Case Studies on Kelloggs and Nestle Products

Kelloggs Special KO – Setting the (Cereal) Bar Higher Once upon a time, the cereal category was simple, but over the last decade, food manufacturers have created a host of innovative new entrants to the category – and no brand has done it better than the Kellogg Company with their Special K line.

In 2006, BusinessWeek. com writer and marketing pundit, David Kiley, predicted that “Kellogg will run up against what every ambitious consumer marketer eventually faces: a case of brand extension greed. ” But four years later, that prediction hasn’t materialized.

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Kellogg has sustained healthy success, generating nearly $13 billion in 2009 sales, by continuing to introduce low calorie cereal and snack options. Most of the products in the Special K line build on the famous “Special K diet” and provide versatile weight management solutions that are marketed toward a largely female consumer segment.

Special K has even crossed aisles to energy/performance foods and frozen meals. But the two most recent launches, Special K Low-Fat Granola Cereal and Special K Fruit Crisps, seek to continue the trend of cereal category dominance.

For the new launch, Special K used a heavy dose of social media outreach. In addition to leveraging a huge Facebook fan base of over 34,000, free samples of the Fruit Crispswere provided to ‘mommy bloggers’ to create awareness, generate buzz, promote product trial and engage consumers. They also posted coupons for Facebook fans to try the new product.

In addition, during January, the all important New Year’s Resolution month, Kellogg reached out to thousands of Special K lovers and brand advocates, and positioned the Low-Fat Granola Cereal as a New Year’s resolution tip on their Web site and Facebook page.

Complementing the social media strategy, Kellogg issued a press release (New Year, New Food: Kellogg@ Introduces Two New Ways to Recharge Your Resolution With Special K@), followed by television commercials. The Kellogg Company seems to find creative ways to align their brand with the lifestyles and everyday challenges of their target customers. The Victory Projectincludes a Web site tracking the Journey of 12 women in three U. S.

cities who shared the common goal of losing weight before one of the biggest moments in their lives, such as 29 year-old Rebecca’s fitness test for her police exam.

The Victory Project Web site offers tools, tips, articles, discussions, and video profiles of these women succeeding at implementing a new, healthy lifestyle. There’s no question that Kellogg has set the cereal bar higher by establishing new products at regular intervals under the Special K weight management brand. Now, they have created a new innovation with the flatter and flakier Fruit Crisps. It will be interesting to track the success of these ‘newbies’ in Kelloggs arsenal of products: Will the Fruit Crisps cannibalize existing cereal bar sales? Will the low fat granola do likewise?

More importantly, how long can Kelloggs Special K brand continue to grow before competitors steal market share or the category becomes saturated? I guess we’ll Just wait and see while we watch our weight with Special K.

KELLOGG’S SPECIAL K SETS WOMEN UP WITH VIRTUAL DIET BUDDY * by: Melita Kuburas * December 23, 2009 ShareThis Fitness centres may be empty now, but they will be packed come January – the indoor air thick with earnestness of weight-loss resolutions (and, hopefully, sweat). According to an Ipsos Reid survey for Kellogg’s Special K cereal, 56% of women aged 25 to 49 resolve to lose weight.

However, four in 10 don’t make it past the first week, and Just 11% attend to their goals all year long. To help these Canadians stay on track with their health and fitness goals all year long, MSN. ca and Kellogg’s have luanched the “Victory Project,” a year-long campaign – with media by Starcom MediaVest Group – to promote the health benefits of Special K, and the health and wellness content on MSN. ca.

Kellogg’s AOR is Leo Burnett. The campaign revolves around an MSN-built microsite based on the insights of the Ipsos survey, which found that women felt they could achieve their goals more successfully if they had encouragement.

The site is meant to serve as a full-on lifestyle guide for women, providing them with advice on fashion, fitness, nutrition and beauty, starting mid-January. It will also feature a discussion board where visitors can share their weight-loss management stories and find a buddy with whom to vent about triumphs and obstacles. The site is being cross-promoted with MSN’s Better Body Guide site, which will contain “Victory Project” content and drive traffic to the Kellogg’s site (and vice versa).

Other media elements to the campaign include keyword search and a television campaign that aunched this weekend. The whole idea is for [consumers] to bring out the best in each other, help each other through the tough times and celebrate each other’s victories,” says Johanne Trudeau, director, nutrition marketing, Kellogg Canada. Special K has always positioned itself as a woman’s “ally” in helping achieve and maintain weight-management goals, Trudeau says. But women don’t often know where to start or how to stick to a plan, which is where the virtual realm comes in, she explains. The “Victory Project” also has downloadable meal plans available on SpecialK. a.

The Kellogg survey, conducted this fall with 2,714 adults, shows that 76% of women agree a meal plan would help them stay committed to their diets. “Whether it’s a virtual diet buddy or your best friend, working alongside someone on resolutions can help keep you both motivated and make the Journey more fun,” says Trudeau. The campaign will run through 2010. Speical K- Market Penetration Strategy Kellogs Special K advertising has taken a radical turn, moving away attacking head on with competitors and ‘stealing’ market share, but trying to expand the market by argeting women who skip breakfast to stay slim.

The bold new marketing strategy is a powerful step for Kelloggs which also helps to position the brand as a healthy alternative.

to increase trial of the product in order to ‘steal’ market share & support the ads with a pricing ‘pull strategy’ (discounting) which tends to be a very short term strategy with short term results. Instead they tried the more difficult direction, expand the market and attract new customers with no existing brand loyalty. This has the potential to form longer lasting and more profitable relationships.

The ads also brand he company as a healthy alternative. The additional benefit of the advertising is the positioning of the product as the ‘healthy’ alternative. Many breakfast cereals are undermined because of sugar content concerns (amongst other ingredients).

Special K are differentiating in the same way Wheat Bix did when they referenced “9 out of 10 nutritionist recommend Wheat Bix”, moving into the growing market of health conscious consumers. Do not make this look like the one and only way to advertise your cereal, there are pitfalls and risks along the way.

The ad needs to convert enough consumers to the rand to pay off the production and airing costs, there is every chance that the breakfast skipping segment is either too small or constrained by other reasons (e. g lac of disposable income) to be able to make a purchase. Josh Strawczynski’s Opinion: I think it is clever and worth a shot at doing, I think the creatives they designed were good and the message was clear. This being said, there is a lot of negative comments being posted on blogs and forums and realize that I am not representative of everyone.