“We’re back to playing our game in cereal, and we’re playing to win,” Chris Hood, president of Kellogg North America, told investors at the Consumer Analyst Group of New York’s 2020 conference last week.
He explained that Kellogg reduced commercial support for cereal in 2019 in order to harmonize pack sizes across its cereal brands – a move that cost the company market share and consumption, but which Hood said “was the right thing to do for the long-term health of this business” because it would make the brands more shoppable on shelf and give Kellogg the opportunity to merchandise more combinations of brands together.
With the transition now fully behind the company, Kellogg resumed normal levels of commercial activity for cereal starting late in the third quarter of 2019. Already market share and consumption have improved “dramatically,” said Hood, adding that he expects them to continue to climb as Kellogg prepares to go beyond previous investment levels.
“We’re adding incremental investment aimed at revitalizing key brands and boosting our innovation. We are committed to winning and expect success in this category, and we definitely expect improved results in 2020,” he said.
While Hood held back from sharing everything the company has planned, he said the investment will focus in part on fun and flavor, “bigger, bolder” advertising campaigns, highlighting wellness claims more effectively, refreshed brand positioning, cross promotions, in store promotions and more.
Bringing back ‘fun and flavor’
The company’s focus on “fun and flavor” may appear counter-intuitive given consumer focus on health and wellness has prompted widespread shaming of “sugary” cereals. But as Hood explained, playful and flavorful cereal actually grew 1% in 2019 after the company brought back “fun and excitement to our biggest brands in the second half of the year.”
He explained that Kellogg will “continue to step-up activity in 2020,” by reintroducing Toucan Sam, launching more licensed property cereals, and co-branding with its own equities with the launch of an Eggo cereal.
On the advertising front, Kellogg has already launched a “major” integrated Mission Tiger campaign for Frosted Flakes, which will connect with social mission by contributing to school sports programs. The campaign included the named sponsorship of Tony the Tiger Sun Bowl earlier this year and has endorsements from athletes including Ben Simmons, Ed Reid and Julie Erts, Hood said.
“During Q4, Frosted Flakes consumption grew 3% behind this program. So, we know it is effective, and it is very encouraging for 2020 as we build momentum on our biggest cereal brand,” he said.
Wellness still figures prominently
Even as the company brings fun back to cereal, it recognizes that health and wellness concerns are here to stay which is why it plans to “elevate cereals’ wellness credentials and bust some myths with a Did You Know promotional campaign,” Hood said.
The campaign will include “sharper on-pack claims, like protein, fiber and sugar,” as well as online and in-store communications.
“We are also going to revitalize some other key brands by sharpening their positioning,” Hood said. “For example, focusing on quality ingredients for Special K behind the Can’t Flake Delicious campaign, on the satiety of Mini-Wheats behind One Bowl and You’re Good to Lunch campaign, and great taste, food and fiber content of Raisin Bran,” Hood said.
Bear Naked granola also will see line extensions and receive its first national media campaign to raise awareness for “this gem of a brand,” Hood said.
Snacking, co-branding and in-store displays
One new product under Bear Naked will be the launch of On the Go Bear Naked Bites in the second half of this year. This combined with the launch of new Jumbo Snax versions of the company’s cereals illustrates how Kellogg is repositioning cereal beyond breakfast and into snacking.
And finally, Hood noted, now that pack sizes and prices are harmonized across cereal brands, Kellogg will be able to create stronger cross promotional material for in-store displays that will range from wellness awareness displays to signage associated with major sporting events and move releases.
As illustrated by these plans, Hood said, Kellogg is “back to playing our game in cereal, and we’re playing to win.”