Developing a marketing strategy for Kellogg's All Bran range of corn flakes

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With over 80 years of legacy behind it, the Kellogg’s All-Bran brand is now one of the most significant trademarks of the company. What was once a name for cereals and cornflakes, now represents nutrition and healthy eating. Through this project we explore the different aspects of the Kellogg’s All-Bran brand and its future.

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  • You now what, i love that brand All-Bran, is number one than Cornflakes and all other brands may follow but THAT ONE is number ONE.
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Developing a marketing strategy for Kellogg's All Bran range of corn flakes

  1. 1. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] With over 80 years of legacy behind it, the Kellogg’s All-Bran brand is now one of the most significant trademarks of the company. What was once a name for cereals and cornflakes, now represents nutrition and healthy eating. Through this project we explore the different aspects of the Kellogg’s All-Bran brand and its future. Kellogg’s All-Bran IMBA NOV 2010 N1 IE BUSINESS SCHOOL FABRIZIO LUONGO JOAO MAGALHAES KUNDAN BHADURI PAUL JAMES SOLOMON SANDRA BOGHOS SANDRA MORRIS© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 1
  2. 2. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] TABLE OF CONTENTSSituation Analysis..................................................................................................................................................................................................3 Consumer............................................................................................................................................................................................................3 COMPANY............................................................................................................................................................................................................3 Competitors ......................................................................................................................................................................................................4 Collaborators ...................................................................................................................................................................................................4 Context .................................................................................................................................................................................................................4Target Market .........................................................................................................................................................................................................5The Marketing Strategy .....................................................................................................................................................................................5Brand Analysis ........................................................................................................................................................................................................6 Health ....................................................................................................................................................................................................................6Marketing Mix: The 4 Ps ....................................................................................................................................................................................7marketing Communication ..............................................................................................................................................................................9major branding Issuesat all-bran............................................................................................................................................................... 11Recommendation ............................................................................................................................................................................................... 12Exhibit 1: Kellogg’s vision, mission statement and operating principles ............................................................................. 13Exhibit 2: All-Bran Direct and Indirect Competitors ....................................................................................................................... 14Exhibit 3: Brand Positioning in the Spanish Market ........................................................................................................................ 15Exhibit 4: SWOT .................................................................................................................................................................................................. 16Exhibit 5: All Bran Brand Awareness Survey Result ....................................................................................................................... 17Exhibit 6: Assisted Product Recognition by Consumers ................................................................................................................ 18Exhibit 7: Consumer Rating of All Bran Products ............................................................................................................................. 19Exhibit 8: What consumers would improve about All Bran ........................................................................................................ 20Exhibit 9: The All-Bran Product Line ....................................................................................................................................................... 21Exhibit 10a: Average Price of All-Bran Cereals Portfolio .............................................................................................................. 22Exhibit 10b: Price of All-Bran Snacks Portfolio .................................................................................................................................. 23Exhibit 11: Price per 100 grams of All-Bran Products.................................................................................................................... 24Appendix 12: Price data for the Market of Cereals and Snacks in El Corte Inglés, Mercadona, Caprabo andCarrefour................................................................................................................................................................................................................. 25Exhibit 13: Price Comparison of All-Bran Cereal Bar and All-Bran Flakes with Competition. .................................. 27Exhibit 14: Supermarket space allocated to All-Bran in snack and cereal sections ........................................................ 28Exhibit 15: Direct Competitors ................................................................................................................................................................... 29Exhibit 16: Lower End Supermarkets ..................................................................................................................................................... 30Exhibit 17: Higher End Supermarkets .................................................................................................................................................... 31Exhibit 18: TV communication.................................................................................................................................................................... 32© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 2
  3. 3. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]SITUATION ANALYSISCONSUMERThe All-Bran brand encompasses a range of products broadly split into two categories, cereals and snacks. Assuch the range of All-Bran consumers is wide, ranging from the young to old and both male and female. Howeverin general the typical customer buys the product to satisfy a particular need for fiber and/or to enjoy a healthy andfilling snack or meal.Traditionally All-Bran was considered as a breakfast product, and this continues to be the main time ofconsumption for the products. The value for customers remains as it has been for decades, with the quick andeasy nature of preparation of any of the products, and the relatively low price compared to alternative foods, givingconsumers a strong reason to use the product. In the area Kellogg’s has long been the market leader, consumershave grown up with the brand and therefore are loyal towards it.However, the recent product expansion and alternative meal suggestions by Kellogg’s mean consumers now enjoyAll-Bran snack and cereal products at any time of the day, for meals or between meals. Snacks offer several keyadvantages over other substitute products to the consumer. Some of the important ones include longer shelf life,easily preservable at room temperatures and a wider distribution/reach. Also, as compared to other substituteproducts such as sandwiches, cakes, yogurts, fruits and cookies the pricing of the All Bran range of products isagain competitive. The average snacks consumer has a need for quick and healthy snacks between meals,generally during short breaks at work or outdoors.All-Bran consumers are therefore diverse in nature. However broadly speaking we could differentiate between “All-Bran plus” type customers, and the less extreme consumers. The first group is very concerned with the healthbenefits, in particular about a healthy digestive system. They are less concerned about taste and are the users ofthe more basic cereals. The second group uses the product for more general reasons, still appreciating the healthbenefits but also attracted by the convenience and weight-suppression aspects of the product. They are likely to bemore concerned with taste and therefore more attracted to the products with additional flavours, in particular thesnacks.Consumers get their information from TV, magazines, street billboards, Internet advertising, and word of mouth.They also obtain information from the packaging both at the point of sale (supermarkets) and at home. The boxescontain nutritional data relevant to their purchases. In general the decision to purchase will be planned, withperhaps consideration of the relative benefits of the options considered at the supermarket shelf, or a consciousdecision to eat more healthy food precipitated by advertising.COMPANYKellogg’s is an American company founded in 1906. It is now the world’s leading producer of cereal andconvenience foods, with products marketed in more than 180 countries around the world. Their products aremarketed under the Kellogg’s brand name and are sold principally to the grocery trade through direct sales forcesfor resale to consumers. The company sales in 2010 comprised of three main categories: cereals (~50%), snacks(~40%) and frozen/other products (~10%).Kellogg´s is established as an international leader in the cereals trade. Their corporate goal (Exhibit 1) is to growtheir cereal business and expand more into snack products, while remaining customer centric. It is a globalcorporation, with self-sustaining financial resources such as good liquidity and healthy levels of capital. It has awide range of distribution partners and devotes a significant proportion of its resources on its marketing campaigns.The company is known for taking long term bets in a few selective categories of the food market and backing themup with R&D and innovation, strong brands and an excellent execution by an experienced team.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 3
  4. 4. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]The company sells two lines of products in Spain - cereals and snacks, which include the cereal bar, mini-breaksand muffins. In the eyes of Spanish consumers Kellogg’s globally recognizable name generates associations oftrust and reliability, and also enables them to attract a talented workforce. Kellogg’s has a manufacturing plant inthe city of Tarragona, Spain. This plant has been operational since 1980 and it produces cereal products for theSpanish and Portuguese markets, as well as for exports to other countries in Europe.COMPETITORSAll-Bran’s cereal competitors are other brands and private labels. In the snacks line of products, All-Bran has beenfacing competition from other healthy snack producers, including the private labels at supermarkets or othertraditional confectionery manufacturers. The competition in the cereals and snack markets has become fiercecompared to a decade ago. The market for natural and healthy snacks has been growing, and adding to thealready large variety of products consumers have to choose from: cookies, cereal bars, drinks, yogurts, and powdermixes to name but a few. Competitors can be categorized in two groups (Exhibit 2):1. Direct Competitors: All other branded and white label cereals, cereal bars, and snacks with high fiber content or categorized as healthy and belonging to the cereals aisle at the Supermarket.2. Indirect competitors: This includes two subcategories: Cereals, cereal bars and snacks not marketed as “healthy” but competing with All-Bran on the cereal aisle. Includes kids’ cereals, chocolate snacks, ‘indulgence cereals’ and other varieties. Other products that contain fiber and communicate the fiber benefits explicitly to the consumers. For example fiber cookies, pills, and yogurts, probiotic drinks, high fiber juices, teas, whole wheat rice and breads, dried fruit, and other natural products like flax-seed and wheat oats.Customers can buy the entire All-Bran range of products, along with direct competitors, from the same points ofsale - supermarkets and convenience stores. There is opportunity in the market for other brands that offercheaper, healthy and tasty alternatives. Our survey results show that the main competitors of All-Bran in the cerealand snack business in the city of Madrid are: Nestle (Fitness), Weetabix, General Mills, and private labels such asEl Hacendado, Aliada, Eroski, and Carrefour.On an overall basis, All-Bran’s brand position vis-à-vis its competitors are shown in Exhibit 3.COLLABORATORSKellogg’s counts well known nutrition experts such as Dr Baltazar Ruiz-Rosso and other professors in relatedbusinesses as thought leaders and collaborators. They provide strategic direction to the company by providinginsights from their research in nutrition and product innovation, and guide consumers by recommending theproducts in magazines, newspaper articles, research journals, online forums or television talk shows. The advicegiven by these thought leaders is crucial as it helps shape public perception. Other minor collaborators include:Grupo Leche Pascual as a key distributor, ID Logistics, and advertising agencies.CONTEXTIn the social context, individuals are becoming more health conscious and aware of the food they eat. Nutritionalinformation on products and the availability of vitamins, minerals, and fiber is important when choosing a snack orbreakfast cereal. This trend started more than ten years ago but is now very strong in Spain; consumers are eatinghealthy breakfasts and snacks, and want new options that fit into their dietary needs.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 4
  5. 5. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]Despite this general trend, data from a study done by Doctor Baltazar for All-Bran has demonstrated that fiberintake is decreasing in Spain. This research concludes that Spanish people consume only 53% of the daily fiberrecommendation. The government is therefore encouraging people to monitor their diets and improve fiber intake.The crisis of the last two years has also significantly influenced the choices Spanish consumers make. Theavailability of similar private label products at lower prices has made consumers perceive All-Bran a premium andmore expensive brand and shift their purchasing habits towards white brands. Furthermore, the growing influenceof technology and social networks means that people today share their good and bad experiences aboutproducts/services and influence other peoples’ buying decisions.SWOT AnalysisExhibit 4 shows the Strengths, Weaknesses, Opportunities and Threats concerning the All-Bran brand.TARGET MARKETThe product is mainly aimed at adults aged 30 and older, both men and women. This population segment in Spainaccounts for around 38% of the total population, approximately 17.6 million people.Demographic profile Psychographic profile Men and women between the ages of 30 to 59 Active and busy lifestyles They typically eat cereal or snacks once a day Concerned with health Mainly living in cities (Madrid, Barcelona) Modern and actively changing Income in the middle to high range Low sensitivity to price for quality productsTHE MARKETING STRATEGYBroadly speaking, Kellogg’s marketing strategy is three-pronged with the following goals. In the long term it plansto improve overall market-share, in the short term to increase Kellogg’s share of wallet, and finally in general itseeks to improve the overall purchasing experience of the customer. This strategy will help the company realize alonger life cycle for the All-Bran brand.Previously Kellogg’s had launched several bran-based products and ended up with a large portfolio of products thatwere difficult to market. The company therefore consolidated all fiber-based products together within the All-Branbrand. This strategy aided the struggling individual brands to both gain importance in their respective markets andreduce the total marketing resources that would have been otherwise required to support each of them separately.However, the brand consolidation created confusion for the customer, and actually negatively impacted the All-Branbrand itself. To deal with this the company adopted a synergy based approach. For instance, the All-Bran Plusproduct is marketed under the master brand of All-Bran while Bran Flakes is labeled as a separate sub-brand. Thepackaging is altered to accommodate the designs of the different sub-brands but also shows the entire range of All-Bran products that could help the end customer make better purchasing decisions. In this way the brand ismarketed in a way such that the properties of all the products within the All-Bran brand are perceived to be unifiedwhen it comes to health and nature.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 5
  6. 6. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]To further expand market outreach, the company then decided to pursue brand expansion by diversifying intocereal bars, muffins and other healthy snacks. The marketing focus extended beyond simple health and nature-based food to include convenience as a selling point. In addition, The company also repositioned the product rangeto depict not only the old “Keeps you regular” message to consumers but one that embodies inner health.On the differentiated purchasing experience front, we note that the All-Bran brand originally conveyed the idea ofbeing a ‘natural product’ to the consumer. This strategy makes it essential for the packaging to show theingredients and the nutrition information much more prominently, which it indeed does. The marketing strategy hasalso strongly relied on carefully crafted television and radio advertising, apart from consistent in-store promotions.The brand positioning can be summarized with the following statement:To adults over thirty, All Bran is the cereal/snack that allows them to maintain their digestive system, stay healthy, and have higher energy levels because of its high fiber content.BRAND ANALYSISKellogg’s, the brand with the strongest brand recognition and advertising recollection of all cereal manufacturers,shows legitimacy and quality, while the All-Bran master brand individualizes the product line. This provides apositive contribution to brand equity and leverages positive associations from the consumer. All-Bran places itsindividual products by means of brand extensions. This approach, besides enabling other marketing synergies,provides an umbrella where the master brand’s attributes are the core around which all extensions are sustained.Two tangible associations identify the brand, the name and the logo. The particular brown color of the letteringused in the logo in the yellow background is most important for brand recognition. On the intangible side the All-Bran brand communicates associations of health and positive attitude to the consumer. The emphasis is on theproducts being a boost to both relationships and health, helping the consumer look and feel good. If the brandwere to have a personality, it would reflect trust, longevity and positive feelings.HEALTHThe key ingredient in all All-Bran products is of course Fiber, and while the brand has lately shifted away from theblunt concept of regularity it still retains a direct connection between high fiber content and a functional benefit,using the more subtle definition of fiber helps you eliminate what your body does not need. The company alsobuilds on this message by promoting the daily dietary requirements that the product fulfils, including vitamins. Theconsumer therefore benefits from the combined value proposition of general and dietary health.TASTEThe brand faces some resistance in developing this association, since some of its promotions attempt to disputeconsumers’ preconception of wheat bran being tasteless or even sometimes unpleasant. The required shift inconsumer beliefs is pursued by promoting the association of “fiber can taste good” aimed at both the classic cerealproduct but also more meaningfully to the cereal bars and mini-breaks. A reaction to the problem of tasteassociations is the presence of fruits, or fruit flavors like strawberry and apple, and more indulgent variations likechocolate, raisins, cinnamon and honey among the different products.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 6
  7. 7. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]Interactions of the AssociationsTASTE AND HEALTHGood taste perception is a desired attribute for all food products. However, the strong negative tastepreconceptions discussed above are backed up by our survey which shows that consumers rate All-Bran taste asfair (Exhibits 5, 6, 7 and 8). Consumers appear to be suspicious of a positioning combining good taste and health,while the presence of fiber is thought to be incompatible with taste. Overcoming the doubts caused by this dualpositioning requires a strong and trusted brand like All-Bran, and it has successfully managed to create anddevelop this category in a believable manner with both benefits being simultaneously grasped by consumers. This,for instance, has allowed the launch Cereal Bars and Mini-Breaks that fulfill the need for a healthy and tasty snackall in one product.POSITIVE ATTITUDE AND FIBERThe functional benefit does not end with eliminating what your body does not need, it conveys keeping thedigestive system healthy, which means keeping the consumer healthy. Inner health goes from the inside to theoutside, meaning that a healthy body is the booster of positive attitudes and being in harmony with the surroundingpeers.MARKETING MIX: THE 4 PSPRODUCTAll-Bran basic products are at the core of what consumers buy; they either buy a breakfast food, or snacks to beeaten on the go. However there is more to the equation than a simple cereal because the product is fulfilling acertain set of expectations. When consumers buy All-Bran they are buying the benefits that come with it, thehealthy image and fiber benefits which are part of the expected product. The augmented product is the health andcomfort that people are acquiring which are the indirect results of consuming All-Bran.All-Bran was created in 1915 and is currently in the maturity phase of its product life cycle, where it is well knownand has had ample time to penetrate the cereal market. What Kellogg’s is trying to do is to lengthen this period, byactively marketing All-Bran, its benefits, and the lifestyle it is part of. Extending the brand and going into snackproduction is a means to prolong this maturity stage.Kellogg’s started the All-Bran range with two products, All-Bran Flakes, and the regular All-Bran. Today the brandlength and width has increased dramatically. The All-Bran brand mix width is composed of two product lines:cereals and snacks. Both lines have the same amount of SKU’s, with six different choices each, therefore thelength of each line is six. The several options vary mainly according to the level of fiber offered and to the specificflavour or combination of flavours. Exhibit 9 shows the All-Bran product mix available in the Spanish market(specific to Madrid) with the percentage of fiber in each serving.The cereal product line has six different flavours to accommodate various customer needs and preferences.- All-Bran Flakes- All-Bran Choco- All-Bran Fruit & Fiber- All-Bran Plus- All-Bran Raisin Hearts- All-Bran Chocolate Hearts© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 7
  8. 8. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]The snacks line has three different types of products: Bars, Mini- Breaks, and Muffin Cakes. The bars offer threeflavours: apple, chocolate, and nature. The Mini- Breaks come in strawberry and cinnamon flavours and the MuffinCake comes in oat and fruit.— All-Bran Mini-breaks (strawberry & cinnamon)— All-Bran Cereal Bars (nature, apple & chocolate)— All-Bran Muffin CakePRICINGFour supermarkets and stores were visited to analyze prices. Visits were done to El Corte Inglés, Carrefour,Mercadona, and Caprabo in order to compare the product prices in these places. A list of cereal products andsnacks was compiled together with the different prices in the stores. Exhibits 10a and 10b show the average pricefor each product and Exhibit 11 calculates the price per 100 grams for cereals. Prices in the stores visited did notvary much when comparing Kellogg’s cereal bars or snacks. This shows a good control of the company over itsprices in this category. On the other hand, prices for cereals are very different in the four stores. This shows thehigh competition between brands and supermarkets, as well as the power customers have over prices. If aconsumer enjoys a type of cereal, he or she will remember the price and will visit the store that has the variety butalso the lowest price.Another important observation is that Kellogg`s has a higher pricing for all its cereals. If we compare All-Branproducts to its other core adult and kids cereals we can see that the average price of 100 grams of All-Bran Flakesand Plus is around 15 to 20 cents cheaper than other Kellogg’s cereals like Pops, Extra and Special K. The otherAll-Bran varieties are about the same as the Kellogg’s portfolio.Supported by the data collected at the stores, we can say that All-Bran products are part of the higher price pointcategory. There is no doubt that Kelloggs wants to project this brand as a top-end premium segment brand, forwhich people are willing to pay a premium price (typically 20-33% more). Exhibit 12 shows the 15 SKUs present inthe Spanish market and their price per unit and per 100 grams of product.The cereals market is clearly classified into three different price segments. These price brackets (per 100 grams)are SEGMENT 1 = €0-0.35, SEGMENT 2 = €0.36-0.70, SEGMENT 3 = €0.71-1.0. On the cereal category All-Branhas an average price of €0.67 per 100 grams of product, compared to the average price of its competitors: €0.62per 100 grams. All-Bran operates in segment 2 and 3 across the six product variations, with three packagingvariations: 375, 500 and 750 grams. Its main products, All-Bran Fiber Plus and All-Bran Flakes, are available indifferent size packages, but the more premium priced flavors (Chocolate Hearts, Raisin Hearts, and Choco) areonly available in 375 gram packaging.The price of All-Bran cereal, in packets of 500 grams, varies between 2.84-3.15 Euros, a price range that alsocontains other brands like Nestlé Fitness, and Kellog’s Special K and Extra. White brands are very strong in thecereal market, offering the consumers a cheaper alternative. This white brand category has an average unit priceof €1.62 and a price per 100 grams of €0.32. All-Bran consumers are willing to pay twice the price of white brandsbecause they trust Kellogg’s quality and heritage.All-Bran also competes on the snacks category with its Cereal Bars, Muffins and Mini-Breaks. The Cereal Barsbusiness has higher product variety, greater pricing variations and a much larger competitive base. The productsin this segment can be classified under the following price segments (per 100 grams): SEGMENT 1 = < €0.50,SEGMENT 2 = €0.51 - € 1.0, SEGMENT 3 = €1.01 - €1.50, SEGMENT 4 = €1.51 - €2.0, SEGMENT 5 = > €2.0.All-Bran operates at the lower end of Segment 3 in this product category (All-Brans price for cereal bars is €1.04).In this category, white brands are very aggressive not only in prices but also in the variety and consistency theyoffer to the consumers. See Exhibit 13 for comparison with competition.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 8
  9. 9. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]POINT OF SALEOur market study of the shelving of All-Bran products took place in the same supermarkets in Madrid. Overall,cereal brands are facing high competition from private labels, with each supermarket pushing its own private labelsand giving them adequate shelf space with good visibility. Supermarkets are giving All-Bran centralized shelf spacewhich is almost always at eye level (Exhibit 14 and 15). However, they are surrounding the branded products withtheir own private labels, so that the consumer can compare prices of the exact same products side by side, All-Bran vs. the private label.Caprabo: Caprabo is a relatively small and convenient supermarket and the snacks and cereals are combinedtogether into 1 section. The section consists of 11 facets and 4 shelves of which 2 are large and the other 2 arenarrow. Only one of these shelves, which happens to be at eye level, is for snacks. The selection is relativelygood for the size of the section. They carry All-Bran Cereal Bar in Apple and Chocolate and All-Bran Muffin Cake in5 facets. On the top shelf, they carry All-Bran Plus and All-Bran Flakes.Mercadona: Mercadona is slightly more disorganized and the snacks are in the upper middle shelves of thesection. The section is bigger than that of Caprabo but this is understandable given that the supermarket is alsobigger. There are a total of 4 shelves of 16 facets for cereals, a level which is a bit higher for the snacks whoseboxes are a bit smaller in size. All-Bran cereals are placed on the second shelf from the floor and they carry All-Bran Flakes, All-Bran Fruit & Fiber, and All-Bran Chocolate Hearts. All-Bran snacks come in 2 types, All-BranMuffin Cake, and All-Bran Cereal Bar in Chocolate. They are at eye level, but only occupy one facet each (Exhibit16).El Corte Ingles: El Corte Ingles has a big cereal section. It is a high end supermarket, where neatness is obvious.There is a clear separation of snacks and cereals, and this is done by placing milk (a complement of cereal) in themiddle. The snack section consists of 6 shelves, and has an entire shelf dedicated to All-Bran snacks taking up 8facets in total. The whole All-Bran snack range is available which is impressive because the shelf is at exact eyelevel. The supermarket also carries extensive selections of Special K and Hero snacks. Adjacent is the cerealsection, occupying 20 facets on 4 shelves. The selection is also wide, but the products are very dispersed,available on different parts of all the shelves except the one at eye level. Top shelf contains All-Bran Plus, the thirdshelf contains the 2 chocolate variations, and the bottom one contains All-Bran Flakes, and All-Bran Fruit & Fiber.Carrefour: Carrefour carries an extensive range of both cereals and snacks whose sections are adjacent. All-BranPlus, All-Bran Fruit & Fiber, and All-Bran Flakes Chocolate are positioned on the highest shelf. Carrefour whitelabel surrounds All-Bran from most sides. All-Bran Chocolate Hearts are placed on the floor under the shelvesoccupying a large space which is highly noticeable; the same is done for Nestle Fitness. As for snacks, the 6 typesof snacks are all available, occupying the top 2 shelves. Again, with snacks, similar Carrefour brand products areplaced side by side to All-Bran (Exhibit 17).MARKETING COMMUNICATIONAll-Bran approaches its customers through different communication channels. TV is the principle device, butInternet channels and communication on the packaging are also used to deliver key messages to existing and newpotential customers.TV COMMUNICATIONThis channel enforces the core attributes of the brand: healthy, tasty, and positive feelings. Across all commercialsthe message is to cut out negative habits and attitudes and bring in positive energy to everyday life. Taste is onlymentioned occasionally. Health is generally used as the underlying reason for the positive attitude the consumer© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 9
  10. 10. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]gains through the use of the product. When advertising All-Bran Choco, Muffin Cakes, Cereal Bars, and Mini-Breaks, besides enforcing brand attributes, the commercials are mainly promoting new occasions for consumption.For each product there is one suggested occasion. With Cereal Bars and Muffin Cakes for instance the emphasis ison the ability to consume the product “on the go”, implicitly promoting the convenience. All TV communication is 1available for viewing at the main corporate site. We point out YouTube references to the commercials whenavailable for ease of view. Exhibit 18 describes the themes of selected advertising campaigns.PACKAGING COMMUNICATIONPackaging communication is identical across all cereal products of the brand. Several combinations are suggestedlike with fruits, white coffee, yogurt, or ice-cream, all to try to boost the perception of taste. Inviting pictures of theproduct within each occasion are given, and communicate the intention of the brand to be perceived as tasty andultimately delicious.Another clear message is the display of the percentage of fiber content on the product, but it must be noted thatnot all extensions bear this sign. Also present on the packaging of cereals is one of the standard mottos of thebrand “Sentirse sano se nota, tomar All-Bran también” meaning “feeling healthy is noticeable, having All-Bran,too”. Furthermore, small notices have been placed at the bottom of the packaging with three messages statinggeneral benefits of consumption of fibre. “Studies indicate that currently only 53% of the desirable amount of fiber is consumed by the Spanish population.” “All-Brain contains insoluble fiber, and studies demonstrate that insoluble fiber is most effective.” “All-Bran is a healthy option, it has high fiber content promoting a healthy digestive system, helping to eliminate what your body does not need.”In the Cereal Bars, Mini Breaks and Muffin Cake products the communications are much more abridged, restrictedto mentions of the fiber content and highlighting the flavor of the product with appealing pictures. The messagestypical of cereal products only appear in small font, stating the proportion of fiber present in relation to the dailyrequirement.INTERNET COMMUNICATIONInternet communications comprise all digital means by which the brand communicates its benefits through theInternet. They include the corporate website, www.kelloggs.es/allbran/, participation in blogs, online recipes andcontent publishing in YouTube.Corporate website: www.kelloggs.es/allbran/It presents the whole range of products in the Spanish market, a dedicated chapter to inform on the role of fiberand a section to evaluate the current relationship of the consumer with his or her fiber consumption. The lastsection exhibits the TV ads created by the agency Leo Burnett, giving a creative and cheerful touch to the site. Therole of fiber in pregnancy was recently incorporated, addressing the problem of constipation many pregnant womenexperience during pregnancy.Muffin Cakes, Bars and Mini-Breaks: www.kelloggs.es/snacks/index.htmThe great taste of Muffin Cakes is emphasized, while bars are promoted for their high content in fiber, and mini-breaks for their general health benefits - “finally a healthy snack”. All the descriptions continue the theme of healthyon the inside, lively and positive on the outside. The suggested consumption is for mid-morning or early eveningsince the product is not a substitute for meals, but a snack one might want to grab between meals.1www.kelloggs.es/allbran/© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 10
  11. 11. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]buenosdiasbizcochito.org presents interactions with the consumer and is positioned midway between a corporatesite and a social network. It presents the Muffin Cake snack and it highlights, through interactive features, the 2cheerful spirit of the brand. It appears that the brand decided not to create this interaction within an existing socialnetwork to retain control of the content published by the users, and to ensure a brand-centric environment.Blogs: The participation on the brand`s blogs is outstanding. Insiders, Kellogg’s hires or employees spread thebenefits in great detail on blogs like ciao.es and dooyoo.es incentivizing consumers to express opinions and alwaysresponding to their comments and queries.YouTube Channel: Some of the commercials devised by Leo Burnett for TV advertisements have been publishedin YouTube but have few views or user comments. It is clear that as yet All-Bran has not yet concentrated on thisparticular channel.On-line Recipes: From the corporate website to other sites like Dia for supermarkets, the brand presents severalrecipes to be prepared using their products. The main objective is to deal with the taste perception issue.In order to emphasize its commitment to the health conscious customer, the company emphasizes a 7-daypromise. Through this plan, the company has tried to promote the value of the brand by showing that dailyconsumption for only seven consecutive days could help alter the digestive irregularity of the consumer. In our viewthis is a definite value proposition and a customer accrual and retention strategy.MAJOR BRANDING ISSUESAT ALL-BRANThe main issues for All-Bran have been briefly summarized below:Threat from white labels: The white label brands are exerting pressure on the Kellogg’s All-Bran family of cerealson the cost front. A white label brand is typically 20-30% cheaper than All-Bran. The store shelving space of thewhite label brands is bigger than the space for All-Bran products. All-Bran negotiates shelf space with thesupermarkets but it is obvious that the retail stores surround Kellogg’s and other brands with their private labelsmaking the price comparison very easy for consumers. Supermarkets are trying to balance keeping the brandshappy while pushing the sales of their own white labels. The company needs to improve its incentive scheme tocounter this trend. Amongst the actions that Kellogg’s could potentially take would be to increase commissions persale or exert greater supplier pressure by consolidating its SKU supply structure.Perception of Taste: After a broad survey of a number of sample All-Bran consumers, we are of the opinion thatthe consumer perception of the taste of the product is low. A lot of consumers associate the taste of All-Brancereals with bland/dull rather than fun. While this is only a subjective and relative issue difficult to quantify, wesuggest the product mix specialists look into this aspect in greater detail. In specific, blind tests on the variations ofthe cereal tastes can be done to ascertain the right taste mix for the variations of the cereals.Growing healthy food substitutes: There is also a growing concern over the availability of substitutes in thehealthy food industry. Over the past several years the substitutes in the healthy food market have improved, as aresult of which there is greater competition in the area. There are plenty of other product offerings that offer generalhealth benefits and high fiber content.Problems with brand positioning: The company has positioned the All-Bran range of products in many differentand disparate ways - without a clear messaging strategy to the consumer. At the end of the day, it is important tohave a single brand image and message for the consumer. In the case of All-Bran, this has not been the case. The2 Link to watch promotional video of buenosdiasbizcochito.org: www.youtube.com/watch?v=S5JaR1PL378© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 11
  12. 12. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]various marketing communications over the past few years in Spain have sometimes projected the healthy aspectof the product, and at other times, communicated its benefits to the digestive system. In view of consumerperception building, this messaging does not clarify whether the product makes one ‘feel good’, ‘feel full’ or ‘feelhealthy’ amongst others notions. Also, the product classification currently appears to be fuzzy - Are the cerealsrecommended for breakfast? for a snack? or should they serve the purpose of a full meal? Over a period of timethe brand has tried to communicate all these elements and has been engrossed in sending too many messagesrather than consolidating them.RECOMMENDATIONOne of the primary recommendations for Kellogg’s All-Bran would be to have an integrated messaging strategy forits brand of cereals and snacks. This could be covering either the healthy aspect of the product, or the conveniencefactor of the product. We understand that the Marketing Director would be vary of the fact that any such choice ofproduct categorization and messaging would entail a more targeted consumer segment selection, which must bedone after giving due diligence to the overall brand and company strategy along with a market research of theconsumer segments that are the most profitable ones in the Spanish market.Premium All-Bran cereal boxes come mostly in small packages of 375g rather than 500g or 750g packaging that isused for other products. Although it might be premature for us to question this decision without further study, wehope that the brand and sales managers have given enough thought to this decision. Typically, these premiumbrands will have a niche customer loyalty, and therefore the demand will be inelastic when introducing largerpackage sizes (of 750 grams). Our recommendation is therefore that the company should consider larger packagesizing for these SKU’s.Kelloggs current strategy is that of competitive differentiation rather than cost leadership, and although we arelooking at the product from a marketing stand point, it would work to the companys advantage to identify the keysuccess factors of the current pricing strategy. The key question that we need to answer is: Are most consumerswilling to pay for the All-Bran cereals for a value differentiation that it brings, compared to all other lower pricedbrands? Is the value correctly projected in the packaging and marketing communication?Since Kelloggs would like to retain the same brand identity across these two product lines, it is imperative that thebrand be associated with one single price segment across all its product lines. In choosing between whether todowngrade the cereals pricing or to upgrade the cereal bars pricing, we believe the company would be betterpositioned to do the latter. The cereals business has already been there for several decades now, and any attemptto re-jig the pricing for the flagship product might be risky. As against that, the cereal bars is a heavily segmentedand contemporary business, and therefore Kelloggs would stand a better chance by competing in segments 4 and5 of the cereal bars product line.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 12
  13. 13. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 1: KELLOGG’S VISION, MISSION STATEMENT AND OPERATING PRINCIPLES© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 13
  14. 14. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 2: ALL-BRAN DIRECT AND INDIRECT COMPETITORS© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 14
  15. 15. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 3: BRAND POSITIONING IN THE SPANISH MARKET© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 15
  16. 16. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 4: SWOT Strengths Opportunities• Great brand awareness worldwide and in the • Expansion into more high fiber product lines Spanish market targeting other consumers• Healthy and high quality product • Continuing growth in the snack market• Very few other major brand names in the field • Aging population in Spain will mean an increasing of high-fiber breakfasts customer base• Supported by the Kellogg’s brand • Brand is adaptable to different healthy food products• Strong distribution channels in Spain • Healthy food market has seen large growth in recent years Weaknesses Threats• Bland taste and perception of lack of taste • New choices of healthy and bran products in the• The main message of “regularity” given by TV market that reduce attraction of the traditional All ads is not very appealing Bran brand• Limited advertising for the brand in • Aggressively priced (white brands) entrants in the comparison with other Kellogg’s brands high fiber content niche • Consumer trends towards healthy but more indulgent and tastier cereals© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 16
  17. 17. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 5: ALL BRAN BRAND AWARENESS SURVEY RESULTExhibits 5, 6, 7 and 8 are based on the results of a marketing survey performed by the team. • Survey Sample Size: 57 • Data collection method: Outdoor interview and physical, paper-based questionnaires • Place of survey: Madrid, Spain • Target Audience: Mid to high income individuals • Date of survey: 28th Jan 2011© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 17
  18. 18. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 6: ASSISTED PRODUCT RECOGNITION BY CONSUMERS 6% 23% All Bran Bits All Bran Muffin 71% All Bran Cereal Bar© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 18
  19. 19. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 7: CONSUMER RATING OF ALL BRAN PRODUCTS (1=lowest, 5=highest) 1 2 3 4 5 Quality 0% 0% 30% 60% 10% Taste 14% 10% 33% 29% 14% Health Benefits 0% 0% 43% 48% 10% Sympathy 11% 0% 47% 37% 5% Availability 0% 5% 24% 38% 33% Price 0% 10% 67% 19% 5%© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 19
  20. 20. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 8: WHAT CONSUMERS WOULD IMPROVE ABOUT ALL BRAN Funner Options Distribution Decrease Price Less sugar Taste 0% 10% 20% 30% 40%© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 20
  21. 21. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 9: THE ALL-BRAN PRODUCT LINE© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 21
  22. 22. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 10A: AVERAGE PRICE OF ALL-BRAN CEREALS PORTFOLIO© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 22
  23. 23. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 10B: PRICE OF ALL-BRAN SNACKS PORTFOLIO© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 23
  24. 24. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 11: PRICE PER 100 GRAMS OF ALL-BRAN PRODUCTS All-Bran Cereals Price per 100gr Choco Flakes € 0.89 Raisin Hearts € 0.81 Chocolate Hearts € 0.75 Fruit and Fiber Flakes € 0.63 Flakes € 0.62 Fiber Plus € 0.58 All Bran Cereals Price per 100 grams Fiber Plus Flakes Fruit and Fiber Flakes Chocolate Hearts Raisin Hearts Choco Flakes € 0.00 € 0.10 € 0.20 € 0.30 € 0.40 € 0.50 € 0.60 € 0.70 € 0.80 € 0.90© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 24
  25. 25. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]APPENDIX 12: PRICE DATA FOR THE MARKET OF CEREALS AND SNACKS IN EL CORTE INGLÉS, MERCADONA, CAPRABO AND CARREFOUR. Point of Sale Price Product Brand Category Grams El Corte Ingles Carrefour Mercadona Caprabo Average Price per 100 gr 1 Chocolate Sacialis 6 units Bicentury Cereal Bars/Cookies 120 € 2.45 € 2.45 € 2.04 2 Devoragras Cookies Bicentury Cereal Bars/Cookies 160 € 2.65 € 2.65 € 1.66 3 Carrefour Barrita Muesli Carrefour Cereal Bars/Cookies 210 € 1.25 € 1.25 € 0.60 4 Carrefour Barrita Naranja Carrefour Cereal Bars/Cookies 210 € 1.25 € 1.25 € 0.60 5 Carrefour Choco Carrefour Cereal Bars/Cookies 150 € 1.21 € 1.21 € 0.81 6 Carrefour Choco con Coco Carrefour Cereal Bars/Cookies 150 € 1.21 € 1.21 € 0.81 7 Carrefour Mini Noir Carrefour Cereal Bars/Cookies 175 € 1.60 € 1.60 € 0.91 8 Carrefour Naranja Carrefour Cereal Bars/Cookies 150 € 1.21 € 1.21 € 0.81 9 Carrefour Nuts Carrefour Cereal Bars/Cookies 150 € 1.21 € 1.21 € 0.81 10 Corte Ingles Digestive El Corte Inglés Cereal Bars/Cookies 800 € 1.69 € 1.69 € 0.21 11 Absolut Vital chocolate Eroski 23 g x 6 Eroski Cereal Bars/Cookies 132 € 1.67 € 1.67 € 1.27 12 Absolut Vital frutos rojos Eroski 23 g x 6 Eroski Cereal Bars/Cookies 132 € 1.67 € 1.67 € 1.27 13 Eroski con chocolate 25 g x 6 Eroski Cereal Bars/Cookies 150 € 1.01 € 1.01 € 0.67 14 Eroski con fresa y chocolate 25 g x 6 Eroski Cereal Bars/Cookies 150 € 1.01 € 1.01 € 0.67 15 Fruta de Fibra Galleta Flora Cereal Bars/Cookies 137 € 1.09 € 1.09 € 0.80 16 Digestive con frutas rojas Fontaneda Cereal Bars/Cookies 215 € 2.00 € 2.00 € 0.93 17 Digestive con manzana Fontaneda Cereal Bars/Cookies 215 € 2.00 € 2.00 € 0.93 18 Integral Marie Fontaneda Cereal Bars/Cookies 520 € 2.20 € 2.20 € 0.42 19 Galleta Digestiva sin azúcar Gullon Cereal Bars/Cookies 400 € 1.65 € 1.65 € 0.41 20 Arroz y Trigo Integral Chocolate Hacendado Cereal Bars/Cookies 168 € 1.55 € 1.55 € 0.92 21 Chocolate Leche 8 units Hacendado Cereal Bars/Cookies 200 € 1.55 € 1.55 € 0.78 22 Digestive Avena Hacendado Cereal Bars/Cookies 775 € 2.28 € 2.28 € 0.29 23 Digestive Avena Chocolate Hacendado Cereal Bars/Cookies 385 € 1.99 € 1.99 € 0.52 24 Galleta Cereales Linnea V Hacendado Cereal Bars/Cookies 350 € 1.75 € 1.75 € 0.50 25 Galleta Maria Integral Fibra Hacendado Cereal Bars/Cookies 800 € 1.18 € 1.18 € 0.15 26 Muesli Albaricoque y Yogurt 8 units Hacendado Cereal Bars/Cookies 200 € 1.20 € 1.20 € 0.60 27 Muesli Avellana 8 units Hacendado Cereal Bars/Cookies 200 € 1.20 € 1.20 € 0.60 28 Muesli Chocolate 8 units Hacendado Cereal Bars/Cookies 200 € 1.20 € 1.20 € 0.60 29 Muesly Buenos días Hero 25 g x 6 Hero Cereal Bars/Cookies 150 € 1.60 € 1.59 € 1.60 € 1.06 30 Muesly chocolate Hero 25 g x 6 Hero Cereal Bars/Cookies 150 € 1.60 € 1.62 € 1.61 € 1.07 31 Muesly chocolate negro Hero 25 g x 6 Hero Cereal Bars/Cookies 150 € 1.59 € 1.59 € 1.06 32 Muesly y avellanas Hero 25 g x 6 Hero Cereal Bars/Cookies 150 € 1.62 € 1.62 € 1.08 34 Choco Krispies 25 g x 6 Kelloggs Cereal Bars/Cookies 150 € 2.50 € 2.50 € 1.67 35 Delissimas frambuesa 6 uni. Kelloggs Cereal Bars/Cookies 132 € 2.85 € 2.75 € 2.80 € 2.12 36 Delissimas naranja 22 g x 6 Kelloggs Cereal Bars/Cookies 138 € 2.68 € 2.90 € 2.79 € 2.02 37 Mini Breaks Special K chocolate 24 g x 5 Kelloggs Cereal Bars/Cookies 132 € 2.90 € 2.90 € 2.20 38 Special K chocolate con leche 6 units Kelloggs Cereal Bars/Cookies 120 € 2.45 € 2.45 € 2.45 € 2.50 € 2.46 € 2.05 39 Special K chocolate negro 6 units Kelloggs Cereal Bars/Cookies 129 € 2.50 € 2.50 € 1.94 40 Special K frutas rojas 21,5 g x 6 Kelloggs Cereal Bars/Cookies 129 € 2.45 € 2.50 € 2.48 € 1.92 41 Special K manzana y pera 21,5 g x 6 Kelloggs Cereal Bars/Cookies 129 € 2.45 € 2.50 € 2.48 € 1.92 42 Special K Melocoton 6 units Kelloggs Cereal Bars/Cookies 129 € 2.45 € 2.45 € 1.90 43 Squares 36 g x 4 Kelloggs Cereal Bars/Cookies 144 € 2.05 € 2.05 € 2.05 € 1.42 44 All Bran Bizcochito 40 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.69 € 2.80 € 2.80 € 2.90 € 2.80 € 1.17 45 All Bran chocolate 40 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.55 € 2.45 € 2.45 € 2.50 € 2.49 € 1.04 46 All Bran fibra 40 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 NA NA NA NA NA NA 47 All Bran manzana 40 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.55 € 2.45 € 2.45 € 2.50 € 2.49 € 1.04 48 All Bran Mini Breaks Strawberry 16 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.70 € 2.69 NA € 2.32 € 2.57 € 1.07 49 All Bran Mini Breaks Cinnamon 16 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.70 € 2.69 NA € 2.32 € 2.57 € 1.07 50 Fitness 23,5 g x 6 Nestlé Cereal Bars/Cookies 141 € 2.45 € 2.45 € 1.74 51 Fitness chocolate 23,5 g x 6 Nestlé Cereal Bars/Cookies 141 € 2.35 € 2.21 € 2.28 € 1.62 52 Golden Grahams 25 g x 6 Nestlé Cereal Bars/Cookies 150 € 2.15 € 2.15 € 1.43 53 Nesquik 25 g x 6 Nestlé Cereal Bars/Cookies 150 € 2.15 € 2.15 € 1.43 1 Carrefour Fibre Flakes Carrefour Cereals 500 € 1.67 € 1.67 € 0.33 2 Carrefour Fibre Flakes Chocolate Carrefour Cereals 500 € 1.81 € 1.81 € 0.36 3 Carrefour Fruits & Fiber Carrefour Cereals 500 € 1.80 € 1.80 € 0.36 4 Carrefour Muesli Carrefour Cereals 750 € 2.35 € 2.35 € 0.31 5 Fit Way copos de arroz y trigo integral El Corte Inglés Cereals 750 € 2.65 € 2.65 € 0.35 6 Fit Way copos de arroz y trigo integral con frutas El Corte Inglés Cereals 375 € 2.47 € 2.47 € 0.66 7 Absolut Vital chocolate Eroski Eroski Cereals 300 € 2.36 € 2.36 € 0.79© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 25
  26. 26. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] 8 Absolut Vital Eroski Eroski Cereals 500 € 1.89 € 1.89 € 0.38 9 Absolut Vital frutas rojas Eroski Eroski Cereals 500 € 2.36 € 2.36 € 0.47 10 Bagies de vainilla y chocolate Eroski Eroski Cereals 300 € 1.99 € 1.99 € 0.66 11 Corn Flakes Eroski basic Eroski Cereals 500 € 1.05 € 1.05 € 0.21 12 Arroz Inflado Hacendado Cereals 500 € 1.40 € 1.40 € 0.28 13 Bolas Maiz Chocolate Hacendado Cereals 500 € 1.40 € 1.40 € 0.28 14 Copos de Arroz Trigo integral Hacendado Cereals 500 € 1.59 € 1.59 € 0.32 15 Copos de Arroz Trigo Integral Hacendado Cereals 450 € 2.20 € 2.20 € 0.49 16 Copos de Arroz Trigo Integral Frutas Rojas Hacendado Cereals 300 € 1.80 € 1.80 € 0.60 17 Copos de Maiz Azucurado Hacendado Cereals 500 € 1.35 € 1.35 € 0.27 18 Multipack variado 6 units Hacendado Cereals 200 € 1.60 € 1.60 € 0.80 19 Relleno de Chocolate Hacendado Cereals 500 € 1.59 € 1.59 € 0.32 20 Relleno de Leche Hacendado Cereals 500 € 1.99 € 1.99 € 0.40 21 Trigo de Chocolate Hacendado Cereals 500 € 1.35 € 1.35 € 0.27 22 Trigo de Miel Hacendado Cereals 500 € 1.40 € 1.40 € 0.28 23 Bolas Chocolate sin Gluten Harrisons Cereals 375 € 2.99 € 2.99 € 0.80 24 CornFlakes sin Gluten Harrisons Cereals 375 € 2.50 € 2.50 € 0.67 25 Choco Krispies Kelloggs Cereals 600 € 2.89 € 2.89 € 0.48 26 CornFlakes Kelloggs Cereals 500 € 2.19 € 2.19 € 0.44 27 Country chocolate Jordans Kelloggs Cereals 375 € 3.40 € 3.40 € 0.91 28 Extra chocolate Kelloggs Cereals 350 € 2.49 € 2.99 € 2.74 € 0.78 29 Extra fruta Kelloggs Cereals 350 € 2.99 € 2.49 € 2.99 € 2.82 € 0.81 30 Extra fruta y fibra Kelloggs Cereals 500 € 3.30 € 3.30 € 0.66 31 Frosties Kelloggs Cereals 375 € 2.46 € 2.46 € 0.66 32 Frosties Kelloggs Cereals 500 € 2.75 € 2.50 € 2.63 € 0.53 33 Miel Pops Kelloggs Cereals 375 € 2.85 € 2.85 € 0.76 34 Optivita frutas del bosque Kelloggs Cereals 300 € 3.29 € 3.77 € 3.53 € 1.18 35 Optivita pasas Kelloggs Cereals 300 € 3.80 € 3.80 € 1.27 36 Rice Krispies Kelloggs Cereals 375 € 2.99 € 3.05 € 3.02 € 0.81 37 Smacks Kelloggs Cereals 375 € 2.85 € 2.35 € 2.60 € 0.69 38 Special K Kelloggs Cereals 375 € 2.45 € 2.45 € 0.65 39 Special K chocolate Kelloggs Cereals 300 € 2.75 € 2.40 € 2.75 € 2.63 € 0.88 40 Special K chocolate con leche Kelloggs Cereals 300 € 2.75 € 2.75 € 2.75 € 0.92 41 Special K Classic Kelloggs Cereals 300 € 2.40 € 2.40 € 0.80 42 Special K Classic Kelloggs Cereals 500 € 3.05 € 3.05 € 3.05 € 3.11 € 3.07 € 0.61 43 Special K con avena y miel Kelloggs Cereals 375 € 3.35 € 3.05 € 3.05 € 3.15 € 0.84 44 Special K con frutos rojos Kelloggs Cereals 300 € 2.75 € 2.40 € 2.75 € 2.63 € 0.88 45 Special K sensations de fresa Kelloggs Cereals 375 € 3.20 - € 3.20 € 0.85 46 Special K yogurt Kelloggs Cereals 300 € 2.75 € 2.89 € 2.82 € 0.94 52 All-Bran Chocolate Hearts Kelloggs All-Bran Cereals 375 € 3.10 € 2.84 NA € 3.15 € 3.03 € 0.81 47 All-Bran Raisin Hearts Kelloggs All-Bran Cereals 375 € 3.10 € 2.84 NA € 3.15 € 3.03 € 0.81 48 All-Bran Choco Kelloggs All-Bran Cereals 375 € 3.40 € 3.10 NA € 3.49 € 3.33 € 0.89 49 All-Bran Fibra Plus Kelloggs All-Bran Cereals 500 NA € 2.84 NA NA € 2.84 € 0.57 54 All-Bran Fibra Plus Kelloggs All-Bran Cereals 375 NA NA NA € 2.35 € 2.35 € 0.63 55 All-Bran Fibra Plus Kelloggs All-Bran Cereals 750 € 3.10 € 3.50 NA € 3.10 € 3.23 € 0.43 50 All-Bran Flakes Kelloggs All-Bran Cereals 375 NA NA NA € 2.35 € 2.35 € 0.63 51 All-Bran Flakes Kelloggs All-Bran Cereals 500 € 3.10 € 3.10 € 3.10 NA € 3.10 € 0.62 53 All-Bran Fruta & Fibra Kelloggs All-Bran Cereals 500 € 3.10 € 3.10 € 3.10 € 3.30 € 3.15 € 0.63 56 Cheerios miel Nestlé Cereals 375 € 2.45 € 2.45 € 0.65 57 Chocapic Nestlé Cereals 625 € 3.19 € 3.19 € 0.51 58 Corn Flakes Nestlé Cereals 500 € 2.19 € 2.34 € 2.27 € 0.45 59 Estrellitas miel Nestlé Cereals 375 € 2.45 € 2.45 € 0.65 60 Fibre-1 Nestlé Cereals 375 € 2.27 € 2.27 € 0.61 61 Fitness Nestlé Cereals 500 € 3.15 € 3.15 € 3.15 € 0.63 62 Fitness & Fruits Nestlé Cereals 375 € 3.09 € 3.00 € 3.05 € 0.81 63 Fitness Chocolate Nestlé Cereals 375 € 3.05 € 2.99 € 3.02 € 0.81 64 Fitness Chocolate Negro Nestlé Cereals 375 € 3.09 € 2.99 € 3.16 € 3.08 € 0.82 65 Golden Grahams Nestlé Cereals 375 € 2.49 € 2.59 € 2.57 € 2.55 € 0.68 66 Muesli Nestlé Cereals 750 € 2.35 € 2.35 € 0.31 67 Muesli con chocolate Seleqtia Eroski Seleqtia Cereals 500 € 3.14 € 3.14 € 0.63 68 Seleqtia con nueces Seleqtia Cereals 500 € 2.99 € 2.99 € 0.60 69 Weetabix Original Wheetabix Cereals 430 € 2.51 € 2.69 € 2.60 € 0.60© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 26
  27. 27. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 13: PRICE COMPARISON OF ALL-BRAN CEREAL BAR AND ALL- BRAN FLAKES WITH COMPETITION. Product Brand Category Grams Average Price per 100 gr 1 Digestive Avena Hacendado Cereal Bars/Cookies 775 € 2.28 € 0.29 2 Carrefour Barrita Muesli Carrefour Cereal Bars/Cookies 210 € 1.25 € 0.60 3 Muesli Avellana 8 units Hacendado Cereal Bars/Cookies 200 € 1.20 € 0.60 4 Eroski con chocolate 25 g x 6 Eroski Cereal Bars/Cookies 150 € 1.01 € 0.67 5 Digestive con manzana Fontaneda Cereal Bars/Cookies 215 € 2.00 € 0.93 6 All Bran chocolate 40 g x 6 Kelloggs All-Bran Cereal Bars/Cookies 240 € 2.49 € 1.04 7 Muesly Buenos días Hero 25 g x 6 Hero Cereal Bars/Cookies 150 € 1.60 € 1.06 8 Fitness chocolate 23,5 g x 6 Nestlé Cereal Bars/Cookies 141 € 2.28 € 1.62 9 Special K manzana y pera 21,5 g x 6 Kelloggs Cereal Bars/Cookies 129 € 2.48 € 1.92 10 Delissimas naranja 22 g x 6 Kelloggs Cereal Bars/Cookies 138 € 2.79 € 2.02 11 Chocolate Sacialis 6 units Bicentury Cereal Bars/Cookies 120 € 2.45 € 2.04 Product Brand Category Grams Average Price per 100 gr 1 Carrefour Fibre Flakes Carrefour Cereals 500 € 1.67 € 0.33 2 Fit Way copos de arroz y trigo integral El Corte Inglés Cereals 750 € 2.65 € 0.35 3 Absolut Vital Eroski Eroski Cereals 500 € 1.89 € 0.38 4 Copos de Arroz Trigo Integral Hacendado Cereals 450 € 2.20 € 0.49 5 Weetabix Original Wheetabix Cereals 430 € 2.60 € 0.60 6 Fibre-1 Nestlé Cereals 375 € 2.27 € 0.61 7 All-Bran Flakes Kelloggs All-Bran Cereals 375 € 2.35 € 0.63 8 Fitness Nestlé Cereals 500 € 3.15 € 0.63 9 Special K con avena y miel Kelloggs Cereals 375 € 3.15 € 0.84 Avg Price Snack per 100g Avg Price Cereal per 100g € 1.16 € 0.54 All Bran All Bran € 1.04 € 0.63 89% 116%© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 27
  28. 28. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT]EXHIBIT 14: SUPERMARKET SPACE ALLOCATED TO ALL-BRAN IN SNACK AND CEREAL SECTIONS Snacks Cereals Caprabo 16% 8% Mercadona 4% 6% Carrefour 18% 11% El Corte Ingles 16% 13%© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 28
  29. 29. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 15: DIRECT COMPETITORS© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 29
  30. 30. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 16: LOWER END SUPERMARKETS© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 30
  31. 31. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 17: HIGHER END SUPERMARKETS© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 31
  32. 32. Marketing Fundamentals [KELLOGG’S ALL-BRAN: TERM 2 MARKETING PROJECT REPORT] EXHIBIT 18: TV COMMUNICATIONPositive attitude and the benefits of fiber: Muffin Cakes, Chocolate Flakes, Fruit &Fiber Flakes and Barsare all individually targeted to communicate these two common benefits, without suggesting occasions forconsumption. The core message delivered is feeling positive, while recalling the underlying reason for thiseffect, which is being rich in fiber, stressing that fiber helps eliminate what your body does not need, makingyou feel healthier and positive. “Sentirse sano se nota, tomar All-Bran también”. Taste is not addressed inthese set of ads.Dining: Two commercials have been produced to promote this specific occasion for consumption. Theyexpose the functional benefits of All-Bran and present the product as a possible dinner by emphasizing thediscomfort felt in the morning from eating too much the night before. The consumer is encouraged to changeover to an All-Bran meal, in this case All-Bran Choco. The communication reflects the product as a deliciouscereal rich in fiber that works while you sleep and helps you feel less bloated, happier and with a contagiouspositive attitude in the morning. “Sentirse sano se nota, cenar All-Bran también”. Taste, health, and positivityare all communicated in these ads.Breakfast: One TV communication has been lately produced regarding this specific occasion forconsumption. While cereals are common ground for breakfast, the brand is presenting “Muffin Cake” whichclearly does not match the regular cereal category, taking it beyond the major functional benefits ofconvenience and portability to become a breakfast meal. The enjoyable attributes are strongly enforced bymentioning soft texture, little fruit pieces and deliciousness. On top, the muffin is rich in fiber which helpsyou eliminate what your body does not need, making you feel healthier and cheeful. “Sentirse sano se nota,desayunar All-Bran también”.Snack/nibbling: All-Bran mini-breaks commercials enforce the fruit tastes, strawberry and cinnamon,projecting desire around the snack product. This may well be to compensate for the image consumers haveagainst fiber products having good taste. This is a healthy and tasty fiber product to be nibbled betweenmeals and on the go. “Finally, a healthy snack”.© IE Business School | International MBA | Nov 2010 Section N1 (erstwhile Group B) 32

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