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Kellogg’s Special K Cereal

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  • Category: Marketing

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Kellogg is one of the leading companies in the world of healthy nutritious food company, has 106 years of history in the business of food production. Their products are manufacture over 18 countries and marketed in more than 180 countries worldwide including Singapore, it has contributed to the environment by adopting a strong environment policy, demonstrating their dedication to caring for the local communities and protecting our environment. The Kellogg’s product that our group is focusing on is Special K which is a lightly toasted breakfast cereals introduced in 1956.

It is to be consume and help one lose weight providing nutritional factors for all ages. In this marketing project, our aim is to successfully promote a convenience package of Kellogg’s Special K cereal, named Special K On The Go! .In the package, it contains milk, disposable spoon and a serving of Special K cereal. Heavy advertising will be conducted over the time span of 6 months. This is to increase the awareness of Special K cereal and gain an increase share in the breakfast cereal market in Singapore. The financial analysis of the sales forecast and expenses have been tabulated in the report. The results projected that our propose marketing idea is feasible and we are confident that Special K On The Go! would be an improvement of Special K cereal line as it offers a new and convenience way of consuming the cereal.

Special K is manufactured by KELLOGG’s company in 1956. Special K is not just nutritious and low-fat cereal, it also provides benefits such as able to help dieters to maintain and even lose weight. In order to stay competitive in the food industry, they have continuously introduced different varieties over the years to entice more consumers as well as to keep up with the market trends. 2.2KELLOGG’S MISSION

Since Special K is manufactured by the Kellogg Company, it naturally abides by the general mission of Kellogg’s Company. “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 How do we uphold this mission? Our world-class leadership is dedicated to a management philosophy that holds people above profits. And they’re committed to an advertising and marketing philosophy that helps ensure the Kellogg name is associated with wholesome, truthful advertising. 2.3KELLOGG’s VISION

To enrich and delight through foods and brands that matter
Nourishing families so they can flourish and thrive. We are a company of promise and possibilities. Each day represents a fresh opportunity to share Our Vision, live Our Purpose. By being mindful and committed to these ideals, we uphold our founder’s dedication to people and their well-being. And we promote an environment where we can push beyond boundaries and across borders to create foods and brands that help to fuel the best in everyone everywhere. It is this belief that brings us together and sets us apart. 3OVERVIEW OF CURRENT MARKET

As of current, Kellogg’s is the first runner-up brand in breakfast cereal and is experiencing double digit growth. While the breakfast cereal market is broadly defined, we managed to pinpoint out the major competitors other than Kellogg’s in the market – namely Nestle’s the direct competitors. The smaller competitors have insignificant market shares and have been grouped into one broad category “Others”. From the figure below, we can see that while Kellogg’s has a significantly average share of the market, it still lacks behind the other 2 big pie.

Increase in health conscious society.
•Consumers are becoming increasingly concerned about the nutritional value of the foods they eat. Special K provides not just low fat cereal, but it is nutritional and helps to lose weights. Eating good food has become a norm. Increase in snacking levels.

•Due to the hectic and stressful environment in Singapore, most people will tend to eat and snack more often. But instead of going towards the unhealthy snacks like potato chips, the health conscious society will tend to choose cereal instead. The use of cereal as an intermediate goods.

•Cereal has become an increasing popular ingredient use for baking. It is no longer only having it for breakfast in the current lifestyle. It can also be used to bake muffins or as a mix-in for frozen yogurt to enhance its flavor. 3.3MARKETING SEGEMENTATION

•Through market segmentation, companies divide large, heterogeneous markets into smaller segments that can be reached more efficiently and effectively with products and services that match their unique needs. Demographic

Age: 18-40 years old
Gender: Female
Occupation: students, working adultsPsychographic
Lifestyle: health conscious / weight
Occasions: Christmas, birthday, Easter, wedding.
Benefit: Average waist circumference reduction when replacing meals with 2 cereal meals is 1.3 inches. Usage rate: heavy or light.Purchasing habit
Loyal customers of Special K will make a repeat purchase more due to absence of dissatisfaction.

NamePostHoney Brunches of Oats – Honey Roasted
Nestle Fitness Wheat Cereal – Honey & Almonds

Address Years in Business1892-present2007/2008-present
Price$5.80 (411g)$6.60 (390g)
Product FeaturesThe original flavor which has the perfect combination of 3 kinds of crispy tasty and crunchy oat clusters baked with a touch of honey.Nice and Crunchy with a crispy texture, not unpleasant and also not too drying making them very nice without milk. Light flakes of rice wheat and corn with a complementary savory flavor. Added with milk they keep their long lasting texture and don’t go soggy before you have finished your bowl. PackagingVibrant packaging with a picture of honey dipper. Image of a slim figure and the word “Fitness” Strength •One serving also supplies 10g whole grains, which promotes a heart healthy diet. •It is cholesterol free and contains 0g Trans fats.

•A wide variety range of cereal flavours like original, fruits, honey & almonds and chocolate. •It is crunchier because they used crispy whole-wheat flakes. •Halal certified.
Weakness•Not halal certified thus may lose a fraction of demographic segmentation due to religion. •Not advertised in Singapore.
•Higher in calories.•Hardly advertise.
•Not recommended for elderly who has weaker teeth as it does not turn soggy.

Product: Special K cereal is a lightly toasted breakfast cereal produced by Kellogg Company. Its main ingredients are wheat flakes and crunchy rice. It is advertised as a low fat cereal to help consumers lose weight. The cereal contains various health and fitness diet information on the packaging. Kellogg’s uses different colors to represent the flavors to appeal to their target audience.

Price: Due to intense competition both domestically and internationally, Special K can afford to charge at premium because of brand equity and product quality.

Place: Mainly at supermarket and hypermarket such as, NTUC, giant and cold storage.

Promotion: Kellogg’s advertises using a whole range of media example, in magazines, on posters and internet. However, the main channel for its advertising is on television where individual brands are given their own air time, aimed specifically at a target audience.

•Collaboration with Her World Women’s Magazine to do a promotion. Customer should flash the empty box of Kellogg to redeem a free copy of Her World Magazine. •Kellogg’s used creativity and humour to deliver their message of “making time for breakfast” 3.6SWOT ANALYSIS

SWOT analysis also known as SWOT matrix is a strategic planning method which is widely used by marketers worldwide to evaluate the company’s overall strength, weakness, opportunities and threats. This initial evaluation is vital in marketing strategies which allows marketers to focus on the strength to build competitive advantages and overpower the threats and weakness which may co-exist. This is further discussed below: Strengths

•Brand recognition.
•Promotes diversity, healthy lifestyle and notes the environment as its main responsibility •Amount of Special K products sold has increased as it has introduced different choices and variety of Special K for the customers. •Special K can be bought in most grocery stores and also is available to buy online.Weakness •High price

•Target consumers are from many different demographically areas. Requesting many different focuses.
•Special K diet is questioned among dieters
•Target audience for the products is narrow as it is mainly targeted towards female adults.

•Global trends for healthier food.
•Challenge outreach to men. The Special K brands image would change if it added men.
•Target audience expanded to kids.

•Intensive competitions as there are other products that are more affordable than and as healthy as ours.
•There is a consumer trend towards tastier cereal.


4.1Marketing Objectives & Goals
With our new marketing plan in mind, there are several goals which we want to achieve. In the short-run, we hope to push the sales to higher levels, hitting the sales target of SGD$ by February 2013. (See appendix.) Although our marketing plan will only span over a timeline of 6 months, we aim to increase our market share by improving our product varieties, how they perceive Kellogg’s Special K On The Go! Cereal and how they make their purchase decision in the long run. With the new product we hope consumers will:

•Win over new consumers with the new packaging, a convenience way of consuming it (market of variety- seeking buyers) while strengthening and retaining old fans of Kellogg’s Special K. •Be able to consume their breakfast more frequently as breakfast is important. We also aim to sustain the existing mission of Kellogg’s by providing nutritious food products of superior value.

Our team used primary and secondary research to assist us in understanding our market better, especially in the areas of market potential and discovering consumers’ preferences. 5.1Secondary Data

Our sources of secondary data came mainly from the established scientific journals and news articles found on the internet. (See Reference)

5.2Primary Data
5.2.1Survey objectives
We conducted 2 surveys over the course of half a year. The first survey conducted before the implementation of our new product. It was basically to find out and confirm our target market and to find out what kind of breakfast the market normally consumes and if breakfast was important. The second survey is mainly to be certain if our product was successful – what the consumer thought about it and which areas could be improved. It served to tell us how effective our promotion strategies were so far, and to justify our budget. 5.2.2How the survey was conducted

The first survey was .
6.1 Market Potential

Potential markets include existing customers and women between 18-40 years old. Based on the findings on Singapore statistics, the proportion of Singapore…

As there is a rise in people who are health conscience, the market for breakfast cereal is a good opportunity for us to utilize to attract consumer who has yet to try our products.

6.2Target Market

Targeted Consumers
•Current product consumers
•Gen Y, early 1980s to early 2000s
•Gen X, early 1960s to early 1980s
•Women who are conscious about their health and diet.


•All major retailers such as supermarket, hypermarket and convenience stores like Cheers and 7-eleven.

6.3Consumer behavioural Aspect
6.3.1Culture Factors (Sub-Culture)
Culture is the most basic cause of a person’s wants and behaviour. Each culture contains small subcultures, or a group of people with shared value systems based on common life experiences and situations. Different cultures have an influence on the buying behaviour and these may vary greatly from country to country. For example the idea of product packaging may differ greatly across Asian market and also judging on Singaporeans’ hectic lifestyle, we often do not have the time to prepare breakfast, so most people would rather just stick to something convenient and just have cereal with milk. 6.3.2Social Factors

The family is the most important consumer buying organisation in society and it plays a huge part and can strongly influence buyer behaviour. Marketers are interested in the roles and influences of the wife, husband and the children on the purchase of the products. In the case of the Special K cereal, the mothers are the one who have the most influence on the buying behaviour. They are often known as the purchasing agent in the family as they are usually the one who is in charge of all these household basic necessities. This is supported by a survey that we have conducted with 20 housewives. 6.3.3Personal Factors (Age/Lifecycle, Occupation, Lifestyle, brand personality) Based on market trend, we can see that more people are weight conscious and are usually tied up with work or either school, thus the demand of convenience products such as cereals would appeal and suit their needs. Consumers can have breakfast on the go with special K and also able to satisfy hunger and keep healthy. 6.4 New Marketing Mix

6.4.1Product Description
In view of the busy lifestyle that every Singaporean is going through every day, they tend to neglect their diet. They make do with ready-to-eat foods, snacks and sugary drinks that seem satisfying at the time but remain woefully low in nutritional value and high in fats. This type of eating pattern inevitably results in weight gain. With that in mind, we came up with Special K on the go! cereal that specially cater to reach out to people who do not have time for breakfast due to busy lifestyle. 6.4.2Product Features

From our survey result (refer to Appendix.) we can conclude that most people do not have time to take their breakfast hence the idea of Special K on the go! Cereal is to encourage more people to take breakfast. We will be offering our customer the most convenient and appealing way of presenting breakfast. We understand the importance of providing a variety of good value breakfast choices to our consumers. Presenting Special K on the go! cereal in a one-serving portion with a choice of milk or yogurt included in a separate package. We will ensure the product stays as fresh as possible, as well as looking appealing when on display. 6.4.3Marketing positioning
Kellogg has always live by dedicating their company to making “quality products for a healthier world.” Kellogg emphasizes on highest quality product thus they have strong brand recognition. They have display diversity, healthy lifestyle and note the environment as its main responsibility.

Value-based Pricing
Special K on the go! Is a modified version of the usual cereal that are sold in boxes in our local supermarket. Each of the Special K on the go! will be priced at $3.50. It is considered to be slightly more costly as compared to cereal sold in boxes ($8.60). The price is set at $3.50 as we believe in offering the best ingredients to our consumers, thereby increasing consumer demand.

Promotional Pricing
For the launching period of the product, consumer can cut coupons from print media or magazines for a $0.50 discount on the product. Alternatively, consumer can “like” and share Special K on the go! Facebook page to redeem discount coupons. Product Bundle Pricing

Special K on the go! also comes in a bundle pack of 5 offered at a reduced price. As a typical individual pack cost $3.50, the bundle be retailed in supermarket for $15.90 instead of $17.50.

Besides our current consumer, we also aim to attract new consumers. With this in mind, we decided that our new products should be sold at all convenient stall which is located in all MRT stations, petrol kiosk etc. 6.4.5Promotion

Our marketing objective is to encourage people to take breakfast regularly and to promote our convenient pack. To execute, we would:
Blog Advertising

With the advance in technology, the internet has become a popular trend. We can spread the word by collaborating with Nuffnang, Asia’s largest blog advertising community. They would able to reach out to our target audience. By placing advertisement on well-known blogs it would attract attention. It could create hype and manifest to more people through word of mouth. It could benefit our Social Media

Incorporating with Facebook, we create a Facebook fan page to interact with our target audience directly and constantly update with the latest news and promotions that are going on. Apart from that, tips on eating healthy will also be posted every week. Print media

Posters/ banner
To create and increase brand awareness of our latest product, we would like to place striking banners and poster along CDB area at Raffles place and City hall where most of our target audience would frequent often. Apart from that, we can place advertisements on public transport like buses and train to educate people about the benefits of breakfast cereal. Similarly, posters can be put up at bus stop by collaborating with ClearChannel the only advertising company for bus shelter advertising. Newspaper

We will also be advertising on newspaper like MyPaper (wo bao) which will be distributed during the weekdays and has an average daily circulation of 250,000 copies. It is distributed at MRT stations in the central business district and major housing estates, offices, institutions, airlines, country clubs, and selected coffee joints. It is also delivered to the homes of selected readers.

As an introductory trial, we would be giving out free special K cereal to the public around targeted locations. To reach out to our target audience, we would be giving out the cereal during lunch time around CBD area so that they would get the chance to try out as a meal replacement.

Budget – Cost of promotion
Type of MediaForecast : $
Blog advertising
Social Media
Print Media

From the survey we have conducted, results shown that the most people are willing to try out our special K convenient pack. It will be marketed as a 4 bundle pack; they will also be sold individually at selected supermarket such as Cold Storage, Fairprice and etc. 7MARKETING IMPLEMENTATION

7.1 Structural Issues
Our overall approach to implement the new product is by creating awareness. A way to spark interest for the new Special K on the go! is to create hype and conduct a campaign to promote as many ways as possible. For example, we will have different advertising mediums such as having it advertised on Facebook and blogs and by placing banners and posters around supermarkets or the public transport. Another way to create awareness is to offer free samples to consumer around targeted locations such as having a booth in supermarkets, or around CBD areas so that the working adults will get the chance to try out. 8 Evaluation & Control

Resources are scarce and costly so it is important to control marketing plans. With Evaluation and control, we would be able to maximize resources to market and promote “Kellogg K’s on the go!” breakfast cereal using lowest budget and achieving desired objectives. 8.1 Sales analysis

We would like to monitor the sales figure every end of the month to gauge if Kellogg special K on the go is performing well and what is it’s placing in the market during the course of the business year. The accounting department would present statement of financial performance, Statement of cash flow and also statement of financial position. These reports would be a creditable measure to ensure we are making sensible and rational decision to minimise loss and also to increase profit. It is also to prevent corruption and fraud case in the firm. 8.2 Meetings and work performance

Communication is essential and vital within the firm. Thus regular meetings on a weekly basis should be held for members and also employees from different departments. For instance, a summary of sales report will be drafted by the sales and marketing team to present to the board of directors. It is to highlight the sales analysis and how corrective actions can be taken to improve current situation. Supervisor of different department should also meet up on quarterly basis to discuss current market situation and also to implement and brainstorm for new ideas. Also, to review the firm’s performance and what has achieved, annual general meeting would held at the end of the year. To retain staff loyalty and to encourage healthy competition, awards can be given out to workers who have excelled and show good performance. This way, it can motivate others to do as well for the good of the firm. 8.3 Effectiveness of advertising

From the results obtained from our survey (See Appendix…), it helps our team to gage how effective our advertising strategies were in creating the brand awareness for Special K on the go! 8.3 customer feedback

Consumers will be able to contact us through by dropping us an email printed on the packaging. Also, we will have a survey (See Appendix…) conducted for consumers to gather feedback of marketing the product. In this way, we will ensure that Kellogg’s Special on the go! will always be of highest quality and providing maximum satisfaction.

Consumer Feedback Survey
1. What is your Age Group?
d)46 & above
2. Gender?
3. Are you a housewife?
a) Yes
b) No (Go to Question 5)
4. Are you the one who take charge of the household necessities? a) Yes
b) No
5. Do you take Breakfast daily?
a)Yes( Go to Question 4)
b)No (Go to Question 5)
6. What breakfast do you take?
7. Why would you not take breakfast daily?

(Go to Question 9) 8. Have you tried Kellogg’s Special K cereals?
b)No( Go to question 9)
9. How often do you consume Special K cereal?
10. Where do you normally purchase special K cereal?
b)Convenience store
d)Other places: _____________

11. Will you consider consuming cereal breakfast on the go?
12. How much are you willing to pay for a cereal breakfast on the go? a)SGD$2.00

This survey was conducted by 50 housewives.


http://www.clearchannel.com.sg/products-and-services/media-portal http://imcms2.mediacorp.sg/CMSFileserver/Documents/067/For%20Advertisers/CH_5_8_U_Media_Rate_Card_.pdf newspaper
http://www.sphison.com/upload/rate_card/display-classified-rate-card-1343718320.pdf Market share

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