Kellogg's is the world's leading producer of cereal and a leading producer of

convenience foods, including cookies, crackers, toaster pastries, cereal bars, frozen

waffles, meat alternatives, pie crusts, and cones, with 2007 annual sales of $11.776

billion and a market share of more than 30 percent. David Mackay, chairman and CEO

of Kellogg's, takes pride in being a part of the Kellogg Company because of the

consistency of the decisions that are made within the company to promote the long-

term growth of their business as well as serve the needs of their people and

communities. With such a large share of the market, one would think that Kellogg's is

untouchable. However, Kellogg's faced a slump in the market. Its cereal sales were

declining and it had to face the challenge of getting out of its slump. Kellogg's therefore

turned to marketing research to identify the problem and develop several solutions to

increase cereal sales. To identify the problem, Kellogg's used several tasks to help them

in the process. The researchers spoke to decision makers within the company,

interviewed industry experts, conducted analysis of available data, and performed some

qualitative research. Several important issues came out of this preliminary research.

Current products were being targeted to kids. Bagels and muffins were winning for

favored breakfast foods. High prices were turning consumers to generic brands. Some

other information also came to light during the research. Adults want quick foods that

require very little or no preparation.

The Marketing Research Decision

1. What is the management decision problem facing Kellogg's?

2. Define an appropriate marketing research problem that Kellogg's needs to

address.

3. Discuss the role of the type of marketing research problem you have identified

in enabling David Mackay to increase the sales of Kellogg's.

The Marketing Management Decision

1. David Mackay is wondering what changes Kellogg's should make to increase

market share. What marketing strategies should be formulated?

2. Discuss how the marketing management decision action that you recommend

to David Mackay is influenced by the research that you suggested earlier and by

the findings of that research.