Anheuser Busch InBev / : Script

AB INBEV'S CAPITAL MARKETS DAY 2023 MEXICO CITY, MEXICO

TUESDAY, 20 SEPTEMBER 2023

Chief Marketing Officer, Marcel Marcondes - Lead & Grow the Category

Thanks Ricardo.

Hello everyone, it is great to be here today. I am Marcel Marcondes. I joined ABI 18 years ago, after 8 years at Unilever running brands in Latin America and global.

In 2005, i decided to exchange shampoo for beer. First running our big core brands in Brazil, then moving to sales to drive commercial integration.

In 2014, i moved to our global headquarters to run our premium global brands. A few years later, i assumed the chief marketing officer position for Anheuser Busch in the us. Now, since 2022, i have the privilege of being the global CMO for ABI.

It is not only a	big privilege, but it is especially	a big responsibility. Because if
we look at this	timeline, now for ABI, as we all	know, the company we have
today was built	partially via inorganic growth, as we led the process of
consolidation for	the industry.

Over the last couple of years, we have been working together to write a new chapter for ABI, with a revised strategic framework that starts from the right beginning- to lead & grow the category, driving organic growth

As we go through this transition, there are 2 key priorities we need to bring to life in order to execute our strategy: building megabrands and our category expansion model.

Because this is all about strong brands and category growth

So, let's start with the megabrands. They are built in 3 steps:

1) focused portfolio

1. effective creativity
2. scalable innovation

All that, because, in the end, this is a game of focus, effectiveness and scale

First, on portfolio management….

We have more than 500 brands. We used to meaningfully invest behind 10, sometimes 15 brands in a given market. So, the first step on our brand portfolio journey is to make strategic choices.

Because here, the key insight is that, on a market-by-market basis, there are only 4 to 5 brands max commanding meaningful growth. Always.

This is why, focus, is the first step of the megabrands concept. Now , on a market-by-market basis, we have around 5 focus brands receiving close to 70% of the total investment, typically driving 70% of the revenue growth.

With a more focused portfolio, we can concentrate resources to accelerate brand equity, which we track via kantar as brand power.

Brands with higher power level are better positioned to command a premium price and deliver volume growth.

And we can see it happen in practice. Our megabrands are accelerating both brand power and volume growth.

And there is another thing that gives us confidence in this process.

If there is one company well positioned to play with a focused portfolio, this is ABI.

We have the privilege of owning 7 out of the top 10 most valuable beer brands in the world, including the number 1, Budweiser, and the fastest growing brand by value, corona.

This is why we are also intentionally making corona our leading horse globally.

And it couldn't be different.

Corona is the only beer brand in the world with more than 10 points of power in more than 10 markets, so, as people say in sports, it is the double-double.

And corona brand power is still way ahead of its market share in all of the markets.

Which means, there is a long runway for growth
Let's watch a video and with	the corona global approach
Now, let's talk about the 2nd	step to build megabrands. After focusing resources,
we need to apply effective creativity…

Because in every study about effectiveness, creativity always shows up as the number one driver.

This is what makes people pay attention to a brand, fall in love with brands.

Iconic brands and companies are built with great doses of creativity, which becomes a competitive advantage when used to solve real business and real consumer problems.

So, to make sure that effective creativity is a sustainable way of working for our brands, we created a process called creative "x", which is made up of four steps:

First, we train people all over the world on the jobs to be done for the brands

Second, whenever there is a big idea or a big campaign,

We convene with the braintrust which is a meeting with senior people in the organization to challenge that idea on relevance, consistency and how to take it to the next level

Also, twice a year we have an external council of world-class creative leaders that evaluate our brand work and ensure we are constantly provoked to be out of our comfort zone

Finally, once a year, every zone evaluates and celebrates their most effective work, followed by a global event to recognize the best of the best and share learnings across the teams to be scaled

We've had more than 500 campaigns, from 60 brands across 25 markets, going through this process, while more than 2.000 people have been trained on it.

As we used the system our work began to improve.

The Effie index is theglobal benchmark for marketing effectiveness, and last year, for the first time, AB InBev was recognized as the world's most effective marketer, improving from being number 24 in 2017.

Earlier this year, they released the rankings again, and ab InBev kept the first position.

Additionally, the Cannes lions is the world's most prestigious festival for creative marketing.

Every year, they honor the company that has delivered award-winning work, together with strong results, as the creative marketer of the year.

In the past 2 years AB InBev was awarded this honor, becoming the first ever back-to-back winner in the history of the festival.

Most importantly, this is being built as a truly global capability.

All of our zones, with no exception, have work being recognized, coming from multiple brands and countries using effective creativity to solve business and consumer problems, to drive growth.

Let's see a video of some examples

Ultimately, a focused portfolio combined with effective creativity has helped us achieve peak results in both brand power as well as volumes for our global business.

Now, the same way as we will stay very ambitious to continue	this journey,
I have to say, we must be very humble to acknowledge the bl	episode in the
us.

We just spoke about a robust process and, it goes without saying, it's not perfect.

We will keep listening, learning and improving.

And, as we move forward in this new complex environment, some of our principles have been reinforced:

Foremost, there is no room to compromise the authenticity, the values, and the strategic consistency of our brands.

We do beer, which exists to bring people together and have a good time.

Also, in times like this we need to focus even more on what we are supposed to do best: which is to listen and actually love our consumers.

Because when our brands do it, consumers love them back.

We even track that.

More than 340 million people around the world loveour brands - and it is growing.

You just saw in the opening video, real stories from real people.

This is what we live for.

Building brands that consumers love.

This is what we mean when we say "let's grab a beer" ..

Ok, so now moving to our 3rd step, scalable innovation

Here we have 3 principles:

The first one, probably, goes against the expectation. Before talking about new launches, we need to simplify to grow.

It is all about delisting the declining, low margin and low scale SKUs.