Case study: Kellogg's New Breakfast Idea! A successful marketing campaign by Kellogg's more than a century ago has locked breakfast in position as the most important meal of RICE the day. Even nutritionists now recommend that people of a healthy weight make sure they have breakfast to maintain this healthy KRISPIES weight. It is also important that breakfast delivers the right vitamins (such as vitamins A, B, and C), iron, calcium, and other minerals. Despite the social importance of breakfast, studies show that many people do not eat breakfast for various reasons. Mainly due to a lack of time to prepare the meal. With changing lifestyles and time pressures in many households, breakfast cereals can provide a healthy start to the day, saving time yet providing the necessary nutritional requirements. One of the leading companies in this market is Kellogg's, that describes itself as a company "making breakfast cereal loved and enjoyed by the whole family." Rice Krispies (known as Rice Bubbles in Australia) was invented and went on sale in 1928 in the United States (US). The original formula was made from a mixture of rice and sugar made into a paste. This paste was then toasted, resulting in the "snap, crackle and pop" effect when milk was poured over it. The ingredients included rice, sugar, malt extract (barley), vitamins A, C, BI, B2, niacin, folic acid, B12 and pantothenic acid (B5), and iron, which was considered a healthy breakfast cereal. For many consumers, Rice Krispies"is not just the product itself - it represents the memories associated with the product, recollections of their childhood and the three cartoon-like characters in the form of the elves (see Rice Krispies "package above). The elves are named Snap, Crackle and Pop. Snap is the oldest, brainiest (smartest) brother; Crackle"is the clown; while Pop"is the youngest and most adventurous. These mascots or characters have been associated with the brand since 1938. The use of brand mascots is aimed at increasing product liking and brand loyalty, as they are positively perceived by consumers. Rice Krispies traditional heritage and the association with a healthy breakfast time has been positively perceived by children, but not necessarily by their parents. Increased health awareness among consumers, especially amongst parents (such as the call for reduced sugar and gluten-free options) has led to the introduction of new products in the marketplace. This includes an increase in the popularity of ready-made-meals, particularly aimed at those consumers who have time pressures in the morning and who are often unable to prepare breakfast for the family. In addition, some retailers produced their own private label cereals as a way of attracting customers via offering cheaper competitive products. In Australia there are versions of Rice Bubbles offered by Aldi, Woolworths, and Coles in private label formats. World-wide, Kellogg's growth has traditionally come from the development of innovative products as part of their growth strategy. This growth strategy involves developing new products or acquiring (buying) other brands to meet the needs and expectations of its current and potential target markets. As part of this ongoing growth strategy, Kellogg's has chosen to develop a new product line. Kellogg's have turned to nutritionists for advice on how to develop a quick and easy healthy product that appeals to singles, to children but also meets parents' expectations of healthier cating. The nutritionists Kellogg's have consulted have agreed on a number of recommendations for a healthier lifestyle:Attributes - How important are the following factors or attributes when purchasing cereal? 1 = not at all important; 5 = extremely important. Same data in a table. Field Minimum Maximum Mean Sid Deviation Variance Richness 1.00 8.00 3.87 2.37 5.61 2 Crunchiness 1.00 8.00 3.97 2.59 6.73 Sweetness 1.00 8.00 4.19 2.53 6.43 Strength of flavour 1.00 8.00 5.20 2.62 6.85 LA Bitterness 1.00 8.00 3.17 2.45 5.98 Saltiness 1.00 8.00 2.87 2.19 4.80 7 The brand 1.00 8.00 3.81 2.57 6.60 Quality 1.00 8.00 5.62 1.90 3.62 9 Packaging 1.00 8.00 3.46 2.52 6.33 10 Price 1.00 8.00 5.09 2.15 4.60 11 Manufactured in Australia 1.00 8.00 2.79 2.18 4.76 12 Ingredients 1.00 8.00 4.48 2.35 5.52 13 Fair Trade practices 1.00 8.00 3.55 2.39 5.70 14 Award winning 1.00 8.00 2.17 1.58 2.51 15 Manufactured overseas 1.00 8.00 2.15 1.68 2.84Q17 - Do you avoid dairy milk for medical or ethical reasons? Q2 - How often do you consume non-dairy milk? Dally Weekly Lieis Who once i Never 6 160 170 140 860 100 209 20 240Q3 - If you ever use non-dairy milks, how often do you consume oat milk? Q7 - What type of dairy or non-dairy milk do you prefer? Buy in Mik Modified Sop Non-durg Mik 50Q10 - When purchasing non-dairy milk, how important are the following attributes to your choice? Not of all inportant Price Container It's sold in Country of Origin Moderately Important Amount of supper Brand Sustainability of production Very Important 20g END OF CASE STUDYFat intake should be reduced, particularly saturated fatty acids. The intake of polyunsaturated fatty acids should be increased. Fibre intake should be increased. Sugar intake should be reduced. Salt intake should be reduced. Many of Kellogg's stakeholders (current consumers, social media feedback, company employees) have provided the company with some good ideas for a new breakfast meal, especially from Australia. After much deliberation, Kellogg's has decided to develop a fresh breakfast pot, named Kellogg's Brekkie ('Brekkie' is slang in Australia for "breakfast"). Kellogg's are considering a move away from packaged breakfast cereals to a fresh food alternative. Preliminary findings from a written proposal to introduce the 'Brekkie' pot into the Australian market have recommended the following: Picture Sourced From Catering SoulOrigin.com au/pre "Brekkie' be made only with the freshest and highest quality ingredients. ducts breakfil-pots Introduce a plant based version of the product with no animal products used at all for people who are vegan, vegetarian, or just trying to cut down on their animal product consumption for environmental reasons. Kellogg's provide a guarantee that all food is same-day fresh, and the food shelf life (use by date) is only 24 hours from time of production. "Brekkie/Kellogg's food partners consist of local organic farmers as well as fresh food distributors who provide daily produce to Kellogg's kitchens. "Brekkie' will be sold through independent grocery stores c.g., IGA supermarkets, organic cafes, school canteens and university cafes, and integrated into food programs. There is the potential to start a 'Brekkie' franchise or retail store in the future. The same iconic elves will appear on the packaging to ensure there is strong brand awareness and recognition for the 'Brekkie' pot and still appeal to children. The Kellogg's team would purchase its organic products from local producers/farmers and adapt their meals according to the season and climate. Kellogg's intends to support local employment and ensure a low ecological footprint (low energy consumption and reduced pollution) in the production of its healthy 'Brekkie" pot. These factors will be emphasised in their integrated marketing communication program and at the point of sale. Other initiatives that are being considered include: All food not sold during the day will be donated to local charities (e.g., Foodbank Victoria, Secondbite, Salvation Army) to ensure that people requesting help from these charities have an opportunity to eat a healthy breakfast. Develop a Food Program to create an environment where people learn healthy eating habits. Include healthy eating messages in their IMC program. Assess the potential to fund a *grow your own food' program in the schools, other education institutions (e-g., Universities) and in the community through further expansion of community gardens.As cereals are still Kellogg's main revenue source, Kellogg's have also conducted research on how, where, and why people buy cereals. One of their key concerns is that the new 'Brekkie' product should not cannibalise their existing product sales. Research results for selected questions are provided below. These results focus on how people who currently eat cereal for breakfast view cereals and cereal purchasing. Kellogg's must now decide whether to commit to introducing the "Brekkie* pot into the Australian market. Kellogg's has commissioned you to investigate further (before making a final decision) for the introduction of the 'Brekkie' pot into the Australian market in 2024. Research Results Provided: There are two sets of research results provided. The first set are about cereal consumption. The second set of research results are selected results about the consumption of plant based milks. Numbers in graphs represent total number of respondents who selected that option (not percentages). In the first set of studies (in blue) there were 150 respondents in total. In the second set of studies there were about 750 respondents in total. In both cases, not all individuals answered all questions resulting in more or fewer responses for a particular question. It is important to integrate this data into your answers, where relevant. How often do you buy cereal? Daily Weekly Fortnightly Monthly Greater than monthly New 10 15 20 25 30 35 45 50 55Which brand of cereal is your favourite? Nutri Grain Other (Please Specify) Weet Bix Just Right (Various Flavours) Rice Bubbles All Bran Carman's - various flavours Crispbe Fruit Loops Frosties Special K Original Uncle Toby's Plus - Various Flavours Aldi Goldermale Sultans Bran Kellogs Sustain Cheerios VitalBrits Com Flakes Cini Mini's Churros Square Weeties Coco Pops Nesquik Crunchy Nut Milo Cereal 20 25 30 35 40 un- 10Which type of fund do you prefer when it names to breakfast? Why would you choose cereal over other kinds of breakfast? Cereal taste better Cereal is cheaper Cereal is easiest to make Other (please specify): Cereal has more varieties I would not choose cereal over other kinds of snacks 10 20 30 40 50 70 90 Do you buy cereal on sale (during promotions) or at full price? Promotion only Full price As needed (at either promotion or full price] 10 20 30 40 50 60 70 90 100 110 120When buying cereal, how important is it for the brand to be sustainable (in production and distribution)? Not at all important Slightly important Moderately important Very important Extremely important 10 15 20 25 35 40 45 50 55Which of these social media platforms do you currently use? (Click all that apply) Tik Tok Facebook Instagram Twitter Reddit Discord Snapchat Weibo Other 20 30 40 60 90 100 110 120 130 140 10 50 70Attributes - How important are the following factors or attributes when purchasing cereal? 1 = not at all important; 5 = extremely important 1 Not at all important Richness 2 Slightly important Crunchiness Sweetness Strength of flavour Bitterness Saltiness The brand 3 Moderately important Quality Packaging Price Manufactured in your home country Ingredients Fair Trade practices 5 Extremely important Award winning Manufactured overseas 4. Very important 10 20 30 40 50 60 70 80Responses must be in the context of the case study and the data provided and your understanding of marketing theory, concepts, framework, and processes. Part 1: New product development process (15 + 8 + 5 Marks = 28 Marks) Question 1. Idea Idea Concept Marketing generation QUIUB BIDS development strategy and testing development Business Product Test analysis development marketing Commercialisation FIGURE 8.1 The main steps in the new-product development process a. The above diagram shows the new product development process. Kellogg's have already completed the first three stages of this process. Your task is to explain how they would use the remaining five stages to decide whether or not they should launch 'Brekkie' pots. In your answer, demonstrate your understanding of the theory for each stage and include evidence from the case to support your discussion. Be certain to include what Kellogg's would look for to make a "launch /do not launch" decision at each stage. (15 Marks) b. The picture in the case show 'Brekkie' pots as small, healthy, fresh, and green. What one alternative format (alternative to one of "small, healthy, fresh, and green") could they use and how could Kellogg's position this product in the Australian market? Be sure to explain what you think the 'Brekkie' pot position should be for your alternative vision. Be sure to use what you already know, what you have learned from the case, and what you learned from the survey data. (8 Marks) c. A key problem with new product introductions into the same market is market share cannibalism: where the new product steals (takes) market share from the old, existing product. Using the data provided, what risk do you see that 'Brekkie" pots would steal share from Kellogg's traditional products. Back up your answer with information from the survey data. (5 Marks)Part 2: Segmentation, Targeting, Differentiation and Positioning (6 + 4 = 10 Marks) Question 2. . Kellogg's have identified young (15 to 35), single and also those married with young children, health-conscious females as their main target markets for 'Brekkie' pots. Kellogg's operate in the Breakfast Food category. Develop two (2) differentiation strategies for Kellogg's 'Brekkie' pot, with justification, as to how they can potentially differentiate themselves from other ready to eat breakfasts (including those purchased for take-away from cafes, those purchased from supermarkets, and those made at home), but still be in the breakfast food category in the Australian market. Differentiation strategies must come from the 5 bases of differentiation. (6 Marks) Based on your chosen differentiation strategy(s) in question 2a, develop a positioning statement for Kellogg's Brekkie pot. (4 Marks) Part 3: Marketing Mix (12 + 8 + 12 = 32 Marks) Question 3. a. Develop three product strategies in the context of your proposed Kellogg's new 'Brekkie* pot as identified in Question 1b, to ensure the proposed new product will be a success in the Australian market. Be clear, how it applies specifically to the target market of young, health-conscious females (singles and those married with young children) and your differentiation strategies. (12 marks) b. Thinking about distribution and logistics, develop a multi-channel recommendation to Kellogg's management for the potential distribution of the *Brekkie' pot in the Australian market. Draw a multi-channel distribution diagram to support your recommended placement (distribution/logistics) strategy. Be sure to take into account the nature of the product. It is fresh and must be consumed within one day. Note. You can hand draw the diagram and upload a photo image to the answer sheet (8 marks) C. Thinking about the promotion element of the marketing mix, develop an integrated marketing communication (IMC) program for the Kellogg's "Brekkie' pot. Recommend three (3) different promotion tool strategies (with justification) Kellogg's could consider in promoting their 'Brekkie" pot to the target market to create awareness and entice trial of the Kellogg's 'Brekkie' brand. (4 x 3 = 12 marks)Question 4. a. Propose marketing metrics (marketing analytics) for each of the product strategy(s), multi-channel distribution strategy and the IMC strategy (s). Provide a brief explanation/justification for your choices. (5 marks) b. Kellogg's is interested in gaining insights from the potential target market on their thoughts, feelings, perceptions, and attitude toward the new 'Brekkie' pot, prior to committing to enter the Australian market. They are not sure whether to undertake qualitative or quantitative research. Which research method would you recommend and why