Bowls of cereal
The cereal category experienced a 1.3% decline in year-over-year dollar sales.

Adding value to cereal

Despite a slight decline in year-over-year dollar sales, the ready-to-eat cereal category remained home to several innovative efforts geared toward waking the category from its several-year-old slumber. In the 52 weeks ended Aug. 7, dollar sales in the category totaled more than $8.7 billion, down 1.3% from the same period a year ago, according to I.R.I.

The challenges were not unexpected. Rob Vitale, president and chief executive officer of Post Holdings, Inc., in early February said he was “cautiously optimistic on the cereal category.” The St. Louis-based maker of Honey Bunches of Oats, Grape Nuts and Fruity Pebbles experienced a slight increase in dollar sales over the past 52 weeks (up 0.07%).


In late August, Post unveiled a new 360-degree marketing campaign for its Honey Bunches of Oats brand, which ranks as the No. 2 brand behind Honey Nut Cheerios. The “THIS. IS. EVERYTHING.” campaign is designed to celebrate the “multiplicity of the product,” according to Post.

Post This. Is. Everything. campaign
Post's “THIS. IS. EVERYTHING.” campaign is designed to celebrate the “multiplicity of the product."

General Mills, the largest R.-T.-E. cereal maker, in early October announced plans to invest $25 million in a project to expand its Chex cereal production in Buffalo, N.Y. The investment, which includes support from the state of New York, will include the purchase of new packaging equipment, upgraded ingredient systems and the added production of Corn Chex and Honey Nut Chex cereal products.

General Mills’ Buffalo location is the company’s oldest cereal plant in the United States, acquired by the company in 1928 following its purchase from Washburn-Crosby Milling Co. The plant currently employs 417 workers and produces Lucky Charms and Cheerios and will soon add Corn Chex and Honey Nut Chex to the plant’s cereal lineup. The plant has milled flour in Buffalo for more than 110 years.

The company also has received positive feedback for its new Trix cereal featuring naturally sourced colors. The ingredient list includes the color sources of vegetable and fruit juice, turmeric extract, and annatto extract. While work still needs to be done to find suitable blue and green options from natural sources, Trix cereal has been a success so far.

Trix  then and now
General Mills has received positive feedback for its new Trix cereal featuring naturally sourced colors.

“We got the taste right, and it’s fun enough for kids, even without the blue and green,” said Erika B. Smith, Ph.D., technology director for General Mills.

At Kellogg Co., there has been a shift in operating focus from volume to value. The company has begun looking toward fewer, bigger launches to create an impact in the marketplace. This strategy has carried over into R.-T.-E. cereal, where Kellogg has reduced sugar and sodium in products while adding positive attributes such as protein and fruit. For example, the company has added more berries to Special K Red Berries cereal and increased the price.