Importance of Building a Brand for Kellogg - Essay Example

Kellogg’s Case Study Executive summary: This report is giving stress for Building a brand for Kellogg and whether it is able to sustain its product life cycle. The reconciliation of other cereal fibre products of Kellogg Company with the master brand of Kellogg’s All-Bran brand. Through effective application of SWOT analysis, adequate research and promotion measures, and the impact of product life cycle; whether it is possible to attain success by Kellogg as a family brand. Introduction: In the Kellogg’s Case Study, an extensive evaluation of the brand building Kellogg is carried out. It deals with the question whether Kellogg is able to sustain its product life cycle which is of great significance. Whilst building a brand for a product, it is equally important to consider whether it is possible to capture the market and profitability. For this, it is necessary to implement appropriate major strategic matters related to marketing. Literature Review: 1. Discuss Kelloggs approach to branding and their current branding strategies: Kellogg’s All Bran Brand has been a leading brand in the fibre sector of the cereal market for a long period of time. Kellogg, a leading company in the global market, produces cereal products and other food items like snacks, pastries, cookies etc. One of the main features of Kellogg’s products is that the company offers goods marked for taste and quality. Among its number of brands, All-Bran brand of Kellogg Company holds a considerable position in the market avenues. This is mainly for the reason that the brand offers more nutritious products than the other brands. An effective implementation of both financing and marketing sectors is decisive for this brand building of All-Bran banner. In addition to this, it also requires consumer perception about the changes made by Kellogg Company. 2. How Kelloggs should manage their segmentation, targeting and positioning: The brand image of Kellogg’s All-Bran is outstanding as compared to other high fibre brands made by Kellogg. So, in order to attain an overall development of all brands, Kellogg gas decided to merge all other brands with the master brand of Kellogg Company. As we take in to account the running style of the Kellogg Company, we find that it is necessary to evaluate the product life cycle of All-Bran product in order to improve its existing strategic plans. Effective implementation of marketing strategies is essential in the accomplishment of goals set by the entity. The success of any product and its marketing is highly related to its brand image. “Consumers very often do not use explicit, concrete, rational factors to evaluate products, and thus their motivation to purchase is not always easy to articulate.” (Hussey and Duncombe. 1999). An effective marketing strategy should evaluate the customer needs; and the decisions should be taken on the basis that it is possible to satisfy those needs effectively. Kellogg Company is trying to extend their market as much as possible. The effective implementation of market segmentation, targeting and positioning is suitable in this regard. It is helpful for distinguishing the Kellogg’s product with those of its rivalries. 3. Using the product life cycle concept, outline a model that fully illustrates the evolution of the All Brand offer with associated commentary and explanation: Product Life Cycle of Kellogg’s All-Bran Brand: It is very essential to conduct a market research about the Kellogg Company, which concludes whether the customer will accept the product, or it is possible to capture the market share in a stable manner, or what will be the reaction of customers etc. With the assistance of a proper research, it is possible to make a clear idea about the future proceedings of the Kellogg Company. From the initial stages onwards, when the All-Bran brand was introduced in the market, it occupied a prominent position in the market avenues. The rebranding of several fibre cereals with All-Bran brand banner requires better consumer response and effective marketing strategy. During introduction stage it is essential to thrust appropriate focus on price and promotion concept. Price should be float or skim pricing strategy. More importantly, it is necessary to stress promotional methods, especially advertising of the product, in order to inform about the new product in the market and among the consumers. Let it be remembered that some times loss may incur during this stage. There should be a chance of slight competition. The cost will be higher due to the sales promotional activities and quantum of sales will be normal or at a lower level. The important fact during this stage is that to analyze whether the customers are ready to accept the All-Bran Banner product or not. “All-Bran has experienced steady growth from its launch in the 1930s with regular promotion to keep sales buoyant. As it as now at a more mature stage, Kellogg had to take the strategic decision as to whether or how to promote it” (Kellogg’s- Building a brand in order to sustain its life cycle. Product life cycle). Where as during the growth stage, the company has to face competition and the sales will begin to increase, in the maturity stage, the consumers will be aware of the brand loyalty resulting in the sales. However, during decline stage, there is a depression in the market. In order to overcome this, certain innovative measures are introduced. During each stage of the product life cycle except the decline stage, the sales and profit level of Kellogg Company are related to each other. (The Product Life Cycle (PLC). 2007). The life cycle of the Kellogg products is maintained in a manner that the company is able to develop its quality products to satisfy customers’ needs and compete with its rivalries. One of the major strengths or successes of the Kellogg was its F Plan Diet, which got a huge publicity especially from nutritionists and health experts. 4. Evaluate Kelloggs approach to integrated communications: We understand that it is necessary to conduct a proper scrutiny about the creation of the family of All-Bran brands, to ensure that whether such brand building will be beneficial to the Kellogg Company or not. One of the best strategic approaches made by the Kellogg to undertake its brand changes is that of the SWOT analysis of All-Bran brands. All-Bran brand is a leading brand of Kellogg Company and while making the SWOT analysis, it is clear that the major strength of the brand is that of its brand loyalty which was accepted by a bundle of consumers through out. Main weakness of the All-Bran brand is that, the non promotional measures lead to turn down the brand image. “The main threats were consumers wanting tastier cereals and the growth of competitor brands. Opportunities were people wanting to eat more healthy foods and the main target market for the cereal growing.” (Kellogg’s- Building a brand in order to sustain its life cycle. SWOT). Therefore, it is clear from the fact that for the prospective development of Kellogg’s All-Bran brand requires the implementation of various marketing strategies and policies. To expand the business, Kellogg Company gives predominance in enlarging the cereal business. The major cereal producers are Kellogg, Nestle, and Weetabix. In the present marketing scenario, cereal market is increasing gradually. Brand image and quality are the major factors that stand behind the success of the Kellogg Company. SWOT Analysis is an important tool in evaluating the strategic planning process. It consists of both internal and external factors. Strength and weakness are internal in nature where as opportunities and threats are external factors. Kellogg’s All-Bran brand also enjoys the competitive advantage, which turns out to be the major strength of the company. To consider the strength of Kellogg, brand image, technical and innovative measures, status etc. are the crucial features. But at the same time, Kellogg faces certain weaknesses. Main difficulty of Kellogg is its working conditions and functioning style that are quiet expensive in nature. The running of the company requires a huge cost structure. In addition to this, the company also evaluates the external and environmental factors. The opportunity of the Kellogg is to develop or expand its business operations through technologies and innovative ideas to introduce more healthy brands, cereals, snacks etc. Other than this, the Kellogg also faces threats in the form of competitive products, change in consumer taste and preference, lack of promotion, etc. The strength of a firm means its available resources and other equipments. Strength should include the product’s brand name, better reputation among the customers, patents etc. Weakness that is the shortage of strength consists of poor brand name, higher cost structure, lack of customer services etc. Opportunity mainly concentrates on the profit structure and overall development of the enterprise. It includes introduction of new technology, removal of trade barriers, failure to satisfy the customer needs and wants. Threat to a firm takes place due to the introduction of new regulations, increased trade barriers, introduction of various substitute products. The firm should try to overcome the weaknesses and other difficulties by the proper application of marketing strategies. Therefore SWOT analysis is also termed as Internal-External analysis. SWOT analysis is significant in measuring the competing power of a business concern. The strength of an organization creates its own opportunities. On the other hand, the main threat faced by a firm is that of their weakness itself. For the over all development of a firm, adequate attention needs to be given in all areas of a business. A tool to combine the internal factors with the external factors is the Confrontation Matrix. Opportunities Threats Strengths Offensive Make the most of these. Adjust Restore strengths. Weaknesses Defensive Watch competition closely. Survive Turn around. (Confrontation Matrix. 2007). In addition to this, Kellogg Company also stresses the implementation of various strategic measures. It is necessary to evaluate the competitive strategy, cost leadership etc for the same While expanding the business of Kellogg, it is necessary to stress on marketing, financial control, and management concepts. While building a brand to sustain the life cycle and for attaining the overall development, Kellogg Company gives keen attention to- 1. Industry stability. 2. State of technology. 3. Industrial competitors. 4. Government regulations. 5. Public and market needs. Competitive Advantage for the business means an advantage over its rivalries in respect of the lower prices, higher quality or any other services being provided by that firm. A firm is said to be competitively advantaged mainly based on its return making ability. Competitive advantage of a firm is mainly of two types- cost advantage and differentiation advantage. It is possible to achieve competitive advantage, a firm must perform its activities in such a way that which is far ahead of its competitors. It is an advantage which allows the firm to survive in its competition over a long period. In addition to this, marketing needs mix which is essential for the maximization of a growth of a product. Research and Promotion is also playing a major role in this regard. Kellogg company has decided to undertake market research for analyzing whether the changes being adopted by the company by means of integrating several cereal brands with the master brand All-Bran brand banner will be successful or not. Marketing research means making an evaluation about the customers, competitors, and the market situation. Conducting market research is effective for the implementation of various changes. There are mainly two kinds of market research, such as qualitative research, and quantitative research. Qualitative research of Kellogg gives focus on its customers’ taste and preferences, brand loyalty, advertising and sales promotional measures etc. Effective sales promotional measures are undertaken for the implementation of various changes in the existing market. The qualitative market research is helpful to develop the concept of sorting various cereal products with the master brand All-Bran brand. Through effective advertisement and better sales promotional measures, it is possible to build up a family of All-Bran banner brand in to the markets. Under this kind of research, only a smaller category of consumers is preferred. Qualitative research of marketing is mainly done through interviews, interactive group discussion etc. But on the other hand, in quantitative market research there are many respondents and it needs questionnaires and scales are being applicable here. It is necessary focus the stipulated concept, for which the research is done. It is also necessary to collect the data, make an analysis of the data so collected to make the most appropriate decisions. Kellogg Company is in a position to conduct a detailed market research to analyze the responses of the consumer thoughts and feelings, if there are changes in the integration of cereal fibre products with its master brand All-bran brand. Extensive and effective market research is crucial for making changes in to the existing business plan for the expansion measures. Kellogg Company focuses on various innovative and technical measures to capture better market share in the break fast and other cereal products. While making changes in to the brand family of Kellogg, it is necessary to make it known to the public or customers. Customers are the key asset for any business, and the success of marketing relies on the customer responses towards the product. For this, it is necessary to undertake various sales promotional measures like advertising. Cereals are natural products, which is clear from the ingredient of the packaging. As a natural product, All- bran products are providing strong diet every day. The complicated product development of Kellogg is possible through various innovative measures. Kellogg’s expanded staff groups amalgamate in order to undertake various research and developmental measures. Sales promotion is an effective measure being adopted by the Kellogg Company to improve the sales. In addition to this, it is necessary that the Kellogg is able to develop the product range better as it makes the cereal products. Also, it is necessary to build an effective marketing strategy through which it is possible to attain the economies of scale. Due to the promotion and trade marketing, it is possible to boost up the sales and brand values of Kellogg Company to certain extend is possible. “Kellogg recently carried out two effective promotions aimed at totally different audiences. The first targeted families and drew on the incredible success of the Star Wars TM movies. This was a large-scale event extending over a number of Kelloggs brands appealing to families. These included Corn Flakes, Frosties, Rice Krispies and Coco Pops. The event coincided with the worldwide movie release of the final Star Wars TM movie - Revenge of the SithTM. A large event such as this needs to create consumer interest straightaway, have 100% trade backing and use a number of varying methods of promotion.” (Kellogg’s- Using promotion to boost sales and brand values. Promotion at Kellogg). The application of effective marketing strategies and principles lead Kellogg Company towards its goals. Marketing mix is the mode in which the marketing policies should be put in to accomplish. Marketing mix is a combination of various tools and techniques of marketing. It contains Four Ps in marketing, such as Product, Price, Place, and Promotion. Through the practicability of a thriving marketing mix, it is possible to reach towards several consumers within the target market. The role of sales promotion increases day by day. Advertising is playing a leading role in this respect for the effective utilization of the market attainments. The cost of sales promotional measures is quiet expensive. Even then it turns out to be a prominent factor in the present market scenario. Corporate Social Responsibility and ethical factors of Kellogg Company should also be taken in an effective manner while dealing with the marketing and its strategical issues. An integrated marketing stands on the lights of its effective functioning, the survival of a product in the market entity requires a continuous promotional impact, and then only it is possible to accomplish the stipulated marketing objectives effectively. Various sales promotion measures and brand debut programmes are effective for the successive marketing. Through these sales promotional measures undertaken by Kellogg’s All Bran brand, it is possible to improve the existing brand loyalty. Conclusion: Even though Kellogg’s All-Bran brand has a considerable place in the global market, it requires certain modifications and implementations for making the integration of its other brands with the master brand. For the purpose of expanding the overall functioning of the business as well as its sales volume and profitability, it is necessary to widen its product life cycle in a most appropriate manner. Through this it is possible to improve the other relevant cereal products of Kellogg, by integrating those with All-bran brand. So, the implementation strategy of Kellogg’s All-Bran brand is helpful in achieving its market potentiality. Bibliography Confrontation Matrix. (2007). SWOT Analysis. [online]. 12 Manage. Last accessed 6 November 2007 at: http://www.12manage.com/methods_swot_analysis.html HUSSEY, Michael and DUNCOMBE, Nicola (1999). Projecting the Right Image: using Projective Techniques to Measure Brand Image. [online]. MCB UP Ltd. Emerald. Vol 2. Issue 1. P. 22-30. Last accessed 6 November 2007 at: http://www.emeraldinsight.com/Insight/viewContentItem.do?contentType=Article&hdAction=lnkpdf&contentId=858366 Kellogg’s- Building a brand in order to sustain its life cycle. Product life cycle. [online]. The Times 100. Last accessed 6 November 2007 at: http://www.thetimes100.co.uk/downloads/kelloggs/kelloggs_10_summary.pdf Kellogg’s- Building a brand in order to sustain its life cycle. SWOT. [online]. The Times 100. Last accessed 6 November 2007 at: http://www.thetimes100.co.uk/downloads/kelloggs/kelloggs_10_summary.pdf Kellogg’s- Using Promotion to Boost Sales and Brand Values. Promotion at Kellogg. [online]. TT 100biz. Last accessed 6 November 2007 at: http://www.thetimes100.co.uk/downloads/kelloggs/kelloggs_11_3.pdf The Product Life Cycle (PLC). (2007). [online]. Marketing Teacher. Last accessed 6 November 2007 at: http://marketingteacher.com/Lessons/lesson_plc.htm Read More