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By, Group 10 Akhil Mehta Neha U Patil Shreyas H N Sunayana Jain Vikas N

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 World's leading producer of cereal and a leading producer of convenience foods.198 billion as per 2011. fruit. United States. crackers.Company Facts  Kellogg’s was established in the year 1906.  Kellogg’s is a multinational food manufacturing company headquartered in Battle Creek.  It has a annual revenue of US $ 13. . three years after the barriers to international trade had opened in India. frozen waffles. Toaster pastries.flavoured snacks.  In 1994. Michigan. cereal bars. and vegetarian foods. including cookies. Kellogg’s invested US $ 30 million into launching its number one brand. Corn Flakes.  Their Products are manufactured in 19 countries and marketed in more than 160 countries around the world.

 Despite offering good quality products and being supported by the technical. Managing Director. there was 25% decline in sales in comparison to previous month. Kellogg India. .Kellogg’s India during initial years “Our only rivals are traditional Indian foods like idlis and vadas" -Denis Avronsart. Wheat Flakes and Basmati Rice Flakes. out of every 100 packets sold only 2 were being brought by regular customers. with the rest 98 being first time buyers.  According to the analysts.  In April 1995. managerial and financial resources of its parent. Kellogg's products failed in the Indian market.  The products offered were Corn Flakes.

Mistakes that lead to failure of Kellogg’s in India It relied heavily on the quality of its crispy flakes. This made it difficult for the larger population to access this product. When warm milk was added it made the flakes soggy. It did not suit Indian breakfast habits. In order to maintain quality Kellogg's focused on premium and middle-level retail stores. Insufficient Market Research. Its advertisements and promotions focused initially on the health aspects of the product. . which was a fundamental departure from the successful ‘fun and taste’ positioning adopted in the United States. Indians liked to boil their milk and consume it warm or lukewarm.

Comparison KELLOGG MOHAN’S CORNFLAKES (competitor) PRICES FOCUSED ON MARKET COMPARISION Rs. 16. . 21 for 100gm Affluent customers Premium and Middle level Rs.50 for 100gm Mass customers Low income consumers and small retailers as well.

nutritional breakfast cereal.. 3 local flavors viz. Educative programs for kids. From healthy breakfast to Tasty. ‘Coconut Kesar ’ and ‘Rose’ Shift in positioning. Different sizes to different consumer groups. Customizing products for India.  Nutrition Promotion Initiatives Health and nutrition symposiums. Replaced cardboard boxes with pouches.Setting things right Innovative marketing and brand-building. Tie up with Indian dietetic association to raise awareness about iron deficiency problems . ‘Mango Elaichi’.

 More focus on promotions Targeted schools Free samples to select retail stores House-to-house sampling exercises Free pencil boxes.. water bottles etc.000 outlets. 30.Contd. with every pack Modification of products Iron fortification in breakfast cereals  Entered the biscuit market  Increased the number of outlets  In 1995.000 outlets. . 40.  In 1998.

Results .

New products launched in 2000 .

 Very few loyal customers.  Lack of understanding of Indian consumer behavior and habits. .  No defense taken even when the competitors were selling the products at much cheaper price.Reasons behind poor performance  Ignorance of the cultural aspects.  Product Orientation.

WEAKNESSES: The product was focused only on premium segment. History of introducing new food habits globally. .SWOT Analysis STRENGTHS: Kellogg’s flexibility and adaptability towards consumer needs. Initially product was not adopted to the taste of Indians .

. THREATS: Cultural factors and eating habits – population not used to processed foods.SWOT Analysis OPPORTUNITIES: Introduction of new trend with nutritional value in breakfast. Less competition. Low awareness about processed foods and calorie requirements.

 Provide free bowls with a family pack to attract house wives New Product Product Development:  Spicy cornflakes. Diversification:  Cooking oil using cereal.  Target youths who are very much into fitness.  Prepare flakes using Ragi. Current Market New Market Market Development:  School kids – By conducting competitions such as Kellogg’s Quiz for its users. .  Developing product which retains crispness even after pouring warm milk on it.Ansoff Model Current Product Market Penetration:  Provide manuals to guide consumers about the various benefits of using it.

 Make the product available at lesser price.  Increase the promotions and advertisements to reach all the sectors of people. .What should Kellogg’s do to change the perception of premium brand?  Make the product available in smaller retail store instead of selling them only in premium and middle level retail stores.

.  Sponsor the television shows related to cooking.How should Kellogg influence the Indian middle class to consume the product?  Increase the nutrition promotion initiatives.  Provide trial packs in the retail shops where middle class people are more likely to purchase goods.  Reduce the price of the products by reducing the margins of profit.