Norman revealed the news at CAGNY 2015 in New York today during a company presentation, and précised it by noting that in 2000 cereal sales in Kellogg’s ‘Core Four’ cereal markets – US, UK, Canada and Australia - accounted for around 50% of total company net sales.
Although that figure fell to around 25% in 2014, Norman said the category was still important and had shown its ability to post single-digit CAGR in the five and ten-year periods to December 31 2014.
'A mainstream big brand like Kellogg can lean into this space' - Chief growth officer, Paul Norman
“A new idea that we’ll launch under the Kellogg brand in the middle of the year, comes into what consumers expect more and more, from a food and a food culture point of view, is new Kellogg’s Origins," he said. Our first glimpse of the range came via his slide, which you can see on the left.
“It’s a range of cereals, mueslis, granolas – real food prepared simply. No preservatives, no artificial colors or flavors. Whole grains, fiber – an ingredients list you can understand and is short,” Norman added.
“You know everything that’s in there and can pronounce it. Very simple food, and we believe this is exactly where the category needs to lean into.
“For a mainstream big brand like Kellogg the opportunity is there for us to lean into this space in targeted ways to really re-energize and drive salience for the category as a choice in today’s world,” Norman added.
Discussing further cereal innovation, Norman said Kellogg was on a “journey from diet to wellness” with Special K. “We’re going from an absence of negatives (less calories) to more bang for the calories I consume.”
“We have work going on with our foods around the world to renovate and innovate the brand to make it more salient with the needs of our consumers moving forward,” he added.
The Special K shift...Away from diet, into 'wellness'
In the US, he said, Kellogg recently launched a new gluten-free variant of Special K and a second variant with protein, while in Australia last year the company launched a new Original variety with three grains, fiber and protein, and Special K Nourish as, “a more complex food…with nuts, seeds, more complex grains leaning into where our consumer wants us to take the food and the brand”.
“Red Berries is our largest variant in the US and a significant portion of our business will be renovated in the second quarter this year with even more fruit,” he added.
“The biggest driver of liking, of purchasing intent that we can get after on Red Berries is sell more the food. Think about Special K in the US over the past 5-10 years, we’ve spent seven out the 10 dollars we spend on the brand selling diet plans – ‘losing six pounds in two weeks!’, challenging you to lose weight.
“For now on those dollars, eight out of 10 of those dollars will go on selling the food – selling the taste of our food, what’s in our food and selling why our food’s good. A big focus back on investing in the food and selling the food,” Norman said.