Monday, October 08, 2007

The challenges for cereal

As I've pointed out before, the cereal industry is facing many challenges. Major companies are facing tough competition and decreasing profits. and cereal consumption is declining in North America.

A recent article in Food Navigator-USA provides an interesting review of these challenges based on a recent market research report. Mintel identifies the challenges as "low brand loyalty, market saturation and increasing competition from other channels". The biggest challenge is increased competition from the foodservice industry. At least once a week 34% of consumers eat breakfast from a fast food restaurant. In other words, cereal is not as attractive of a convenience food as it once was. It may not be convenient enough. Obviously cereal manufacturers have been trying to address this through the introduction of cereal bars, etc. but even these do not appear to be reversing the current trends.

Another study from Research and Markets indicates only 52% of survey respondents cited cereal as their top breakfast choice. The suggestion is that "many consumers are simply 'bored' with the segment".

More reason why the future of breakfast cereal must step out of the ordinary and into the truly innovative.

Technorati Tags: , ,

1 comment:

Anonymous said...

This stuff isn't new...
I used to eat this back in the mid-90's when I was in middle school.
I loved it and it disappeared :(