...Experience Details Source: http://www.icmrindia.org/free%20resources/casestudies/Marketing%20freecasestudyp1.htm Themes: MNCs in India Period : 1995-2001 Organization : Kellogg India Ltd Pub Date : 2001 Countries : India Industry : Cereals and Convenience foods Kellogg's Indian Experience: A Failed Launch In April 1995, Kellogg India Ltd. (Kellogg) received unsettling reports of a gradual drop in sales from its distributors in Mumbai. There was a 25% decline in countrywide sales since March1995, the month Kellogg products had been made available nationally. Kellogg was the wholly-owned Indian subsidiary of the Kellogg Company based in Battle Creek, Michigan. Kellogg Company was the world's leading producer of cereals and convenience foods, including cookies, crackers, cereal bars, frozen waffles, meat alternatives, piecrusts, and ice cream cones. Founded in 1906, Kellogg Company had manufacturing facilities in 19 countries and marketed its products in more than 160 countries. The company's turnover in 1999-00 was $ 7 billion. Kellogg Company had set up its 30th manufacturing facility in India, with a total investment of $ 30 million. The Indian market held great significance for the Kellogg Company because its US sales were stagnating and only regular price increases had helped boost the revenues in the 1990s. | Launched in September 1994, Kellogg's initial offerings in India included cornflakes, wheat flakes and Basmati rice flakes. Despite offering good quality...
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...Failed Research Leading to Failed Positioning – Kellogg’s Launch in India Kellogg’s in the 90’s started facing immense pressure from competitors and their main markets of the U.S and Europe had become sluggish. It is during this time that they decided to launch in India. Our “Marketing Management” textbook outlines the following six major forces to be researched at a macro level when considering the opportunities and threats, especially when venturing into a new territory: Demographic, economic, social-cultural, natural, technological and political-legal (Kotler, Keller, Koshy, Jha, 2009). If the above has been researched and evaluated carefully, you can then position your product well with the other 3’P’s: Place, Promotion and Price. Yet, Kellogg’s with their over-confidence just gambled on the economics and here too they failed miserably. While considering economics in 1994, they considered the overall population. Mr. Bhagirat B. Merchant, at that time director of the Bombay Stock Exchange, agreed on this when he stated, “Even if Kellogg’s has only a two percent market share, at 18 million consumers they will have a larger market than in the US itself” (Cashberry, 2006). Yet, Kellogg’s forgot to take into consideration, before investing USD 65 million, was the “consumer class” was not more than 100 million and were dispersed geographically with very different cultures, customs, and tastes. Over-confidence came from the fact that they were a huge company...
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...Kellogg's Indian Experience: A Failed Launch |In April 1995, Kellogg India Ltd. (Kellogg) received unsettling reports of a gradual drop in sales from its distributors in Mumbai. There | |was a 25% decline in countrywide sales since March1995, the month Kellogg products had been made available nationally. | | | |Kellogg was the wholly-owned Indian subsidiary of the Kellogg Company based in Battle Creek, Michigan. Kellogg Company was the world's | |leading producer of cereals and convenience foods, including cookies, crackers, cereal bars, frozen waffles, meat alternatives, piecrusts, | |and ice cream cones. Founded in 1906, Kellogg Company had manufacturing facilities in 19 countries and marketed its products in more than | |160 countries. The company's turnover in 1999-00 was $ 7 billion. Kellogg Company had set up its 30th manufacturing facility in India, with | |a total investment of $ 30 million. The Indian market held great significance for the Kellogg Company because its US sales were stagnating | |and only regular price increases had helped boost the revenues in the 1990s. | Launched in September 1994, Kellogg's initial offerings in India included cornflakes, wheat flakes and Basmati rice flakes. Despite offering good quality products...
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...keting lessons from Kelloggs experience Marketing lessons from Kellogg’s Indian experience [pic] Kellogg’s is a name to reckon throughout the world. It is the company that introduced the concept of Corn flakes as a breakfast item throughout the world. They have taken on markets where corn flakes has never been very popular as breakfast and converted them into corn flake eating nations over a long period of time. They are experts in changing breakfast eating habits of customers’ across the world. In the early nineties Kellogg came to India with lots of hope and confidence. The Indian organized breakfast market sector was expected to roll over and die. After all Kellogg’s annual turnover was so big that the Indian organized breakfast sector was written off even before the skirmishes started. Kellogg did lot of home work and launched its products in India. They had the best products, packaging and their marketing strategy was excellent. The advertising campaign was handled by a leading Indian advertising agency. Kellogg did not do as well as expected. The witch doctors (read marketing research firms) were called in. The research findings were very surprising. The areas where Kellogg went wrong include: [pic] 1. Kellogg pitched itself as an alternative to the regularly consumed breakfast. The Indian breakfast is heavy and there is a feeling of fullness at the end of an Indian breakfast. What with oily Parantas, Puris and Dosas, the feeling of fullness is real...
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...used by Kelloggs India Ltd.: 4 2.1: summarizing data: 5 2.2 Results from the summarizing data: 6 2.3 Measures of dispersion: 7 2.4 quartiles, percentiles, conelation coefficient 8 3.1 Using data from kellogg's business scenario, preparation a range of graphs 9 3.2: Use trend lines in spreadsheet graphs 10 3.3 The answer is delivered through attached Microsoft PowerPoint 10 3.4 Formal Business Report: 10 4.1Management information system: 11 4.2Presentation of a project pian for the Kellogg's case study for an 14 4.3Internal rate of return: 15 Referrences: 16 1.1 Preparation of primary and secondary data: Primary data: Primary data of Kellogg India Ltd. is collected from the primary sources like company own databases, company surverys, interviews. The data which are collected by thoe own researchers source or primary source is known as primary data(Dawes, 1971). The company generally gather its primary data from the existing customer perspective. Besides company accountant information regarding survey plays vital role in this case. Kellogg India Ltd. empahasizes more on primary sources than on the secondary sources of data. They use direct observatons, personal interview from customer as their primary data sources. Secondary data: Secondary data are the subsequent publication of primary literature(Kahnmean and Lovallo, 1993). The data sources from the third parties not company internal sources is used as secondary data to use in research by Kellogg India Ltd...
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...of company`s goal, philosophy and characteristic. For Kellogg`s the quality was the key also the mission is to develop their product through the customers, consumers and communities. * Vision: This can be defined as a dynamic and compelling view at some point in the future. True the vision the company can see where it want to be and what Kellogg`s want to achieve in the future. Kellogg`s vision is ‘To enrich and delight the world through foods and brands that matter’ (Kelloggs). Regarding to our case study, Kellogg`s vision in India was to serve a bigger choice in the food industry and also apart of cereal they wanted to expand into snack and frozen foods in U.S. * Objectives: Kellogg`s objectives included such as support physical activity for the population, promote exercise, sponsor activities (studies). Kellogg became the main sponsor of swimming in Britain. Also they introduce food labelling which is providing an opportunity for the consumers to make decisions about the right balance of food. Kellogg is violently supporting but in the same it puts a lot of effort to protect their reputation. * Goals: Kellogg`s want to provide the consumers all over the world with simple and more suitable way of enjoying good health. * Core competencies: Core competence is important for any company. The firms has to follow the market needs and to be successful they should offer the best product at the best price. Kellogg`s is focusing on the loyalty, constancy of the customer...
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...How can Kellogg’s do better in India? What were the mistakes it made? ABOUT KELLOGS: Kellogg is $13.2 billion multinational food manufacturing company with its headquarters in Michigan, USA. It has manufacturing units in 18 countries and markets its products in over 180 countries. Brand Kellogg’s a global successful player serving packaged breakfast items across globe. Kellogg’s ventured in India in 1994. On its arrival, it created a new category of branded breakfast cereal products. Since then the journey for Kellogg’s has been far from easy, actually it has been so tough that it has found itself to be one of the biggest brand failures in India. In this article let us study what went wrong for the global brand, what mistakes it made and going forward what should be its strategy. Breakfast Cereal Industry: The Industry was pegged at Rs 150 crores way back in 1995 during early days of Kellogg’s. Today, this new category created by Kellogg’s is pegged at Rs 500 crores. Cornflakes account for 80% of the market, rest is shared by Oats, Muesli and Wheat Porridge. Kellogg has 70% market share i.e. 350 crores. The category has grown by only 8.4% per annum over the last 15 years. The figures are testimony to the fact that Kellogg's effort to change the breakfast habit of the Indian people, has not had as much success as it hoped for. Cornflakes for breakfast is somethings we as Indians are not used to and making us leave our idli’s, dosas and parantha’s for cornflakes...
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...Portfolio Marketing Mix Strategies adopted in Indian market Failure of Kellogg’s and its results Porter’s Five Force Model SWOT Analysis PESTEL Kellogg’s •Kellogg Company is a multinational food manufacturing company headquartered in Battle Creek, Michigan, United States. •Kellogg started with only 44 employees in 1906. •Founder, W.K. Kellogg, had a strong commitment to nutrition, health and quality. •Kellogg's products are manufactured in 18 countries and marketed in more than 180 countries. Vision and mission Vision: To enrich and delight through foods and brand that matter. Mission: To drive sustainable growth through the power of our people and brands by better servicing the needs of our customers, consumers and communities. Operating Principles •Remain consumer centric •Executional excellence •Prioritize to win •Continuous efficiency improvement Values • Kellogg Company’s values, K Values™, shape their culture and guide the way they run their business. • In 2005, the company instituted the W.K. Kellogg Values Award, which is given annually to one individual and one team of employees who best exhibit the K Values in their work. History of Kellogg’s 1906 - John Harvey Kellogg and Will Keith Kellogg also known as W.K Kellogg founded the Battle Creek Toasted Corn Flake Company in Battle Creek, Michigan. 1914–The production of the Kellogg’s Corn Flakes expanded world wide. 1922–The Battle Creek Toasted Corn Flake Company changed there name to The Kellogg Company...
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...------------------------------------------------- Kelloggs in India SWOT ANALYSIS Strenghs Strong Brand recognition * Product of Kellogg’s are manufactured in 18 countries and marketed in more than 80 countries. * High brand recall and top of the mind breakfast cereal brand globally * All the children in the world know their Mascots such as the Tiger Kellog’s flexibility and adaptility towards consumer needs * Great marketing initiative through various campaigns * They are able to make special products for different countries Control 42% of global market share for cereal * Has a global workforce of over 30,000 people * Considered as the best brand in their area Weaknesses The product was too expensive initially for the Indian Market * The revenues of the Indians are not the same compared to the americans or the europeans for example Product not adapted to the Indian taste * The Indian people have their own taste concerning their food habit and it is completely different comparent to the “usual” customers of Kellogs Opportunities Introduction of new trend with nutritional value in breakfast * Change in lifestyle of consumers , lack of time increase consumption of readymade food * Give examples of the Benefits of Kellogg’s Cereals Diversification of their product line * Create new product line adapted to the indian taste Develop a better pricing strategy * Adapt their prices to the...
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...Introduction Decision making is a vital part of business. But without having the appropriate source of information it can’t be done properly. One can learn about various fields of business while taking decision. Four procedures of accurate information- gathering data, string data, creating useful information, and presenting them can also be learnt. Currently all the successful organizations use IT based data analysis. This type of data analysis has a lot of advantages. Kellogg India is an US based company focused mainly in cereal products. After the reconstruction of Indian market, it decided to expand its operation in this side of this world. It invested 35 million pound and implemented its western policy. Now after decade’s Ups and Downs, Kellogg is keen to control the lion’s share of Indian domestic market and wants to be the only player. While Kellogg still holds more than 60% share in India's Rs 700-crore organized breakfast cereal market and increased its overall sales 30% in FY12, it is now facing increased competition with multinational and home-grown players including PepsiCo, Marico, GlaxoSmithKline and Dr Oater entering the oats and muesli segments(New York Times 1998). That’s why now it’s going to take some vital decision that will reshape its market strategy. The author can examine a variety of data Sources. He can use any type of data and any type of method and also will use all the necessary tools to represent this work. However Author will clarify the whole...
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...Week Three Assignment Louis C. Diaz BUS330 Principles of Marketing Instructor: Benjamin Pitts November 10th, 2014 Consumer economy refers to the concept that evaluates an assortment of adjusts in recent consumption stages as well as the alteration taken place in capital, demography and society over a period of time (White, S., 2012). It gives a complete breakdown of variables and social actions that are current in consumer economy. This paper will examine future marketing tactics for new youth oriented consumer economies like those in India and China based on the marketing tactics taken on by United States to cater to youth consumers for the past sixty years. American economy is the world’s largest economy. This country has elevated level economy output and the largest purchasing power equivalence. Suitable tactics assumed by the government did not let the market down even in the 1930’s in the time of recession. The government cut taxes drastically so that the consumer would spend more. Various strategies were implemented in order to even out the economy during the 1930’s to the 1980’s (Mintz & Kellogg, 1989). Years 1945 to 1957 saw a soaring rate of fertility and the birth of countless baby boomers. As a result of this momentous climb in fertility rates, prosperity was decreased; the need for single family homes increased and brought hope for a better future. From 1946 to 1973 the expansion of the American...
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...Growth in China and India Satiya Elam BUS 330 Principles of Marketing Prof. Rebecca Johnston-Gilbert January 14, 2013 In this paper we will explore the growth in China and India and what products and services will interest the new market youth. We will look at the micro and macro-environmental forces that can influence the marketing strategies for these products and services. We will look at whether marketers in these countries will use similar marketing strategies to influence this group or will their strategies be different from Western-based consumption marketers. Then we will take a look to see what opportunities for the U.S companies we might foresee. China and India are two of the world’s largest emerging markets that are growing rapidly. Our text states “As populations grow, so does consumer spending. As the percentage of the population of working age grows, so does economic stability. When a large share of a country's population is in the work force, that country sees income growth and high per-capita savings” (White, 2012). So as these countries grow we will see a significant increase in consumer spending. As these markets become wealthier we will see an increase in personal income growth for consumers which will increase their purchasing power. This can be an increase in food, housing accommodation, cars and energy etc... I think we will also see the younger market leaning towards branding and...
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...------------------------------------------------- Abstract: The case, 'Kellogg's Indian Experience' analyzes the causes that led to the failure of the Kellogg breakfast cereal brand in the Indian market. The case examines the measures the company adopted on the marketing front to rectify its mistakes and at the efficacy of these measures. | ------------------------------------------------- Issues: » Enable students to see how mistakes on the pricing, positioning and distribution fronts led to Kellogg's poor performance in the initial stages Market Many people view breakfast as the most important meal of the day. Research shows that 96% of the UK population eat or drink something for breakfast and 49% start the day with ready-to-eat cereals. This signifies a huge change in UK breakfast eating habits over the last twenty years. In 1968 approximately half the population tucked into a cooked breakfast on a regular basis, but, by 1990 this had dropped to an estimated 10%. This change can be attributed to increasingly busy lifestyles and an awareness of the importance of healthy eating. However, hectic lifestyles can mean breakfast is often sacrificed to keeping to a tight timetable. The major challenge facing cereal companies today is to persuade consumers that eating cereals is both convenient and beneficial at breakfast time or at any time of the day. In terms of volume, the UK is the largest consumer of cereals in Europe. In 1999, the market was valued at £944 million...
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...plunges down. So How would u like to see the graph ? Why do they die down? 1. Lack of innovation : Generally people misinterpret this word with invention. Any improvement done and if it gives money , then it is called INNOVATION. If it doesn’t give money it is called CREATIVITY. Ex : Today there is no medicine for AIDS. But if medicine is found then it is INVENTION. Ex: Different ways of thinking is creativity. There are no examples of creativity. When creativity gets practical implication and you get money is innovation. Ex: Steve Jobs was highly creative and what he gave the world by way of his product was innovation. Innovation is not only in product but also in selling / systems. Ex : unique ways of selling. Direct marketing. Door to door selling. All the product was existing in the market. So very innovative in selling. Ex : Pan Parag Product was competitive. But no corporate competitors . This was way back in 1983. But he took the route of paanwala and sold thru them only. Actually they were his competitors. For innovation, you remember companies like Apple, Google, facebook , 3M ........ Ex: In 3M , employees ( after some hierarchical levels ) were given time for creativity. No questions asked. There are lots of flexibility. They are told You are free to define your working hrs. You are free to spend any time for creativity. Company will provide all the resources. One person...
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...IntMk-CStud-4.qxd 26/05/2005 14:05 Page 563 section 4 case studies cases 4.1 Wal-Mart’s German Misadventure 4.2 Handl Tyrol: Market Selection and Coverage Decisions of a Medium-sized Austrian Enterprise 4.3 Blair Water Purifiers to India 4.4 A Tale of Two Tipples 4.5 Kellogg’s Indian Experience 4.6 Strategic Alliances in the Global Airline Industry: from Bilateral Agreements to Integrated Networks 4.7 GN Netcom in China 4.8 IKEA: Entering Russia 4.9 The ‘David Beckham’ Brand 563 571 574 583 586 590 594 599 604 case 4.1 Wal-Mart’s German Misadventure I don’t think that Wal-Mart did their homework as well as they should have. Germany is Europe’s most pricesensitive market. Wal-Mart underestimated the competition, the culture, the legislative environment. — Steve Gotham, retail analyst, Verdict Retail Consulting, October 20021 We screwed up in Germany. Our biggest mistake was putting our name up before we had the service and low prices. People were disappointed. — John Menzer, head of Wal-Mart International December 20012 ‘Don’t look now:’ low prices all year round! With thanks to Walmart 563 IntMk-CStud-4.qxd 26/05/2005 14:06 Page 564 section 6 case studies section 4 German blues For the world’s largest retailing company, Wal-Mart, Inc., the German market was proving difficult to crack. By 2003, even after five years of having entered Germany, Wal-Mart was making losses. Though Wal-Mart did not reveal these figures, analysts estimated...
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