Kellogg's Journey from Failure to Success... what they did to come from the disaster failure of launching the same in 1996. They failed and then they did HABIT Marketing and effectively changed our Habits

1. Insights of Marketing Strategy
Planning
By Mihir Upadhyay

2. Objective
• To understand how the Marketing Strategic
Planning Decisions are made, with the help of
some Case Studies.

3. Case Study of …

4. Who is Kelloggs ?
• Established in 1906 founded by Will Keith Kellogg
• Products manufactured in 18 countries and marketed in more
than 180 countries around the world.
• World's leading producer of cereal and a leading producer of
convenience foods, including cookies, crackers, Toaster
pastries, cereal bars, fruit-flavored snacks, frozen waffles, and
vegetarian foods.
• Post liberalization, Major reason to come in India was Per
Capita Consumption was just 2 gms of Breakfast Cereals
against the World average of 5 gms in 1993-94

5. Launch of Kellogg’s India
• Full back up from the Parent brand - $65 mn
• Supported by the technical, managerial
and financial resources of its parent Co.
• High-profile launch
• Backed by hectic media activity
• Our only rivals are traditional Indian foods
like idlis and vadas."
- Denis Avronsart, Managing Director,
Kellogg India in 1994 Press Conference.

6. • Kellogg did lot of home work and launched
its products in India. They had the best
products, packaging and their marketing
strategy was excellent.
• The advertising campaign was handled by
a leading Indian advertising agency.
Launch of Kellogg’s India

7. What should be the RESULT ?
• April 1995, 25% decline in sales in comparison to last month.
• Despite offering good quality products Kellogg's products
failed in the Indian market.
• Slowly & Gradually people stopped buying the products and
the sales were stagnant.
• Only 2% of the Buyers were repeated buyers while 98% were
new buyers.
• This was a SHOCK for the Brand and eventually reputation of
a BIG Brand like Kellogg’s was at stake !

8. Where were they WRONG ?
• Over Confidence & Ignorance of the Cultural Aspects, they wanted
to CHANGE the basic culture of Indian Breakfast (Heavy) to Cereals
(Very Light).
• Ignored the basic taste of Indians (Sweet, Hot Milk Vs Tasteless,
Cold Milk) – Lack of understanding of consumer behaviour
• Premium Pricing Policy ( Rs. 21/- ) against Rs. 16/- of Mohun’s
Flakes.
• Banked heavily on Crispness which was ZERO as Indians used it
with Hot Milk.
• They advertised : “Indian Breakfast is not too healthy to eat, go for
healthy” --- ABSOLUTELY WRONG MOVE !

9. REVIVING the Kellogg’s Image
• Focused on HABIT Marketing.
• Immediately changed their Target from Parents to Child.
• Brought their BEST products to INDIA, Chocos & Frosties.
• In September 1996, Chocos was launched.
• In April 1997, Frosties was launched.
• Later on they also changed the Mascot of Ballu
(A Comic Series Character) to Jose

10. • The success of these 2 variants took even Kellogg’s by
surprise and sales picked up significantly.
• They immediately followed it by launch of Chocos
Breakfast & Cereal Biscuits.
• They made their distribution more stronger to reach
out to more families.
• Indianise the Taste with more varieties in Chocos Stars &
Moon , Chocos DUET, Chocos SNACKS.
New Product Launches

11. S-T-P Analysis & Promotion Mix
• Tasty Start - the cereals that most people will eat to begin their day. Kellogg's
brands include Kellogg's Corn Flakes and variations, such as Kellogg's Crunchy
Nut. – ( Sakshi Tanvar)
• Shape Management. Brands that can enable customers to manage their weight
or shape, such as Kellogg's Special K. - (Lara Dutta)
• Mum Approved. Those that mothers see as being good for their children, such
as Kellogg's wheat flaks. - (Karishma Kapoor)
• Kid Preferred. The brands that children themselves prefer, such as Kellogg's
Frosties, Kellogg's Chocó's and Honey Loops.
• Inner Health. These are the brands that help people with digestion, such as
Kellogg's All-Bran and Kellogg's Heart to Heart Oats.

12. • Kellogg’s
• Pepsico’s Quacker Oats
• Mohun’s Meakins
• Bagrry’s
• Tasty Treat (Big Bazaar)
• Heinz Complan
• Amway
• Saffola Oats
• Nestle Corn flakes

13. Current Scenario of 2013-14
• Total Breakfast Cereal Industry is 800 cr in
India.
• This Industry is growing with 20% every year.
• Kellogg’s India have just registered a
landmark sales of Rs. 500 cr !
• Kellogg’s is right now enjoying 70% of the
total Market Share of India…

14. • www.economictimes.com
• www.google.com
• www.timesofindia.com
• www.slideshare.com
• http://summertrainingreports.blogspot.in
• Various News Articles
• Online Journels