Kellogg'S Unveils Biscuits Thrust

Kellogg's India, the wholly-owned subsidiary of the $7-billion Kellogg's, has undertaken a surprising brand extension with the launch of Chocos Breakfast Cereal Biscuit. The 50gm pack, priced at Rs 5, is the company's first foray into the biscuits segment world-wide.

A company spokesperson said the product has been positioned as the country's first fortified breakfast biscuit and added the launch would help strengthen its market leadership position in the breakfast foods business.

Kellogg's, whose performance with its cereal brand was very much below expectations, is now adapting to the realities of the Indian market and attitudes.

The branded cereals market, which lacks competition of any sort, is hogged by Kellogg's which has a market share of over 50 per cent.

 

The company had launched Chocos cereals end 1996 .The launch was followed by the introduction of Frosties.

This was due to the local consumer's indifference to the company's plain breakfast cereal. Apart from being expensive, children, the main target of Kellogg's campaign shunned the product due to its taste.

Market sources said, thelaunch follows the revelation that Chocos cereal, which was supposed to be consumed with cold milk was being eaten straight out of the box by both kids and adults.

The rationale behind Kellogg's entry into the biscuit mart is an attempt to leverage the Chocos brand equity.

According to the spokesperson, the product has been launched here and will be undertaken in a phased manner in other metros.

The biscuit foray, he said, was encouraged by the huge success of Kellogg's Chocos breakfast cereal. According to the company, biscuits were enjoyed in the country as a breakfast food item.

Says Kamini Banga, an independent marketing consultant, "Strategy-wise, Kellogg's has made a smart move. A large part of research in the Indian context has shown that biscuits are viewed as nutrition and energy providers.

Further they are perceived to be much better than unhealthy junk food. Kellogg's is obviously hoping that the biscuits can hitch a ride on the Chocos brand equity."

Market analysts feel Kellogg's is positioning the Chocos biscuit as something both nutritious and one which provides value for money

"Kellogg's was, with the launch of Chocos cereals, moving away form its core plank of health and nutrition. But now it is making a comeback and trying to firmly position it once again on the health plank. The launch of the Chocos cereal, in fact, diluted Kellogg's equity. All along they had never strayed from their health platform. But then bottomline pressures made them go in for the chocolate cereal variant," Banga pointed out.