Carl Seaberg

1

• Presented By
• Carl Seaberg
• Jordan Post
• Elise Boldt
• Matt Prehm
• Michael McNany

2
History of Kelloggs

• Corn Flakes came about by an accident
• Will Kellogg founded the Battle Creek Toasted
  Corn Flake Company
• 1906 the first Corn Flakes started to be produced
• Started with one factory that produced 33 cases a
  day.
• By 1924 the company expanded to Australia
• 1938 they were selling to Europe.

3
History of Marketing

• 1952, Frosted Flakes were introduced.
• Tony the Tiger pops onto the scene
• Focused the sale of Frosted Flakes to younger
  generation
• Used slogan
• Theyre Gr-r-reat!

4
What Kelloggs Stands For

• Will Kellogg believed in using economics and
  marketing to have a solid base.
• Have a product for every market
• Keep a low profile keep themselves from
  receiving bad publicity
• Pride themselves in knowledge, perseverance, and
  class

5
Marketing Philosophy

• 7 individual categories
• Product Management
• Evaluate and implement creative marketing ideas
• New Production Development
• Manage the introduction of new products
• Consumer Understanding
• Experts learn how Kelloggs products meet
  expectations

6
Marketing Philosophy (Continued)

• Consumer Affairs
• Goal is to maintain consumer confidence in
  Kelloggs
• Promotional Marketing
• Kelloggs promotion- packaging, coupons, sales
• Nutrition affairs
• Work with nutritionists to provide nutrition
  information
• Product Communications/PR
• Handles public relation activities

7
The Four Ps of Marketing

• Product
• Kelloggs cereal and snack treats
• Price
• Generally 2 -5 dollars for cereal and costs
  differ for snacks
• Place
• Grocery stores, convenience stores, vending
  machines, and gas stations
• Promotion
• Prizes, give a ways, advertisement

8
Success In Advertising

• 4 main characters
• Tony the Tiger
• Theyre G-r-e-a-t!!!
• Toucan Sam
• Adventurous/Tropical
• Snap, Crackle, and Pop
• Rice Krispies
• DigEm
• Smacks Cereal

9
Value Chain Analysis

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

10
Value Chain Analysis

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

11
Value Chain Analysis

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

12
Value Chain Analysis

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Use of Mascots
• Toys/Prizes
• Advertisements

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Use of Mascots
• Toys/Prizes
• Advertisements

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

13
Value Chain Analysis

• Conservation
• -Mass Storage
• -Bulk Packaging
• Computerized
• Systems

• Packaging
• -Freshness
• -Flavor
• -Nutrient Levels
• Provides value to
• Different sized
• families
• Kelloggs commits
• to full packaging

• Use of Mascots
• Toys/Prizes
• Advertisements

• Easy to find
• suppliers
• Quality control
• Efficient methods
• of transportation
• and storage

• Not much to do
• in food industry
• Products Guaranteed

14
P.E.S.T. Analysis
P
E
S
T
olitical
conomical
ocial
echnological

• Logistics of how Kelloggs moves and tracks their
  products.
• Systems of accounting
• Ways of manufacturing products

• Employment laws
• Food and Drug Administration laws
• Freedom of business practices in the USA
• Trade regulations in the USA and other countries
• Kelloggs Global Code of Ethics

• Economic growth
• Industry growth
• Exchange rates and inflation rates
• High home economy

• Lifestyle trends
• Promotions for niche marketing

15
S.W.O.T. Analysis
S
W
T
O
trengths
eaknesses
pportunities
hreats

• Marketing and Promotional skills
• Involvement in Charity
• Reputation for healthy, tasty cereal and snacks
• International involvement
• Strong brand name
• Popular base products

• Widespread brand identity
• Many substitutes for product
• Constantly changing lifestyle trends to adapt to
• Product balances

• Growing demand for healthy, organic cereals and
  snacks
• International market

• Other Competitors
• Targeted for not filling up their bags threat to
  reputation-

16
Porters Five Forces
Low Product Market Price Few Big Brand
Competitors Lots of smaller, private companies
Barriers to Entry
Raw Materials Raw Ingredients Labor Processing
and Packaging Equipment Sanitation Services
Wholesale Marketers Retailers You and Me
Buyers
Suppliers
Substitutes
Other food products, cereals Low switching costs
17
Finance and Sales

• With 2004 sales of 10 billion, Kellogg is the
  world's leading producer of cereal and
  convenience foods.
• Kellogg has gradually increased in gross profits
  each year
• Volume to Value is the initial part of Kelloggs
  broader operating standards
• Kellogg again increased their investment in brand
  building at a double-digit rate in the year 2004.
  
• Kellogg is constantly trying to lower the size of
  cash Kellogg has committed to working capital.
• Kellogg happens to believe that consistent,
  dependable results the key to growth.

18
Finance and Sales (continued)

• Net Sales is up eight percent from last years
  numbers. Operating Profit has worked its self up
  7. Kelloggs stock has gone up a shocking 12
  increase. The cash flow ends this trend with a
  modest 6 increase as well.

19
(No Transcript)
20
(No Transcript)
21
(No Transcript)
22
Conclusion

• From the early days of Kelloggs the company has
  added value by using an exceptional product and
  providing people with healthy, great tasting
  cereal. Their marketing philosophy and techniques
  have paved the way for a very successful company
  today and in the future. By analyzing the company
  itself and the industry in which it resides we
  believe that the best way for Kelloggs to add
  value is by continuing their outstanding
  promotional techniques and targeting the changing
  trends in their niche of young and healthy minded
  customers.