kellogg case study market research

Kellogg’s Marketing Strategy 2024: A Case Study

Kellogg’s, a global leader in the production of cereal and convenience foods, has a comprehensive marketing strategy that plays a crucial role in shaping its market presence and consumer engagement. With products available in over 180 countries worldwide, Kellogg’s showcases its global reach in the cereal and convenience foods industry.

The company’s marketing strategy places a strong emphasis on digital marketing to effectively reach and engage with its target audience. By utilizing various digital channels, such as social media campaigns and influencer partnerships, Kellogg’s maximizes its online presence and connects with consumers on a broader scale.

To stay ahead in the industry, Kellogg’s conducts thorough market research and competitive analysis, adopting a data-driven approach to decision-making. This enables them to identify consumer trends, understand market dynamics, and make informed marketing decisions that drive their business forward.

Kellogg’s tailors its marketing campaigns to target specific audiences, recognizing the importance of personalized marketing strategies for consumer engagement. By understanding the unique needs and preferences of different consumer segments, Kellogg’s delivers relevant and impactful messaging that resonates with their target consumers.

The marketing objectives for Kellogg’s encompass various goals, including brand promotion, increasing market share, and driving consumer engagement. By pursuing these diverse objectives, Kellogg’s ensures a comprehensive and multifaceted marketing approach that enhances brand awareness, strengthens market position , and fosters lasting consumer relationships.

Despite initial marketing challenges during its entry into the Indian market, such as lack of awareness, pricing strategies, and competition from traditional breakfast options, Kellogg’s successfully adapted its marketing strategies. By introducing new products tailored to the Indian palate, targeting children as a key audience, and leveraging storytelling in its campaigns, Kellogg’s witnessed significant sales growth and market revival in India.

Key Takeaways:

• Kellogg’s global presence is evident in over 180 countries where its products are available.
• The company’s marketing strategy focuses heavily on digital marketing for effective audience engagement.
• Kellogg’s employs data-driven analysis and market research to make informed marketing decisions.
• By tailoring marketing campaigns to specific audiences, Kellogg’s emphasizes personalized consumer engagement.
• Kellogg’s marketing objectives include brand promotion, market share growth, and driving consumer engagement.

Advertising Techniques

Kellogg’s employs a range of advertising techniques to effectively promote its brand and products. With a focus on capturing consumer attention and differentiating itself from competitors, Kellogg’s utilizes both traditional media and digital marketing channels to reach its target audience .

Traditional Media

Through TV commercials and print ads, Kellogg’s leverages traditional media platforms to engage with consumers. These advertising campaigns ensure widespread brand exposure and allow Kellogg’s to communicate the key features and benefits of their products to a wide audience.

Digital Marketing

Kellogg’s recognizes the power of digital marketing and incorporates it into their advertising strategy. They employ various digital channels, including social media campaigns and influencer partnerships, to effectively promote their brand and products to a digital-savvy target audience.

By leveraging influencers’ reach and engagement on platforms like Instagram and YouTube, Kellogg’s can tap into the influencer’s credibility and connections with their loyal followers. This allows them to creatively showcase their products and create a strong connection with their audience.

Kellogg’s also places a strong emphasis on storytelling and creating memorable visuals to capture consumer attention in the digital space. They understand that consumers nowadays are bombarded with countless advertisements, so it is crucial to stand out and leave a lasting impression.

To further enhance their digital marketing efforts , Kellogg’s actively explores new trends and platforms to stay relevant and innovative. This ensures that their advertising campaigns are up-to-date and resonate with the evolving preferences of their target audience.

Brand Promotion

In addition to their advertising campaigns, Kellogg’s employs various brand promotion techniques to increase brand awareness and consumer engagement. They offer promotional programs, such as discounts and coupons, to incentivize consumers to try their products and build loyalty.

Case Study: Share Your Breakfast

One of Kellogg’s innovative marketing campaigns was “Share Your Breakfast.” This campaign encouraged consumers to share their breakfast photos online, generating millions of user-generated content showcasing Kellogg’s products. By tapping into the power of user-generated content and social sharing, Kellogg’s not only increased brand visibility but also fostered a sense of community and engagement among their consumers.

The success of Kellogg’s advertising techniques can be seen through their collaboration with Netflix’s Stranger Things. By leveraging the popularity of the TV show and creating a limited-edition product tie-in, Kellogg’s successfully boosted sales and created buzz around their brand, capturing the attention of both existing and new consumers.

Marketing Campaign: “Cereal and Milk”

Kellogg’s also launched the engaging marketing campaign “Cereal and Milk,” encouraging consumers to share their unique cereal and milk combinations online. This interactive campaign not only generated thousands of user-generated content but also created a deeper connection with their consumers and showcased the versatility and enjoyment of Kellogg’s products.

Please note that Kellogg’s invests approximately 15-20% of its annual turnover in marketing activities, underscoring their commitment to effective advertising and brand promotion.

Digital Marketing Strategy

Digital marketing plays a vital role in Kellogg’s overall marketing plan . In today’s digital age, it is essential for businesses to embrace digital channels to effectively reach and engage their target audience. Kellogg’s understands this importance and has implemented a comprehensive digital marketing strategy to amplify their brand presence and connect with consumers in a meaningful way.

To create successful digital campaigns, Kellogg’s relies heavily on market research and data-driven marketing techniques. They conduct thorough analysis of consumer behavior and preferences, allowing them to gain valuable insights on their target audience. By understanding their consumers’ needs and motivations, Kellogg’s can create personalized and targeted digital campaigns that resonate with their audience.

Kellogg’s also stays ahead of industry trends through continuous market research and competitive analysis. By monitoring the digital marketing landscape, they can identify emerging trends and innovative strategies that can enhance their own marketing efforts. This proactive approach ensures that Kellogg’s remains at the forefront of digital marketing, constantly adapting and evolving their strategies to stay competitive.

Market Segmentation

Kellogg’s understands the significance of market segmentation in creating a successful marketing strategy. Through thorough market research, Kellogg’s identifies and segments its target audience based on factors such as consumer demographics, psychographics, and behavior. By gaining a deep understanding of their consumers’ unique needs and preferences, Kellogg’s can effectively tailor their marketing campaigns to specific audience segments.

This segmentation approach allows Kellogg’s to maximize the impact of their marketing efforts by delivering more relevant and impactful messages to their target consumers. By engaging with different consumer groups through targeted messaging, Kellogg’s ensures that their marketing campaigns resonate with their diverse customer base.

As the world’s largest cereal maker and the 2nd largest maker of cookies and snacks, Kellogg’s has a wide range of products that cater to various consumer segments. Their product segments, such as ready-to-eat cereals and crackers, are classified as stars in the BCG matrix, indicating their high market growth potential. Through market segmentation, Kellogg’s can identify and cater to the specific needs and preferences of different consumer segments, allowing them to effectively position their products and drive sales.

Kellogg’s target customer segments primarily include people from urban and metro regions, where they have a strong presence. By understanding the unique needs and preferences of these urban consumers, Kellogg’s can develop marketing campaigns that capture their attention and resonate with them on a personal level.

Product Innovation

Kellogg’s is committed to product innovation as a core component of its marketing strategy. The company recognizes the importance of continuously introducing new and exciting products that cater to evolving consumer tastes and preferences. Through intensive research and development, Kellogg’s identifies emerging trends in the food industry and leverages this knowledge to create innovative offerings that capture consumers’ attention.

One example of Kellogg’s product innovation is the introduction of chocolate chip cookie dough Rice Krispies Treats. This delicious twist on a classic favorite showcases Kellogg’s ability to combine familiar flavors in a new and exciting way. By tapping into consumers’ love for both chocolate chip cookies and Rice Krispies Treats, Kellogg’s has created a product that appeals to a wide audience and provides a fresh take on a beloved snack.

In addition to developing its own ideas, Kellogg’s has embraced collaboration with nostalgic brands to fuel its product innovation efforts. Collaborations with brands like Cinnabon and ICEE have resulted in the creation of Cinnabon Bakery-Inspired and ICEE cereals, offering consumers a taste of their favorite treats in a convenient breakfast option.

Beyond partnerships with other brands, Kellogg’s has also established marketing partnerships to leverage the popularity of popular franchises. For example, Kellogg’s entered into a marketing partnership with Minecraft for its Cheez-It and Pringles products. This collaboration allows Kellogg’s to tap into the large and dedicated Minecraft fanbase, expanding the reach and appeal of its snack products.

In order to support its innovative products, Kellogg’s has implemented improved merchandising strategies. These strategies aim to create visually appealing displays and optimize product placement to attract consumers’ attention and enhance the overall shopping experience . By strategically showcasing their innovative products, Kellogg’s can maximize exposure and increase awareness and sales.

Moreover, Kellogg’s has embraced personalized marketing approaches to further strengthen its product innovation efforts. By segmenting its target audience and understanding their unique preferences, Kellogg’s can tailor its marketing messages and promotions to effectively resonate with each consumer group. This personalized approach allows Kellogg’s to create deeper connections with consumers and drive engagement and loyalty.

Furthermore, Kellogg’s utilizes advanced technologies like artificial intelligence and machine learning to predict retail needs, strengthen supply chains, and optimize production. These technologies help Kellogg’s analyze market trends , forecast demand, and streamline operations, ensuring the availability of innovative products to meet consumer demands.

In conclusion, Kellogg’s commitment to product innovation is a key driver of its marketing strategy. Through collaborations, marketing partnerships, improved merchandising strategies, personalized marketing approaches, and the use of advanced technologies, Kellogg’s continues to introduce innovative products that captivate consumers and drive growth and success in the food industry.

Distribution Channels

Kellogg’s has developed a well-strategized distribution network to ensure the wide accessibility of its products. By leveraging a diverse range of distribution channels, Kellogg’s reaches consumers efficiently and effectively, both in traditional retail environments and through e-commerce platforms.

Some of the key distribution channels utilized by Kellogg’s include:

• Convenience stores: Kellogg’s products are readily available in convenience stores, ensuring convenient access for consumers on-the-go.
• Vending machines: Kellogg’s utilizes vending machines strategically placed in high-traffic areas to offer quick and easy access to their products.
• Mini superstores: Kellogg’s products are stocked in mini superstores, catering to consumers who prefer a wide selection of options.
• High-frequency stores: Through partnerships with high-frequency stores, Kellogg’s products are easily accessible to consumers who frequently visit these types of establishments.

In addition to these distribution channels, Kellogg’s employs a broker and distributor system for certain products, ensuring effective delivery and broad market coverage. The company also utilizes direct store-door delivery to supermarkets, streamlining distribution and enhancing in-store visibility.

Recognizing the importance of adapting to changing consumer preferences, Kellogg’s has embraced e-commerce platforms to distribute its products. By leveraging online retailers, Kellogg’s products are easily accessible to consumers who prefer the convenience of online shopping.

Strategic partnerships with major retailers, such as Walmart, significantly contribute to a large portion of Kellogg’s sales. These partnerships further enhance the company’s distribution reach and visibility, ensuring widespread availability of their products.

Kellogg’s strategic approach to distribution, encompassing various channels, enables them to maintain a strong presence in the market. By catering to different consumer preferences and regional variations, Kellogg’s ensures that their products are accessible to consumers worldwide.

Competitive Analysis

In a highly competitive FMCG industry, Kellogg’s recognizes the importance of conducting thorough competitive analysis to stay ahead of its rivals. By closely monitoring its competitors’ marketing strategies, pricing, product offerings, and consumer perception, Kellogg’s can gain valuable insights into the market landscape and identify opportunities to enhance its own marketing strategy. This comprehensive analysis allows Kellogg’s to make informed decisions about product positioning, pricing strategies, and promotional activities, enabling the company to maintain a competitive edge.

Kellogg’s faces competition from both local and international companies operating in the FMCG sector. Competitors such as General Mills, Nestlé, PepsiCo, and Mondelez International pose significant challenges in terms of market share and consumer loyalty. However, Kellogg’s extensive portfolio of 1600 products under various recognized brands like Murray, Austin, Famous Amos, Cheez-it, and Keebler strengthens its market position and gives it a competitive advantage.

The market in which Kellogg’s operates is saturated with various competitors, reflecting the high demand for convenient and nutritious food products. Consumption patterns, lifestyle changes, urbanization, and rising income levels influence the demand for Kellogg’s products. Kellogg’s marketing strategy effectively addresses these market dynamics by leveraging its brand equity and strong distribution network.

Kellogg’s revenue in 2022 reached $15.3 billion, demonstrating its significant market presence and financial performance. However, Kellogg’s faced challenges, including product recalls and quality concerns, as well as supply chain issues that impacted its net income. Despite these setbacks, Kellogg’s remains a prominent player in the industry, targeting different market segments such as kids, adults, and teens. By using a mix of demographic, geographic, and psychographic segmentation strategies, Kellogg’s can effectively reach and engage its target consumers.

Kellogg’s competitive analysis is further strengthened through the use of tools like the BCG matrix, which identifies ready-to-eat cereals and crackers as stars in the company’s portfolio. These stars indicate strong performance and growth potential for Kellogg’s in these product categories. This analysis helps Kellogg’s identify areas for future investment and focus its marketing efforts to maximize profitability.

Through a combination of competitive analysis, market research, and consumer insights, Kellogg’s maintains its position as a global leader by continuously adapting its marketing strategy in response to market trends and customer preferences. By staying ahead of the competition, Kellogg’s can secure its market share and continue to deliver quality products to consumers worldwide.

Consumer Insights

Kellogg’s understands the importance of consumer insights in shaping its marketing strategy. Through various methodologies such as surveys, focus groups, and data analysis, Kellogg’s gathers valuable information about consumer preferences, behaviors, and motivations. This in-depth understanding of their target audience enables Kellogg’s to create personalized and relevant marketing campaigns that resonate with consumers on a deeper level.

By leveraging consumer insights, Kellogg’s can make data-driven decisions to continuously improve its marketing efforts. This process involves analyzing consumer feedback and identifying trends and patterns to develop strategies that meet the evolving needs of their consumers. Consumer insights play a crucial role in refining product offerings, crafting compelling messaging, and selecting the most effective distribution channels.

One way Kellogg’s utilizes consumer insights is by tailoring its marketing campaigns to specific consumer segments. This approach allows them to deliver messages that align with the unique preferences and motivations of different groups. For example, after facing a decline in sales during the initial phase of operations in India, Kellogg’s strategically shifted its target audience to children in India. This shift was informed by consumer insights that highlighted the importance of appealing to children and their parents in the Indian market.

Overall, consumer insights serve as a foundation for Kellogg’s marketing strategy, providing valuable guidance in understanding consumer needs and preferences. By leveraging these insights, Kellogg’s can tailor its products, messaging, and marketing channels , ultimately enhancing consumer engagement and driving business growth.

Promotional Strategies

Kellogg’s employs a variety of promotional strategies to engage consumers and drive sales. Through their well-executed campaigns, they aim to create brand awareness, entice customers to purchase their products, and foster brand loyalty. Let’s explore some of the key promotional strategies implemented by Kellogg’s:

1. Discount Offers and Special Deals

Kellogg’s regularly offers discount promotions and special deals to attract price-sensitive consumers. These promotional pricing techniques, such as limited-time discounts, buy-one-get-one offers, and bundle deals, encourage consumers to choose Kellogg’s products over competitors. By providing value for money, Kellogg’s increases the likelihood of customer conversion and repeat purchases.

2. Co-promotions and Cross-promotions

Kellogg’s partners with retailers and other brands to run co-promotions and cross-promotions. Through these strategic alliances, Kellogg’s expands its reach and increases brand exposure. By featuring their products alongside complementary items or leveraging the brand equity of their partners, Kellogg’s captures the attention of new customer segments and reinforces brand loyalty among existing consumers.

3. Experiential Marketing

Kellogg’s understands the power of experiential marketing in creating memorable experiences for consumers. They organize events and activations that allow consumers to engage with their brand on a deeper level. By providing interactive and engaging experiences, such as product sampling, contests, and interactive displays, Kellogg’s strengthens their brand connection and fosters emotional loyalty among consumers.

4. Loyalty Programs and Rewards

Kellogg’s may implement loyalty programs or reward schemes to encourage repeat purchases and foster customer loyalty. By offering incentives such as points, discounts, or exclusive rewards, Kellogg’s incentivizes consumers to choose their brand consistently and provides an added value proposition for their products. These loyalty initiatives not only drive customer retention but also encourage positive word-of-mouth marketing.

In conclusion, Kellogg’s deploys a range of promotional strategies, including discount offers, co-promotions, experiential marketing, and loyalty programs, to engage consumers and drive sales. Their innovative and customer-centric approach ensures that Kellogg’s remains a prominent brand in the highly competitive food industry.

Brand Equity

Kellogg’s, with its rich history and extensive global presence, understands the importance of building and maintaining brand equity. The company’s commitment to delivering quality, taste, and nutrition has solidified their position as a trusted and preferred choice for cereal and convenience foods. Through strategic brand-building activities and consistent brand promise fulfillment, Kellogg’s has successfully cultivated a strong brand identity and reputation.

Kellogg’s reported net sales of $13.8 billion in 2020, highlighting their significant market presence and financial success. With a market share of 24.7% in the US cereal market, Kellogg’s ranks among the top food companies on the Fortune 500 list. Their operations span over 180 countries worldwide, showcasing the global reach and recognition of their brand.

To strengthen their brand equity, Kellogg’s engages in various brand-building initiatives. They strategically invest in sponsorships, endorsements, and cause-related marketing campaigns to enhance their brand image and reputation. By aligning themselves with influential personalities and supporting meaningful causes, Kellogg’s creates a positive association with their brand, resonating with consumers who share their values.

Kellogg’s commitment to consistently delivering on their brand promise plays a vital role in building brand equity. Consumers rely on Kellogg’s products for quality, taste, and nutrition, forming a strong bond of trust and loyalty. By consistently meeting and exceeding consumer expectations, Kellogg’s reinforces brand equity, retaining their existing customer base and attracting new consumers along the way.

Furthermore, Kellogg’s strong brand equity is reinforced by their presence across different markets. In North America, their largest market, Kellogg’s offers popular brands such as Kellogg’s, Kashi, Eggo, and Morningstar Farms. In Europe, their known brands include Kellogg’s, Pringles, and Special K. In Latin America, they have brands like Kellogg’s, Pringles, and Zucaritas. And in the Asia, Middle East, and Africa (AMEA) region, leading brands like Kellogg’s, Pringles, and Corn Flakes solidify Kellogg’s global brand presence.

In conclusion, Kellogg’s focuses on building and maintaining brand equity by investing in brand-building activities, consistently delivering on their brand promise, and catering to diverse markets. Through these efforts, Kellogg’s has established itself as a trusted and preferred brand, continuing to thrive in the highly competitive food industry.

Kellogg’s marketing strategy for 2024 encompasses a comprehensive approach that has contributed to its success as a global leader in the food industry. Through a combination of advertising campaigns, digital marketing strategies, market segmentation, product innovation, distribution channels, competitive analysis, consumer insights, promotional strategies, and brand equity, Kellogg’s has established itself as a trusted and preferred brand.

By leveraging its strong brand image and iconic characters like Tony the Tiger and Snap, Crackle, and Pop, Kellogg’s has successfully targeted families with children and health-conscious individuals as its primary audience. Through a competitive pricing strategy, Kellogg’s adjusts prices based on market research and offers promotional programs like discounts and coupons to attract consumers.

Kellogg’s also employs various distribution channels, including convenience stores, vending machines, mini superstores, and e-commerce platforms, to ensure its products are accessible globally. The company’s commitment to social responsibility is evident in its donation of cereals worth more than $10 million during the pandemic to fight hunger globally.

Looking ahead, Kellogg’s will continue to use innovative marketing strategies to connect with the next generation of consumers, such as associating with international events like FIFA and the Olympics. By analyzing customer demands and implementing effective promotion strategies, Kellogg’s will enhance its brand reputation and value, positioning itself for continued success in the competitive breakfast food market.

What is Kellogg’s marketing strategy for 2024?

How does kellogg’s promote its brand and products, what is kellogg’s digital marketing strategy, how does kellogg’s conduct market segmentation, how does kellogg’s approach product innovation, what distribution channels does kellogg’s use, how does kellogg’s conduct competitive analysis, how does kellogg’s use consumer insights, what promotional strategies does kellogg’s employ, how does kellogg’s build brand equity, related posts:.

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Nina Sheridan is a seasoned author at Latterly.org, a blog renowned for its insightful exploration of the increasingly interconnected worlds of business, technology, and lifestyle. With a keen eye for the dynamic interplay between these sectors, Nina brings a wealth of knowledge and experience to her writing. Her expertise lies in dissecting complex topics and presenting them in an accessible, engaging manner that resonates with a diverse audience.

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Kellogg’s Marketing Case Analysis Presentation

• To find inspiration for your paper and overcome writer’s block
• As a source of information (ensure proper referencing)
• As a template for you assignment

Introduction

Kellogg: company background.

• The company is a global leader in the production of cereals (MarketLine 2012).
• It is a multinational producer of snacks, breakfast cereals, crackers, and cookies.
• It has operations in more than 18 countries.
• The goods are distributed in approximately 180 nations around the globe.

Kellogg’s Marketing Project

• The marketing entails communication of the product’s value for the purposes of selling (Kerin 2012).
• It involves promotion and sale of products (Kotler & Keller 2012).
• Marketing actions include, among others, advertising and conducting market research.
• The duration of the marketing project is six months.
• It is divided into various phases.

The current paper is a proposed marketing project for Kellogg. The marketing plan is divided into different phases to enhance its effectiveness.

The project phases include:

• Initiation.
• Controlling.

The following activities will be undertaken to achieve the objectives of the marketing plan:

• Determining creative concept (a).
• Determining and securing communication media (b).
• Preparing the marketing message (c).
• Contacting communication media (d).
• Campaign execution (e).
• Assessing consumers’ response (f).
• Closing the marketing campaign (g).

According to Denscombe (2007), a project progresses through different stages. They include initiation, planning, execution, control, and closure. The tasks are given tags (IDs) for the purposes of entry into the Gantt chart. The IDs are also used to draw the critical path diagrams.

Gantt Chart

A Gantt chart is a visual representation of a given project’s schedule (Wilson 2003). The proposed marketing project will take a duration of 6 months.

Justification of Activities

Justification of the activities involved in the gantt chart.

• The activities address all the phases of a project.
• They include planning, execution, and review.
• They involve the core elements associated with the marketing of Kellogg’s products.

Kellogg’s Marketing Project: Critical Path

There are two paths in the company’s project network diagram.

The paths include:

• Path 1: A-C-E-G Length = 1+1+3+1=5 months.
• Path 2: B-D-F-G Length = 2+2+1+1=4 months.

The longest route is A-C-E-G, which is 5 months. It is also the project’s critical path.

The critical path is the longest route through the network diagram (Hendrickson & Tung 2008). The number of paths in a given project vary depending on its duration and other dynamics.

Literature Review

Management Information Systems

Various types of information systems exist in business organisations. According to Laudon and Laudon (2009), they include:

• Transaction processing systems.
• Management information systems.
• Decision support systems.
• Executive information systems.

Management information systems provide the management team with the data needed in decision making.

Information processing requirements for a given organisation exist at 3 levels. The three are strategic, tactical, and operational levels (Adeoti-Adekeye1997).

Management information systems provide managers with the data required to effectively operate an organisation. The functions of MIS include extracting and summarising information from transaction processing systems. Other uses include the provision of scheduled and pre-specified reports (O’Brien 1999). The system allows managers to direct and monitor organisations. It provides accurate feedback from the stakeholders.

Proposed Information Processing Systems for Kellogg

Kellogg can implement various information processing systems at different organisational levels.

Some systems are crucial to the entity’s operational, tactical, and strategic management. According to Laudon and Laudon (2009), the systems include:

• Inventory management.
• Transaction processing.
• Office automation.
• Enterprise resource planning systems.

Inventory management systems help in stock taking and control (Laudon & Laudon 2009). On their part, transaction processing systems (TPS) assist in the collection and recording of routine transactions in the organisation (Cengiz, Ihsan & Emre 2011). Kellogg can utilise such a system to manage customer transactions. Examples of TPS models that the company can use include sales order entry, payroll, shipping, and employee record systems.

Office automation systems (OAS) support communication and production activities in the organisation. They involve automation of work flow and elimination of bottlenecks (Cengiz et al. 2011). The system serves all levels of the organisation.

Enterprise resource planning systems (ERP) enhance the flow of information among various internal business functions. In addition, it links these activities to external stakeholders (Cengiz et al. 2011). The model supports optimum utilisation of the resources available to the organisation.

Suggested Information Processing Systems

Enterprise applications suitable for Kellogg’s operations include:

• Knowledge management systems (KMS).
• Supply chain management systems (SCM).
• Customer relationship management systems (CRM).

The nature of the company’s operations calls for the extensive application of these systems.

Knowledge management systems help organisations to collect, record, organise, retrieve, and disseminate information (Cengiz et al. 2011). Kellogg can use the system to keep track of information on skills, practices, and procedures in the firm. The aim is to improve the company’s productivity.

Supply chain management systems improve the administration of delivery processes by synchronising the various links in the network (Cengiz et al. 2011). Kellogg can use the model to handle its supply chain. The system can address issues arising from suppliers of input materials and retailers of the company’s products.

Customer relationships management systems assist businesses to regulate their engagement with current and potential clients. The systems also help the organisation to handle its relationship with other business partners, such as marketing firms (Cengiz et al. 2011). Kellogg can adopt the strategy to develop a close relationship with customers. The aim is to improve customer service and increase profitability.

Financial Tools

Financial tools are used by companies to manage fiscal activities with the objective of attaining the desired returns on investments (Kimmel, Weygandt & Kieso 2013).

Monetary control is exercised through, among others, operating ratios and financial statements.

The fiscal tools evaluated in this study include:

• Discounted cash flow.
• Internal rates of return.

Discounted Cash Flow (DCF)

DCF is a valuation method used in estimating the attractiveness of investment opportunities (Kimmel et al. 2013).

The function is calculated as follows:

• CF=Cash Flow
• r=discounted rate (WACC)
• WAAC= Weighted Average Cost of Capital

DCF estimates total amount of cash that can be expected from an investment.

Under DCF, future cash flow projections are discounted. In most cases, the function uses weighted average costs of capital. The aim is to attain the present value of the investment (Kimmel et al. 2013). The current value is used to evaluate the potential of a given investment.

When the value of DCF exceeds the current investment cost, the investment opportunity can be regarded as feasible for the company. Basically, the function discounts or brings back the anticipated returns to their common ground, which is the present value.

There are two basic methods of computing DCF. The two are internal rate of return and the net present value methods (Kimmel et al. 2013).

Internal Rate of Return

IRR refers to the discounted rate used in capital budgeting.

It makes sure that net present value of all cash flows from given projects is equal to zero (Kimmel et al. 2013).

IRR is used in analysing alternative investments. It is mostly used on projects that have identical risks. It is not advisable to use it on fixed return undertakings.

However, the function has one major weakness. To this end, it assumes that cash flow discount rates remain the same during reinvestment.

A project with a high internal rate of return is more desirable than one with a low function. IRR can be used in the ranking of the prospective projects the firm is considering to invest in.

Financial Tools Recommendations for Kellogg

Kellogg’s has several financial tools at its disposal.

DCF and IRR can be used to project return on investments.

However, each of the two has its own shortcomings.

IRR has a complex formula. It is mostly determined on a trial and error basis.

Small changes in DCF can lead to significant alterations in its overall value (Kimmel et al. 2013).

DCF gives better results if terminal values in cash flows are used as opposed to infinite projections.

Methodology

Collection of primary and secondary data for kellogg.

The success of Kellogg’s marketing project and customer responses should be evaluated.

There is need to use both primary and secondary sources of information.

Primary sources involve original materials from which raw or first-hand information is found (Denscombe 2007).

Primary data collection methods for Kellogg’s case include:

• Questionnaires.
• Observations.

Primary and Secondary Data Collection for Kellogg

Sources of secondary information reflect data gathered from primary materials (Denscombe 2007).

The sources offer secondhand accounts.

Kellogg can obtain this data from the following:

• Newspaper articles.
• Campaign feedback analysis.
• Questionnaires and surveys analyses.

Justification of Data Collection Methods

The primary and secondary sources of data selected by Kellogg are relevant to the objectives of the project.

Marketing objectives include increased product awareness, brand promotion, and preference over competitors.

The selected methods will determine whether the objectives are realised or not (See Appendix I for questionnaire).

Summary of Representative Values

Data from Kellogg’s survey:

Mean, mode, and median are the commonly used averages.

Mean is determined by dividing the number of values by their sum (Olive 2013).

• Sum of the data 1+1+2+2+2=8
• Number of values 5
• Mean 8/5=1.6

Mode refers to the value that is most recurring in the data (Hippel 2005).

Mode for Kellogg’s survey data:

Median refers to the value in the middle when data is arranged in a numerical order (Hippel 2005).

Median for Kellogg’s data:

Conclusions Drawn from Kellogg’s Data

Mean, mode, and median are measures of central tendency.

In cases where the data set has no extreme values, mean is used in the prediction of future results (Hippel 2005).

Kellogg’s data set has no outlying values.

A mean of 1.6 indicates higher chances of finding company products if more retail outlets are surveyed.

Mode and median values of 2 also indicate high prevalence of Kellogg’s products in the market.

Mean, mode, and median are regarded as measures of central tendency. The three measures indicate the point where data is clustering around or centered.

Analysing Kellogg’s Data through Measures of Dispersion

Measures of dispersion are used to quantitatively express the degree of variation for values in a given sample or population (Olive 2013).

The measures include standard deviation, range, average deviation, and interquartile range.

Measures of Dispersion for Kellogg

Standard deviation.

The function is the square root of the sample variance (Olive 2013).

It measures variability or spread of data.

It is calculated as the root mean square deviation of values from their arithmetic mean.

• X = Individual score
• M = Mean of all scores
• N = Sample size (Number of scores in population) (Olive 2013)
• ∑(X-M)ⁿ = 1.2 n=2
• s= √ ∑(X-M)ⁿ∕N

The standard deviation of the population surveyed is 0.24.

Conclusions Drawn from Standard Deviation

The value of a measure of statistical dispersion is supposed to be zero in instances where all data is identical.

As the data becomes more diverse, the value of the measure increases.

As such, the value cannot be zero.

Standard deviation of 0.24 indicates little diversity in the population data.

In relation to Kellogg’s case, the value indicates increased likelihood of similar results from the sampled population.

Recommendations and Conclusions

Findings from the survey indicate high presence of Kellogg’s products in the sampled UK cities and retail outlets.

Measures of central tendency illustrate slight variations in data.

Measures of dispersion (standard deviation) highlight minimal diversity in sample values.

Both central tendency and dispersion measures give highly correlating results.

Future studies in relation to Kellogg’s products should focus on the company’s market share.

Market share can be analysed using volume of sales in sampled segments.

The measures of central tendency and dispersion are used to evaluate features and aspects of the sampled population. It helps in drawing conclusions. The measures used in this study indicate that data is clustering closely together. Consequently, it is apparent that results from sampled population are relatively similar. The value of the measure of dispersion used (standard deviation) indicates slight diversity. As such, one can conclude that the awareness of Kellogg’s product in the sampled markets is high.

Future studies on these products should try to determine the company’s market share since it is clear that the organisation is highly visible in the industry.

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Kellogg’s Market Survey Questionnaire

• Business Name.
• If yes to three, how many Kellogg brands do you offer? (Indicate number)
• If no to three above, would you like to introduce Kellogg’s brand in your business?
• Less than $30,000.
• 30,000 – $39,999.
• $40,000 – $49,999.
• $50,000 – $59,999.
• $60,000 – $74,999.
• $75,000 – $99,999.
• $100,000 – $149,999.
• $150,000 – $249,999.
• $250,000 – $499,999.
• $500,000 – $999,999.
• 1 million or more.
• $100,000-$249,999.
• $500,000-$749,999.
• $1 million -$1.4 million.
• $2 million -$4.9 million.
• $10 million and over.
• $50,000-$99,999.
• $250,000-$499,999.
• $750,000-$999,999.
• $1.5 million -$1.9 million.
• $5 million -$9.9 million.
• If no, please give us your reasons.
• Thank you for your assistance and cooperation.
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IvyPanda. (2022, June 29). Kellogg’s Marketing Case Analysis. https://ivypanda.com/essays/kelloggs-marketing-case-analysis/

"Kellogg’s Marketing Case Analysis." IvyPanda , 29 June 2022, ivypanda.com/essays/kelloggs-marketing-case-analysis/.

IvyPanda . (2022) 'Kellogg’s Marketing Case Analysis'. 29 June.

IvyPanda . 2022. "Kellogg’s Marketing Case Analysis." June 29, 2022. https://ivypanda.com/essays/kelloggs-marketing-case-analysis/.

1. IvyPanda . "Kellogg’s Marketing Case Analysis." June 29, 2022. https://ivypanda.com/essays/kelloggs-marketing-case-analysis/.

Bibliography

IvyPanda . "Kellogg’s Marketing Case Analysis." June 29, 2022. https://ivypanda.com/essays/kelloggs-marketing-case-analysis/.

How Kellogg's Went From Corn To Multinational Food Manufacturer

Table of contents.

Like most specialty foods, breakfast cereal is the result of a kitchen accident rather than deliberate planning. The brothers, who worked as a superintendent and a bookkeeper at a local sanitarium, were experimenting with various diets and accidentally discovered the process for making delicious and crunchy cereal.

After several name changes, the company that eventually became the Kellogg Company has grown into a multinational organization selling its breakfast treats in 180 countries. Over the decades, both the ingredients and the recipe have changed significantly: Originally intended as diet food, and later with large amounts of sugar added, the company has now refocused on healthy eating.

In this article, we take a look beyond the controversial founders to learn how a small cereal company became a Fortune 500 corporation and what its business looks like today.

A few key facts about Kellogg's:

• The Kellogg Company was founded in 1906.
• Kellogg's employs 31,000 people around the world.
• Kellogg's reported $13.77 billion net sales for 2020 .
• The gross profit in 2020 was 3% of net sales .
• In 2020, the company spent $780 million on marketing .
• Kellogg's is marketed in 180 countries around the world .
• The company sells 54 different products .
• The Kellogg Company spends less than 1% of its revenue on Research and Development .

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The Story Of The Kellogg Company

Two brothers, a sanitarium, and a kitchen accident.

The Seventh-day Adventists are a church group founded in the 1860s that preaches strict vegetarianism (and a ban on alcohol, tobacco, and other drugs). The Kellogg brothers, Will Keith Kellogg and John Harvey Kellogg were among the church's most ardent followers and made every effort to live a lifestyle consistent with religious observances. The meat was not part of their diet, so they tried to spice up their otherwise rather monotonous meals with a variety of grains. The monotony stemmed not from the ban on meat, but from the fact that John Harvey liked a hard meal and, along with Seventh-day Adventists, was a staunch follower of Sylvester Graham, the inventor of graham crackers and graham flour. He held that salt, sugar, and various spices should be avoided, in addition to meat, because they cause undesirable passions in the human body.

The Kellogg brothers ran a large and popular resort sanatorium in Battle Creek, Michigan, where patients were required to follow a strict diet in addition to regular enemas and exercise. According to some contemporary accounts, the spa was a transition between a luxury hotel and a military training camp. Methods included ice-cold showers, frequent enemas, and the use of bizarre devices of the spa's own design.

But the severity with which he treated his patients did not stop celebrities of the time from turning to Kellogg for their health. Female aviation legend Amelia Earhart and Hungarian-born Olympian Johnny Weissmuller, who played the first Tarzan, were among the patients who had access to Kellogg's sanatorium, and automobile magnate Henry Ford also willingly submitted to the doctor's will. It was here that cornflakes were born - initially from wheat.

The idea for cereal did not come first from Kellogg's. The idea came from Dr. James Caleb Jackson, who made the first dry granola in 1863, which he called "granola." It was not particularly successful until the Kellogg Company finally made the real breakthrough with sweetened cereals.

The Kelloggs found the recipe for success by accident: they had accidentally left a batch of grain in the soaker, but, short of cash, decided to use the shaken-up raw material. The wet grains were then pressed together to produce the distinctive flakes, which were initially offered to "invalids with digestive problems", constipation or other problems resulting from overly fatty, salty, or spicy American cuisine, and excessive caffeine and alcohol consumption.

How Will took over the family business

Will also realized he could make better quality by using much tastier corn instead of less exciting-tasting grains, and with his excellent business sense, he realized the market was not just people with stomach problems, but almost anyone who wanted a quick and convenient nutritious breakfast. 

As soon as guests left the sanitarium, hundreds of mail-order requests from them were made for flaked wheat. Will was forbidden by Dr. John Harvey to distribute cereal beyond the boundaries of his consumers. Consequently, the brothers fell out, and Will founded Battle Creek Toasted Corn Flake Company on February 19, 1906. He persuaded his brother to give him the rights to the product, which was then developed and produced by his company, and renamed the Kellogg Toasted Corn Flake Company in 1909, later becoming the Kellogg Company in 1922.

Turning the company into a responsible organization

"I'll invest in people," Will declared as the United States plunged into the Depression in 1930. The company split shifts and hired new workers. He also established his own foundation (named after him), which still exists today, to give poor children a start in life. For further commitment to people, Kellogg began displaying cereals' nutritional information on their boxes, so customers knew exactly what they were eating.

The company’s engineers helped manufacture supplies in Kellogg's machine shops during World War II and produced K-rations for the US military overseas. Introducing Kellogg's Raisin Bran helped the company bring new whole-grain cereal to life, helping America get more nutrition.

In 1969, while Neil Armstrong, Buzz Aldrin, and Michael Collins were on the Apollo 11 mission to the moon, the Kellogg Company provided breakfast for them.

From the late 60s, the company invested more (but as later turned out, not enough) in marketing and expanded its advertising activities to television. This has been one of the busiest periods of the company’s history with events including:

• Sunday morning TV shows used the slogan "Kellogg's puts more into your day" from 1969 to 1970.
• As of 1977, Kellogg's had acquired Salada Foods, Fearn International, Mrs. Smith's Pies, Eggo, and Pure Packed Foods, among others. The company was later criticized for not diversifying further as its competitors did at that time.

Kellogg's market share in the US dropped to 36.7% in 1983 after it underspent on marketing and product development. Wall Street analysts called it "a fine company that's past its prime".

The overall market reception encouraged Kellogg chairman William LaMothe to improve, which primarily involved marketing cereals to the 80 million baby boomers rather than children. As a result of emphasizing cereal's convenience and nutritional value, Kellogg's helped increase cereal consumption among US consumers aged 25 to 49 by 26% over the last five years.

In 1983, the US ready-to-eat cereal market was worth $3.7 billion, but by 1988, it had grown to $5.4 billion and had expanded three times as fast as average grocery categories. In addition to Crispix, Raisin Squares, and Nutri-Grain Biscuits, Kellogg's introduced Just Right for Australians and Genmai Flakes for Japanese consumers. The company, which marketed largely children's cereals, maintained a competitive edge over its top competitors: General Mills and Post, which faced challenges in the adult cereal market.

Preparing for the future with acquisitions

Kellogg's bought Keebler in 2001 for $3.87 billion, while also cutting 470 jobs at the same time. The company has also acquired Morningstar Farms and Kashi over the years. In addition, the company owns Bear Naked, Natural Touch, Cheez-It, Murray, Austin cookies and crackers, Famous Amos, Gardenburger (acquired in 2007), and Plantation brands.

As part of a cash transaction, Kellogg's acquired Pringles from Procter & Gamble in 2012 for $2.7 billion , becoming the world's second-largest snack food company (after PepsiCo). 5 years later, Rxbar, a simple food company in Chicago, was acquired for $654 million .

Ferrero SpA announced on April 1, 2019, that they would be acquiring Famous Amos, Murray's, Keebler, Mother's, and Little Brownie Bakers from Kellogg’s. The acquisition deal was completed later that year. The Kellogg Company kept the Keebler cracker line but brought it under the Kellogg's brand umbrella.

Key takeaways

The Kellogg brothers were unable to settle their cornflakes dispute until their deaths, and their relationship was forever damaged after they started their own company. But this personal tragedy does not diminish their joint achievement of inventing one of the world's most famous and beloved foods.

From the company's history, it's clear that Will, a skilled accountant, quickly understood what they needed. Kellogg's needed to capture more and more markets. After focusing on specific regions, the company moved on to targeted market segmentation - primarily targeting children and their parents with its products.

Kellogg’s Brands And Flagship Products

Who owns the company today.

Today, Kellogg’s is among the largest food manufacturing and grocery holdings companies traded on the stock exchange. The major shareholders of the company are the following, according to Market Screener .

Kellogg’s brands

The world's largest food and beverage brands are controlled by about ten companies. These companies are:

• General Mills
• Associated British Foods

And, of course, Kellogg’s .

The Company’s brands include Kellogg’s, Keebler, Pop-Tarts, Eggo, Cheez-It, All-Bran, Mini-Wheats, Nutri-Grain, Rice Krispies, Special K, Chips Deluxe, Famous Amos, Sandies, Austin, Club, Murray, Kashi, Bear Naked, Morningstar Farms, Gardenburger and Stretch Island.

Kellogg’s flagship products

According to a study by IRI Worldwide in 2017, Kellogg’s had a share of 30.01% in the US breakfast cereals market. This was because the company produced 4 out of the 10 favorite bowls of cereal:

• Raisin Bran
• Frosted Mini Wheats
• Fruit Loops
• Frosted Flakes

Sunshine Biscuits

The American Biscuit & Manufacturing Company was founded in 1890 by 33 Midwest and western bakers. The goal of consolidation, i.e., the merger of small, local companies, was to oust the two largest U.S. companies from the top of the market. The American Biscuit and New York Biscuit groups tried to eliminate the competition by opening bakeries in each other's areas and lowering prices. The National Biscuit Company (Nabisco) was formed by combining 114 factories in February 1898.

As a member of Nabisco's Board of Directors, Joseph Loose created the Loose-Wiles Biscuit Company in Kansas City in 1902, along with his brother Jacob and John H. Wiles. They imagined a factory that was filled with sunlight, so they called their products SUNSHINE. The company began expanding, opening plants in Boston and then New York.

It took Loose-Wiles forty years to dissuade other companies from using the term "sunshine" or any related term in products or advertising because it did not register its brand name. Sunshine Biscuit, Inc. finally became the official name of the Loose-Wiles Company in 1946.

The company developed new products and acquired established brands from smaller competitors in the early part of its history. There are many products and their names that resemble those of their biggest competitor, the National Biscuit Company.

The company was purchased by the American Tobacco Company in 1966. Following the sale to GF Industries, a privately held California company, the company merged with Keebler in 1996. In 2001, it joined Kellogg's group, already part of Keebler.

Cheez-It snack crackers, as well as Krispy Crackers saltines, are Sunshine's best-known products.

Frank Dorsa developed a process for cooking, freezing, and packaging waffles in San Jose, California. In 1953, similar to Kellogg’s, the Dorsa family came up with Eggo frozen waffles as "Froffles" (putting together the words "frozen" and "waffle"). A waffle iron was not necessary to prepare frozen waffles, which immediately made the product unique to the market.

Customers called them Eggos because of the egg flavor. As more and more people started calling their frozen waffle products Eggos, the owning family realized it was worth taking the opportunity to rename the company.

Eggo potato chips (and Golden Bear potato chips) and Eggo syrup were also produced by the Dorsa brothers, in addition to frozen waffles. In San Jose, CA, a sprawling plant and factory on Eggo Way produced all of the products. As active members of their local community, the Dorsas donated a great deal to local schools and community projects.

Kellogg Company acquired Eggo in 1968 as a means of diversifying. Through their television commercials, their advertising slogan "L'eggo my Eggo" was developed in 1972.

The Eggo brand of breakfast cereals is shaped like waffles and is produced by Kellogg's. It comes in flavors such as maple syrup and cinnamon toast. Originally produced from 2006 to 2012, the brand was reintroduced in 2019 following a successful campaign.

Fredric J. Baur (1918-2008) was tasked by Procter & Gamble in 1956 with creating a new kind of potato chip in response to consumer complaints about broken, greasy, and stale chips, as well as air in the bags. A canister was selected as the container for the saddle-shaped chips that Baur created from fried dough for two years. Pringles chips have a saddle shape known as a hyperbolic paraboloid.

Baur's work was restarted by P&G researchers in the mid-1960s, and they succeeded in improving the taste. The patent name on the Pringles chip is Liepa's, not Baur's, even though Baur designed the chip's shape. The machine that cooks them was developed by Gene Wolfe, an author and mechanical engineer. Pringles were first sold in Indiana in 1968 by P&G. Throughout most of the US, they were available by 1975, and internationally by 1991.

The product was originally called crisps, but due to a competitor's veto, the product was eventually required to include the words crisps made from dried potatoes. However, for understandable reasons, the company could not easily use this name in its advertising, so it was changed to "crisps".

The deal would have more than tripled the size of Diamond Foods' snack business if it were to sell the brand to P&G in April 2011. After a year-long delay, Diamond's accounts caused the deal to collapse in February 2012. As part of its strategy to grow its international snack business, The Kellogg Company acquired Pringles for $2.695 billion on May 31, 2012. As a result of its acquisition of Pringles, Kellogg became now the world's second-largest snack company.

Pringles has five plants worldwide as of 2015: in the US, in Belgium, in Malaysia, in Poland, and China.

GardenBurger

Paul Wenner developed the Gardenburger at his vegetarian restaurant, The Gardenhouse, in Oregon, around the early 1980s. In March 1985, Wholesome & Hearty Foods, Inc., was incorporated. Paul Wenner and Allyn Smaaland received their first funding as part of a venture capital investment program of Louisiana-Pacific Corp. As a result, L-P took a controlling stake in the company immediately. About a year later, the company received a second round of venture capital financing. Despite filing for bankruptcy in 2005, Gardenburger continued to operate by becoming privately owned.

It announced in 2006 that it would remove eggs from all of its products, except for one item sourced privately, which now contains organic, cage-free eggs. In 2006, the company renamed itself Wholesome & Hearty Foods. A year later, Kellogg’s acquired the company to broaden and diversify its portfolio.

The Kellogg's Company has been very involved in product development since its founding. Without it, the breakfast cereal market would not exist - although it should be added that countless studies have shown that these products have contributed greatly to the morbid obesity of American children. However, the company's strategy was clear: drive product development through the creation of new brands and acquisitions.

Today, Kellogg's has developed a complex portfolio of products and brands that includes all types of breakfast and snack foods - from frozen waffles to hamburgers.

The most famous of the acquired brands are undoubtedly Pringles, which reformed the potato chip market with its distinctive shape and flavor. In almost a decade, the group has become one of the strongest brands in the industry.

The Outline Of The Company’s Strategy

The kellogg’s better days program.

‍ Kellogg's Better Days , Kellogg's signature purpose platform, has provided 3 billion servings of food to people in need since 2013. As part of Kellogg's commitment to increase ambition in 2019, the company captured a wider range of goals and aligned with the United Nations Sustainable Development Goals.

Kellogg will address food security and create Better Days for 3 billion people by 2030 through its updated program goals. To drive positive change for people, communities, and the planet, the company focuses on wellbeing, hunger relief, and climate resilience. Kellogg's specifically supports:

• Delivering nutrients of need to 1 billion people while addressing hidden hunger.
• Providing food donations and expanded child-feeding programs to 375 million people in need.
• Achieving science-based targets, sourcing ingredients responsibly, reducing organic waste, and providing sustainable packaging while supporting 1 million farmers and workers across the value chain.
• Advancing the values of the founder by advocating for children facing hunger, encouraging employee volunteering, ensuring an ethical supply chain, and supporting diversity and inclusion.

Raw materials

As a result of the COVID-19 pandemic, food companies have run into serious difficulties as labor shortages have led to sharp price fluctuations in the commodity market. Kellogg's normally sources its raw materials from local growers but says it is increasingly reliant on imports. To compensate, Kellogg's is gradually extending contracts with its suppliers, tying up capacity in advance to ensure predictability and planning.

The trend in the international market is that the strong fluctuations in raw material prices mainly affect the US market, so Kellogg's other factories can continue to operate smoothly.

Research and Development

At the WK Kellogg Institute for Food and Nutrition Research in Battle Creek, Michigan, and other locations around the world, researchers support and expand the use of existing products and develop new products. Despite having a dedicated research institute dedicated to food quality, safety, and new product development, the company spends surprisingly little: 2020-$135; 2019-$144; 2018-$154.

Food scientists at Kellogg's world-class research facility develop innovative breakfast foods that meet consumers' expectations for taste, nutrition, and convenience.

Nine conference rooms, a boardroom, a 120-seat auditorium, a 3-story atrium, a stainless steel staircase, and state-of-the-art technology are all included in the new building. As a result, the WK Kellogg Institute consolidates the Company's global food research efforts in one location. This enables Kellogg researchers and technical experts to better share knowledge while enabling new products to be introduced to consumers more quickly.

Equity and diversity within human resources

Kellogg established a separate, independent Diversity & Inclusion Office in 2005. A major focus of this internal organization has been to recruit and retain a diverse workforce, create awareness about diversity issues, foster a supportive, inclusive work environment, and embed accountability for diversity across all lines of business. The company strives to reflect the diversity of its consumers. ED&I (Equity, Diversity, and Inclusion) is reported directly to the Board of Directors periodically.

This organization is divided into 8 different Business Employee Resource Groups:

• KVets and Supporters
• Kellogg Multinational Employee Resource Group
• Kellogg’s Young Professionals
• Kellogg African American Resource Group
• Women of Kellogg
• Hola (Latino resource group)
• KPride & Allies (LBGTQ+ resource group)
• Kapable (support group for people with disabilities).

Risk assessment with a COVID-19 focus

Kellogg's is being unusually open about the risks that management sees in COVID-19 and the economic difficulties that have followed in its wake, mainly, of course, under pressure from and for the information of its shareholders.

In its annual report, the company cites the negative impact of COVID -19 on the supply chain as the biggest risk. Forced shutdowns due to regulatory quarantine and illnesses within the company (including Kellogg Company subcontractors) make it very difficult to meet order backlog. This applies primarily to the US but could affect any other country if the outbreak worsens.

A decline in national and global economic conditions, as well as volatility in financial markets, could have a variety of effects on the business and operations, including the following:

• In economic downturns, consumers may opt for cheaper or more generic offerings or may forego certain purchases altogether, which could result in lower sales revenue or a shift in product mix to lower profit offerings, adversely affecting business results.
• As a result of disruptions or uncertainties related to the COVID-19 pandemic, Kellogg’s could be hindered in efforts to reduce operating costs, both in the supply chain and in overhead, and the ability to implement strategic plans and initiatives.
• Currency translation losses and currency transaction losses would result if the US dollar strengthened relative to foreign currencies in the countries where the company operates.
• As a result of illness or government restrictions, a considerable portion of the workforce may not be able to work.
• Because many of Kellogg's employees work remotely, Kellogg's is increasingly susceptible to cyberattacks due to its reliance on information technology systems.
• Due to illness, government restrictions, or other workforce disruptions, a manufacturing, warehousing, or distribution facility may close down, or the supply chain may be disrupted.
• As a result of reduced in-store visits and travel restrictions, it's difficult to modify trade promotion and advertising activities effectively.
• During the COVID-19 pandemic, unemployment may lead to a decrease in demand for products.
• A significant increase in commodity and other input prices could have a substantial impact on the results of operations.
• Volatility in equity markets or interest rates can significantly affect the cost of pensions and the required contribution.

Numerous measures have been taken by the Company to help fulfill key objectives and reduce industry-related risks during the pandemic:

• Keeping employees healthy and safe.
• Produce and deliver food safely to consumers and customers.
• Kellogg's supports the communities in which it operates.
• Flexibility in financial matters.
• This process involved close collaboration with medical, regulatory, and other experts.

Among the above measures, maintaining financial flexibility is discussed most openly. According to Kellogg’s, operating activities are expected to generate $1.6 billion in cash for the company in 2021, while capital expenditures will be about $500 million. Additionally, it has access to commercial paper markets and currently has revolving credit agreements totaling $2.9 billion, including $1.5 billion effective through 2023 and $1 billion through 2022.

The Kellogg Company’s operating strategy is multi-faceted and highly diversified. The Better Days program and internal strategy HR demonstrate that the company is socially responsible, to provide food to as many underdeveloped, poor regions as possible and strengthen the equity and inclusion of external and internal human resources (employees and contractors).

At the same time, another important element of the operational strategy is to ensure the stability of the company during the pandemic COVID-19. This involves ensuring that the huge demand for raw materials can be met (especially in the U.S., where shutdowns are most difficult) and providing financial stability, for which Kellogg's considerable liquidity is a great help.

But it is also surprising how little one of the world's largest food conglomerates spends on food safety and innovation. This is especially true given the pressure on the company to produce ever healthier, sugar-free products that are more beneficial to children's development - but so far this is happening more at the level of communication.

Production, Sales, and Marketing

Manufacturing breakfast.

Three nutrients - nitrogen, phosphorus and potassium - are injected into the soil in April to help the seeds grow. Two months later, the corn undergoes a growth spurt, reaching five feet tall and blooming. It is time to harvest the corn between October and November, when it is ready for sifting, cleaning, and rolling at a mill, before it is shipped to Kellogg's. Flakes are formed from corn grits in the factory. Kellogg's Corn Flakes are cooked, dried, and toasted to create these flakes, which are then sold at supermarkets.

As a traditional FMCG company, Kellogg's does not sell directly to customers but is associated with small and large grocery chains such as Walmart and Tesco. About 20% of the group's employees are in sales, mainly account managers who sell products to store networks and make sure they are positioned correctly.

There is also a dedicated team for what is known as sampling, which overlaps with sales and marketing. This involves giving customers the opportunity to try the latest products in a country-specific, localized way. With a category like cereal, the company needs to create multiple touchpoints so consumers can experience the products. Sampling, along with the right pricing architecture, helps achieve this. In this series of innovations launched over the past few years, sampling and other promotional activities have taken center stage as they help consumers experience a product firsthand before they develop an affinity for it.

Kellogg's has focused on its core target group of children - or more specifically, families with children - almost from the beginning. This is a special market segment, because you have to both persuade and engage kids (if they do not like the product, parents will buy it for free) and send the right messages to parents. The company realized early on that the packaging of the products plays an important role in this, and continues to do so today.

To meet parents' expectations, the health benefits of healthy foods must be emphasized in advertising, on packaging, and on all company communication platforms.

Kellygg's invests more than 8% of its sales in brand building , which helps the company build a strong brand in the developing world. One of the current focus areas of the company is India. According to Bakery and Snacks , the 2019 brand value of Kellogg’s was $6.7 billion - the fourth largest globally.

Kellogg's marketing campaigns have changed significantly over the years. With a marketing budget slightly below the market average, the company typically thinks about more thoughtful campaigns. Before the 2000s, it was more typical to sponsor sporting events, advertise on TV (the best time to do this was before children's shows on weekends), but they also provided the fake money for the moon landing.

In developed countries, marketing spend is increasingly shifting to the Internet (the company has over 1 million followers on Facebook in the US alone), but in developing countries, print media and television remain the most effective channels. For the poorest regions of the developing world, not only is information an important goal, but Kellogg's must also educate the market. In India, for example, a significant proportion of children do not eat breakfast at all, so Kellogg's is also raising awareness in its local campaigns.

The Kellogg's group of companies is a traditional FMCG company, meaning that it does not sell its products directly to the consumer, but involves various distributors in the process. These are smaller, local grocery stores, which are visited individually by sales representatives, and large chains and supermarkets, which are in turn contacted by central customer service representatives.

For one of the world's best-known food brands, Kellogg's spends very little on brand building and marketing activities. Much of that spending goes to developing countries, where breakfast and fake foods are not as fashionable as they are in the U.S., for example. Kellogg's is trying to market itself through education.

Final Thoughts And Key Takeaways

Growth by numbers.

Kellogg Company Group sales clearly peaked in the past decade in 2014, followed by a sharp decline and another gradual increase. However, the coronavirus outbreak changed all scenarios - providing an unexpected surge in cereal purchases (only to later lose momentum due to supply chain disruption).

One of the big challenges for Kellogg Company is the growing competition in the market, fueled not only by cereals but also by breakfast offerings from fast-food chains. However, the company does not yet have an overarching global strategy that could differentiate it from the rest of the market.

Key takeaways from Kellogg’s story:

• Responsible recipes: Kellogg's focused on responsible practices relatively early on, which remains an important communication point today. However, values such as producing healthy food, promoting the trace elements necessary for children's development, and educating people about the importance of breakfast are not just marketing concepts; they play a major role in convincing families with children to buy the products in the long term.
• Building complementary brands: The company has slowly but steadily developed its numerous sub-brands. These were later complemented by acquisitions of companies already established in the market. The underlying strategy was to be present in the breakfast meal and snack market with all significant product lines.
• Taking responsibility within the company: Diversity and inclusion are not just buzzwords, they also help Kellogg to remain a world-leading group and provide opportunities for talent to flourish, regardless of background. It has also launched a special program to feed and educate people in poor regions.
• Brand building at low cost: One of the Kellogg Group's greatest advantages is that the product line it invented is still identified with the company, giving it an advantage in competing for customers even after 100 years. For this reason, brand building is primarily focused on global regions such as certain Asian countries where there is still room for market growth.

But competitors are on a more spectacular trajectory - both Nestlé and Danone are developing much broader product portfolios, giving them the opportunity to capture a larger segment of the food market. Kellogg's is still the market leader in breakfast cereals, but if the company does not increase its pace of innovation, spend more on marketing and overcome the risks associated with the global shortage of raw materials, it could lose its leadership position.

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How Kellogg’s perfected product placement with VR

What accenture did.

• Value Delivered
• Meet the Team
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Kellogg Company (Kellogg’s) is the world’s leading cereal company; second largest producer of cookies, crackers and savory snacks; and a leading North American frozen foods company.

Consumer brands like Kellogg’s and retailers invest considerable time and money trying to determine the ideal product placement and assortment on the shelf. But traditional approaches to this kind of market research have limitations. For example, you could build an expensive physical store environment and invite focus groups to “shop” the shelves and then fill out a survey; or, you could create a “virtual” store on a computer screen to replicate the shopping experience; or mail products for consumers to try at home and then ask them questions in an online survey.

VR Merchandising Solution with Eye Tracking

All of these conventional approaches pose drawbacks, however, and Accenture wanted to find a better way. So, they teamed with Qualcomm as the technology partner and approached Kellogg’s and proposed a pilot Virtual Reality (VR) and eye tracking-based solution that transforms how brands and retailers conduct market research.

As Kellogg’s prepared to launch a new product, Pop Tarts Bites, the company sought market data to determine placement, assortment and promotion in store.

Traditional tests—online surveys and in-home user tests—showed that consumers expected to find new products higher up on a shelf.

With Kellogg’s, Accenture Extended Reality (XR) developed a VR solution based on the Qualcomm reference headset powered by the Snapdragon 845 with embedded eye-tracking that produced a slightly different answer, and the results offer a glimpse at a new reality for brands, retailers and consumer testing. Accenture designed an immersive experience based on Kellogg’s real-world need to test the product placement and assortment and pricing strategy for the launch of Pop Tarts Bites. They tested a pilot program of the VR solution in which customers wore VR headsets as they shopped in a “real” store.

Mobile VR with eye-tracking helps brands and retailers extend their reach to geographically dispersed participants, performing research faster, more affordably and at larger scale, while providing holistic conclusions.

Value delivered

The pilot showed that VR Merchandising, using mobile VR headsets with embedded eye-tracking, provides more holistic data and a faster, lower-cost process.

The VR testing revealed that when the Pop Tarts Bites were placed on a lower shelf—rather than higher up where consumers typically expect to find new products—testers paid more attention to other surrounding Pop Tarts products. That stimulated additional sales of Pop Tarts items, with an overall 18 percent brand sales increase during testing.

The experience shows VR merchandising pays off in at least four ways:

Expands testing reach to diverse locations

VR headsets can be used in consumers’ homes, at stores and during product roadshows.

Improves experience in branded environment

Shoppers walk through a realistic virtual store model, look at shelves, pick up and examine products, and place selections directly into their carts.

Increases dataset for analytics

Brands can gather deeper data in a way that does not interrupt the shopping experience.

Decreases costs while improving flexibility

Easy to test a variety of planogram combinations in a faster, cost-effective manner and reach a holistic conclusion for the product and category.

Meet the team

Raffaella Camera

Marc Carrel-Billiard

Related capabilities, consumer goods and services, accenture extended reality (xr) services.

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How Snap, Crackle, and Pop Helped Kellogg’s Grow

It’s a lazy Sunday afternoon (Sunday mornings do not exist) and you prepare a bowl of cornflakes for your routine breakfast.

You take the first portion in your mouth, and immediately, your friend from the other room reminds you to add one packet of Kellogg’s Cornflakes Original to the weekly grocery list. We haven’t yet upgraded to the fancier Kellogg’s Cornflakes Real Almond and Honey because we are students living on a budget. Also, the crunchy sound is the same.

Do you see what happened here? The crunchy sound of a cornflake snapping into pieces was so distinct and characteristic that my friend from the other room immediately recognized what I was having for breakfast (at one in the afternoon) and even associated a brand to it.

You might say she knows what I have for breakfast every day (yes, we are not big on diversification of our breakfasts), but you get my point. Kellogg’s cornflakes have a distinctive and unique sound and the brand bet big on it early on.

The Power of Sound

Traditionally, brands have focused on catering to consumers’ sense of sight by ensuring optimal visual satisfaction through their products. This includes gorgeous product designs, conspicuous packaging, and even advertisements exhibiting splendor and a little bit of razzle-dazzle to offer a complete visual package to consumers.

We have all been guilty of getting attracted to brightly-colored packaging on grocery shelves, only to repent later that all that glitters is not gold. The other four senses, namely sound, smell, touch, and taste, have conveniently been sidelined and relegated to the background. Especially the sense of sound.

It’s important to note that we perceive the world through the combination of  all  our five senses. They trigger fond memories, transport us to parallel realms, and tap right into our emotions.

The sense of sound has some powerful physiological, psychological, cognitive, and behavioral effects on humans. It enables us to connect the dots and relate objects, people, experiences — you name it. You know bad luck is in store for you when you hear a callous caw on your balcony.

You know you are in store for a major mood uplift when you hear piano rock. Now, imagine a brand leveraging all these effects to dramatically increase its brand recall value and secure a permanent and memorable place in its consumers’ minds. This is what Kellogg’s set out to achieve as it realized the significance of the sense of sound.

Re-Purposing Audio Marketing

Even though audio marketing has been around for ages, the incumbent “sonic brands” repeatedly failed to conjure up a truly unique sound that left an indelible impact. Most of them artificially created the sounds first and then tried to deliberately bring them to people’s attention, cajoling them into associating those sounds with their brands.

Some of them rented pop culture clippings to soundtrack their commercials. Rather than letting the sound naturally blend in with product usage and slowly become ubiquitous, these brands adopt a hurried and mechanical approach and ended up giving rise to “corporate sounds.”

Some brands got it partially right wherein they created a unique sound DNA and armed themselves with a repertoire of sonic assets. But in this clutter, that one distinctive sound was lost.

Then came along Kellogg’s, and it completely changed the paradigm of audio, and to an extent, sensory marketing. In addition to making the snap, crackle, and pop sound as a means of brand recognition, it also made it a criterion to judge the product quality.

Crunchiness Is Everything

Kellogg’s Rice Krispies that do not snap, crackle, and pop are considered to be stale, even though the taste or smell might not have altered much. In essence, the brand places a heavy emphasis on this crunchy sound which is used as an indicator for almost all other product attributes.

Its initial marketing adverts even featured three characters named Snap, Crackle, and Pop, highlighting the importance of the sound of the grain in their overall marketing strategy as well.

Interestingly, several Autonomous Sensory Meridian Response (ASMR) videos have also been created on this iconic crunchy sound. The  videos  — some of them running up to one hour — feature the sounds associated with a person opening a Kellogg’s cereal packet, pouring the grains in a bowl, mixing them with milk, and then finally eating the cereal.

The brand has created a synergy between texture, taste, and sound where sound acts as an anchor. In short, Kellogg’s considers the crunchiness of the grain as having everything to do with the success of the breakfast product.

Taking audio marketing a notch higher

Gradually, the crunchy sound became so well-known, pleasure-inducing (thanks to ASMR videos), and uniquely identifiable that the brand decided to patent it.

Kellogg’s approached a Danish music lab and requested them to recreate the highly exclusive and distinctive crunch associated with their cornflakes so that anyone helping themselves to a bowl of cereal will instantly recognize the anonymous cereal as a Kellogg’s product, by the mere sound of the crunch.

This strategic move also provided the brand with a lot of positive publicity, with 74% of modern consumers now associating the word crunch with the company.

Closing Thoughts

The power of audio marketing is underrated. Before thinking of investing in mind-blowing graphics for brand commercials or out-of-the-box ideas for product packaging, brands could instead ponder what appeals to human beings on an everyday basis and think of integrating the five senses their overall brand strategy to achieve a greater emotional connection with consumers. Kellogg’s mastered it and has set a great example for future brands to emulate.

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Case Study | Launching Kellogg’s Cornflakes in India

Case Study | Launching Kellogg’s Cornflakes in India 10 min read

“ Mothers know what they want and when; we can’t push our offering to them without giving them a reason they value, ” the Head of Marketing at Kellogg’s India clarified. The Kellogg’s cornflakes marketing team was struggling to find an appropriate positioning platform for the brand to increase sales and ensure brand growth. The brand was globally accepted but its journey in India has been bumpy. They had struggled to find a suitable place in consumer’s heart and mind, and again they were rethinking the growth strategy. Let’s delve into the classic case study of Kellogg’s launch in India and the valuable lessons it departs.

Table of Contents

Breakfast Market in India

The breakfast cereal market in India was pegged at Rs. 12 billion in 2014, an almost 15% growth from Rs. 10.4 billion in 2013, and was expected to grow at a CAGR of 13% over the five-year period. Due to increased health consciousness among consumers, hot cereals and muesli were the fastest growing product categories. Among hot cereals, oats had gained the highest popularity registering a 33% growth in 2014.

Cereal was not a popular breakfast item for Indians, and hence, the market was dominated by international brands from Kellogg’s and Pepsico. Bagry’s India Ltd and Mohan Meakin were the only two Indian players in the market. Kellogg’s India Ltd had the first-mover advantage and was the undisputed market leader with 37% value share in 2014.2 Regional players had a competitive edge over bigger brands because of their robust distribution network. Competition also stemmed from other FMCG chains that did not necessarily have packaged breakfast as their core product offering, for example, ready-to-eat players like MTR and Britannia with its range of ready-to-cook upma, porridge, and poha. These products provided consumers with healthy options that were not just quick but also healthy.

Consumer Behavior Towards Breakfast

India did not have the culture of breakfast. A typical, average middle-class Indian family did not have breakfast on a regular basis like their western counterparts. Breakfast was always combined with lunch—“Brunch” as it was popularly called. Breakfast habits (brunch) in India, for the most part, were inclined towards hot, cooked regional items, like flattened rice flakes (chivda/poha) in western and central India, whole wheat grits (dalia) and parathas in northern India along with traditional regional staples such as idli or dosa in the south. In the earlier days, women prepared fresh breakfast for the family. Serving ready-to-eat meals were not part of the cultural norm and such options were also not widely available.

However with urbanization, dual-working households, and lifestyle changes, there was a greater need for convenience. This was also coupled with increasing disposable income and health consciousness. Increasing awareness of health and susceptibility of Indians towards lifestyle ailments like heart disease and diabetes yielded a greater demand for value-added healthy breakfast options.

Hence, consumers, especially in urban areas, preferred a quick-fix breakfast and cereals would fit the bill. The influence of Western lifestyles and “eating out” trends also played a significant role in opening the gateway for experimenting with different tastes and varying eating preferences. This transition from traditional to modern breakfast took place among young Indians (24–35 years), mostly from dual income families. Choice of breakfast options was induced by personal factors like time constraint, work timings, social groups, and family members.

Kellogg’s Entry in India

In the late 1980s, ready-to-eat cereal giant and market leader, Kellogg’s had reached peak sales occupying a 40% market share in the US. The company had its presence in 18 countries and over 20 plants worldwide with annual sales of over $ 6 billion. However, in the 1990s, competition got tougher and Kellogg’s began to struggle when its nearest rival when General Mills introduced Cheerios brand. There was little room for growth in core markets; therefore, the company started looking beyond its traditional American and European countries as a potential cereal-consuming market.

India was a lucrative target market with population of over 950 million, out of which 250 million were middle class and untapped. In 1991, India went through an economic liberalization and removed the barriers to international trade. Three years later, Kellogg’s decided to invest $ 65 million towards launching its number one brand, Corn Flakes, in India. “ Even if Kellogg’s had 2% market share at 18 million consumers they would have a larger market than US itself , ” said Bhagirat B Merchant, Director of Bombay Stock Exchange in 1994.

Positioning at Launch

Globally, Kellogg’s cornflakes were positioned on the “fun and taste” platform, and they emphasized on the crispiness of its flakes. When Kellogg’s entered the Indian market in 1994, it positioned itself to families/households on the health platform, thus emphasizing on the nutritional benefits of the cereal. They tried to communicate to consumers that traditional Indian breakfast options were not as healthy, and hence, cornflakes were a good choice. This was done based on the insight that Indians consumers were not habituated to cereals as a breakfast item and needed to be educated to create acceptance and liking for not just the brand but cereal as a category.

Kellogg’s kicked off its India entry with three variants of breakfast cereal: Corn Flakes, Wheat Flakes, and Rice Flakes, packaged with an emphasis on the crispiness of its flakes compared to local cereals. These cereals were best served with cold milk without adding sugar. The tagline to reinforce the positioning was- “ Jaago jaise bhi, lo Kellogg’s hi ” (“No matter how you start your day, start it with Kellogg’s”). However, the proposition did not find much credibility with households. Average Indian did not pay much importance to iron/vitamin intake.10 The nutritional benefit was not a differentiated and strong enough proposition for Indians to change their habits and move away from traditional items as they considered their food to be equally or more nutritious.

The initial sales were impressive but Kellogg’s knew that this was a result of one-off purchases. Cereals were a new item for the Indian consumer and after the initial excitement wore off, repeat purchases were few. Another barrier to repeat purchase was the high price. A 500 grams box of corn flakes was almost 30% costlier than its nearest competitor. Indians did not find value in spending so much for an expensive breakfast and often the leftovers from the previous day were cooked or served differently for breakfast next day. In certain households, corn flakes were reserved as a Sunday or special occasions treat.

Also, the emphasis on crispy flakes failed in India as consumers were used to hot milk which made cornflakes soggy. This further diluted the Kellogg’s brand promise. On the heels of continuous unimpressive sales, Kellogg’s realized that their breakfast option was diametrically opposite to what generations of Indians have been eating. The typical Indian breakfast was still hot, home-made, heavy-as-a-meal, and savory rather than sweet. What Kellogg’s was offering was ready-to-eat, best served with cold milk, and bland unless you add a sweetener.

In early 1996, defending the company’s products, Managing Director, Avronsart said, “ Kellogg’s India is not here to change breakfast eating habits. What the company proposes is to offer consumers around the world a healthy, nutritious, convenient, and easy-to-prepare alternative in the breakfast eating habit. It was not just a question of providing a better alternative to traditional breakfast eating habits but also developing a taste for grain-based foods in the morning ”.

Indian consumers did not perceive the Kellogg’s differentiators relevant. They were not looking for thicker and crispier flakes with iron and vitamin. They sought basic health and taste which their traditional food and other competitor brands were also fulfilling.

Repositioning and Product Extensions

Kellogg’s saw that Indian households were difficult to target and moved their focus to kids with the launch of two of its highly successful international brands, Chocos in September 1996 and Frosties in April 1997. Chocos were wheat scoops coated with chocolate, while Frosties had sugar frosting on individual flakes. Frosties addressed the shortcomings of plain cereals because they were ready sweetened which sweeten the milk when it is added to the bowl. Both these variants were not positioned as breakfast items but as snack items on the proposition of fun and taste combined with health. Now the mother was urged to give Chocos as a mid-meal snack to fulfil nutrition requirement.

These variants found feet in the market and targeting kids helped. However, in 1998, Kellogg’s again tried targeting families and households by “Indianizing” its cereal range with the “Mazza” brand. Mazza cereals were available in fusion of local flavours like mango-elaichi, coconut-kesar and rose. The variant did not work. Mazza was more to do with the taste of the product and many consumers thought these were too outlandish.

In 1999, Kellogg’s began offering fortified cereals. The “Iron Shakti” cornflakes positioned on the nutrient value of cornflakes and addressed iron deficiency in children. The nutrition platform was more focused and relevant here as no other brand or product spoke of iron supplement. This became the differentiator and sales increased by 17%. Making the brand and proposition sound Indian by using words like “Iron Shakti” and “Calcium Shakti” gave it a local feel. This approach was more successful than the brand’s previous attempt to imply that the traditional Indian breakfast was not nutritious—messaging which made the Indian housewife rather indignant. The proposition this time was a nutritious and fun breakfast for kids coupled with goodness of iron (which mothers worry about).

Besides positioning, Kellogg’s also changed the communication. It removed the rooster which had an integral association with Kellogg’s globally from all its advertisements in India. The promotions focused on inducing product trial by targeting schools across the country. In March 1996, the company gave out specially designed 50 gm packs to shoppers at select retail stores, and door-to-door sampling exercise offering one-serve sachets to housewives in the city.

However, the company knew that very few Indians had breakfast and they could grow only by growing the category. In 1997, they launched the “Kellogg Breakfast Week” in Mumbai, Delhi, and Chennai, a community-oriented initiative to create and increase awareness. The campaign focused on making people aware about the prevention of anemia, an iron deficiency disorder, and conducted a series of nutrition workshops to educate individuals and families.

As the brand had sub-segmented the market and offered specific customized variants to each with the relevant proposition, its agency, JWT, wanted to identify the triggers that enabled customers to move towards this category. Their research suggested that though Kellogg’s was positioned to kids, they were consumed by the entire family. They also found that healthy afternoon snacking was a large consumer need. Lastly, women in India were becoming more health conscious and desperately wanted to get into shape.

Using these insights, Kellogg’s launched Kellogg’s multi-grain, fortified cornflakes targeted to adult taste buds. Advertisements also began showing adults eating the cereal, rather than focusing on children alone. The assault on the afternoon-snack segment was led by Chocos. This brand was already popular with children, who were their key consumers for “4 pm munches”. The launch communication offered the Chocos variant as a nutritious substitute for chips and other junk food.

Special K: Get into Shape

In 2008, Kellogg’s launched their $1.5 billion “Special K” brand as a weight management cereal targeted at women (25–44 years) who wanted to keep in shape. It was positioned as a low-calorie weight control meal. This was again not categorized as breakfast item but a complete meal. Consultants pointed out that Kellogg’s’ brand extension strategy helped to increase its relevance across categories. It was a player in the Rs 500-crore weight management market and the Rs 750- crore convenience foods market, apart from the Rs 250-crore breakfast cereal market (which, in turn, was part of the Rs 2,000-crore health foods segment).

The marketing team knew that as against other markets, Kellogg’s not only adapted its portfolio to match Indian needs but also made changes to their global positioning to appeal to Indian consumers. Indian market is diverse and unique, and expects the offerings to fit their life pattern. The marketing head at Kellogg’s had recently read an article that incorrect positioning was the reason behind 80% brand failures. Kellogg’s have been relooking at their 5-year strategy as they have always wanted to be confident on the delivering the promise they have made to its consumers.

Also Read: Case Study | Launching And Establishing Oreo in India

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How Kellogg’s used conversational research to prepare for the future of online grocery

Notable wins:.

Identified drivers of online shopping

Utilized dynamic deliverables

Received powerful video testimonials

About Kellogg's

Challenge and objectives.

COVID-19 accelerated e-commerce sales, resulting in an influx of new online grocery shoppers.

Kellogg's wanted to understand how grocery shopping was evolving in order to win in the "Bricks and Order" world. To gain a robust understanding of the Click & Collect digital path to purchase across key categories, Kellogg’s needed to:

- Quantify motivators and barriers to conversion for Kellogg's categories - Identify pain points in the e-commerce experience - Gain a richer and more contextual understanding of shoppers’ experiences - Identify roadblocks to Kellogg’s category purchases

The solution

Working with Reach3 Insights powered by Rival, Kellogg’s engaged with shoppers via a multi-faceted quant and qual conversational approach to provide a 360-degree view of shoppers' Click & Collect experiences, perceptions, preferences, and intentions for the future. The study evolved into three phases. Using Rival’s mobile messaging-based market research platform , the first phase was a highly engaging path to purchase understanding exercise. The study was comprised of (n=2400) current Click & Collect shoppers at one of the following retailers: Walmart, Target, Kroger, Albertson’s, Sam’s Club, Instacart.

The chat included video feedback opportunities in addition to emotional elicitation exercises designed to encourage participants to think more deeply about the question they were being asked. Key objectives were to quantify motivators and barriers to conversion for Kellogg's categories and identify pain points in the e-commerce experience.

The first of many chats, Kellogg’s intends to re-engage these participants over time as an iterative research opportunity to learn about shopper habits, attitudes, and opinions as they continue to evolve. In phase two of the study, Kellogg’s used the Rival platform’s notification capabilities to reach out to (n=12) shoppers who participated in the first phase of the study to conduct. Here, 30-minute interviews were conducted with screen sharing capabilities to capture real-time online shopping behaviors. In phase three, comprehensive interactive, multimedia digital reports were delivered to the Kellogg’s team that revealed shoppers' Click & Collect experiences, perceptions, preferences, and intentions. These insights were discussed and workshopped in collaboration with a variety of stakeholders to determine how the lessons gathered from phase one and two could best be applied to their online grocery shopping services. 

“Working alongside a team with such a deep knowledge of the CPG space made the planning and execution of this program more efficient and impactful. The interactive, media-rich deliverables brought shopper data to life and resonated with internal stakeholders and key retail partners. The result was immediate ROI for this three-part initiative." - Melissa Davies, Director of Shopper Insights & Analytics Kellogg Company

Improved online shopping filtering and keywords

A retail partner of kellogg's used feedback from this study to improve the navigation and filtering of their online store to simplify the path to purchase experience of their consumers., optimized category purchases and fulfillment.

Another partner improved the "substitutions" feature of their online shopping services to provide consumers with more choices based on their needs and preferences. In addition, they’ve implemented a solution which allows online and in-store shoppers to leverage their coupons more quickly and easily.

Enhanced retail partnerships A third retail partner of Kellogg's took key recommendations provided by chat participants to redesign their shopping portal for a more intuitive and streamlined online grocery experience.

Overall, feedback gathered through Reach3’s conversational approach and using Rival’s market research platform helped equip Kellogg’s and its retail partners with the insights needed to understand the habits, behaviors, and preferences of their online shoppers. Ultimately, this equipped these brands with the insights necessary to drive action within the organizations and be prepared for the future of a “Bricks and Order” grocery world.

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How a 115-year-old brand advances its commitments to equity

In 2020, I was leading communications for Kellogg’s RxBar. That was the year the brand announced its plan to observe Juneteenth. Watching employees from a range of backgrounds connect with and celebrate Black culture was a powerful thing. The response was so inspiring; it’s part of why I jumped at the chance to lead the new Kellogg Cultural & Inclusion Acceleration Plan in Marketing. I couldn’t wait to scale what I’d seen.

The program has achieved meaningful change in a surprisingly short time, thanks to the efforts of a cross-functional team. Our initiative's early wins prove that if a century-old CPG brand can transform its marketing processes in a matter of months, anyone can. Here’s how.

Make it a team effort

Before we can implement plans and procedures, we must educate ourselves on the case for change. Why is this so important? To create a foundation of common understanding, we partnered with a cultural intelligence agency to launch the Cultural Intelligence Marketing Accelerator. This multiweek training program consisted of five facilitated sessions that aimed to close the empathy gap, helping us connect with and learn about the diverse consumers we look to serve. Among the attendees of the initial training were key internal stakeholders and several of our agency partners.

Including our partners was the key to the program’s success. We cannot work in silos if we want to make a significant and sustainable impact. Our new Equity, Diversity, and Inclusion (EDI) Steering Committee gathers internal and external stakeholders, including our partner agencies, to collaborate on, inform, inspire, and educate each other on topics related to our EDI initiatives, then disseminate those learnings back to their respective teams. All participants are deeply committed to advancing our EDI priorities and ensuring our work has relevance and resonance with our consumers.

Our “Black History. Every Month” campaign is a testament to the power of that process. The campaign includes videos honoring Black heroes who have made invaluable contributions to the food and beverage industry, like Fredrick McKinley Jones, inventor of the refrigerated truck, and Edna Lewis, chef, author, and protector of Black Southern cooking. We have also partnered with World Food Program USA, in support of the mission of the United Nations World Food Program, and Street Art for Mankind, creating murals in six cities affected by food insecurity due to systemic racism. Every video and activation is informed by the committee’s complex conversations and is better for it.

This time-lapse video of a mural being painted in Houston features the faces of four Black children and messages like “Zero Hunger” and “Food Justice."

Ask the right questions

If an ad tailored to a diverse audience runs when no one is watching, is it really inclusive?

Connecting with the right audience means understanding their preferences.

As marketers, it is our job to avoid assumptions and, instead, consider a multitude of factors that determine when and where an ad will reach consumers. No matter how inclusive our creative is, the context surrounding a placement determines how people will experience it. For example, running an ad during a show with a Black lead does not necessarily mean you have reached a Black audience. Connecting with the right audience means understanding their preferences.

To create opportunities for the type of meaningful engagement that drives impact, we partnered with media agency Starcom to complete the first round of media composition benchmarks within our buys. Our teams are now starting to evangelize the importance of understanding message receptivity among our multicultural audiences. By sharing our learnings around optimization, we hope to create opportunities for diverse consumers to feel more connected to Kellogg’s leading brands.

Apart from being the right thing to do, using these metrics helps us demonstrate the importance of engaging multicultural consumers in delivering overall business goals. The numbers show that when companies invest intentionally in diversity, everyone benefits.

Give your teams the tools

A truly unified approach to inclusion means giving every team the same opportunities to learn. Those include free resources, such as Google’s Inclusive Marketing Toolkit , as well as internal market research.

Through Google’s Culture Lab service, we get access to culture- and privacy-first insights, as well as inclusive best practices and media solutions.

In addition to repurposing and distributing materials from the Accelerator to other departments, the Culture and Inclusion (C&I) team has created ongoing office hours and playbooks that focus on five specific consumer segments: U.S. Hispanic, African American, Asian American, LGBTQ+, and people with disabilities. While every brand will focus on different areas, these deep dives provide a starting point for teams to learn more about each group, as well as their buying power and shopping preferences.

Keeping everyone aware of best practices is always going to be a cross-functional enterprise. C&I works closely with Kellogg’s centralized Insights and Analytics (I&A) division, which shares research across the organization, to ensure multicultural insights are integrated into our learning plans. Through Google’s Culture Lab service, we get access to culture- and privacy-first insights, as well as inclusive best practices and media solutions. Our first session helped to illuminate a new perspective for Special K regarding cultural relevance to the Latinx community.

To gauge that relevance, we have adopted the Association of National Advertisers’ Alliance for Inclusive and Multicultural Marketing’s (ANA AIMM) new Cultural Insights Impact Measure (CIIM), a metric that conveys how multicultural consumers feel about how we talk to them. So far, the results look promising: 40% of ad effectiveness can be explained by overall CIIM score and persuasion. 1

Think with Google

Source: Kellogg/Google, U.S., “Multicultural Brand Immersion 2021,” March 2021.

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Since the launch of the acceleration plan, we have had an immense uptake in our trainings, tools, and ways of integrating multicultural insights into our go-to-market strategy. Internal surveys show the C&I training was our highest rated yet. We have even seen some teams go beyond their mandate to tie EDI goals to compensation. To me, that says this 115-year-old company is serious about fulfilling its commitments to equality.

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1 Kellogg/Google, U.S., “Multicultural Brand Immersion 2021,” March 2021.

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How Kellogg’s Failed, and Then Won, in India

Home » Blog » How Kellogg’s Failed, and Then Won, in India

Kellogg’s initial foray into the Indian market is generally agreed to have been a failure, although it’s now doing well in terms of both market share and sales growth in the subcontinent.

As part of our series of in-depth case studies looking at major brands tackling major new markets, last week we examined how Marks & Spencer are getting along in China .

Whilst local in-store sales have been a touch underwhelming for this British high street brand, it has had success selling dresses online with Tmall (part of the Alibaba group).

One slightly unexpected outcome from the adventures of M&S in Asia is the surprise popularity of teabags and porridge oats with the Chinese consumer. It seems Chinese households are becoming slightly more western in their habits, and breakfast cereals are starting to sneak into their shopping baskets.

But are Indian consumers ready to accept breakfast cereals?

In this article, we’ll examine what went wrong, and discover how Kellogg’s recovered from its initial problems in this challenging market.

An unsuccessful first foray into India

The world’s leading producer of cereals and a major snack foods manufacturer Kellogg’s entered the Indian market way back in 1994.

Kellogg’s is no stranger to international marketing : their products are manufactured in 18 countries and sold in over 180.Despite a high-profile launch and a frenzy of marketing activity, the first breakfast cereals it marketed were an initial failure in India.

There was little appetite for breakfast cereals in India in the early nineties, although milk was a regular part of the Indian diet, so Kellogg’s needed to establish a market for the products if it wanted to win over the Indian consumer.

Following a big media launch effort, initial sales seemed promising but it emerged that consumers were buying the product as a novelty but not repeat purchasing.

Kellogg’s India opened its first manufacturing plant in Mumbai, India in 1994. Image trabantos / Shutterstock.com

Most analysts conclude that the brand was overconfident and overlooked many critical cultural insights that would explain why the market wasn’t ready for the breakfast cereals offered. It also seems that the pricing was far too high to be a regular grocery purchase, explaining the lack of repeat sales.

The Indian palette is considered by many to be a challenging one to crack.

Indians were accustomed to boiling their milk and consuming it hot and sweetened. One key hurdle for Kellogg’s to overcome was persuading the Indian consumer to consume milk cold rather than hot when eating breakfast cereals.

When Kellogg’s initially launched into the Indian market it was with crispy flakes that would go soggy when consumed with hot milk. When Indians tried the unsweetened breakfast flakes with cold milk, they couldn’t get the sugar they added to dissolve properly.

This may explain why Kellogg’s later enjoyed better success with Frosties, which come ready-sweetened with dissolvable sugars which sweeten the milk when it is added to the bowl.

Indian consumers accustomed to gut-busting breakfast staples such as buttery fried parathas  or deep fried vadas found breakfast cereals somewhat insubstantial when eaten as a substitute for India’s more familiar breakfast items.

A bland bowl of cereal flakes also failed to match the variety of foods often eaten at breakfast time, or the habit of eating more flavoursome foods such as chutneys and pickles with various morning staples.

Indian breakfasts tend towards spicy and hot; by offering a dish that was bland, sweet and cold Kellogg’s was proposing the exact opposite of expectations at this time in the day. Essentially Kellogg’s offered a product that failed to match local breakfast habits and expectations – and at twice the price of local competitors.

Other critics of the initial launch also thought that Kellogg’s trod on a few toes with marketing campaigns implying the traditional Indian breakfast was not nutritionally sound.

A revised strategy

Kellogg’s initially launched in India with corn flakes, wheat flakes and basmati rice flakes, none of which were especially successful. When Kellogg’s launched Frosties (sweet, sugar-coated flakes) in 1997, even the company was surprised by their success.

Kellogg’s reduced the price of their products and began to offer a wider range of product sizes to appeal to different customers.

Individual packs were especially popular. Messaging was also changed, to reposition the cereals as a fun choice rather than just a nutritious one.

This approach may have been more successful than the brand’s previous attempt to imply that the traditional Indian breakfast was not nutritious – marketing messaging which may have made the Indian housewife rather indignant. The products were no longer positioned as premium products, in order to make them a regular rather than a one-off buy.

The brand also localised its branding and advertising approach to make it more acceptable.

Gone was the familiar cockerel, and advertising campaigns using local faces such as a yoga instructor and Kathakali dancer attributing their vigour to a Kellogg’s diet. Accompaniments such as curd and pistachio, which suited the local palate, were suggested.

Kellogg’s localised Corn Flakes packaging on Amazon.in. Image credit: trabantos / Shutterstock.com

Kellogg’s took the decision to localise its flavourings, and chose brand names to appeal to the Indian public such as ‘shakti’ (‘power’) when selling products fortified with iron. These days, cornflakes are offered with mango and banana puree to suit local tastes.

Although the brand presently enjoys a colossal 70% market share, it now has to defend from rivals the market it has created. Logistically Kellogg’s is well invested in this territory. All raw materials, including packaging, are sourced in India, and the main plant is located close to the largest market; all of which minimises costs.

Using a network of agents, the brand has established a distribution network including storage facilities. Overheads are minimised by giving distributors large responsibility for sales. In 2010 the market growth was at 20% but following a change in leadership, it is thought to be closer to 30%.

RELATED : How India is Becoming One of the World’s Biggest Markets for Localisation

Kellogg’s remains significantly pricier than local rivals such as Bagrry’s , whose website and logo are breathtakingly similar to Kellogg’s. Larger multinationals including Dr Oetker and PepsiCo are also muscling in on the market. Kellogg’s India is defending its market share by expanding its distribution network by 50%.

It’s arguable that only a massive brand like Kellogg’s was capable of cracking the Indian market, given the amount of market creation and habit changing that was required.

What’s generally agreed is that Kellogg’s was too confident when it entered the market and didn’t do enough research on local tastes and habits before plunging in. Whilst the company has now turned its performance around, it has done so by trying new things but above all by localising its offering and message to suit the market.

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FDA initiating independent review of tampon ingredients after study found many contain toxic metals

The U.S. Food and Drug Administration is taking a closer look into tampon ingredients after a study in July found toxic metals in a wide variety of the menstrual products.

On Thursday, Washington Democratic Sen. Patty Murray, who is also the chair of the Senate Appropriations Committee, announced that a letter she had sent the FDA in July after the study's release had now received a response, with the FDA saying it has initiated both an independent review of the literature and an internal lab study of the metals the researchers found in tampons.

The FDA's review will also more precisely determine the proportion of metals that the products may release in normal use and how much risk that poses to the consumer. This will also allow researchers to understand any possible adverse health effects that may be linked to tampon use.

"These are products millions of women are using on any given day, so it's important we absolutely put to rest any concerns about their safety — so I'm pleased that FDA is taking action to help us better understand the issue of metals in tampons, and I am going to keep pushing to make sure we are taking all the steps we need to keep women safe and healthy," Sen. Murray said in announcing the FDA's response.

RELATED STORY | Are your tampons harming you? Study finds 16 metals in widely available brands

Sen. Murray is one of many lawmakers and consumers alike who were sent into a frenzy of questions and concerns once researchers from Columbia University, the University of California Berkeley and Michigan State University published their study about metals in tampons in the Environment International journal .

Presumed to be the first to measure metals in tampons, the study detected the presence of each of the 16 metals it tested for in 30 tampons from 14 different brands and 18 product lines. This included toxic metals like lead — which researchers said has no "safe" exposure level — elevated mean concentrations of arsenic and cadmium, and the presence of various other metals, including barium, calcium, cobalt, chromium, copper, iron, manganese, mercury, nickel, selenium, strontium, vanadium and zinc.

The study said that future research was needed to determine whether the metals that the tampons could absorb during the agricultural or manufacturing process were then being absorbed by the vagina's absorptive tissue.

In a comment to Scripps News at the time, the FDA said while it was reviewing the study, it did have limitations, such as not assessing whether the metals are released from the tampons and subsequently into the bloodstream. It also said that any tampons must undergo a "premarket review" to ensure their safety and effectiveness before being sold in the U.S.

Still, lawmakers like Murray had questions. Her July letter to the FDA asked, among other questions, whether the agency's initial review requires testing of tampons for metals or toxins and if additional authority is needed for the FDA to institute more safeguards against ingredient contamination and appropriate labeling.

RELATED STORY | Nonprofits struggle with rising cost of pads and tampons

And the day Murray announced the FDA had responded to her letter, another group of lawmakers — members of the Democratic Women's Caucus — sent their own.

"It's unconscionable to think that women could be putting their health and lives at risk simply by using basic, essential hygiene products like tampons," said Congresswoman Pressley, DWC policy co-chair. "In light of this alarming report, we're calling on the FDA to take urgent action to ensure the safety of these products, protect the health of those who depend on them, and give women the peace of mind that they can use them without putting themselves at risk."

Between 52% to 86% of menstruating people in the U.S. use tampons, the study said, and if each contains high levels of heavy metals, continued exposure can cause adverse health effects.

Signs and symptoms depend on the type of metal and level of exposure, according to Cleveland Clinic , but abdominal pain, dehydration, nausea and vomiting are some. More severe symptoms can include anemia, kidney or liver damage, higher cancer risk and brain damage.

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