nutrigrain product report

Product Report on Nutri-GrainIndividual Assignment 325-640 Marketing Management Mohamad Zaky Ihsan Fadhil (217700) ......... ....... .............................................. 18 Conclusion ........... ........ Product .. 9 Target Marketing ............................................................................................ ....... ............... 14 Media .......................................................................................... Place .... ... ...................................................... ............ 7 Customer value creation......... ...................................................................................................................... ............................. ....................... ................. ................................................................................... .................................. ........ ..................................... 13 1..................................................... .................. .. 17 Opportunities.......................... ................................................................... 3 Competitor Analysis ..................................................... ............ .................................... .............................. .................... ........ . ................................................... ............................................................................ ............................... ............... 14 Content ..... 14 Response Sought .............................. ............................................................................. ............. 8 Marketing:..... .. 8 Quality:. ............. 18 Threats .............................. .. ............... ............. ... .......................................................................................................... ....... ........ 15 4................ .. ............... ................. .............. ..... 17 Weakness ........................................................ .................................................... ........................................................... .......... ......... .......... ....... .............................. ...................................................................................................... .. ................. .............. ............... ........................................................ .......................... 9 Segmentation .....................Table of Contents Introduction of the product ... .................................... ............ . ................. ........ . . .. . .......................................... . ............... 14 3.................................... ........................................................................................................ ....... ..... 3 Company Analysis......................................... 13 Target Audience ............................................................................................ ........................................ Promotion ................................................. ...... 14 Message.... 17 Strengths ............ .................. .. .................................................................. ........................................ .... ........... ............................................................. 9 Post purchase ..................................................................................................................... Price ..................................... . .... 18 Reference List................................................................ .. 16 SWOT ANALYSIS ....... .......... ...................... ........... ............................................... 10 Market Targeting .. 4 Customer Analysis ........................................... .............................. ..... .................................. 9 Promotion ................................................................... ........ ............................................ ................................. ... ................................... ................................. ........................................................................................... ...... ............ 11 Market Positioning......... ............................................................................. ...... 19 2 ...... ............ ........................ .............. .................................................. ............. .................... ................. 12 Marketing Mix ....................... ................................ .... .................................................................. 13 2................................................................................................................................ since its inception in1894 (Kelloggs. Cereals are manufactured in Botany. 3 . Froot Loops. 2009). 2010). NSW and snack products in Charmhaven. calcium & B-group vitamins (Nutri-grain. Kellogg s is considered to be a reputable brand mainly because it has been long established in the cereal and snack food market. Coco Pops. Nutri-grain was marketed to portray the symbol of iron man . etc. It is targeted at growing boys and young men who need protein. Special K. 2009). Company Analysis The manufacturer of the cereal is Kellogg s Australia Holding Pty Ltd. 2010). It claims that it is one of the highest protein level breakfast cereals on the market and also a good source of iron. the Australian subsidiary of the Kellogg Company from the United States.Introduction of the product Nutri-grain is one of the leading breakfast cereals from the Kellogg s Australia. Today it is the largest ready-to-eat cereal manufacturer in the world operating in 19 countries and marketed to over 180 countries (IBISWorld. with the iron man being someone who is strong. All Bran. NSW (IBISWorld. iron and calcium for growth and muscle development. The company s portfolio brands include Frosted Flakes. athletic and at the prime of their physical being. Kellogg s opened its operations in Australia in 1924. 5%) Graph 1 Both Australia and New Zealand have one of the highest consu ptions of readyto-eat cereals per capita in the world. Uncle Toby s Plus range. These brands are considered to be direct competitors because they also attempt to fulfill the needs and wants of Nutri-grain s target market. ¤£ ¢ ¡   4 .Major Players (CerealFood & Baking Mix Manufacturing) K Aust Ltd (17. Australian Health & Nutrition Association Limited (Sanitarium) and Nestle (Uncle Toby s). Sanitarium s Weet-Bix and Nestle s Milo Energy cereal. Table 1 in the next page attempts to compare Nutri-grain against its direct competitors. compared to its major competitors.5% share of the cereal & baking mix industry.2%) Nestle Australia (5.2% respectfully. only the Repu lic of Ireland and the UK have higher consu ption levels (Falci 2006). Graph 1 above shows in Australia Kellogg s holds a 17. which holds a market share of 7.2%) Other (62. Co p tito An l sis Cereal brands from Kellogg s competitors (Uncle Toby s and Sanitarium) that are in direct competition to Nutri-grain cereal include.6%) Australian Health & Nutrition Association Li ited (7. The target market is athletic boys and young men who require breakfast food that will support them throughout their daily sport activities.2% and 5.5%) i Holdi s Pt General Mill Holding (Australia) Pt Ltd (7. includes wholegrain. Milo Duo Lower Shelf 350 gr Always available always deliver that great taste of Milo and b/c it s made w/ wholegrain & fibre it delivers great nutrition too . oat & wheat. Lower Mid-Shelf 750 gr Always available Australia s favourite cereal for over 40 years . rich source of fibre .rich source of iron essential for carrying oxygen to energise active bodies .high level of protein.very low in salt & sugar Promotion . Oats & Barley.celebrity endorser s include Adam Gilchrist. . 10 vitamins & minerals (E. iron & Bgroup vitamins . Weet-bix from Sanitarium prides itself in being Australia s favourite cereal for over 40 years and calls itself the breakfast of champions (Weet-bix.official sponsors of the Socceroos Uncle Toby s Plus cereal brand emphasizes on the cereal s various natural ingredients.19 Multi-grain.swim survive stay alive campaign . oats. iron.uses iron-man symbol -brown (iron) packaging color . zinc & calcium) . Michael Clark Attributes .Iron-man series -official sponsor of NRL Uncle Toby s Lift $4.. Bgroup vitamins. nuts and nutritious wholegrains. Protein Lift Mid-Shelf 460 gr Always available has real plump fruit.98 Nutri-grain Mid-Shelf 345 gr Always available iron man food. the breakfast of champions Milo Energy Cereal $4.Milo in 2 Cricket . C. which includes dried fruits such as berries. Meanwhile.98 Milo Energy Cereal. for growing boys who need protein. 5 . This is shown by displaying a clear and appealing picture of the cereal in a bowl on its package.Put a REAL Plus in your morning competitors Sanitarium s WeetBix $4. apples and apricots.Table 1 Components Price (Au$) Variety Place Weight (grams) Stock (availability) Value Proposition Nutri-Grain $4.Milo Summer of Cricket . etc.Weet-bix kids try-athlon . Kids. iron & calcium from corn. nuts and grains.celebrity endorsers include Grant Hackett & Emily Seebohm .99 Sports Lift. iron and calcium for growth and muscle development .High level of protein.97% wheat. It also offers Milo Duo cereal. other products that can also provide this include breakfast bars. Milo on the other hand promotes the message of tasting great as well as being nutritional. similarly Weet-bix sponsors the Weet-Bix kids Try-athlon for kids aged 7-12. traditional breakfast such as sausage. Kellogg s as well as its competitors offers these substitutes in the market. Indirect competition comes in the form of substitutions. as well as hot cereals (porridge/oats meals) and breakfast drinks. Weet-bix also highlights the fact that its main ingredient is wholegrain wheat (97%). Nutri-grain has its Iron-man series. meanwhile Up & Go from Sanitarium provides breakfast drinks.3% respectively (Weet-bix. It is the official breakfast cereal for the Australian soccer team (Socceroos). naturally high in fibre and contains very low level in salt and sugar. thus companies has responded by producing breakfast bars and breakfast drinks which can be consumed on the go (GoGrains. For example Kellogg s and Nestle offer breakfast bars under the same brand as its cereal products (Nutri-grain bars & Milo Energy Snack bars) whereas Uncle Toby s has its Ot s and Muesli Bars. which adds an extra source of calcium to the cereal. 2010). 0. Uncle Toby s and Milo have also used celebrity athlete endorsers to promote their products which include members of the Australian Olympic swimming team and the National Cricket team. Additional promotion effort done by each company is organizing annual sporting events targeted to its segment market. Thus these products do not directly take away the company s perspective market share. some people can t find time to eat a bowl of breakfast cereal. Milo.29% & 3. 2001). its latest TV commercial features Tim Cahill. which is popularly known by kids as a delicious energy milk drink. with today's busy lifestyle.2010). bacon and eggs. an exception would be traditional breakfast meals and hot cereals 6 . It relies on the great taste of its original product. In this case Nutri-grain provides a great energy meal to start the day. fittest and strongest. identifying their characteristics. Growing boys who consume Nutri-grain normally get it from their mothers. Girls and young women can also be consumers of the product (the iron-man series is also opened to young women) but at the moment Nutri-grain s main focus target market is still for boys/young men. especially about food or grocery items. each would have some input. one for the mothers and the other for young men. the decider and buyer of the product are still the mothers and kids being only the user.Customer Analysis Customer analysis involves the process of distinguishing current and potential consumers. 2009). the young man. Thus. energetic. This translates as motivation to consumers when they decide to be active in sports or is seeking to have an edge over their peers in competitions. 7 . The personality of the Nutri-grain brand is that of growing boys and young males who are strong. determined and competitive. defining the consumers buying roles and evaluating the buying decision process. It is important to differentiate the buying roles for growing boys and young men.. However. Consumer markets are all the individuals and households who buy or acquire goods and services for personal consumption (Kotler et al. For Nutrigrain the end-consumers mostly consist of growing boys aged between 12 and 16 as well as young man aged between 18 and 24. In the first case the initiator and influencer can be both the mother and her son. the fastest. 2009). Children can have a great influence over purchase decisions of their parents. When consumers purchase Nutrigrain they see themselves as somebody who is thriving to be the best they can be. whereas young men usually purchase the product themselves.. they are often influenced by TV commercials as well as what their friends (Kotler et al. and the initiator and influencer are normally their peers or girlfriend. when promoting itself to the market Nutri-grain creates two different marketing efforts. In the second case the decider and buyer is the same person. ¨¦§ © ¦ ¨ § ¦¥ v lu tion   8 . Kellogg s operational facilities must deliver consistent and safe food to meet the consumer s high standards (Kelloggs. Diagram 1 Custo Kellogg s must ensure that customer s expectations and needs are consistently met as to create the most perceived value for the customer. Variety-seeking behaviour is where there is low involvement and significant perceived differences between the brands when purchasing the product (Kotler et al.Cereals can be considered to be a product that invokes a variety-seeking behaviour in consumers buying decision. Qu lit : Monitoring and improving food quality to verify that all incoming raw materials conform to Kellogg s strict standards Ensuring that the packaging maintains the food nutrient level. 2009). Perceived differences between the products arise because of promotion efforts by the brand as well as influence from peer groups. The buying decision process is a five-stage model in which the consumer goes through when purchasing a product. 2010) Ensuring availability of products at the supermarkets.. Diagram 1 below shows an example of a consumer decision process for purchasing Nutri-grain. flavour and freshness from the manufacturing plant to the consumers. This is done in a number of ways. Post purchase Offering quick and accurate responses to consumer enquiries through the consumer hotline. food preferences and eating patterns. Companies have realized that they cannot develop only one type of product that satisfies the consumers needs and wants. consumer research and market tracking research (Kelloggs. Kellogg¶s uses three types of research in support of its marketing activity. 2009). therefore now they attempt to develop a product and marketing mix that is tailored to its selected segment (Kotler et al. 9 . Athlete endorsements and sponsorships to ensure customers that the product is reliable and credible.Marketing: Use marketing research to monitor environment of consumer food choices including nutrition needs.. - Test consumer reactions before new products are introduced to the market and evaluate consumer response to Kellogg¶s advertisements. which involves market segmentation. product research. 2010) - Promotion Marketing department must ensure that all promotional activities are consistent with Nutri-grain s brand positioning. Ensuring the quality of promotional items and activities used to promote Kellogg s Nutri-Grain s products. Target Marketing Target marketing is a three-step approach used by companies to deliver its product to a targeted market segment. market targeting and market positioning. the Healthies are looking for cereals that 10  "!    r J i          &# % #$ #  . the cereal market is segmented into 4 segment markets. Frosted Flakes Fulfilling daily nutritional requirements High Low (breakfast only) Medium to High Low Breakfast Lose and maintain weight. The Sweet-tooths are seeking for cereals that are good tasting (typically sweet) and are fairly loyal to their cereal brands. resulting from being categorized by three variables. The demographic of this segment consist of kids under the age of 12. behaviour. the Body-Watchers and the Energy-Junkies. WeetBix. Uncle Toby s Plus. thus they are likely to have whatever is given to them by their mothers. they can carry some role in the buying decision. Weet-Bix multigrain. the Healthies. Each of the segments has a unique characteristic. demographic and psychographic. the Sweet-Tooths. however as stated earlier. Coco Pops. Sanitarium s Light n Tasty Medium Growing Kids/young adults 12-25 Active/sporty Energetic/outgoing medium Nutri-grain.Segmentation Tabl 2 Behaviour : B Sw - H al hi h B watch r E it sought Knowl ge of product Usage rate Loyalty status Price sensitivity Occasion consumption Demographic : Income Life-cycle stage Age Psychographic : Lifestyle Values Involvement Sweet and delicious breakfast meal Medium to High Low to Medium (breakfast & snacks) Medium Low Breakfast & snacks Low to medium Children 5-12 Care-free Fun/outgoing Low Froot-loops. Alternatively. Uncle toby s Healthwise Medium to high Urban Woman 25-late 30s Urban /modern Modern/confident High Kellogg s Special K. Milo Energy Cereal Brand As seen from Table 2. and feeling good High Medium (breakfast & snacks) Low to Medium Low to medium Breakfast & snacks Energy for daily activities and sports Medium to High Low (breakfast only) Low to Medium Low to medium Breakfast Medium to High Adults/mature 30s to 40s Settled/healthy Healthconscious High The Guardian. very involved in sports/exercising and need a good source of energy to start the day. here is where the Nutri-grain brand is placed under.provide the most nutritional ingredients. It is important for the companies. 11 .. The third segment are the Body-watchers. The final segment is called the Energy Junkies. one that will fulfill their daily nutritional requirements and help with their overall well-being. when promoting their cereal brand to incorporate the image of the strong and confident women in their ads. wholegrains and oats. Kellogg s have their Special K 2 Week Challenge. Companies who have products in this market segment generally do heavy promotion of their brands. Thus when browsing the aisle in the supermarket they look for cereals that contain high levels of fibre from wheat. where they offer to assist women lose one jean size with a two-week eating and exercise plan (SpecialK. They have celebrity athletes endorsing their product. confident and imageconscious. Nutri-grain in particular is categorized under the energy cereal segment. Many of their products can be found in the various segments of the cereal market. This segment is targeted to people who have an active lifestyle. Market Targeting After segmenting the market the company must evaluate each segment and select the one they want to target (Kotler et al. Kellogg s as a company incorporate many segment market for each of their brands. 2010). and contribute to local communities through sporting events as well as sponsoring national sport teams. 2009). the market mainly consists of young women aged between 25 and late 30s who are modern. 2009). Research show that it is one of the top brands in the Australia associated with being a sports sponsor. 12 . Nutri-grain compared to its competitors taste better than Weet-Bix or Uncle Toby s but is considered to be less nutritional. Nutri-Grain s also has a long term-association with life surfing.Market Positioning Diagram 2 Diagram 2 above shows the position of Nutri-grain against its competitors in the energy cereal market segment. 2009) as well as sponsoring the Iron Man Series. taste and nutritional benefits. second only to Billabong ( Marketingmag. However its competitive advantage in the market is derived from its strong position in the consumers mind as a cereal most associated with sporting activities/exercise. which targets young men between the ages of 24 and 35 on how to survive in a rip (SLSA. It is done by putting the brands under the two most important criteria of differentiation for segmentation of the cereal market. Though it is often marketed as a cereal for a great source of energy. it derives most of it from its considerable high level of sugars. Winners of the Iron Man competition (picture on packaging). and the Kelloggs. All the mediums have to represent the nutri-grain brand and positioning in a consistent manner.Marketing Mix The marketing mix must be intergrated to the brand positioning of the product. They are bought by consumers with minimal effort and are further classified into staples because consumers buy breakfast cereal on a regular basis. iron and carbohydrates Features: . 13 .Iron Man symbol . . Product Nutri-grain cereal is a convenience product. 1. The color of the package (iron color-very masculine). calcium.The Kellogg s logo. Product levels: Core product The core product is a breakfast meal needed by consumers to start the day Actual product The actual product is cereal with added protein. price. iron and carbohydrates. B-group vitamins.Nutritional information. Nutri-grain and Iron Man logo will trigger recognition of the brand name. which can trigger brand awareness amongst consumes. Promotion Nutri-grain adopts integrated marketing communications. promotion and place (distribution). The packaging plays an important role in the purchase decision. . such as the average daily intake of calcium. they include product. The paragraph below discusses the marketing mix Nutri-grain cereal. 2. 14 . Content The message shows how Nutri-grain is superior to its competitors.Billboards placed in public spaces such as tram and bus stops as well as inside the trams and buses. placed during specific television programs (sport games).Television commercials . because they buy their own groceries when they have moved out of home. It communicates that Nutri-Grain has all the things he needs to do those sport activities. reinforce Nutri-grain s brand image.Nutri-Grain appears in 15 and 30 seconds ads. encourage brand trial and also encourage brand switching. In the advertisement that is specifically targeted to mothers. Media . Iron Man food and Nutrigrain has what it takes to built you into an Iron Man . and up to when he is a teenager and wins a triathlon The second advertisement shows a young man eating his cereal. Response Sought The purpose of the message is to create widespread consumer awareness. which is Nutri grain. The second target audience is young male adults. Message The focus of the message is around the brand positioning. because generally mothers do the grocery shopping. . the advertisement shows a flashback of the son training from when he was a toddler. while he thinks about himself doing active sports such as running.Target Audience The first target audiences are mothers. rowing and cycling. by communicating that Nutri-grain is one of the highest protein cereals. The program also includes a media partnership with the Nine Network. 15 .Sporting Events . In general. The wholesaler and retailer will then mark up the price for consumers. grassroots program to support junior rugby development Media Advertising (BANDT.. Price Nutri-Grain implements a mark up and target return pricing. Kelloggs would charge wholesalers and retailers a certain price to make profit per unit. 2009) 3. companies earn large profit margins. . rather it is channeled into advertising and new product introduction (Nevo. cereals is a fast moving item so the mark up is low to medium. Then the Marketing Department at Kellogg s must convince consumer through marketing activities (advertisements.Sponsorship .98 for 345grams to consumers. Nutri-Grain is charged at $4. which is the where forty of the world s fittest athletes compete in five rounds in the course of three days (Nutri-grain website).Nutri-grain has an alliance with the National Rugby League. This price fits the value of how the Energy cereal segment places on the product. sponsorships) that Nutri-Grain s value at that price justifies its purchase. Price wars do not exist between the major players (cooperation). Because of the oligopolistic nature of the cereal industry.the Iron Man Series. 2001). Retailer s orders are then received from all states. It is considered to be a convenience good that is widely distributed in order to make it widely available to consumers. Kellogg s has a partnership with retailers such as Coles and Safeway because they fit in with Kellogg s Nutri-Grain s target market of mothers and young adults. IGA etc.Manufacturing plant in Botany. The product itself is always placed closed to other Kellogg s brands in the store shelves and at eye-level thus very visible to the consumers 0)( ' Central Warehouse (located in each State) Retailers (Coles. The orders are then checked to make sure that products requested are available and credit conditions are met before sending it off to the retailers. IGA. Packaged goods are then moved from the Botany Manufacturing Plant to the central warehouse to be stored. l 16 . The Botany Warehouse then supplies local and export customers in all states other than Western Australia. Safeway. Woolworths.) Consu ers 4. Nutri-Grain is sold in supermarkets such as Coles. Nutri-grain cereal is made in the central warehouse located at Botany in NSW. and one of the few cereal brands that is available in convenient stores such as 7-Eleven. NSW Diagram 3 The level of distribution for Kellogg s Nutri-Grain is intensive (Channel 3) with two intermediaries. To maintain this brand association. In order for the brand to be more successful. it needs to continue to build effective marketing campaigns and sponsorship that is highly to the Iron Man C ode and its consumers. as the Iron Man has become one of the most important key features in its promotions. It should lower its sodium and sugar content because there are other cereals such as Weetbix that are healthier and could pose a threat to Nutri-grain. 17 .SWOT ANALYSIS Diagram 4 Strengths Nutri-grain successfully implements the marketing mix according to the brand positioning and segmentation. it should keep sponsoring the Iron Man Series. Nutri-Grain s long term sponsorship with the Iron Man Series and surf Life Saving has made it the number one brand that Australians associate with sport. Weakness Nutri-grain has high contents of sugar and sodium. It could extend its brand to a breakfast drink. Cheaper brand cereals such as Home-brand cereals offered in Coles and Woolworths can also reduce Nutrigrain s market share. However it should always be aware of the marketing effort of its direct competitors and should consider extending its brand to other forms of breakfast meals. Conclusion Cereals rely heavily on advertising and promotion as to create a unique market position in the consumers mind and to show differentiation among its competitors. 18 . Thus as long as Nutri-grain maintains a relevant and strong brand promotion through those marketing efforts it should still retain its current market position. There are also opportunities for Nutri-grain to extend its brand. because more and consumers are becoming time poor. Threats Cereal substitutes such as breakfast bars and drinks impose a threat to Nutrigrain cereal because of their instant-food nature.Opportunities Nutri-grain can increase its marketing effort to appeal to young women by offering a product range or sponsorship specifically made the active/sporty young woman. d) Retrieved February 1.nutri-grain.d) Retrieved January 30. 2010. Retrieved January 28. P.marketingmag. Nevo.com. Econometrica. . <http://www. 2010. Jun e 30). (2009. <http://hypertextbook. (n.specialk. Mass of US Breakfast Cereal Consumption. <http://www. S. 307-342 Nutri-Grain. 2010..au> Reed.au> Weetbix (n.com. (2009) Marketing Management. 2 . Strategic Marketing Planning (2nd edition). Special K.au> Uncle Toby's (n. Burton.au> 19 . K.au> Nutri-Grain. 2010 from <http://www. No.shtml >. IBIS World (2009) Cereal Food and Baking Mix Manufacturing in Australia Kelloggs (n. 2010. <http://www. 69. Vol. <http://www.com. Emirates lead sports sponsor list. (2007). 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