Cereal killer
It's crunch time for manufacturers of the ‘breakfast of champions’: next month Kellogg’s, the iconic cereal brand that brought us Corn Flakes, will snap, crackle and pop into two divisions. On Oct 2nd, shares in WK Kellogg, a spin-off focused solely on cereal production, will begin trading, while the remaining Kellogg Company will rebrand to ‘Kellanova’ as it hones in on global snacking and frozen foods.
Kellogg has been on a rocky road. Factory fires and strikes have plagued the company, while the cereal market has been slowly declining for years. Excepting an upturn in 2020 as homebound buyers buyers turned to unfussy, nostalgic foods, US sales of ready-to-eat cereals fell 8.7% in 2021, and a further 3.9% in 2022, with Kellogg’s also losing market share.
Bowled over
It’s much harder to stay afloat in today’s cereal market than it was when Kellogg’s launched in the early 1900s, as the number of competitors has boomed. Between 2000-2009, 333 new cereals hit the shelves, almost equivalent to the number of cereals that were released in the 127 years up to 1990, and a further 341 varieties were introduced in the 2010s alone (data from MrBreakfast.com).
But, even with all of that cereal choice, shoppers are still shifting towards convenience — a report from Mintel in 2015 showed that almost 40% of millennials thought cereal was an ‘inconvenient’ breakfast — driving frozen breakfast food sales up 11.4% in 2022. Indeed, cultural changes in taste have seen high-protein yogurt soar in popularity over high-carb, often sugary cereals, even with significant efforts from cereal brands to market ‘protein-packed’ versions as ‘health-conscious’ choices.
