Market analysis and plan for Kellogs all-bran

INTRODUCTION

Market planning involves designing activities relating to marketing objectives and the changing marketing environment. The marketing plan acts as guidebook of marketing activities for the marketing manager.

Let us consider a declining product Kellogg’s All Bran and see how marketing plan allows us to examine the external marketing environment in connection with inner workings of the business allowing the firm to enter market place with an awareness of possibilities and problems.

Marketing plan elements: defining the business mission and objectives, performing a situation analysis, delineating a target market and establishing components of the marketing mix.

Every marketing plan is unique to its firm which it is created. Basic factors that will be covered in Kellogg’s All Bran’s marketing plan include following

BUSINESS MISSION STATEMENT

Kellogg Slogan

A slogan is a short, memorable catch phrase, tagline or motto used to to identify a product or company in advertisements. The advertising slogan, or business slogan most associated with Kellogg, is:

“The Best to You Each Morning…from Kellogg’s”

Kellogg Mission Statement and/or Vision Statement

Mission Statements and Vision Statements are written for customers and employees of corporations. A Mission Statement can be defined as a sentence or short paragraph written by a company or business which reflects its core purpose, identity, values and principle business aims. The definition for a Vision Statement is a sentence or short paragraph providing a broad, aspirational image of the future.

Kellogg Mission Statement:

“Kellogg is a global company committed to building long-term growth in volume and profit and to enhancing its worldwide leadership position by providing nutritious food products of superior value.

OBJECTIVE

Defining the business mission for Kellogg’s:

Kellogg Company says:

We promote eating well and healthy living.

Our legacy is based on the philosophy that people can improve their health by eating a balanced diet and engaging in regular physical activity.

Living a healthy lifestyle begins with a good understanding of nutrition.

We believe in providing high-quality, nutritious food and helping educate consumers about the benefits of a healthy diet.

Kellogg’s has in place a global marketing code and a longstanding commitment to advertising in a responsible manner.

This means:

•We don’t encourage over-consumption of our foods when consumers take part in promotions.

•We always present Kellogg’s breakfast cereals as part of a balanced breakfast.

•We run balanced promotional calendars featuring a good mix of fun, education and wellbeing based activities

ALL BRAN’S ROLE IN KELLOGG’S

Kellogg’s All-Bran has a long and distinguished history. Like many other famous products, however, it is important from time to time to re-energise its life cycle.

While All-Bran continues to be a powerful brand, a number of other high fibre brands made by Kellogg have not had the promotional support or sales of the All-Bran brand. Kellogg has therefore sought to support these other fibre products by associating them with the Masterbrand All-Bran.

Kellogg has looked to raise consumer interest by creating a family of fibre-based cereal brands focused around the All-Bran banner in order to create a power brand structure. These bran products have now been marketed as a family. This has added extra strength to each separate product. The decision to create the power brand was a strategic change, made at a high level. It involved managers at Kellogg planning for the long term future. It also needed heavy resource commitments e.g. to finance and market the initiative.

The product life cycle is the period over which it appeals to customers. The cycle can be illustrated in a series of stages showing how consumer interest, and hence sales, has altered over time.

For example, a company like Kellogg is continually developing new product lines, which it then market tests. For many of these products, test marketing will indicate that the product might be popular for a short while and then interest would quickly fizzle out. Such product ideas are screened out (eliminated), because their product life cycle would look like the curve that rises steeply but soon falls down

ALL-BRAN’S PRODUCT LIFE CYCLE

The product life cycle is concept that provides a way to trace the stages of a products acceptance from its introduction to its decline. It is useful to think of product concepts as passing through various stages in life.

Introductory stage:

Kellogg created All-Bran as a product and the fibre sector of the cereal market in the 1930s.

This was its introductory stage, where in sales are low as the idea is first introduced in market.

Informative promotion was done to let the potential costumer know about the advantages and uses of new product. Introductory stage usually has high marketing and production costs and negative profits as sales increase slowly yet All-Bran moved rapidly from introduction to growth.

Growth stage:

The growth stage of the life cycle is characterized by sales growing at an increasing rate .From 1935 onwards the product experienced steady growth with the company injecting regular promotional spends to support product development. The most spectacular growth was in the 1980s with widespread publicity for the ‘F’ Plan Diet from nutritionists and health experts. This diet had an impact similar to that of the Atkins Diet in recent years.

Maturity stage:

In late 1980s the Kellogg ‘bran’ range has been moving into a mature stage:

Because the product is mature, Kellogg has looked to re-brand a range of fibre cereals in order to inject renewed growth and interest. The company has run a £3 million campaign that urges consumers to re-appraise these products. Large investment was needed to support the strategy and to evaluate the consumer response. If the product is not handled carefully at this stage we may then see saturation of the market and the onset of a decline in interest.

Decline stage:

During the declining stage new products replace the old ones. Sales decline does not necessarily mean the absence of profits. News flash like following stated that Kellogg’s sale is declining and All Bran is declined product.

The largest U.S. maker of breakfast cereal, said third-quarter profit dropped 6.4 percent as North American cereal sales continued to decline. Out of the 5,600 company reputations Vanno monitors, Kellogg ranked ninth before it booted Phelps. Now it’s ranked 83. Not even an industry-wide peanut scare inflicted as much damage on the food company’s reputation.

Kellogg All Bran slid 3.54, or 6.9%, to 47.98, after the cereal maker’s second-quarter profit fell 15% on weakness in cereal sales in the U.S. and U.K. and impacts from a recent recall. Sales fell short of analysts’ expectations and the company cut its estimate for 2010 per-share growth.

A product’s life cycle may last for a few months or for more than a century. It all depends on how good the product is originally, how easy it is for competitors to emerge and how good a firm is at keeping its own product relevant and attractive to consumers.

To prolong the life cycle of a brand or product an organization needs to use skilful marketing techniques to inject new life into the product.

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CONDUCTING A SITUATION ANALYSIS

This involves carrying out a SWOT analysis to identify:

• Strengths of the All-Bran brand

•Weaknesses

• Opportunities existing in the market

• Threats – e.g. from competitors.

The SWOT analysis produced these results:

SWOT

STRENGTH

Kellogg’s ‘All-Bran’ is the only large, very high fibre brand in the marketplace. Private labels provide the main competition.

The general public remains highly aware of All-Bran.

The All-Bran brand is strong – consumers associate it with healthy activity.

WEAKNESS

Awareness of the brand had been declining because of little promotional (e.g. advertising) activity in recent years.

Compared with leading brands such as Kellogg’s Corn Flakes, the individual fibre products have limited scale, making it hard to make advertising investment economic.

The proposition that ‘a fibre cereal keeps you regular’ is less motivating to consumers than in the past. Consumers now more interested in products that promote “inner health”.

OPPORTUNITIES

People are looking to eat more healthily.

The rapid growth of non cereal products that meet inner health need (Pro-bioticdrinks and Yoghurts +£100m P/A category).

In the UK, the number of people over 55 (the product’s main consumers) continues to increase.

THREATS

The sales of private labels fibre cereals are growing.

The generation next is getting attracted to towards the junk food or more fast food.

There is a consumer trend towards tastier cereals.

TO OVERCOME THE WEAKNESS:

Kellogg should consider the fact that consumers see cereals as a ‘natural product’. Thus it is a strong selling point. It should thus feature the ingredients on the packaging.

Some consumers might find the act of placing a range of separate products under the All-Bran brand confusing. The solution is to ensure that packs clearly display both the power brand name (All-Bran) and also the product name.

Kellogg’s should focus on the fact that high-fibre diets may help people to feel lighter and more energetic as well as aiding the digestive system while promoting the product.

TO OVERCOME THE THREATS

Kellogg should identify which of its existing fibre based products offered the best present and future prospects to concentrate on those. Managers can thus concentrate on the common elements of the chosen range and focus marketing activity on them.

In choosing a cereal product, consumers place high priority on taste. Although they

want a healthier cereal, thus Kellogg’s must try to make new product with same cereals but new flavours this will thus create a product which is tasty still healthy.

Before proceeding with the change, Kellogg must carry out some detailed market research with consumers to discover their thoughts and feelings

There are two main approaches to market research:

• Qualitative

• Quantitative.

Qualitative research involves working in detail with a relatively small number of consumers e.g. observing and listening to them talking in small groups in which they discuss the brand, products, packaging, advertising ideas, etc.

Thus qualitative research can help to assess consumers’ perceptions e.g. Kellogg’s can give them pictures of possible new packaging and letting them give their views on the benefits of the product also try to find reasons why consumer would use fibre based cereals?

Once the qualitative market research is complete it will be possible to test the concept through quantitative research. This will involve use of questionnaire and survey approaches with a much larger sample of targeted consumers to estimate the impact on sales if these changes were put into market.

DIFFERENTIATION ADVANTAGE

A differential competitive advantage exits when a firm provides something unique that is valuable to buyers.

In case of All Bran it provides natural product of cereals contains high fibre.

All Bran is branded with Kellogg’s in such way that it endures competitive advantage.

TARGET MARKET STRATEGY

Target market in simple words is a fairly homogenous group of costumers to whom a company wishes to appeal. In case of All Bran, Kellogg’s is sailing a fibre rich cereal product thus should target every individual that wants to leave a fit and healthy life.

Using Demographic Segmentation we broadly classified on the basis of age group in three:

1. Children

2. Adults

3. Elders

What should Kellogg’s All Bran do if they decide to target 3 groups discussed above

1. Children:

Most of the children tend to eat junk food and many dislike milk and fibrous food like fruits. This is a reason to worry for many parents. As lack of fibre may create a problem in bowel movement of children

So, as discussed earlier introduce a flavoured Kellogg’s All Bran to attack this segment highlighting its benefits of Kellogg’s All Bran as being solution to their worries (considering that parents have the right to purchase even if target is children product must appeal to parents)

Attractive packaging could play an important role to get attention of children

2. Adults:

Adults which are health conscious usually tend to visit gym to stay fit. So Kellogg’s can try getting into partnership with gym instructors so that they capture major junk of health conscious adult group. People visiting gym tend to follow their instructor so this could be good strategy to tap this age group. Kellogg’s needs a market team that would convince the gym instructors with benefits of product and also offer them some commission.

3. Elders:

This age group is very conscious about their health for them Kellogg’s should focus on the fact that high-fibre diets may help people to feel lighter and more energetic as well as aiding the digestive system while promoting the product.

Here they can try getting partnership with chemist who would recommend All Bran best in the breakfast.

Although depending upon geodemographic segmentation All Bran will have to consider the lifestyle of different places as it is launched in global market.

MARKETING MIX

The term marketing mix refers to unique blend of product, distribution, promotion and price strategies designed to produce mutually satisfying exchanges with target market.

All of the 4 P’s products, place, and promotion and price have an impact on satisfying the needs of consumers in the target market. No single area is more important than the others, they all are interconnected.

Let us discuss each of them with respect to Kellogg’s all bran:

PRODUCT

The heart of marketing mix, the starting point is our product Kellogg’s All Bran. This includes packaging, brand name and company image as major factors.

The market research revealed several matters that Kellogg needs to address when alerting the public to changes in the brand family.

1. Some consumers might find the act of placing a range of separate products under the All-Bran brand confusing.

The solution is to ensure that packs clearly display both the power brand name (All-Bran) and also the product name (e.g. Bran Flakes).

2. To maintain continuity, it is vital to use consistent type fonts and colors from the old packaging, as well as introducing the flash ‘new name, same great taste’.

3. To support consumer understanding of the new range, the back of each pack featured a range sell detailing the different attributes of each of the products in the range. This allowed consumers to make purchase decisions on the basis of taste and the amount of fibre they require in their diet.

4. Research showed that consumers see cereals as a ‘natural product’. This is a strong selling point. It makes it vital to feature the ingredients on the packaging. also mention the percentage requirement of fibre to different individuals and how much each product would fulfill .e.g. .age 18 to 40 needs 20% fibre in diet and a bowl of All Bran will fulfill 17%.This is because the All-Bran range can be seen as part of a daily healthy diet.

Thus using Informational Labeling, All Bran must be designed to help consumers in making proper product selections and lower cognitive dissonance after the purchase. Also the Nutritional Labeling and Education Act of 1990 directed the food and drug administration to require detailed nutritional information on most food packages to establish standards for health claim on food packing.

5. Facilitating recycling and reducing environment damage: An important recent issue is the compatibility of the package and environmental concerns. Many consumers demand recyclable, biodegradable and reusable packages. Thus All Bran must pack its product in environmentally friendly pack.

PLACE

Distribution strategies which usually involve wholesalers and retailers are concerned with making product available when and where the costumers want them.

If we consider All Bran’s target audience: children, adult and elders. Wholesalers and retailers will take care of all 3 in general but if All Bran is in tie ups with gym instructor and chemist it should try and get some storage place on shelves of each them. This will make product easily available at the time when consumer will wish to buy it. (Rather than consumer taking advice of chemist and gym instructor and planning to add it to the buy list)

PROMOTION

Kellogg needs careful coordination of television and radio advertising, PR and in-store promotions. These encourage consumers to try out and reappraise the revamped products. For example, in September 2004, Kellogg introduced the All-Bran ‘Feel Great in a Fortnight’ Challenge. This campaign was designed to make the brands benefit more relevant to consumers. Adopting the ‘feel great’ message moved the brand away from the outdated ‘keeps you regular’ message and into the feel good territory of better inner health. This promotion featured on 8 million packs and on the All-Bran website.

It used William Shatner, best remembered from Star Trek’s Starship Enterprise! The challenge invited consumers to eat one bowl of any of the cereals in the All-Bran range for two weeks and see if they could feel the benefit. It focused on the fact that high-fibre diets may help people to feel lighter and more energetic as well as aiding the digestive system.

Also, when promoting product globally it should consider different food habits of different people at different place. For e.g. for many Asian countries say India.

Indian people usually have hot breakfast and when Kellogg’s introduced itself in India as breakfast food people added it to boiling milk. Thus it was big failure.

Kellogg’s should remember that its All Bran may be new to many buyers and the procedure to consume it must be highlighted on first place.

PRICE

While product, price, personal selling, promotion and distribution all contribute towards sales volume, it is only price which determines profit for the product. Pricing is most visible variable to costumer and is often considered by them as the most flexible variable for marketers. All the other elements in marketing mix represent costs; price represents revenues.

All Bran should consider that although high price will meet Kellogg’s goal but at present it is declining state of sales and if price is too high in the minds consumers, sales will be lost.

All Bran comes under food thus perishable easily compared to other products like cars, books, etc.

Thus its product needs to be sold before expiry

Considering this fact All Bran can ask the wholesalers to change the selling policy when product is near its expiry: for e.g. before 1 month of expiry sale 2 for price of 1.

EVALUATION AND CONTROL

Before proceeding with the change, Kellogg must carry out some detailed market research with consumers to discover their thoughts and feelings

There are two main approaches to market research:

• Qualitative

• Quantitative.

Qualitative research involves working in detail with a relatively small number of consumers e.g. observing and listening to them talking in small groups in which they discuss the brand, products, packaging, advertising ideas, etc.

Thus qualitative research can help to assess consumers’ perceptions e.g. Kellogg’s can give them pictures of possible new packaging and letting them give their views on the benefits of the product also try to find reasons why consumer would use fibre based cereals?

Once the qualitative market research is complete it will be possible to test the concept through quantitative research. This will involve use of questionnaire and survey approaches with a much larger sample of targeted consumers to estimate the impact on sales if these changes were put into market.

Control is not punishment mechanism to be used only when someone makes mistake. It is an ongoing process of analyzing and correcting the actions taken in implementation.All Bran is declining product with increasing competitive forces thus it needs more of control.

CONCLUSION

If a business wants to make a product’s total sales grow, it must carefully consider how best to extend its life cycle.

By creating the power brand ‘All-Bran’ and by providing the right sort of well researched promotional support, Kellogg will able to inject renewed vigour into a family of related products.

Through appropriate promotional activities and more relevant messages, Kellogg will re-awake the consumers’ interest in products that can play an important part in developing a healthy diet in a health-conscious world.

Regular campaigns of promotional activity will be helpful in enabling organization to sustain their own life cycle and those of their brands and products.

THE REASON FOR PRODUCT IN DECLINE STAGE

The following is the reason for all-bran entering decline stage

After few years all fibre diet did not appeal to the masses.

Tastier cereals are overtaking all-bran’s market.

Improper segmentation of the market.

Hiccups in promotional strategies overseas.

Learning objectives achieved

The learning outcome of using appropriate marketing terminology, concepts, theories and models applied in a variety of marketing settings. As the process for analysing the company, market and the product in decline I started understanding the various terminology used in various concepts. This concept and theories were used as a tool to compare by various organisations to know its standing against competitors which proved to be useless some times.

A handful of the organisation practice concepts and theories in actual market settings there focus in on sales and revenues on which they can promote the company and product but not on promoting the swot or pestel analysis of the company

Second learning outcome is to describe the components of a professional marketing plan. Every book talked about the importance of a marketing plan but none specify one which is the best marketing plan. The reason I came upon is that there nothing as one good marketing plan or its components cause every organisation sees itself in a different way each market uniquely as it all about showing the customer the brand and differentiation so there cannot be one good marketing plan to show uniqueness of every company.

The last learning outcome i could relate was the dynamic nature of market. Proved to be 100% true as many companies are lacking behind just because there consumers they targeted have moved on or changed the need they had to a newer one and the company is still trying to sell on the old perceived need. Thus the market is every dynamic nowadays.

Expectations at start of module

The following were the expectations at the start of module:-

Come to know what a brand is, how is it made, why is it so valued.

What are various theories in marketing

Who are the people how started marketing as a business functions itself.

Process of learning

The process of learning was very different to what i use to experience in my degree level study. Back in my country every aspect of subject is taught to us and we respect our teachers for the knowledge they impart on us. We have six months to study a new module so ample of time is given to us to grasp the knowledge. So there is a vast difference from that I have experienced here the teaching here is more of self improvement rather to be taught. So the concept is introduce to us by the teacher or professor an then we are left to fiddle around that concept alone and come up with our very own interpretation of it.

BIBLOGRAPHY

www.thetimes100.co.uk

GEOFFREY A. MOORE 1999, “INSIDE THE TORNADO”.

ROBERT A. STEUERNAGEL 2000.”WIRELESS MARKETING”

KOTELLER, KELLER, BRADY, GOODMAN 20009.”MARKETING MANGEMENT”

MALCOLM MCDONALD 2009, “MARKETING PLANS”

W. CHAN KIM RENEE MAUBORGNE 2005, “BLUE OCEAN STRATEGY”.

GEOFF LANCASTER, LESTER MASSINGHAM 1998, “ESSENTIAL OF MARKETING”

SUNNY CROUCH, MATTHEW HOUSDEN 1999,”MARKETING RESEARCH FOR MANAGERS”

www.kellogs.co.uk

www.kellogs all-bran.com