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Kelloggs Case Study Analysis

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Kelloggs Case Study

Kellogg’s is a well-Known brand in the western part of the world, unfortunately, when they launched their products in the market it was not at all a smooth journey for them as they had to face a lot of hurdles. But the hurdles never stopped them from achieving what they want to. The company started to thoroughly analyze the market and found out a way as to how they can hold on to the stakeholders in India because India proved to be a tough market for them in the initial years.

The first and foremost hurdle that the company faced is just because they wanted to change the eating habits of the Indian people. It had to go through a lot of phases until it established itself as one of the strongest players in the breakfast cereal category in India.

A lot of reports have shown that presently, Kellogg’s holds approximately 65% of the Indian market. It was not easy for Kellogg’s being a foreign brand to launch in India. This paper will emphasize how the company started its journey as a failure and with proper marketing strategy they are able to capture around 65% of stakeholders at the present date, which can be regarded as a huge success. We are also providing a KIA Motors case study solution.

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Background of Kellogg’s

In the United States of America, Kellogg’s is regarded as one of the biggest brands providing cereals for breakfast. It has been found out that the products of the company are manufactured in around 18 countries and sold over 180 countries. Kellogg’s entered the Indian Market in the year 1994 and it has not been a smooth entry for them because they wanted to transform the eating habits of the Indian people.

The Indian people preferred their traditional eating habits over modern-day cereal breakfast. The company felt that the Indian people do not have healthier eating habits and that is where the challenge of the company started, as the Indian people did not take it in a positive way. We are also providing a Jaguar case study solution.

Initial Faults made by the company

The first-ever fault that was made by the company is that in the initial advertisement they focused on the unhealthy eating habits of Indians, this ended up hurting the sentiments of the Indian people and especially the ladies who have been serving traditional food for their families.

The advertisement had a negative impact on the mindset of the Indian people. The second fault was, the price at which Kellogg’s was available was considered to be higher in comparison to the traditional food in India, and not all people have the capacity to buy it. It was becoming impossible for the company to convince the Indian people. We are also providing an IKEA case study solution.

The company was not able to understand the cultural aspect of the Indian people, what they like or do not like. Indian people prefer warm milk, but cornflakes go better with cold milk, and once the cornflakes are dipped in warm milk, it lost its crispiness and the Indian people thought that the company made fake promises by not providing crispy flakes to them. All these factors led to the decline of sales of the company. Assignmenthelp.us offers Kellogg's case study help.

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Specific Strategies Took up by the Company for Indian Market

Creative marketing technique

  • Increasing the brand image with the help of proper advertising and investment.
  • The active interaction program was started in schools, various government and non-governmental agencies to give a clear perspective about Kellogg’s.
  • The company started using brand names that appealed to the Indian people.
  • The packaging was made attractive and was used an effective marketing tool to convey messages to the Indian people.
  • Kellogg’s started manufacturing Chocos Kellogg’s for children.
  • The company started to reuse and recycle their product to improve the brand image.
  • The health and human services were also looked upon by the company in a few local companies.

Improvement in the supply chain

  • To save the import duty the company started to localize the raw material and the requirement for packaging.
  • In order to reduce the transportation, cost the company started its manufacturing unit in Mumbai, as it was the market that consumed the largest amount of cereals.
  • They set up a proper distribution network so that the products can reach to the markets all over India.

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Customization of Products

It has been found out that over a period of time the company was successful in widening its product portfolio according to the needs of the Indian customers. The products ranged from Frosties to Choco flavored scoops and different variants of cornflakes. Not only that the company also emphasized the issues related to health faced by the local people. For instance, it tried to increase awareness amongst people about the benefits that they will get if they increase the intake of iron and calcium. With the help of products like Iron Shakti and Calcium Shakti.

Improving the Indian Talent

The company has also helped the Indian managers to leverage their skills by moving them to other countries. Not only that the Indian managers also managed neighboring countries like Sri Lanka, Bangladesh, and Nepal.

Present Market Scenario

At present Kellogg’s has about 60% of the market share in India related to breakfast cereals.  The competitors that the company has is- Quaker, and Nestle.

Swot Analysis

Strengths of Kellogg's – Internal Strategic Factors

  • The biggest strength of Kellogg’s is that they can successfully innovate products according to the needs of the people.
  • Being a multinational company, they have a strong flow of cash that can be used to expand products and projects.
  • Kellogg’s has a strong distribution of network that helps them to circulate the product.
  • Over the years the company has built up a strong brand portfolio for them.

Weakness of Kellogg's – Internal Strategic Factors

  • The organizational structure that is followed by them is only compatible with their present business model that limits their expansion.
  • Certain gaps have been found in the products sold by the company.

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Opportunities for Kellogg's – External Strategic Factors

  • The company has a stable flow of cash.
  • The lowering of transportation costs and shipping prices have provided the company with certain opportunities.
  • The shopping pattern of customers has changed and it has shifted to online channels that have added advantage to the company.  

Threats Kellogg's Facing - External Strategic Factors

  • The changing shopping behavior of the customer might be a threat to the company.
  • Intense competition in the market might be a threat to the organization.
  • The rising price of raw materials might be a threat to the profitability of the company.

Pestle Analysis

Political Factors:

  • The political stability of the country might affect the sales of the company.
  • People in the country trust their government more than any foreign company, so it might affect the sales of the company.
  • The boundary that the host nation shares and the exchange condition can affect the company.
  • The tax system of the company might be a problem.

Economic Factors:

  • The growth of GDP shows how much customers trust Kellogg’s.
  • The loan affects the buying pattern of the customers.
  • In a country where a large number of people are unemployed, it means that Kellogg’s will get workers at a lower cost, and eventually, it will bring down the expense of the company.

Social Factors:

  • Culture, mindset, values of the people are social factors that affect the company.

Technological Factors:

  • Any novel way for growing corn in a cost-effective manner can considerably lower the entire cost of corn flakes manufacturing.
  • Kellogg's should keep an eye on how effective the competitor firm's innovation is and how quickly it is developing and disrupting its rival's earnings. Kellogg's should either adopt the invention or come up with fresh inventive ways to oppose the competitor firm in order to respond to the issue.
  • When a firm achieves a substantial improvement in a certain technology or invention, it reaps greater financial rewards.

Legal Factors:

  • The Intellectual Property Rights that exist in the nation in which it operates is critical in ensuring the safety of patents and other information that has allowed Kellogg's to maintain a competitive advantage over other companies in the market.
  • Discrimination laws are in place by various governments depending on the country to ensure that employees are treated equally regardless of their age, caste, gender, or qualification. Other legislative limitations are in place to safeguard the health and safety of Kellogg's or any other company's employees.

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Environmental Factors:

Kellogg's uses a lot of water in their food manufacturing, thus rules governing water disposal and other waste food resources should be followed. If it establishes any plant in such an area that affects or leads to the endangerment of existing endangered animal species or natural flora and fauna, it may face severe reprisal from local organizations.

Thus, this paper can be concluded by saying that Kellogg’s had a very tough journey in the past and it had to face a lot of criticism, after accepting the criticism in a positive way, transforming their failure into success. As a result of which it is one of the most famous organizations.

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