WK Kellogg focuses on health to bolster cereal sales

USA – WK Kellogg Co. has announced that it will be focusing on health and wellness as a key strategy to boost sales of ready-to-eat cereal through its new SPOONS platform.

WK Kellogg aims to enhance its cereal portfolio to appeal to health-conscious consumers, using the SPOONS framework as the basis for its messaging. The initial focus of the SPOONS strategy will be to promote simplicity, protein, and fiber in the market.

In the first quarter, WK Kellogg’s organic net sales decreased by 5.6%, driven by an 8.6% drop in volume, while its in-market U.S. dollar sales fell by 4.5%, causing a 100-basis point reduction in market share.

This decline occurred in the context of a 0.8% dip in dollar sales and a low single-digit volume decrease for the overall U.S. ready-to-eat cereal category.

However, Gary Pilnick, chairman and CEO, pointed out that granola, natural and organic cereals, and health-focused cereal brands experienced double-digit sales growth during the same period.

“We believe that the increased emphasis on health is beneficial for both the category and WK Kellogg. We introduced the SPOONS framework at CAGNY, which highlights essential health attributes for cereal, such as simplicity, protein, and fiber,” said Pilnick.

Kashi, a part of the company’s Natural & Organic (N&O) portfolio, will play a key role in WK Kellogg’s efforts to highlight the protein content in its cereals.

Kashi Go, which makes up nearly half of the Kashi franchise, is being relaunched with new recipes, improved packaging, and larger pack sizes.

Kashi Go now offers consumers 10 grams of protein and 10 grams of fiber, along with single-digit sugar content.

WK Kellogg also aims to leverage this momentum to support its struggling Special K brand.

The company began increasing marketing efforts for Special K last year, but despite having significant health credentials, the brand has continued to lose market share, including a 40-basis point decline in the first quarter, as noted by Pilnick during a May 6 conference call with analysts.

Special K will also be included in the upcoming multi-brand campaign aimed at promoting fiber.

However, WK Kellogg’s health-focused strategy may not guarantee success, cautioned Robert Moskow, an analyst with TD Cowen.

He referenced the inconsistent success of similar brand initiatives in the past and the Make America Healthy Again (MAHA) movement, which has intensified public scrutiny of food ingredients. 

 Sign up to HERE receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.