Report on the case: “Kellogg’s – Moving Beyond Breakfast”

1. Kellogg’s encountered tremendous problems when faced with the Indian breakfast market and cultural habits. Kellogg’s offered an upscale product that provided a light, healthy breakfast at a relatively high price for the traditional Indian market. There are three main obstacles that I believe should make Kellogg’s move to a segment different from the breakfast one: • Cultural aspect – Indian breakfast consumers are used to a substantial amount of cooked food on their table in the morning. They are used to a wide variety of cooked, spicy food that is consumed warm and gives them a sense of fullness before they start their day. This does not fit the value proposition and the positioning of Kellogg’s breakfast cereals in the Indian market. Since these habits are inherited from many generations, they naturally are very complicated to break, even for a firm as big as Kellogg’s. Therefore, the only option available for Kellogg’s in order to satisfy the Indian cultural demands would be to change its products completely, which seems a bit farfetched and would go against the history and the values of the company. • Price – The price of Kellogg’s breakfast cereals, comparing to the prices obtainable by Indian consumers of traditional Indian breakfasts is another barrier for the settling of Kellogg’s in the breakfast segment of the Indian market. • Not used to processed food – Since the traditional Indian breakfast is composed of home cooked food, including vegetables, the introduction of Kellogg’s processed breakfast cereals on this meal is even further complicated. The low awareness for processed food in India further contributes for this argument. With the arguments stated above it is understandable why Kellogg’s needs to move into non‐breakfast segment, and find a new trend in the fast changing Indian food market. This is a doable task for Kellogg’s since this company founded on cereal meal has moved far beyond breakfast, remaining a major international food corporation.

2. Positioning is defined as the marketer’s effort to identify a unique selling proposition for the product. It is arranging for a product to occupy a clear, distinctive, and attractive position relative to competing products in the minds of target consumers. Companies position themselves to change this perception of the target consumers for their benefit. Kellogg’s should position itself into a snack segment, in order to meet new customer needs that start to appear, in a country that is getting developed and starting to have a rapidly increasing urban lifestyle. It should position itself as a healthy diet snack to be eaten on the go or at home, differentiating the product from competitors settled in the snack segment. There is an increasing concern with weight in India and Indians are getting more and more health conscious as the country is getting more developed. This leads to an increasing demand for health and diet foods, which provides a considerable growth opportunity for Kellogg’s in this market. This would have to be accompanied by an effort to find new flavors and formats for the snacks that best fit the customer’s wants and needs. Given this, the positioning statement I would suggest to Kellogg’s is the following: Our products are the ones that will satisfy you the most, in the balance between flavor and health among all snack producers, because we care and we have the experience to deliver such performance.