Kelloggs Marketing Mix
Short Description
Kelloggs Marketing Mix...
Description
Marketing Marketing Mix Katherine Mulhall 20041462
This assignment has been prepared with the highest standards of academic integrity
Katherine Mulhall
BBS2
20 0 4 1 4 6 2
Table of Contents TABLE OF CONTENTS.....................................................................................2 TABLES AND FIGURES............................................ FIGURES...................................................................... ....................................... ............... 3 COMPANY COMPANY HISTORY/BACKGROUND........................ HISTORY/BACKGROUND.............................................. .................................... .................... ...... 4 ELLOGG-BROTHER..........................................................................................4 JOHN HARVEY K ELLOGG ELLOGG$% ORN#LAKE%............................................................& THE A!"ENTAL REAT!ON O# K ELLOGG OR'ORATE !MAGE..............................................................................................................&
MARKET SEGMENTATION SEGMENTATION & TARGETING..................... ARGETING...................................................... ...................................... .....6 6 MARKET %EGMENTAT!ON.......................................................................................................( TARGET MARKET!NG............................................................................................................) MARKET POSITIONING...................................................................................8 TRATEG!E%.....................................................................................................* 'O%!T!ON!NG % TRATEG!E%
PRODUCT......................................................................................................9 NE+ 'RO",T "EVELO'MENT .............. ...................... ............... .............. ............... ............... .............. ........................................... .................................... New Product- ‘Special K’..........................................................................................10 'RO",T L!#E YLE........................................................................................................ Introductory Stage...................................................................................................11 Growth Stage...........................................................................................................11 Maturity Stage..........................................................................................................12 ecline Stage...........................................................................................................1! PRICING......................................................................................................14 !NTERNAL / E0TERNAL #ATOR%.........................................................................................4 Internal "actor# $%ecting Pricing eci#ion#.............................................................1& '(ternal "actor# $%ecting Pricing eci#ion#.............................................................1) PLACE DISTRIBUTION!.................. DISTRIBUTION!........................................ ............................................ .........................................1" ...................1" TRATEGY....................................................................................................) "!%TR!B,T!ON % TRATEGY ONL!NE MARKET!NG..........................................................................................................* *hat +u#ine## +ene,t# can the Internet proide...................................................1/ Kellogg’# nline Mareting.......................................................................................1/
PROMOTIONS..............................................................................................2# A"VERT!%!NG...................................................................................................................12 In#titutional $derti#ing...........................................................................................20 Product $derti#ing..................................................................................................20 CONCLUSIONS & RECOMMENDATIONS........................ RECOMMENDATIONS.............................................. ................................... ............. 22 ONL,%!ON% ............................... ................................................................. .................................................................. ...................................... ............. ........... .... 11 REOMMEN"AT!ON% ..........................................................................................................13 REFERENCES...............................................................................................24
2!age
Katherine Mulhall
BBS2
20041462
Tables and Figur #!G,RE -+!LL!AM K E!TH K ELLOGG............................................................................................4 #!G,RE 1-J OHN HARVEY K ELLOGG.............................................................................................4 #!G,RE 3-%NA' RAKLE / 'O'..............................................................................................) #!G,RE 4-K ELLOGG5% %'E!AL K.............................................................................................2 #!G,RE &-%'E!AL K BL!%%.....................................................................................................2 #!G,RE (-N,TR!-G RA!N.........................................................................................................3 #!G,RE )-%'E!AL K LOGO.................................................................................................... #!G,RE *-"RO' A JEAN %!6E.................................................................................................. #!G,RE -R,NHY N,T.......................................................................................................1 #!G,RE 2-K ELLOGG5% LOGO.................................................................................................1&
Y TABLE -THE %EGMENTAT!ON 'ROE%%.......................................................................................( TABLE 1-N,TR!-GRA!N %ALE% #!G,RE%.....................................................................................3
"!age
Katherine Mulhall
BBS2
20041462
Company History/Bacground Kellogg#s began on $ebruary 1%th 1%06& 'illiam Keith Kellogg was born (pril )th* 1+60* in Battle ,ree-* Michigan and he died in .ctober 6th* 1%/1&'illiam Kellogg was the person responsible for it all and was the person who signed the papers that officially incorporated the Battle ,ree- Toasted ,orn $la-es ,ompany which is now commonly -nown as Kellogg#s& 'ill Kellogg started his business entures by selling brooms* before helping his brother* ohn arey Kellogg* run the Battle ,ree- Sanitarium& 3ow he is responsible for the '&K Kellogg ,o& (lthough 'illiam Keith Kellogg is the official founder of the cereal* it was his brother ohn who had first attempted to deelop the first brea-fast cereal& ohn Kellogg failed to inent the cereal as the taste was not appealing and then that is when 'illiam stepped in and too- oer and with the addition of a simple ingredient* sugar* it became a huge success& The popularity of his new ,orn $la-es# cereal was discoered by accident in 1+)6* which Figure 1!"illiam #eit$ #ellogg encouraged 'illiam Kellogg to set up the Kellogg company* now the most successful cereal manufacturer in the world# 5Kelloggs 7&
John Harvey Kellogg-Brother ohn arey Kellogg 5$ebruary 26* 1+/2 8 9ecember 14* 1%4"7& Kellogg was a dynamo of human energy* a personification of the wor- ethic* who needed only 4 to / hours of sleep a night* went cycling or :ogging eery morning* dictated 2/ to /0 letters a day* adopted and reared 42 children* wrote nearly /0 boo-s* edited a ma:or maga;ine* performed more than 22*000 operations* gae irtually all of his money to charitable organi;ations* loed human serice* generally accomplished the wor- of ten actie people* and lied in good health to age %1&# 5ohn * 1%%%7& 'hilst 9r& ohn arey Kellogg wor-ed at the hospital and health spa in Michigan* his brother 'illiam wor-ed alongside him as the business manager& The hospital stressed healthy liing and -ept its patients on a diet that eliminated caffeine* meat* alcohol* and tobacco&
Figure 2!%o$n Har&ey #ellogg
4!age
Katherine Mulhall
BBS2
20041462
The Accidental Creation of Kellogg’s Cornflakes The two brothers inented many foods that were made from grains* including a coffee substitute and a type of granola* which they forced through rollers and rolled into long sheets of dough& .ne day* after coo-ing some wheat* the men were called away& 'hen they eentually returned* the wheat had become stale& They decided to force the tempered grain through the rollers regardless of its condition& Surprisingly* the grain did not come out in long sheets of dough as it preiously had done& tension inoles the deelopment of indiidual offerings that appeal to different mar-et segments* but that remain closely related to the e>isting product line&# 5Boone E Kurt;* 1%%/7 Kelloggs already -new that women who are -een to watch their weight and shape see- a range of solutions throughout the day 8 not :ust at brea-fast& Figure !(pecial # Bliss They e>amined the accomplishment of Special K cereal and e>panded its product line by producing similar low fat* healthy snac- bars and nibbles for women to en:oy on the go& Kellogg#s was aware that people would not eat a bowl of cereal at their des- during the day so this new product was perfect for them mid8day snac-s& They brought out a wide range of Special K Snac-s such as Special K Bar 5original* apple E pear* chocolate* bliss7* Special K Mini Brea-s&
10 ! a g e
Katherine Mulhall
BBS2
20041462
!rod$ct &ife Cycle !roducts are li-e people* they go through stages of life& ( person#s life cycle progresses progress from infancy to childhood to adulthood to retirement to death whereas successful products progress through four basic stages@ introduction* growth* maturity and decline* this is -nown as a product life cycle&
3ntroductory (tage The firm#s ob:ectie in the early stages of the product life cycle is to stimulate demand for the new mar-et entry&# 5Boone E Kurt;* 1%%/7 $inancial losses are common in the introductory stage due to high e>pensie to deelop the product and heay promotion costs and e>tensie research e>penditure& (dertising is an e>tremely e>pensie component of mar-eting a new product as you hae to let your potential customers aware of this new product on the mar-et& ( negatie profit is usually the outcome as sales are low and e>pensie is high& pensie and roc-y stage there are ways to assist your product through the unpleasant stageH element that generates income& The other ariables include ma-ing the product* telling consumers about it* and ma-ing it aailable to them* all these other elements generate costs&
Internal ' ()ternal *actors !ricing decisions affect profit* olume* share of the mar-et and social stance& ternal factors& .scar 'ilde once wrote that a cynic is a man who -nows the price of eerything and the alue of nothing&# But the concepts of price and alue are hard to separate&# 5ill E .Sullian* 1%%%7
3nternal Factors ffecting *ricing 5ecisions (ccording to Kotler internal factors affecting pricing include the company#s mar-eting ob:ecties* mar-eting8mi> strategy* costs and organisation&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017 Mareting +ectie# Before setting a price* the company must decide on its strategy for the product& 'hether or not the organisation has set its target mar-et and positioning carefully will determine if its mar-eting mi> strategy* including price* will be straightforward or not& $or e>ample Kellogg#s Special K targeted towards women and carefully positioned themseles in the healthy foods section* this allowed them to price Special K a little higher than their e>isting products such as Rice Krispies or Cornflakes. ,ompany ob:ecties are general aspirations toward which all actiities in the firm* not only pricing* are directed# 53agle E olden* 1%%/7 To be effectie and efficient* the company#s pricing decisions must fit into the mar-eting strategy* and be in line with decisions on other mar-eting8mi> elements& Ceflections on appropriate prices should occur at the time the product* communication* and distribution are conceied* because the different instruments of the mi> hae a synergic# influence on the mar-et&# 5Blois* 20007 The company may see- additional ob:ecties* the clearer a firm is about its ob:ecties* the easier it is to set prices& A>amples of common ob:ecties are survival, current profit a!iisation, arket-s"are a!iisation and pro#uct-$uality lea#ers"ip.# 5Kotler* (rmstrong* Saunders* E 'ong* 20017 17 Surial8 ,ompanies set surial as their fundamental ob:ectie if they are troubled by too much capacity* heay competition or changing consumer wants&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017& Kellogg#s deals with surial by producing 14 ! a g e
Katherine Mulhall
BBS2
20041462
new product mi>es to meet consumers eer8changing wants such as %ll-&ran. !eople became aware of their health and how much fibre they consumed and this is why Kellogg#s launched %ll-&ran to meet their consumer wants and needs& ed costs* they can stay in business& isting competitors& 27 ,urrent profit ma>imisation8 Many companies use current profit ma>imisation as their pricing goal& They estimate what demand and costs will be at different prices and choose the price that will produce the ma>imum current profit* cash flow or return on inestment&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017& Kellogg#s Cornflakes is so well -nown that they do not hae to promote it which means costs are low& (lso it has such a high demand because of its familiarity that Kellogg#s can -eep the price of Cornflakes relatiely low and still generate profit off the freFuent sales& "7 Mar-et8share leadership8 .ther companies want to obtain mar-et8share leadership& They beliee that the company with the largest mar-et share will en:oy the lowest costs and highest long8run profit&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017& Kellogg#s posses most of the mar-et8share as they are the ones that inented cereal so yes their costs are low and profit is high& 47 !roduct8Fuality leadership8 ( company might decide that it wants to achiee product8Fuality leadership& This normally calls for charging a high price to coer such Fuality and the high cost of CE9&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017
3o#t# ,osts can determine the price that a company can charge for its product& ( company will want to charge a price that will coer its costs for producing* distributing* and selling the product but also that will retriee a fair rate of return for the effort that was put into producing it& (ccording to (rmstrong many companies wor- to become the Llow8cost producers in their industries& ,ompanies with lower costs can set lower prices that result in greater sales and profits&# 5(rmstrong E Kotler* 20007& (s < hae mentioned& Kellogg#s Cornflakes is -nown as their Lcash8cow as it e>tremely well recognised so Kellogg#s does not hae to pump much inestment into the product so costs are low& 'ith haing low costs means that Kellogg#s can set low prices but still generate a substantial amount of profit&
1/ ! a g e
Katherine Mulhall
BBS2
20041462
78ternal Factors ffecting *ricing 5ecisions (s well as factors internal to the firm* there are factors that are e>ternal to the firm that must be ta-en into account when prices are set& A>ternal factors that affect pricing decisions include the nature of the mar-et and demand* competition* and other enironmental elements&# 5(rmstrong E Kotler* 20007 4he Maret and e5and 'hereas costs set the lower limit of prices* the mar-et and demand set the upper limit& Both consumer and industrial buyer balance the price of a product or serice against the benefits of owning it& Thus* before setting prices* the mar-eter must understand the relationship between price and demand for its product&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017& The seller#s pricing freedom aries with different types of mar-et& Aconomists recognise four different types of mar-et* each presenting a different pricing challengeH pure competition* monopolistic competition* oligopolistic competition* and pure monopoly& < beliee that Kellogg#s falls under oligopolistic competition which defines as a mar-et in which there a few sellers that are highly sensitie to each other#s pricing and mar-eting strategies&# 5Kotler* (rmstrong* Saunders* E 'ong* 20017& & The adertisement shows that he could not wait to eat the delicious cereal and they use the slogan Lobiously another Kellogg#s ,runchy 3ut* this indicates that this man is not alone when it comes to be addicted to the cereal&
3o5petitie $derti#ing $irms use competitie adertising when a product enters the growth stage of the product life cycle and other companies begin to enter the mar-etplace& ogo
2/ ! a g e
View more...
Comments
