Shrinking boxes, growing profits

As previously reported, cereal companies have been shrinking cereal boxes in an effort to increase profits.

The strategy appears to be working, at least for now. General Mills latest financial results reveals that this strategy has increased profits during the last quarter. (See article at the StarTribune.com)

Corporations that short-sightedly look for short-term profits at the expense of long-term sustainability are playing a dangerous game. What will they do next time profits fall flat? You can only shrink the boxes so far. Eventually consumers will balk at the price of cereal, especially if there is not perceived value. Innovation could turn that around, but it doesn't appear that the big cereal companies are catching on to that.

Technorati Tags: cereal, General+Mills, marketing, breakfastbowl

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: cereal, marketing, breakfastbowl

Time for packaging innovation

For the second day in a row I am highlighting a cereal innovation from the U.K.

Jordans Cereals have introduced a new cereal bag that stands out for several reasons. First of all it breaks away from the cardboard box and liner approach found with most cereals. Second, it is a standing bag, and not the flimsy cellophane of bulk and discount cereals. Third, the packaging material itself is unique: recycled, recyclable, biodegradable and soon fully compostable. Finally, the packages look good!

I have long argued that the future of cereal will be shaped by those willing to innovate. The big cereal leaders, Kellogg and General Mills, seem to be more focused on short-term profits and brand extensions than truly creative innovations. Perhaps they need to look at European examples like Jordans and mymuesli to see more substantial breakthroughs.

Technorati Tags: cereal, Jordans, innovation, packaging, breakfastbowl

Eatmecrunchy bowl

Occasionally I come across an interesting new kitchen item for cereal lovers. The latest is the Eatmecrunchy bowl, a uniquely-designed bowl for those who like their cereal crunchy.

The bowl has a shelf that holds the cereal above the milk, and a small section where the two actually mix. The bowl is from the United Kingdom, so I haven't tried it myself and it doesn't appear to be available in North America yet.

Technorati Tags: cereal, bowls, breakfastbowl

Kellogg buying Post?

Post has long been an also-ran cereal company, behind the obvious leaders Kellogg and General Mills. In my opinion, there isn't much real innovation or creativity coming out of Post.

The Battle Creek Enquirer reports that rumors are flying in cerealville that Kellogg might be trying to take over its long-time rival.

The article is worth reading. LINK.

Technorati Tags: cereal, Kellogg, Post, breakfastbowl

All-Bran's subliminal advertising

This summer Kellogg released a creative, new commercial for All-Bran that takes on a sensitive topic (i.e. regularity) with subtle humor.

Watch it for yourself on YouTube and notice the striking visual metaphors!

Technorati Tags: cereal, marketing, Kellogg, breakfastbowl

Kellogg announces new nutrition labelling

With pressure to focus less on marketing to children, and more on nutrition, Kellogg has announced a new approach to nutrition labelling on its cereals. Up to this point both Kellogg and General Mills have each been using a complex set of symbols to depict nutrition content of cereals, but it was a little to complicated for most consumers. Kellogg is simplifying things with its new Guideline Daily Amounts that appear on the front of the package, and convey key nutritional facts.

While simpler, the new labelling still assumes some basic understanding of key nutritional concepts by consumers. Savvy purchasers will find the information convenient, but for those who are confused by nutrition (or simply don't care) it is doubtful to make an impact.

Technorati Tags: cereal, Kellogg, nutrition, breakfastbowl

Hot cereal anyone?

With the growing trend of consumers toward natural products, hot cereals appear to be making a comeback. The simplicity of porridges are in stark contrast to the highly processed ready-to-eat cereals that dominate the market. The New York Times recently picked up on this with an article that highlights how Quaker is getting back to its roots by marketing hot cereals, specifically its new Simple Harvest line.

While cold breakfast cereals have an edge in convenience, the return to hot cereals are a trend worth watching.

LINK

Technorati Tags: cereal, Quaker, breakfastbowl

Skipping Breakfast

Breakfast is too important to skip,so I wouldn't dare do that. But, due to extreme personal circumstances in the last month or so blogging has taken a back seat. But, it's time to return to this passion and pour another bowl. There's much to catch up on from the last few weeks!

Technorati Tags: cereal, blog, breakfastbowl

Cereal and bloggers

It's been a long time since I last listed significant blog postings pertaining to cereal. Here are some over the past couple of months that caught my attention:

Samuel L. Bronkowitz presents comments on the not-so new-shaped Trix.

Girls Cash Cars reveals a simple, but hilarious Shreddies advertisement from Canada.

The Ramblings of a Collegiate Designer is about a graphic design student's adventure in creating a cereal box.

The Toque rallies against granola

Kellogg's new Cereal Straws have been getting considerable attention on the blogosphere, including: The Impulsive Buy, and The Thoughtful Bagger,

Technorati Tags: cereal, blogs, breakfastbowl