Cereal Development Proposal - Essay Example

Business Proposal on New Product Development Joyce Brooks, Cheerios Barbara Wallace June 12, Cereal Product Development Proposal Introduction The purpose of the following proposal is identification and development of new type of cereals. As preliminary analysis has shown, Cheerios has two biggest competitors: Kellogg’s and Malt-O-Meal. Taking into account great variety of products and brands of both companies, it is recommended to Cheerios to widen range of goods for staying competitive and increasing people’s awareness and demand for our assortment.

It is imperative to raise number of Cheerios cereals from 11 to 20 at least. On contrast to that Kellogg’s cereal category contains 27 varieties, while Malt-O-Meal has 19 types of cold cereals and 4 types of hot ones. Therefore, Cheerios should provide broader choice for the consumers, proposing absolutely new and delicate tastes. Key findings Previous analysis has shown that Cheerios lags behind its competitors because of its not very diverse range of products. Kellogg’s attracts consumers with big variety of brands, proposing such uncommon flavors and additives as maple syrup, almond, pecan and marshmallow.

Meanwhile Malt-O-Meal suggests two categories of cereals: hot and cold ones, that manages to distinguish it from other companies significantly. Taking into account mentioned competitive advantages, it is essential for Cheerios to develop new products with unfamiliar for consumers flavors and implement carefully developed marketing plan, aiming at appropriate design of the new product types and effective promotion campaign. Moreover, in the issue of analysis it has been revealed that currently Kellogg’s and Malt-O-Meal propagandize idea of healthy meal without any preservatives except natural ones.

Consequently, it is suggested to reject any artificial colors and unnatural ingredients added to the products and launch advertising, emphasizing the safety of Cheerios cereals. Product concept With a help of brainstorming there were generated twenty ideas, concerning new flavors of the cereals. Setting two screening criteria based on the limited number of ingredients and shapes of the flakes allowed to select three the most appropriate ideas. They are the following: flower-shaped flakes with dried apricots, prunes and walnuts; heart-shaped corn flakes with oats, fruit jelly and bergamot; moon-shaped flakes with millet, vanilla and peach.

The first type of cereals will be aimed at adults, especially sportsmen and those people who keep on diet. The most important thing of the promotion is to show useful and healthy effects of the proposed cereals. That is why it is recommended to provide as much information on the package as possible to persuade consumers during their decision-making. It is known that dried apricot is very wholesome for people who suffer heart diseases. Also it affects thyroid gland positively and cures kidney’s illnesses.

Prunes improve the work of gastrointestinal tract and stable human’s pressure. For keeping liver, brain and retinas in a healthy condition person should eat walnuts everyday. Containing a lot of useful elements and vitamins, such as A, B, C, E, K, walnuts help to secure person’s immune system. And taking into account that dried fruits do not contain sugar, nourishing human’s body with natural carbohydrates, new cereals will not lead to obesity. This fact will be very attractive to those people who keep their weight under thorough control.

That is why during advertising campaign it is recommended to mention all these useful characteristics of the new product. The heart-shaped corn flakes will be aimed at young people, attracting them with colorful fruit jellies made in shapes of different fruits. Also it is essential to show parents utility of this type of product, emphasizing healthy elements of oat. According to previous analysis it has been revealed that children choose packets that are situated in the middle of the aisle and on the shelf, which can be reached by them.

Consequently, it is important to keep that information during positioning new type of cereals. The package of the cereals should be very colorful and catching for being able to encourage kids to get it. The third type of cereals will propose absolutely new flavor mixed with vanilla and peach. Corn flakes will be combined with millet that contains high level of proteins. Also millet strengthens bones and teeth, giving enough phosphorus and potassium to organism. This type of cereals will be aimed at middle class families, suggesting big packaging and affordable price.

Firstly all three types of cereals will be distributed locally. But after examination of consumers’ behavior the company will target on international markets. Characteristics of the new products Flower-shaped flakes with dried apricots, prunes and walnuts will be named as “24-hour energy”. It is advised to place a picture of running sporty girl on the front of the package along with facts about dried fruits printed on the back of the box. It should be positioned in the middle of the aisle on the top shelf.

Heart-shaped corn flakes named as “FUNtasy” will have small-size colorful package with an image of jellyfish and different quizzes for fun. Also stickers with popular cartoon heroes can be added along with small presents, which kids may find within the box. Flakes with millet, vanilla and peach will be called “Moon’s time” and will be positioned in the beginning of the aisle. With its new taste characteristics flakes with peach may be able to catch customer’s attention immediately, before he sees something else.

All three types of cereals should be advertised on TV and point-of-sale. Different shapes of flakes will become new trend in company’s assortment, where customer can find only standard ring-shaped cereals. In addition, taking into account that all existed types of Cheerios cereals have common picture of spoon with flakes, image of girl and jellyfish will make customers interested, influencing their awareness. Recommendations Consequently, several steps that the company should do are the following: produce three new types of cereals with mentioned names, shapes and flavors; provide “FUNtasy” cereals only for children with quizzes and presents; create packages with new images and different sizes; launch promotion campaign on TV and point-of-sale, suggesting to make a purchase of ordinary Cheerios on the assumption of getting one package of new type with discount.

Appendices Idea List 1. Corn flakes with barley, banana and cinnamon 2. Star-shaped wheat bran flakes with dried apricots 3. Cereals with raisins and cashew nuts 4. Flower-shaped flakes with dried apricots, prunes and walnuts ? 5. Cereals with pear and raspberry taste 6. Wheat flakes with pine-apple and honey 7. Ring-shaped corn flakes with walnuts and maple syrup 8. Flakes with oats, caramel and raisins 9. Heart-shaped corn flakes with oats, fruit jelly and bergamot ? 10. Triangular flakes with gooseberries and cinnamon 11.

Corn flakes with pomegranate and papaya 12. Cereals with chocolate and cinnamon 13. Heart-shaped flakes with kiwi and vanilla 14. Wheat flakes with maple syrup and grapefruit 15. Flower-shaped corn flakes with caramel and coconut chips 16. Flakes with millet, oats, honey and figs 17. Cereals with prunes, banana and chocolate 18. Moon-shaped flakes with millet, vanilla and peach ? 19. Corn flakes with rice, pecan and cowberries 20. Wheat flakes with yogurt, marshmallow and caramel List of Criteria Number of appropriate ideas 1.

Cereals should contain at least three main ingredients 1, 4, 8, 9, 16, 17, 18, 19, 20 2. Flakes should be shaped in unusual forms 2, 4, 7, 9, 10, 13, 15, 18 Total(?): 4, 9, 18 References Bonabeau, E., Bodick, N., & Armstrong, R. W. (2008). A more rational approach to new-product development. Harvard Business Review, 3, 96-102. Cooper, R.G., & Kleinschmidt, E.J. (1987). New products: What separates winners from losers? Journal of Product Innovation Management, 4, 169-184. Wind, Y., & Mahajan, V. (1988). New product development process: A perspective for reexamination.

Journal of Product Innovation Management, 5, 304-310.