HOW RODAN AND FIELDS IS POISED FOR GROWTH AT HOME AND ABROAD

1. HOW RODAN + FIELDS IS
POISED FOR GROWTH AT HOME
AND ABROAD
David Margulies

2. WHO IS EUROMONITOR INTERNATIONAL
Our Services
Syndicated Market Research
Custom Research and
Consulting
Expansive Network
On the Ground Researchers in
80 Countries
Complete View of the Global
Marketplace
Cross-comparable Data Across
Every Market
Our Expertise
Consumer Trends & Lifestyles
Companies & Brands
Product Categories &
Distribution Channels
Production & Supply Chains
Economics & Forecasting
Comparable Data Across
Markets

3. Looking back at the last five years of the beauty and
personal care market
Identifying and exploring areas of future growth
Taking a closer look at the demographic trends driving
that growth

4. LOOKING BACK AT
FIVE YEARS OF STRONG
GLOBAL PERFORMANCE

5. BEAUTY & PERSONAL CARE IS A $400BN INDUSTRY GLOBALLY
Global Skin Care alone is a $111bn
market, making up 28% of BPC sales
Skin
Care,
$111bn
Skin Care Remaining Beauty and Personal Care
North America makes up 14% of sales
$15.3 billion
Source: Euromonitor Passport, 2014

6. THE NORTH AMERICAN MARKET HAS REACHED NEW HEIGHTS
$15.3bn
$12.9bn
2014
2009
North America Skin Care Sales
Premium
58%
Mass
42%
Share of Growth by Price Tier
(2009 – 2014)
Total Growth: $2.4bn
Total Premium
Growth:
$1.4bn
Source: Euromonitor Passport

7. Hair Care 1.6%
PUTTING THAT GROWTH INTO CONTEXT
2.0%
Average Yearly Growth
Full Service Restaurants
Color Cosmetics
Category
4.1%
Wine 4.8%
Premium Skin Care 7.2%
North America, Historic Value Compound Annual Growth Rate (2009 – 2014)

8. R+F MADE UP 12% OF PREMIUM SKIN CARE GAINS AND
GREW THE MARKET BY NEARLY 1%
2,500
2,900
3,300
3,700
4,100
2009 2010 2011 2012 2013 2014
ValueSales(US$mn)
USA Premium Skin Care Performance
Rodan + Fields Contributed Growth Rest of Premium Market
Rodan + Fields Contributed Growth
 12.3% of Total Premium Skin
Care growth
 Led all premium brands in share
of total category growth
 Within the top 10 Premium Skin
Care brands, R+F was the
fastest growing brand every year
from 2009 to 2014
Source: Euromonitor Passport
Total Market: $4.0bn

9. RODAN + FIELDS PRODUCTS SPEAK TO CONSUMER DEMAND
 Science behind the skin care
 Skin care as a social experience
 Harness innovation and launch quickly
 Active in the fastest growing categories

10. PERFORMANCE GREATLY OUTPACES RIVAL BRANDS
Rodan + Fields
106.5%
Clinique
5.4%
Lancôme
6.5%
Estée Lauder
4.6%
Shiseido
4.2%
Source: Euromonitor Passport
Data refers to brand average yearly growth (2009 – 2014) in the US

11. HOW MUCH ROOM IS THERE
FOR FUTURE GROWTH?

12. GLOBAL SKIN CARE WILL BE A $131BN MARKET IN 2019
Source: Euromonitor Passport
Growth is in constant terms, excluding inflation
$111.2bn
$131.3bn
100,000
105,000
110,000
115,000
120,000
125,000
130,000
135,000
2014 2019
ValueSales(US$mn)
Global Skin Care - 2014 & 2019
$20bn in total Skin Care
growth
Premium market will be
$42bn globally in ‘19
Premium global Skin
Care will grow by $6bn

13. NORTH AMERICAN SKIN CARE MARKET SET TO GROW BY $1.3BN
$15.3bn
$16.7bn
14,500.0
15,000.0
15,500.0
16,000.0
16,500.0
17,000.0
2014 2015 2016 2017 2018 2019
ValueSales(US$mn)
North America Skin Care Sales
North America Skin Care Sales
$1.3bn
Total Growth
(2014 – 2019)
Source: Euromonitor Passport
Growth is in constant terms, excluding inflation

14. PREMIUM SKIN CARE WILL GROW BY $718MN
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
2015 2016 2017 2018 2019
%Growth
Future Year on Year Growth -
Mass and Premium
Premium Skin Care Y-o-Y Growth
Mass Skin Care Y-o-Y Growth
 Not just percentage growth: $718mn in
real growth
 Premium Skin Care will make up 53% of
total Skin Care gains
 Total growth in Premium Skin Care will
be more than DOUBLE growth in Mass
 Premium Skin Care sales in North
America will reach $5.5bn by 2019
Source: Euromonitor Passport
Growth is in constant terms, excluding inflation

15. PREMIUM ANTI-AGERS ARE A WINNING CATEGORY
 The best way for beauty
products to justify a price
premium is through proven
effectiveness
 This is especially true for
anti-aging products, where
results are a must – if the
results are there, consumers
will pay a premium
$2bn
$3bn
1,500
1,700
1,900
2,100
2,300
2,500
2,700
2014 2015 2016 2017 2018 2019
ValueSales(US$mn)
North America Anti-Aging Sales
(Mass and Premium)
Mass Anti-Agers Premium Anti-Agers
Source: Euromonitor Passport
Growth is in constant terms, excluding inflation

16. WHO WILL BE DRIVING
THAT GROWTH?

17. Source: Nielsen
HIGHEST TOTAL SPEND COMES FROM MIXED HOUSEHOLDS
Millennial + Gen-X Household
$798mn
Ages:
15-29
Ages:
30-59

18. MILLENNIALS ARE THE “SPARK”
 Early adopters
 Interested in new trends and products
 Excited to share new discoveries with
others, strive to be the first to discover
and the first to share

19. GEN-XERS ARE THE “FIRE”
 Entrepreneurial Spirit
 Well-Educated
 Skeptical

20. ANTI-AGERS ARE NOT JUST FOR BABY BOOMERS
Consumers aged
15-29 used anti-
aging products daily
57%
28%
Consumers aged
15-29 used anti-
aging products at
least weekly
Consumers aged
30-59 are using
anti-aging products
daily
68%
20%
Consumers aged 30-
59 are using anti-aging
products at least
weekly
Millennials Generation X
Source: Euromonitor Survey

21. WHERE IS THAT SPENDING TAKING PLACE IN THE US?
Top 10 in Total
Skin Care Spend
1. California
2. Texas
3. New York
4. Florida
5. Illinois
6. Pennsylvania
7. Ohio
8. New Jersey
9. North Carolina
10. Georgia
Top 10 Fastest
Growing
1. Arizona
2. Texas
3. Georgia
4. Washington
5. Florida
6. Colorado
7. North
Carolina
8. California
9. Virginia
10. Minnesota
Source: Euromonitor Passport
Top 10 in Spend Top 10 in Growth Top 10 in Growth + Spend

22. WHAT ABOUT DERMATOLOGISTS?
 Spend on dermatologists in the US in 2013: $10.1bn
– 18% of clients are aged 20 – 39
– 26% are aged 40 – 59
– 20% is “Cosmetic Dermatology”
 Opportunity to bridge the gap and provide some of the same services at
home at a fraction of the cost
Source: IBIS World

23. FINAL THOUGHTS

24.  Skincare is a large, expanding market
 Anti-Aging at premium prices is driving that growth
 Efficacy and results is what sets brands apart
 The Rodan + Fields opportunity is tremendous –
GO GET IT!

25. THANK YOU
Questions?