New Look at Kashi

Kellogg owned cereal-maker Kashi recently unveiled a fresh new look intended to reflect "its belief that food should not only taste good, but do good." The new design includes its revised logo, and packaging that is contemporary and simple in appearance. The boxes certainly stand out for their clean look, avoiding most of the visual clichés common on cereal boxes such as a bowl of cereal, and excessive design elements. Instead the focus is on ingredients and cereal itself at the most basic level. The back of the boxes feature stories of "how the food was made and where it comes from – including employees, farmers and friends of Kashi who had a deep impact on it."

For quite sometime Kashi has struggled to find itself as a natural and health-conscious brand in the Kellogg portfolio, while becoming more and more mainstream in its distribution. Packaging has always been a big part of cereal's success and place within our culture, and this new look, while basically simple, should give the brand new life, if applied consistently across its product line. In my opinion, it's also a far superior effort than the cartoonish appearance of the new Annie's cereals recently launched by General Mills.

What do you think of the new look?

Kashi returns to its roots

It was not even one year ago that I commented on Kellogg's disappointment with Kashi, the natural food brand it had acquired fourteen years ago. It was becoming obvious that Kashi had lost its niche appeal and was becoming just another mainstream cereal brand. Coming under the Kellogg umbrella and relocating to Battle Creek has domesticated Kashi and lessened the passion that some consumers had for its cereals.

According to Food Business News Kellogg is recognizing that its big corporate approach to such a loved specialty brand isn't working and that Kashi needs to return to its roots. Last month the company announced that David Denholm, the former General Manager for Kashi in 2006-2008, is returning as the CEO of Kashi and that business will return to La Jolla, in southern California, where it was founded. Kellogg executive Paul Norman admitted that "when you come off a trend of health and wellness, you slip to the side, it can be quite painful," and that these latest moves are designed to "get on the front foot and get forward back into progressive nutrition."

This is an important move for Kellogg during a time when cereal consumption is shrinking and the big companies are struggling to be competitive. Breakfast cereal is not just about big business, but taps into people's passions and emotions. Executed well, this has the potential to give Kashi the boost it needs. If it works we may see similar moves at other brands.

Kashi too "Mainstream"

Last week a big announcement in the cereal industry was Kellogg announcing another disappointing round of cereal sales, and a workforce reduction of 2000 employees. As we've discussed here before cereal has gone soggy in American culture, and the big companies are struggling to maintain, let alone grow, revenues.

Lost around that story was a much more interesting tidbit that came from the mouth of Kellogg CEO John Bryant. As he relayed the state of the company's financial performance he commented on the problems with Kashi, Kellogg's natural food brand. The reality is that health foods are now mainstream, and Kashi no longer has a unique place in the market. When Kellogg purchased Kashi 13 years ago they saw this as an opportunity to reach a population segment that was looking for something much more wholesome than regular cereals. If it has worked, that success is now waning, and Kellogg is in dire need of a new strategy.

Kellogg is not alone in the attempt to broaden their market reach by buying out healthy food brands. General Mills owns Cascadian Farms. Kraft bought Back to Nature cereals. Barbara's is owned by the U.K's Weetabix. And, Kellogg's has yet another natural brand in its arsenal: Bear Naked. These revelations could be a shock to many of you who thought you were thumbing your nose at the large corporations.

In other words, the big cereals companies have jumped on the bandwagon over the last decade or so to capture a portion of the breakfast bowl, knowing that consumers were increasingly looking past the nutrition mediocrity of popular cereals. But, nutrition conscious consumers are not stupid. They know the facts, and are easily put off by companies acting without authenticity. In fact, they also react negatively to inconsistency such as when it was discovered that Kashi used genetically modified ingredients. The result of all this, as CEO Bryant inferred, is that brands like Kashi are no longer desirable brands, they're as mainstream as Froot Loops.

The future for cereal companies is nothing less than innovation, reaching out to a broader base of consumers in fresh new ways. It appears, however, that going natural is no longer one of those ways.

(Source: Huffington Post)

Kashi fights bad PR

This has not been a good week for Kashi, the Kellogg-owned cereal company that works off its natural foods branding. Controversy hit a peak as claims by the Cornucopia Institute, fueled by social media, made claims that genetically-modified organisms (GMOs) were found in some of its products. Kashi, of course, responded (including an online video) refuting the claims, followed by counter-claims, and so on.

No company wants this type of publicity, as truth often gets lost in the midst of the debating. Certainly, companies like Kashi that make "natural" claims have a high reputation to live up to, and deserve criticism if they don't walk the talk. On the other hand, based on the comments I've read online, it also seems like natural food fans are just plain suspicious of any natural food companies that is successful and ends up part of a large corporate empire like Kellogg.

The vast majority of consumers will likely never even hear about this controversy, and eventually it will likely die down. But, Kashi also can't alienate some of its most passionate consumers who are looking for the purest possible foods.

(Source: Huffington Post)

What's up with oatmeal?

I've been noticing a rising trend in the last couple of years, and even more so in recent months: There seems to be a resurgence of interest in cooked oat cereals. Walk down any cereal aisle and you will notice that the selection of instant oatmeals is quite significant.

Years ago preparing oatmeal from scratch using oats, especially from Quaker, was a morning staple. The advent of prepared, cold cereals has obviously changed things for the majority of people. Could it be that in the midst recession or because of a desire for things more natural that porridge in general, and oatmeal in particular, are "hot" commodities?

For a number of years now Quaker has offered convenience through its Instant Oatmeal products. Quaker certainly dominates the market as in most consumers' minds they own the word "oats". But, others are recognizing the opportunity and getting into the action. Some are obvious, like Kashi. But there are newcomers to the market place as well. These include smaller, niche companies that are focusing on being natural, such as Pro Oats and Umpqua Oats. Even cranberry specialist, Ocean Spray, has a new line of instant oatmeal. And, the company that seems to be shaking things up right now is Better Oats, a newcomer that is gaining considerable traction with almost 30 varieties covering a range of preferences and styles. Some of the innovative flavors include dark chocolate and chai spiced.

Could it be that consumers are looking for a change, and that this could continue to be a growing market? What do you think?

UPDATED 11/7/10: Some additional evidence: http://www.foodproductdesign.com/news/2010/10/oats-driving-breakfast-cereal-launches.aspx

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Digestion niche

Starting with the Kellogg Sanitarium over 140 years ago, cereal has been considered a health food. Certainly the highly sugared and artificial flavored versions of recent decades seems to contradict that, there has always been a strong contingent of cereals designed to promote health. High fiber cereals (such as All-Bran) and the recent marketing of cereals for weight loss (e.g. Special K) are but two examples.

Consistent with the popularity of yogurt, a relatively new twist in the cereal aisle has been the introduction of pre- and pro-biotic cereals.

In 2006, Kashi introduced Vive, the first pro-biotic cereal. "Pro" biotics are live lactobacillus bacteria that naturally assist digestion in the intestinal tract.

Within the last month Kraft has introduced a line of pre-biotic foods, including a cereal, under the Live-Active brand name. "Pre-biotics" are special fibers that enhance the proliferation of friendly probiotics.

The key point in all this is that focusing on health niches is a good strategy for cereal companies, especially when they can be innovators in the industry.

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