Last year Kellogg snapped up Pringles for $2.7bn – hurling it into the global snacks arena at number two position, just behind PepsiCo. With no prior expertise in the sector, the cereal major has said the Pringles brand is its springboard into snacks on a global level.
“We were not present in snacks in Asia before the Pringles acquisition,” said Amit Banati, president of Asia Pacific at Kellogg.
“We feel very excited by the opportunity. The snacks category is an established one that is significantly larger than breakfast in Asia Pacific and Pringles is an iconic brand and well-loved across the region,” he told BakeryandSnacks.com.
Although brand awareness is varied from market to market, he added.
Existing versus emerging markets – what’s tougher?
The Pringles brand is well established in Japan, Korea, Australia, New Zealand and Singapore, Banati said, but less so in emerging markets like India, China and South Africa.
“The new markets are always, obviously, more difficult because you have to create the brand and in many cases the distribution too. But the size of the opportunity is always bigger,” he said.
However, Kellogg is working on a balanced strategy when driving growth across Asia Pacific – it’s not all about these new markets, he added.
“We see growth opportunities in all of our developed markets from a share standpoint. We want to drive growth in our existing footprint. Ideas include smaller Pringles cans, targeting convenience stores and working on commercial innovation and food innovation – like flavors.”
Igniting brand loyalty and sizing up to Asian markets
Banati said there are clear opportunities to drive brand awareness harder in some Asia Pacific markets, particularly in India, China, Southeast Asia and South Africa (a market within Kellogg’s Asia Pacific remit), where penetration of Pringles is lacking.
“There is an opportunity on commercial innovation - that could be Christmas activation or Chinese New Year in China. There are a number of opportunities we have working with our customers for in-store events,” he said.
Asked if the team would be adapting the Pringles brand for each market, he said this was something Kellogg would work on to an extent – in terms of flavoring and some sizing work – but for the most part it would leverage its global brand.
Sizing presents great opportunity in Asia, he said. “For example, we’ve just launched a smaller 47g pot across Southeast Asia in Q2. I think this is driven by price points because at a smaller price you can access new customers, but it also plays into the convenient, on-the-go desires from a consumer standpoint. It’s on trend.”
R&D in Pringles and beyond…
Kellogg’s research and development (R&D) center, located in Singapore next to its new headquarters, will be dedicated to developing the Pringles brand for Asia. But over the medium- to long-term, Banati said the center would also work to bring some of the US Kellogg snacks portfolio over.
“Maybe not all parts – we’ll do it selectively,” he said.
The previous Pringles team is working in the R&D center, offering a lot of expertise and insight that Kellogg can learn from, he said. “We’ve inherited a great brand and business in snacks – its intact.”
To find out more from Banati about how Kellogg plans to 'create' the breakfast cereal category in Asia, click HERE.