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Information Resources: Management Add in library

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Question:

Provide an overview of how your selected company uses these information resources to build their marketing decision support systems and customer relationship management (CRM) environment.

 

Answer:

Domestic and International presence of Kelloggs’ Company

Kelloggs’ Company is a huge public company selling wide array of cereal, frozen foods, snacks and particularly famous for its product Kellogg’s cornflakes. The company operates in more than 180 countries across the globe. In May 2012, the brand grew larger with their acquisition of principle business from Procter and Gamble. While in September, the Kellogg’s company expand their global footprint by the announcement of their joint venture with Wilmar International Ltd at China (Che, 2014). The acquisition of Kellogg’s with the Russian company United Bakery significantly boosted the company’s presence in Eastern Europe. In addition, Kelloggs has also entered small-acquisition with Shandong Navigable food company Ltd at China to serve its purpose to broaden its consumer base in the emerging market.The key acquisition of kellogg’s in the domestic market in US include IndyBake products LLC, Brownie products company, Cookie Co. & Mothers Cake, Bear Naked Inc takes place over a period of 2006-2010 has significantly increased the company’s presence in the domestic market.

 Company’s vision and execution of strategy

The vision of Kellogg’s company is to delight and enrich the world through its food and development of brand image on this legacy. The company aims to nourish families and children so that they can thrive and lead a healthy life. Kellogg Company significantly focus on developing products that are grain-based and compact of essential nutrients (Gaviria, 2012). The healthy initiatives by Kelloggs’ are an effective strategy that intensify its brand image and encourage customers buy their products.

 The execution of strategy by Kelloggs’ is done through its corporate social responsibility and development of business in a responsible manner that is sensitive to all the needs of its consumers (Bakir, 2014). Moreover, the company implement Blue Ocean strategy and its execution considers the following:

Product innovation to develop and capture new demand and target market

Target distinctive market segment i.e. focus on health conscious consumers

Emphasize on constant increase in market share through acquisition with small and large size companies.

Kellogg’s plan to growth and service to its customers

Kellogg’s record the data of past purchase by their existing customers and contact new customers to gain information about their purchase behaviour and consumer preferences. Based on this information, Kelloggs deliver customized products and services to fit the specific needs of consumers (Navickaite, 2011). For instance, the introduction of Kelloggs’ special K benefits the diet needs of consumers, grain-based cereals and breakfast food for customers who are health concern.

 Kellogg’s mainly implements three strategies for its growth. They are:

Target the existing customers and encourage them to increase their spending and purchase on the brand. By utilizing the information of customer purchase behaviour, Kelloggs’ develop wide arrays of products that would fit the needs of their existing customers which in turn increase their purchase

Target the customers of competitors and persuade them to switch brand. Kellogg’s implement differentiation strategy and cost leadership in order to attain large group of target customers specially the competitor’s customers ( Kelloggs’ cornflakes and other cereals gives competitive advantage to the company which no other industry rivals can imitate. Kellogg’s develop cost leadership by offering unique price rates for its quality products much less than the cost offered by its competitors

Encourage the non-category users to consume the category product and select their brand ( Kellogg’s influence purchase behaviour of non-category consumers to choose their product through healthy initiatives and awareness programs of Kelloggs’ benefits.

Information sources of Kelloggs’ company

With the focus to meet the global needs of customers, Kelloggs’ rely on wide range of its suppliers, contractors, manufacturers, consultants, distributors, partners of joint ventures and agents. Kellogg’s forms collaborative business with the aforementioned stakeholders to gain insight and information about the industry. The growth and corporate responsibility of Kelloggs’ are not mutually exclusive (Jackson et al.2015). Hence, Kelloggs’ derive information from the company researchers and Kelloggs’ business analyst and subsequently meet the aspects of corporate responsibility. The CRM by Kellogg’ consider nutrition of consumers, diversity in workplace, employee welfare, environmental performance and sustainable agriculture. With the changing demographics of customer base and workforce diversity that acts as an key information resource to understand and meet the needs of customers.

Market research and competitor analysis help the firm to discover and identify consumer needs and wide array of issues such as, their views on company products, packaging, and prices, recent advertising campaigns (Supriya et al. 2014). This helps the organization to make their marketing decisions.

 Market segment of Kelloggs’

 Kelloggs’ company mainly target the health conscious people ranging from women who are employed or homemakers, mainly between the age 25-50. Kellogg’s special K is aimed at women who are constantly trying to lose their weight, since according to the market research 23.5% of women diet regularly as compared to 12.9% of men (Jones, 2011). With the increasing popularity and demand of health food, Kelloggs’ cornflakes grab the interest of majority population in Europe and Asia-Pacific. Kelloggs’ cornflakes is targeted as the healthy breakfast cereal for children, young teenagers, middle age population and aged people as well.

 According to the recent statistics, the level of obesity level at UK is found to be 31.3% at women and men are less prone to obesity ( 24.8%). Hence, the Kelloggs’ special K is highly favoured in UK which enable the brand to expand its customer base. In addition, with the current growth rate, the cereal market in UK is anticipated to thrive in future (Morrisette & Hatfield, 2014). This statistics support immense market potential for Kelloggs’ and encourage its vast segmentation with products like Kellogg’s all-Bran and own label Kellogg’s Brand flakes (22% of the market segment), Kellogg’s fruit and Fibre(11%), Kelloggs’ Special K (34%), Kelloggs’ cornflakes (61%), Kellogg’s’ rice crispies and Coco Pops.

Integrated market communication of Kelloggs’

Ready-to-eat cereal is the largest category of packaged food marketed directly towards the children. Kelloggs’ consistently position Nutri-gain as the energy food for boys particularly focuses on them who wants to grow as successful athletes (Fernandes, 2013). The integrated market communication by Kelloggs’ focus to build a strong association between Nutri-Grain cereal and success in sport let the boys to perceive Nutri-Grain as their essential daily diet to a point that goes beyond the dietary recommendations.  Integrated marketing communications refers to Kellogg’s advertising that represents the cereal as an indispensable part of a competitive and successful preparation of athletes’ that enhance their perceptions (Jones, 2011). Hence, Nutri-gain is a significant product that may be perceived as an important stimulant to achieve success in sports and success which in turn enhance the appeal of cereal to male teens.

 The campaign of Kelloggs’ cornflakes and Kelloggs’ special K are addressed to mothers and son and analogous to support health with “Nutritional energy food” (Malhotra, 2014). Integrated marketing communication focus on emotional appeal and target the potential anxieties of parents who desire to give best nutrition to their children.

Promotion mix of Kelloggs’

Kelloggs’ promote its product through advertising and attractive packaging. The company make use of bright package in order to distinguish its products from its rivals in the industry. Kelloggs’ design its package to appeal both the children and adult. Advertisement is the key mesium of promoting its product. Television is the main medium for advertising (Rhoads & Conwell, 2014). The company’s promotional campaigns, like “Drop a jeans size challenge” increase its sales extensively that encourage consumers to have a bowl of cereal in their breakfast in lose weight. Kelloggs’ encourage its customers to provide feedback through the printed phone number on every wrapper of product (Che, 2014). This is also a strategy of promotion that enhances brand value. Kelloggs’ being a leading cereal brand makes use of online discussion forums and chat rooms where consumers can attain pre-purchase knowledge and also can share their post-purchase feedback.

 Online forums helps to spread electronic word of mouth thus targeting a large group of customers across the globe (Gaviria, 2012). However, E-WOM has negative effects as well. A negative feedback about the product or brand from the dissatisfied customers can spread negative word of mouth which in turn will affect its overall sales.

Communication model and promotion issues

The interlink between communication model by Kelloggs’ and its promotion issues are considered in details below:

Mass advertisement- Through Television, Crackle and Pop, Cocoa the monkey and Snap. Kelloggs’ spent approximately $15  million  for media campaigns however, the agency cannot attain a large group of target market who spend majority of their time in internet.

Direct promotions through coupons is an effective strategy however, it allows promotion only to visiting customers and not to the outside world (Diaz-Montano et al. 2014).

Trade Promotions by in-store displays and samples offers in accurate information and lack in timely convey. This communication process is in able to plan promotions based on analytics.

Personal selling- It induces high cost and incur problem of finding and retaining people potential customers. The most significant issue of this communication model is the inconsistency in message (Bakir, 2014). Sales person find themselves as independent from organizations and hence design their own message strategies and sales technique thus leading to disparity in sales.

Role of marketing managers in promotion

Identify and select the target market and decide on specific marketing strategies based on market area.

Managers maximize the effectiveness of promotional strategy by significant utilization of company resources, values and policies of management, potential risk and return, etc (

Identify, develop and evaluate the marketing strategies based on characteristics of market, cost and mark up factors.

Examine the financial aspects of promotional strategy such as budget of advertisement mediums , expenditures, return on investment and projections of profit and loss.

The execution of marketing or promotion plan is monitored and coordinated by the marketing manager ( Moreover, control of marketing plan execution is done in three steps, I) measurement of the outcome of executed marketing plan, II) comparison of results between pre-stated objectives in the marketing plan, III) adjustment and modifications are made in marketing plan if the objectives are not achieved.

 

Key concept of advertisement

Advertisement- it is the delivery of persuasive product message to the right people (target market), at the right time and at the right place at the lowest possible cost (McNeill, 2013). Advertising is the main component of marketing management and promoted through newspapers, Magazine, banners, direct mail, Television, Internet, etc.

Sales promotion- This promotion strategy adopt short-term and non-recurring methods to boost up the sales in various ways. Sales promotion offers are not available throughout the years rather counts on festive seasons, year ending and seasonal opportunities (Jackson et al. 2015).Tools of sales promotion are  exchange offer, free samples, discount coupons, scratch and win offer, money back offer, etc.

 Public Relation- It is a significant management function that helps to establish and maintain mutual mode of communication, cooperation, understanding and acceptance between an organization and its public (Supriya et al. 2014). Tools of public relation is Propaganda, Lobbying, Campaign, etc.

 

Reference List

Che, D. (2014). What happened to Tony the Tiger?: The rise and fall of Kellogg's Cereal City USA.

Gaviria, D. (2012). ‘Fueling Better Days’–Refreshing Kellogg’s 106 Year Old Brand.

Diaz-Montano, J., Campbell, J. F., Phillips, T. W., & Throne, J. E. (2014). Evaluation of potential attractants for Liposcelis bostrychophila (Psocoptera: Liposcelididae). Journal of economic entomology, 107(2), 867-874.

Bakir, B. (2014). Kellogg's" To Go" Breakfast-Shake at the Danish Market.

Navickaite, I. (2011). Psychological contract in the context of the wider organisational system. Challenges and opportunities in Kellog's company(Doctoral dissertation, Dublin, National College of Ireland).

Trehan, K., & Singh, G. K. (2013). Deceptive Practices in Indian Advertising: A Content Analysis of Print and Television Advertisements Violating the Guidelines of Advertising Standard Council of India. International Journal of Business Ethics in Developing Economies, 2(1), 30.

McNeill, L. (2013). Sales promotion in Asia: successful strategies for Singapore and Malaysia. Asia Pacific Journal of Marketing and Logistics, 25(1), 48-69.

Jackson, M., Harrison, P., Swinburn, B., & Lawrence, M. (2015). 17. Marketing ethics in context: the promotion of unhealthy foods and beverages to children.Handbook on Ethics and Marketing, 354.

Supriya, N., Vasudha, T. J., & Yadav, P. J. (2014). Social Networking-An Influencer of Brand Promotion. International Journal of Innovative Research and Development, 3(12).

Jones, E. (2011). An empirical estimation of price sensitivity differences among inner-city and suburban consumers: A look at breakfast cereals. Journal of Innovative Marketing, 7(4), 71-92.

Morrisette, S., & Hatfield, L. (2014). Batter Blaster. Journal of the International Academy for Case Studies, 20(3), 25.

Fernandes, S. (2013). A Case Study Approach On Indian Companies And Global Companies Entry In Foreign Markets–An Analysis Of Glocalization Strategies. Journal Of Business Management & Social Sciences Research,2(1), 30-39.

Jones, E. (2011). Measuring Price Sensitivity Differences for Inner-City and Suburban Consumers: An Analysis of Breakfast Cereals with Supermarket Scanner Data. In 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania (No. 103892). Agricultural and Applied Economics Association.

Malhotra, S. (2014). A Study on Marketing Fast Moving Consumer Goods (FMCG). International Journal of Innovative Research and Development, 3(1).

Rhoads, G. B., & Conwell, W. Y. (2014). U.S. Patent Application 14/152,925.

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