BY

Sushil kumar singh

MBA 4th sem

 In 1994, three years after the barriers to international trade had opened in India, Kelloggs decided to invest US $65 million into launching its number one brand, Corn Flakes. However, the Indian sub-continent found the whole concept of eating breakfast cereal a new one. While this meant that Kelloggs had few direct competitors it also meant that the company had to promote not only its product, but also the very idea of eating breakfast cereal in the first place.

Synopsis

 Furthermore, the companys attempts to Indianite its range have been disastrous. Its Mazza-branded series of fusion cereals, with flavours such as mango, coconut and rose, failed to make a lasting impression.

Synopsis

the research founded that their only rivals are traditional Indian foods like idlis & vadas. - this statement was given by Denis Avronsord (M.D of Kellogg's India.)

Kellogg`s India `S Kal In 1994

Industry analysis
Kellogg's entered in India in 1994. Our only rivals are traditional Indian foods like idlis and

vadas.
products offered in India : corn flakes, wheat flakes, basmati rice flakes With 2008 sales of nearly $13 billion, Kellogg Company is the worlds leading producer of cereal and a leading producer of convenience foods, products include cookies, crackers, toaster pastries, cereal bars, frozen waffles, and meat alternatives.

Key points
Products offered in India Corn Flakes, Wheat flakes, Basmati rice flakes. April 1995, 25% decline in sales in comparison to last month. Despite offering good quality products and being supported by the technical, managerial and financial resources of its parent, Kellogg's products failed in the Indian market. High-profile launch backed by hectic media activity failed to make an impact in the marketplace.

Swot analysis

STRENGTHS:

Swot analysis

Kelloggs flexibility and adaptability towards consumer needs Customization of products History of changing food habits globally

WEAKNESSES: If even they liked taste, the product was too expensive initially Initially product was not adopted to the Indian taste or Indian traditional food habit Wrong evaluation of projection in market demand.

OPPORTUNITIES:

Swot analysis

Introduction of new trend with nutritional value in breakfast Changing work-life demanding processed foods Less competition Scope for entering untapped markets

THREATS: Cultural factors and eating habits population not used to processed foods Blinded by the population figures of India Low awareness about processed foods and calorie requirements Price sensitive customers

MARKETING MIX
1995 1997

PRODUCT New Product Concept Less variety Not Indianized PRICE Premium pricing

Product segmentation More variety Indianized Penetration pricing

MARKETING MIX
1995 1997

PLACE

Localized

Nationalized

Ad campaign PROMOTION

Better advertising strategy

WHY TO GO FOR KELLOGGS?

Communication strategy
Give away free gifts with packs of chocos. eg. Glowing stickers with Rs.10 pack of chocos.

Advertising strategy
Jaago Jaise Bhi, lo Kelloggs hi
Yoga instructor to kathakali dancer attributing their morning energy and fitness to Kellogg's Introduction of new cereals (Chocos, frosties etc.) forced to look at alternate product categories to make up for bad performance of breakfast cereals.

Kelloggs Breakfast Week

Positioning
A healthy, nutritious, convenient & easy - to prepare alternative to traditional breakfast eating habits. Developing a taste for grain based foods in the morning. Different Skus 500 gm family pack, Rs.10 pack of each variant. Worked on Better Positioning Iron Shakti. Now positioned as Fun-&-Taste-&-Health.

 New positioning level of iron & vitamin intake.

Kelloggs Special K Diet Women health.

Target market
Chocos launched in India in September 1996. Targeted at Kids with mascot monkey Jose

Chocos were wheat scoops coated with chocolate.

Launched Frosties in India April 1997. Frosties had sugar frosting on individual flakes. The success of these variants took even Kellogg by surprise and sales picked up significantly. It was even reported that Indian consumers were consuming the products as snacks.

Market objectives and strategies

Markets strategy are divided into six key segments to the Kellogg market, as shown: 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. Simply Wholesome. These are 'good for you' brands, such as Kellogg's Fruit 'n' Fiber

 Shape Management. Brands that can enable customers to manage their weight or shape, such as Kellogg's Special K. Mum Approved. Those that mothers see as being good for their children, such as Kellogg's wheat flaks. Kid Preferred. The brands that children themselves prefer, such as Kellogg's Frosties, Kellogg's Choc'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.

Results for failure

Over confidence and ignorance of cultural aspects. Lack of understanding of Indian consumer behavior and habits. Premium pricing policy. Banked heavily on crispy flakes.

Porter Five Force Model

 1995 53% market share of Rs. 150 million breakfast cereal market. 2000 65% market share of Rs. 600 million market. Improved prospects - Shift in Positioning - Increased consumer promotions - Enhanced media budget Continued to have image of Premium brand.

recommendation

 In a nutshell we have seen that the main reasons for Kellogg's failure in India was the westernisation of its products and high prices. The indianisation of its products helped Kellogg's in penetrating the market. The reduction in prices also helped Kelloggs improve its standing in the market.

conclusion