Growth Opportunities in the Consumer & Office Business Moe Nozari Executive Vice President, Consumer & Office Business 1
Broad Portfolio of Category Defining Brands Scotch Post-it Scotch-Brite O-Cel-O Scotchgard 3M Filtrete Command 2 Nexcare
Long Term Performance 3
Consumer And Office Business Summary $Billions & YOY % Chg $4.0 $3.0 $2.0 $1.0 $3.2 $2.9 +8% +7% Sales $3.4 +8% $1.7 +5% $Millions & YOY % Chg $800 $600 $400 $200 Operating Income $692 $613 $633 +9% +3.4% +10% $345 +1% $0.0 2005 2006 2007 First Half 2008 $0 2005 2006 2007 First Half 2008 LC Growth 6.4% 7.4% 5.0% 0.5% OI Margin 20.9% 20.0% 20.3% 19.9% 2007 Sales By Geographic Area U.S. 59% LAC 10% APAC 13% Europe 18% New Business Opportunities 6% 2007 Sales By Division Construction & Home Improvement 27% Cleaning &Protection 23% Stationery & Office Supplies 44% 4
Office and Stationery Market Transparent Tapes Cutting Tools Recycled Notes Specialty Notes Package Protection Adhesives Writing Instruments Collaborative Solutions 5 Laminating Specialty Tapes Organization Products Pockets
Construction and Home Improvement Markets Home Filtration Products Air Cleaning Filters 4 Filters Air Purifiers Water Filtration Safety Products 6
Cleaning and Protection Market Kitchen Bathroom Floor Retail Chemicals Grooming Pet Hair 7
Consumer Health Care First Aid Tapes Bandages Cold Sore Treatment Wound Care Hot / Cold Therapy Skin Care 8 First Aid Supplies Braces & Supports Active Line
Growth Drivers New Platforms Core Product Extensions Key Account Partnerships International Expansion 9
Growth Drivers New Platforms for Growth Expansion Through Our Core Products Close Partnership With the Key Accounts Improved International Penetration 10
Filtrete Air Cleaning Filters 11
Filtrete Has Transformed the Category 12
Filtrete Air Cleaning Filters in Aisle MPR 1500 $18.88 (500 Stores) MPR 1200 $12.88 MPR 700 $7.96 MPR 300 $3.88 13
Filtrete Room Air Purifier Product Line 14
Command Hooks Elegant with fun Elegant and young Fun 15
Scotch Cutter Product Line 16
High Design and Performance in New Scotch Scissors KIDS Playful Emotional STUDENT Creative Provocative WOMEN Elegant Emotional Status 17
Scotch Lint Rollers and Fur Fighters 18
Growth Drivers (cont d) New Platforms for Growth Expansion Through Our Core Products. Close Partnership With the Key Accounts Improved International Penetration 19
Scotch-Brite Ultra NailSaver Product Family 20
Martha Stewart 21
Writing Instruments 22
Post-it Flag Highlighter on Oprah 23
Scotch-Blue Painter s Tape DIY Tape Sales Mix 42% 38% 36% 32% 27% 58% 62% 64% 68% 73% 2003 2004 2005 2006 2007 24 Value-priced tan masking tapes Scotch-Blue Painter s Tape
Super Sticky Notes 25
International Herald Tribune 26
Sustainability in New Products New Scotchgard TM VPI Recycled Post-it Notes 27 Packages and dispensers from recycled DBEF waste Scotch-Brite wipes and scourers from natural and recycled fibers
Market Segmentation Premium Brand Price Brands Private Label Opening Price Point 28
Market Segmentation Premium Brand Price Brands Private Label 29 Opening Price Point
Transparent Tape Value Map $3.19 $3.09 $1.99 $1.39 $1.49 Pop-Up dispenser + 4 tape pads Price** $1.19 $.99 $.89 30 Private Label Quality **Average Retail Prices
Scotch-Blue Painter s Tape in Lowe s Bay M3000 $34.98 Applicator Refill $5.98 2080 $9.98 2030 $4.98 2090 Applicator $8.98 2090 $6.97 2020 $3.98 5142 $2.48 31
Repositionable Notes Value Map $5.00 $4.36 Price** $1.85 $2.03 $1.62 $0.63 $0.62 32 Quality * Approximate list price per pad
Growth Plan-Construction & Home Improvement Origin Current Future* *Includes all areas in Current Abrasives Tapes Flexible Abrasives Blue Masking Tape Applicators Aerosol Adhesives Masking Systems Safety Duct Tape Repair and Maintenance Exterior Maintenance Outdoor Usage Painting Products Contractor Solutions Hardwood Floor Solutions Adhesives, Carded & Sealants Protection Films 1 Filters Deep Filters Water Quality Air Quality Thermostats Utility Hooks Room Air Purifiers Interlocking Air Conditioner Filters Designer Hooks Indoor Moisture Control Faux Metal Hooks Water Conservation Picture Hanging Water Treatment Kitchen Organizers 33 College Solutions Mounting Strips Utility Bath Garage Solutions Bath Organization Children Solutions
Growth Drivers New Platforms for Growth Expansion Through Our Core Products Close Partnership With the Key Accounts Improved International Penetration 34
One Company, One Voice Strategy 3 Team M Logistics Sales Trade Marketing Cust Serv Buyer Merchandising Store Op Warehousing Finance MIS MIS Finance Customer Ad/ Promotion New Products Planning Ad/ Promotion International International Executive Executive 35
Customer Recognition 36
Customer Recognition 37
Larger and Redesigned Post-it Planogram at Staples 2007 Planogram 8 ft, 22 Private Label SKU s BEFORE 2008 Planogram 16 ft, 3 Private Label SKU s, Front of the store AFTER 38
Factors Favoring 3M With Key Accounts Innovative products Category defining brands Good growth margins for the accounts Good value to the end users Innovative marketing e.g., YouTube 39
Growth Drivers New Platforms for Growth Expansion Through Our Core Products. Close Partnership With the Key Accounts Improved International Penetration 40
Relative Market Penetration Index 100% 32% 21% 15% $0 US Europe/ MEA US APAC LAC 41 Sales Penetration
3M Task Light 42
Was Replicated In Taiwan Filtrete UVA 1000 Countertop Water Filtration 43
Carrefour - China 44
Floor Care in Carrefour Thailand 45
Scotch-Brite - Brazil 46
Global Replication of 16 foot Planograms China Korea Japan Australia 47
Global Replication of Post-it Note Displays Argentina Guatemala Colombia Thailand 48
Korea Train Post-it Super Sticky Promotional Event 49
Summary Difficult Macroeconomic Issues in the U.S. Great Technologies String of New Products Excellent Support from the Key Accounts Global Reach Enduring Franchise 50