Special K and Kashi look to get back on their game

by Eric Schroeder
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As part of efforts to revitalize the Special K brand, Kellogg is adding a gluten-free variety and upgrading its packaging.

 

BOSTON — Special K and Kashi — two brands that have been growth engines for The Kellogg Co. for the past 15 years — will be vital to the Battle Creek, Mich.-based company’s efforts to bring consumers back to cereal, said Paul Norman, chief growth officer and interim head of Kellogg’s Morning Foods business in the United States. Recently, the brands have not lived up to their lofty standards.

“In the last 52 weeks, the pair of them (Special K and Kashi) are responsible for more than 50% of our consumption declines as a company in the (cereal) category,” Mr. Norman said during a Sept. 4 presentation at the Barclays Back-To-School Consumer Conference in Boston. “It goes to point out that when you come off a trend of health and wellness, you slip to the side, it can be quite painful. There’s nothing to say here that I don’t believe we can’t get these brands back on trend fairly quickly.”

Mr. Norman offered several examples of how he expects Kellogg to get the brands back on track.

Freshening an ‘old brand’

On Special K, which Mr. Norman described as “an old brand,” Kellogg plans to move and adapt, a strategy that has served the brand well in the past. In 2015, Kellogg plans to reinvent just about every aspect of Special K’s proposition to the consumer, starting with positioning.

“The positioning that’s recently been more around losing weight, and based around programs and challenges, will move to a focus on nutrient density, and the food,” he said. “That will obviously come through communication. It will touch on renovation and innovation, and also come through in our packaging as we move the brand to more of a positioning around, as I said, nutrient density and a focus on our food, and less on a focus on challenges and ways to lose weight.”

Mr. Norman said Kellogg plans to bring more protein to Special K in the first quarter of 2015 and intends to launch the first ever gluten-free Special K food. The company also plans to participate in the “hot” segments, including hot granola.

Special K also will receive a complete refresh of its packaging with better differentiation between varieties, he said.

For the Kashi brand, Kellogg is working to make the entire Go Lean franchise non-G.M.O. certified and is adding new varieties with "progressive nutrition."

Kashi back to progressive nutrition

Last month, Kellogg announced that David Denholm, who ran Kashi in the 2000s, would return to become chief executive officer of the business. Kellogg also announced that the Kashi business will move back to La Jolla, Calif. In March 2013 Kellogg announced it was moving the Kashi business to Battle Creek and that the move would best position the business unit for growth.

During the Barclays Back-To-School Consumer Conference call, Mr. Norman said the whole point of refocusing Kashi is to “get on the front foot and get forward back into progressive nutrition.”

To that end, Kellogg is working to make the entire Go Lean cereal franchise non-G.M.O. certified by the first quarter of next year. With that initiative in place, Mr. Norman said the company will be able to lean more forward into driving after the core consumers, the core customer and their needs, and the advocates in pioneering and progressive nutrition.

“We have two variants rolling out under the Kashi cereal range at the end of this year and the beginning of next year,” Mr. Norman said. “One is the Raisin and Chia Granola, and the second is a brand new feature under Organic Promise with sprouted grains coming to certain markets at the beginning of the year. So we get the house in order, and we lean into progressive nutrition under an operating model that is far more autonomous, with more speed, more nimbleness, and focus more on those advocate consumers and customers, which is really where the brand came from, but we believe this operating model will get us back onto growth in the not-too-distant future.”
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