General Mills to invest in ad spending for cereal, bars

by Jeff Gelski
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General Mills, Inc. is ready to battle for breakfast consumption share.
 

MINNEAPOLIS — General Mills, Inc. is ready to battle for breakfast consumption share. The company plans to invest in advertising for its top cereal and bar brands in fiscal year 2018.

Jonathon J. Nudi, group president of North America Retail for General Mills, acknowledged competition for breakfast consumption when he spoke in a July 12 investors’ day.

Jon Nudi, General Mills
Jonathon J. Nudi, group president of North America Retail

“Consumers eat a wider variety of food at breakfast these days, and this has had an impact on the cereal category retail sales for the past few years, but cereal remains the No. 1 food choice for breakfast in the U.S., and history shows that when we bring consumer-focused innovation and news to the category, supported with solid marketing and merchandising, we see positive results,” he said.

General Mills plans to leverage wellness and taste on its biggest cereal brands in fiscal year 2018, he said. A Big G cereal campaign called “Good Starts with G” will involve television and digital media.

“For the digital component, we’re using precision targeting to tailor messages to individual consumers, with an emphasis on Hispanic families and empty nesters,” Mr. Nudi said.

Cheerios will have its own advertising campaign called “Good Goes Round.”

“We focus on Cheerios’ wholesome ingredients, health benefits and how it makes the whole family feel good,” he said.

General Mills will roll out a limited-edition Banana Nut variety of Cheerios that will feature the taste of banana bread.

Some General Mills’ cereal brands have had success. Cinnamon Toast Crunch registered a compound annual growth rate of 6% in retail sales over the past four years, Mr. Nudi said. Apple cinnamon, blueberry and strawberry varieties will join the Cinnamon Toast Crunch portfolio. Lucky Charms posted 3% retail sales growth in the past fiscal year as General Mills emphasized the marshmallows in the product.

General Mills has planned a double-digit increase in media spending for Nature Valley in fiscal year 2018. A U.S. advertising campaign called “Be a Powerful Force” will showcase the brand.

“It’s all about how Nature Valley harnesses the power of nature and the potential that exists in all of us to be powerful,” Mr. Nudi said.

Fiber One underperformed in the United States in fiscal year 2017.
 

He said Fiber One underperformed in the United States in fiscal year 2017. This year advertising will seek to get Fiber One back in touch with its primary consumers: women.

“We’re emphasizing what the brand is known for: making fiber taste great,” Mr. Nudi said. “We’ll be adding more drizzle to our brownies and more nuts to our protein bars. We’re launching a new permissible treat with protein nut bars. These bars contain 10 grams of protein but only 5 grams of sugar with no artificial colors, flavors or sweeteners, perfect for consumers looking for hard-working calories and great taste.”

In-store displays, sampling, and advertising on television and through social media channels will support Fiber One, a $300 million business in the United States in Nielsen-measured outlets alone, he said.

 

Retail sales of Larabar snacks rose 41% in the United States in fiscal year 2017. New flavors of Larabar Bites and new Nut & Seed bars will launch this fiscal year.

“These crunchy bars contain simple ingredients like chia seeds, almonds and honey, and have 8 grams or less of sugar per bar,” Mr. Nudi said. “We see great opportunity to continue to grow the Larabar brand. We’re targeting a 30% increase in distribution this year.”

General Mills will introduce a macaroni and cheese with bacon variety to the Totino’s hot snacks portfolio. Under the Pillsbury brand, an out-of-the-can rolled pizza dough will launch this summer, and a confetti flavor will be added to the ready-baked cookies portfolio this fall.

The North American Retail segment of General Mills generated net sales of $10.2 billion in the fiscal year 2017, he said. The U.S. Meals and Baking unit, which includes brands such as Old El Paso, Progresso and Betty Crocker, accounted for nearly 40% of segment net sales, Mr. Nudi said. The U.S. Cereal and Snacks units each accounted for a little more than 20%, and the U.S. Yogurt unit and the Canadian business each accounted for about 10%. 
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