We are always looking to find stronger and differentiated segment: Sumit Mathur, Kellogg’s

In January this year, cereal breakfast manufacturer Kellogg’s repositioned its brand positioning in India with the focus shifting to convenience. Strengthening this positioning, Kellogg’s has launched a new variant under its muesli segment, ‘Kellogg’s Pro Muesli’ - a 100% Plant Protein’ breakfast cereal in the ready-to-eat cereal category. The latest variant is a way to incorporate protein in one’s breakfast and targeted to provide time-pressed consumers with an additional ‘nutritious and tasty’ breakfast option.

Kellogg’s India’s portfolio is broadly categorised under Corn flakes, Chocos, Froot Loops, K Energy Bars, Muesli, Upma, Crunchy Granola and Oats.

Sumit Mathur, Senior Director of Marketing for Kellogg South Asia, says, “We are always looking to find stronger and differentiated segments so that we continue to lead the nutritional agenda in a category that is rapidly growing. Since the pandemic, the need and importance of protein has gone up significantly. The trend is clear and we want to bring in a big differentiation in the category which is niche but growing”

Tapping into a ‘plant-ed’ opportunity

As per reports, it is estimated that the market size of the ready-to-eat breakfast cereal category in India is around Rs 2,000 crore and muesli’s share is estimated to be around 1/3^rd of this. As per the recent Nielsen data of July 2022, Kellogg enjoys a 70% share in the muesli & granola category in India and the category is growing at a strong double digit. When it comes to plant-based protein, as per Plant Based Foods Industry Association, the market for plant protein is expected to grow from a size of $347.1 million in 2018 to $565 million in 2023 in India – providing just the perfect opportunity for companies to tap into this trend.  

Asked about the anticipated growth rate for the entire category, Mathur says, “Quoting Nielsen Consumer data, volume growth in breakfast and healthy snacks – when put together and compared with other food categories – has been consistent over a span of two years (from July-September 2020 to January-March this year). The segment showed 1.8% volume growth in the first three months of this year as compared to the year-ago period. In comparison, the average FMCG food growth was a negative 1.8% in the same period.”

Looking to grow the category, Mathur highlights the need to democratize the segment – in terms of affordability and give functional benefits in a tasty and palatable way so that the product becomes part of the regular food habits of the consumer. “The muesli user is used to multigrain inclusions, fruit, nut seeds etc. What we have done is created a product using the right inclusions which have the right protein such as the five grains, moong dal, cranberries, soy etc. that not only makes it delicious but also solves the need for protein,” Mathur says.

Driving penetration

Kellogg’s Pro Muesli is available at a SKU of 500 grams for Rs 420 and is targeted to the health discerning SEC A to A+ audience, predominantly metro based. Says Mathur, “The focus of the communication will be digtial, e-commerce and in-store.  The biggest part of the communication strategy to drive awareness will be through e-commerce. We also have a very strong influencer campaign as this category, product and benefit lends itself to well to such associations.”

Talking about ensuring penetration by driving availability, affordability and relevance. Mathur says, “At Kellogg’s we have a single task for the entire portfolio - how do you get to more households and gain penetration? ……In India, because of the affordability pyramid, you can play both at the bottom and the top end of the pyramid.  While you look to drive the base and penetration, you will find segments where there are people are discerning and ready to pay a premium.”

He continues, “This is where the muesli and granola segment comes in and the specific differentiation on products.  Looking back, Kellogg’s launched Choco Fills under the Chocos category in a premiumization drive. Similarly, the health and wellness segment saw the introduction of Granola. At the top end of the pyramid, you identify consumer trends early on, so that as the segment grows, you will have a larger part of that. This is where protein comes in. The task for us is to continue to find sharper insights around how we can make our consumers life better with our proposition and food and become more relevant.”

This strategy has worked well for Kellogg’s as the business has doubled in the last four to five years. Mathur states, “Kellogg’s ready-to-eat cereal category has done well and consistently over the past couple of years. The good news is that it continues to stay consistent even after the pandemic, despite the macro-economic challenges that various industries including ours are facing.” He continues, “We nearly doubled our penetration from 8% (MAT June'20) to 14% (MAT June'22). We are happy to report 60%+ increase in number of households (MAT June'22 vs Year Ago), as per Kantar World Panel's household panel data.”

The growth driver for Kellogg’s – at the bottom and top end of the pyramid – include the kids portfolio, the low unit price points packs, granola and froot loops. Looking ahead, Kellogg’s is betting on increased penetration through affordable price-packs and offering differentiated and value added products,