- Kellogg is branching out with different strategies to promote its waning cereal brands after multiple quarters of sales declines for its morning foods segment — though, as Business Insider notes, the company reported stagnant morning cold cereal sales last month.
- This has included teaming up with celebrity chefs to introduce new ways of seeing cereal as a food that can be consumed at any time of day, such as snacks and even dinner, by mixing cereal with any number of ingredients.
- "If cereal is granted reverence by celebrity chefs, it justifies customers treating it as a modern, notable meal, worthy of creativity, time, and attention," according to Business Insider.
"To convince new and returning customers to buy cereal, the company needs to make them see iconic cereal brands in a new light. Even among people that do still do eat cereal (90% of US households, according to Kellogg's, buying nearly 21 boxes of cereal per year), convincing them to use cereal in new ways would provide a crucial sales boost," Business Insider reported.
"You don't even need a calculator to think about what can happen if we can get that consumer to buy just that one more box of cereal," Craig Bahner, Kellogg's president of US morning foods, said during his Investor Day presentation.
Analysts feel that Kellogg will have to do more to revive its cereal sales than just introduce consumers to new recipes featuring recognizable brands.
"More radical innovation in cereal — organic or via M&A — in the US will be needed, and [Kellogg's] goal to 'win in breakfast, beyond the bowl' may force them to make acquisitions outside their current categories," Susquehanna analyst Pablo Zuanic wrote in a research note last month.
Moody’s Investors Service agrees, as its 2016 Outlook report named Kellogg as potentially one of the most acquisitive companies in the industry next year. Kellogg is taking other steps too, such as removing artificial colors and flavors from its cereals and offering new product lines, including To Go Breakfast Mix, which consumers can eat without milk straight from the pouch. The company also hopes to capitalize on the healthy eating trend by propping up its Kashi brand.