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Kellogg's Initial Marketing Mix-4P

Kellogg's launched corn flakes, wheat flakes, and basmati rice flakes in India in 1994, positioning themselves against traditional Indian foods. However, sales declined sharply by 25% in the following months due to failures to understand Indian consumer preferences and culture. Kellogg's did not realize that Indians preferred hot, sweet milk over cold milk and heavier breakfasts to lighter options. They also priced their products too high and lacked effective distribution. It took Kellogg's time to learn from their mistakes and adapt their marketing strategy to the Indian market.

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198 views3 pages

Kellogg's Initial Marketing Mix-4P

Kellogg's launched corn flakes, wheat flakes, and basmati rice flakes in India in 1994, positioning themselves against traditional Indian foods. However, sales declined sharply by 25% in the following months due to failures to understand Indian consumer preferences and culture. Kellogg's did not realize that Indians preferred hot, sweet milk over cold milk and heavier breakfasts to lighter options. They also priced their products too high and lacked effective distribution. It took Kellogg's time to learn from their mistakes and adapt their marketing strategy to the Indian market.

Uploaded by

swati
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Kellogg’s did a lot of research while launching their product and finally in September 1994 they

launched their three products in India which were corn flakes, wheat flakes and Basmati rice flakes.
As Denis Avronsart, Managing Director Kellogg India in a press conference said that “Our only rivals
are traditional Indian foods like idlis and vadas”. Such a statement was very emotionally striking to
Indian customers who are habituated to having traditional Indian food. They used a hefty
advertisement to promote their product and also used advertisements were handled by a leading
Indian advertising agency. Still, sales were declining and in April 1995 there was a record 25%
decrease in sale in comparison to last month. Kellogg’s was offering good quality and healthy food
but still, their sales were stagnant and repeat purchasers were very less. It was a complete nightmare
for a Big Brand like Kellogg’s.

Mistakes-

 Kellogg’s being a big brand was overconfident about their success in India. They thought that
they can change the whole perception of breakfast in India and this was where they went
wrong. Indians preferred heavy breakfast to light breakfast but it was a huge mountain to
climb which Kellogg’s took lightly.
 Kellogg’s failed to understand Indian Consumer behaviour. Ignored basic taste of Indians,
where any day they would prefer sweet hot milk over tasteless cold milk.
 Kellogg’s was priced as a premium product where a cheaper Indian brand Mohun’s Flakes
was available at a much lower price.
 Kellogg’s main attraction was Crispiness but that was nullified when it was consumed with
hot milk. Indian consumer-preferred hot milk to consume cereals and Kellogg’s product lost
it crispiness because of that.
 Kellogg’s higher management made strong management about changing Indian Breakfast
culture which was not taken positively by Indian consumer.
 Price was far too high to be a regular purchase of food, which explains the lack of repeat
sales.
 The amount of premium that Indian customers were willing to pay for quality and
international label was overestimated
 Indian market-Mixture of several regional markets with local tastes and preferences
 Kellogg’s used taglines such as “Indian breakfast is not too healthy too eat, go for healthy”
which was incorrect and harmed their image.
 Kellogg focused on premium and medium level retailer as they thought they can’t maintain
the uniform service quality if they provide products at a large number of shops. Due to this
Kellogg missed large section of Indian population.
 Weak distribution and retail chain
 Kellogg made a mistake in the positioning front. As company advertisements and promotions
focused only on the health aspects and missed on the ‘fun and taste’ positioning. Missing
taste part of the product didn’t serve any good for Kellogg’s.

Kellogg’s Initial Marketing Mix- 4P


Product Price
 It tried to change the Indian food  High Price
habits forcibly, which the Indians  Direct conversion of US Dollar to
did not like. Rupee
 The product was also not hunger-  Cost based Pricing policy
satisfying and focused more on
the aspects of health.
Place Promotion
 Available in only middle and  TV advertisements
premium level stores  Unattractive packaging
 Majority of Indian market was  Absence of mascot
rural based

Kellogg’s Changed Marketing Mix- 4P


Product Price
 Indianised version  Reduced cost
 Introduced products to meet  Introduced small sachet packets
Indian customers demands  Shifted from cost based to
 Flavours like kesar, rose ,elaichi competitor based pricing
Place Promotion
 Introduced mascot- Cornelius
 PAN India Rooster
 Increased number of outlets  Indianised campaigns and
taglines- “Jago jaise bhi, lo
Kellogg’s hi”
 Association with Indian Dietetic
Association (IDA)
 Gained confidence of parents
 Promotion and offers in schools
 Distributed free samples

Recommendations-

 Kellogg's already produces its products in 18 countries and sells them in over 180 countries,
but for its growth it can still look for more international expansions.
 In order to increase its profitability, Kellogg's can slowly diversify while doing proper justice
to its core cereal business.
 Introduce Indian flavors
 Indian people look for ‘value for money’ so they should launch new products at affordable
price with quality by introducing smaller packets.
 Attract children by introducing various shapes and sizes like flowers, stars, etc for cereals.Can
also include free toys inside packets.
 Should have appealing brand ambassadors for each brand like an athlete for healthy meals
and models for working women.

References

https://www.ukessays.com/essays/marketing/analysis-of-kelloggs-in-india-marketing-essay.php

https://www.translatemedia.com/translation-blog/how-kelloggs-failed-and-then-won-in-india/

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