An Analysis of Kellogg’s Business Strategy: A Case Study in Innovation and Sustainable Growth
Kellogg’s, the cereal giant that has been a household name for generations, has gone through a business transformation in recent times. The company’s aggressive innovation strategy, centered on sustainability and brand expansion, has helped Kellogg’s remain a global leader in the FMCG industry.
The Beginning of Success
Innovation has always been at the core of Kellogg’s business strategy. The company’s founder, Will Keith Kellogg, developed the first cornflakes back in the late 19th century. Since then, Kellogg’s has been dedicating a significant chunk of its revenue to research and development.
Despite its long-standing history in the market, Kellogg’s has not only managed to remain relevant but has also catapulted into the future. In 2017, Kellogg’s launched its “Better Days” initiative and set sustainability targets to reduce its greenhouse gas emissions, energy use, and water usage.
Expanding its Reach
To expand its footprint, Kellogg’s acquired RXBAR, a protein bar manufacturer, and Mother Earth, a New Zealand-based manufacturer of natural and organic snacks. The acquisition of RXBAR aligns with Kellogg’s focus on the health-forward snacking category.
Kellogg’s has also made a significant investment in its plant-based offerings, with its MorningStar Farms brand now featuring many vegan and vegetarian products. It has even expanded its presence overseas by opening its first cereal café in NYC in 2016, aimed at offering customers a unique breakfast experience.
Responding to Consumer Needs and Preferences
Kellogg’s has made various product improvements to cater to an ever-changing and discerning customer base. In the US, the company has reduced the amount of sugar present in its cereals by 20% and introduced organic and gluten-free ranges.
Kellogg’s has also migrated several products to recyclable packaging materials, thereby reducing waste and improving sustainability. Through its partnership with the Ellen MacArthur Foundation’s New Plastics Economy initiative, the company aims to reduce plastic packaging waste drastically.
Conclusion
Kellogg’s business strategy pivots around innovation, sustainability, and continued growth, evident from its recent expansion and performance. It prioritizes product quality and customer needs and proactively responds to the evolving market trends. Through the company’s ingenuity and customer-first approach, Kellogg’s has remained a profitable company for over a century, and its future looks brighter than ever.
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