call to action, etc.) Begin integration of GS1 standards and services Pilot project design – retailers/manufacturers paired, outlines complete CGF Board Meeting – GO/NO GO Begin to develop migration plan (local sunrise dates) Conduct pilot projects • • Pilot project – results reporting GS1 BOD meeting CGF BOD meeting

Timeframe

Oct. 2013 Oct, 2013 Nov. 30, 2013 Dec. 2013 Jan. 2014 Jan.

Many ways to keep connected to NGPI Retail Network Regional MO representatives

•

GS1 Expert Team

Liaison with respective MOs • Internal alignment • One voice • Technology groups 26