Marketing Objectives For Kellogg’s Australia – Strategic Analysis

Presentation of report

1. The breakfast cereal market in Australia continued to experience modest growth in 2017 with rise of value sales by 1%. The growth of the breakfast cereal market in Australia continues to decline as a result of continuous shift away from children’s breakfast, which declined by 3% in value terms in 2017, as well as flakes, which declined by 1% in value terms in 2017. The market size of the Australia breakfast industry is expected to contract as a result of perception regarding the presence of high sugar content in major cereal brands.
2. By introducing the new product line of the company, cereal drinks, Kellogg’s, can conservatively take majority of the market share of close to 40%, as there are no or very limited global companies in Australia, who has introduced cereal drinks in the market. The capturing of the majority of market share by the introduction of cereal drinks is very much worth to the company, both financially and otherwise, as the company is experiencing decline market shares and sales in the breakfast cereal market as a result of increased health consciousness among the target customers.
3. The cereal drink product line of the company fits perfectly in to the current market of the company as the cereal drink of the company will operate in the breakfast cereal market of Australia which caters to the breakfast needs and requirements of the customers. Kellogg’s can create a new market for the cereal drink of the company which will be consisting of the customers who prefer to have breakfast on the go due to lack of available time to have breakfast.
4. The factors which have led to the success of Kellogg’s in the market are highly effective marketing campaign undertaken by the company and the worldwide presence of the company and the strategic alliances undertaken by the company. The factor which has contributed to the un-successfulness of the company in the market is concerns regarding the nutritional value of the ingredients of the products.
5. As stated by Bok (2014) the buying habit which is most prevalent in the Australian market is that the customers are searching for alterative products which are healthy in nature and whose nutritional value are high in nature without any side effects. Another buying habit which is observed in the Australian market is that the consumers mostly prefer to buy products online and also from various supermarket chains as a result of lack of time and variety of options regarding payment and delivery available. In order to exploit the buying habits of the customers, Kellogg’s needs to develop products which are health and tasty in nature and are high in nutritional content and they also need to offer the products to the customers from various supermarkets and through various online shopping platforms.
6. According to Adetunji, Nordin and Noor (2014) the different segments of the breakfast cereal market are a good start, an easy start, family feeders, mobile snackers, family friendly, dietary needs and just for kids. It is recommended for Kellogg’s to compete in segments of the market rather than competing in all the segments of the market regarding their cereal drink product line so that they can effectively focus on meeting the requirements of the customers belonging to the particular market segments. Kellogg’s can operate in an easy start, mobile snackers, family friendly and dietary needs. The growing market segments are an easy start, dietary needs, a good start and just for kids. The contracting market segments are family feeders and family friendly.
7. The main competitors of Kellogg’s in context of the Australian Market are Nestle, Quaker and other domestic companies. The reason for which, the customers buy from the competitors of the products is presence of more nutritional value in the products of the competitors. The main task that Kellogg’s needs to do in order to get customers buy from them, are develop products which have more nutritional value and which satisfies the health-consciousness requirements of the customers and which satisfies the breakfast requirements of the customers.
8. The kind of margin that Kellogg’s should expect in the market is 30.5 %. The margin closely aligns with the overall margin of the company which is 33.90 %. The reason for fluctuation between both the margins is because that the cereal drink product is new in the market and therefore in order to make the product acceptable the company has to offer the products at a lower margin.
9. As stated by Urde and Koch (2014) the customer organizations which Kellogg’s need to target first in Australia are Australian Consumer’s Association, Consumers’ Federation of Australia and Australian Consumer Organization.

1. In order to identify potential markets for the increased marketing opportunities for Kellogg’s in Australia, the company needs to conduct market research in Australia which will help in identifying the preferences of the customer and the trends affecting the cereal market in Australia.

Vision of the company- The vision of Kellogg’s is to enrich and delight the world through the foods and brands which matter.

Purpose of the company- The purpose of the company is to nourish families so that they can flourish and thrive.

Heritage of the company- The heritage of the company drives the future of the company and keep the company excited for tomorrow.

It is very important that the identified opportunities after the market research comply with the vision, purpose and heritage of Kellogg’s so that the identified opportunities reflect the values of the company.

1. In order to reach to the target markets of the products and future directions of the company based on price, promotion, distribution and product it is very important to analyse the marketing mix of the company as it will help in defining the product, price, distribution and promotion regarding the various product lines of the company and it will also help in reaching to the target markets of the products and provide future direction to the products of the company.
2. In order to ensure supply of the product, in the market it is very important to review the market performances of the products of the company in the market as the success of the products of the market attracts influences the distribution channel of the products of the company as the distributors prefer to distribute those products in the market which have a demand in the market and which will yield profitability for the distributors and therefore it is very important for the company to review the market performances of the products in order to ensure supply of the product based on the demand of the product.
3. In order to meet the Australian challenges, Kellogg’s must be geared up to clear the clear the perception regarding cereals as a healthy breakfast option among the target customers of the products of the new product line of the company. previous lessons which have learnt from the previous marketing launch campaign is that that the company should take into account the psychology of the customers regarding the benefits of the products among the various genders of the society and must also take into account the images and perceptions associated with every gender which are being associated with the marketing campaign
4. According to Newstex (2014) the previous marketing positioning strategy of Kellogg’s involved using product or benefit based positioning strategy in order to highlight the benefits of their products to the target customers of the product. The current marketing positioning strategy of Kellogg’s will focus on differentiation based positioning strategy which will help in differentiating the new product line of the company with the existing options available in the market.
5. SWOT analysis of the current cereal drink market in Australia are as follows:

Strengths- The main strength of cereal drink market in Australia is that it has high growth potential. The other strength of the cereal drink market in Australia is that it will receive high customer attraction due to the requirement of the customers regarding nutritional breakfast options.

Weakness- The main weakness which is associated with the cereal drink market in Australia is that consumers perceive cereal as a non-nutritional element for breakfast owing to its high sugar content. The other weakness associated with the cereal drink market is that it has got limited or no global companies operating in it and therefore it lacks popularity.

Opportunities- The main opportunity which is associated with the cereal drink market in Australia is that it can exploit various emerging market segments such as an easy start and the mobile snackers. The other opportunity which is associated with the cereal drink market is that it can exploit the growth opportunities associated with the non-availability of competitors in the sector.

Threat- The main threat which is associated with the cereal drink market is the rise of several other alternative breakfast options. The other threat which is associated with cereal drink market is the regulations imposed by government regarding the use of various ingredients.

1. The marketing performance against the previous marketing objectives was effective in nature as the previous marketing strategies of the company were successful in accomplishing the previous marketing objectives of the company. The crucial success factors regarding accomplishing the previous marketing objective was the innovative marketing strategy design of the company and selection of the effective platforms in order to accomplish those objectives. These ideas can be used towards the new ideas of the marketing opportunities by designing the marketing campaign of the new product line according to the preferences of each market segment and using both online and offline platform to ensure the effectiveness of the marketing campaigns.

1. As opined by Efanny, Haryanto, Kashif and Widyanto (2018) the main marketing opportunity which is associated with the cereal drink market in Australia is that it can exploit various emerging market segments such as an easy start and the mobile snackers. The other marketing opportunity which is associated with the cereal drink market is that it can exploit the growth opportunities associated with the non-availability of competitors in the sector.

As opined by Yang, Cai, Chen and Yang (2017) the new product line of the company can contribute to the business of the company in Australia as the new product line of the market which is cereal drinks, is relatively new in the market with very limited or no competition and therefore customers will be tempted to try out a new alternative breakfast option in order to access that whether the cereal drink is capable of becoming a health and nutritious breakfast option.

1. The PESTLE analysis of the new marketing opportunity is as follows:

Political- The political environment of the country is stable in nature and the policies of the government are friendly in nature and it helps in fostering investment in the country. The country has sound relations with most of the countries of the world regarding trade and business.

Short term objectives

Economic- The economic environment of the country is stable in nature as the economy is growing in nature. The growth of the economy ensures that the disposable incomes of the people are high which ensures high purchasing power of the customers.

Socio-cultural- As opined by Srivastava (2015) the socio-cultural environment of the country is accompanied by growing awareness among the people regarding their health and diet as they have become health-conscious in nature. The people of the country seek for high quality nutritious and healthy products irrespective of its prices.

Technological- The country has a high technological growth rate which can be witnesses through the high rate of technological advancements in the countries. As a result of high technological infrastructure, new technologies are used by the companies in order to manufacture new products and services which suits customer demands.

Environmental- The country demonstrates a high level of environmental awareness in response to the various environmental issues which are affecting the country such as climate change, deforestation and melting of glaciers.

Legal- The legal framework of the country is very strict and affective in nature in order to promote fair trading and human rights and equality in the society. There are strict legal regulations and legislations regarding the use of particular materials or the use of a various technology in the manufacturing of the products which safeguards the healthy well-being of the customers of the country.

1. The costs, benefits and risks for each opportunity are as follows:

Opportunity	Cost	Benefit	Risk
Exploiting various emerging market segments such as an easy start and the mobile snackers.	Promotion of the products in different segments of the market.	As opined by Wang, (2015) it will help in increasing the market share of the new product line of the company and will help in enhancing the brand image of the company.	Lack of products awareness in the other segments of the market which could result in decreasing of the brand image.
Exploit the growth opportunities associated with the non-availability of competitors in the sector	Manufacturing and marketing the new product line of the company.	Will help in increasing the profitability and revenue of the company. Can exploit the monopoly of the market.	Concerns regarding the quality of the product as a result of limited or no competition in the sector.

1. As stated by Fair Disclosure Wire (2013) The main organizational goal and aim of Kellogg’s is to enrich and delight the world with the foods and brands which matter and the main aim of the new product of the company is to satisfy the demands of the customers regarding healthy and nutritional breakfast option and therefore the new marketing opportunity of the company fits with company’s goals and objectives in general. The marketing capability of the company is highly effective in nature as the marketing at Kellogg’s exists to cultivate and activate engaging relationship between the brands of the company with the customers of the company. The marketing team of the company work consistently to develop media and messages which connect the brand to the customer and helps in increasing the demands of the products among the customers. The marketing personnel of the company develop and implements innovative ideas which are supported by deep human insights in order to create a delightful customer experiences with the products of the company.
2. According to Presswire(2016) the opportunity to market the new product line of the company will have a positive impact on the business of the company and its current customers as the new product line of the company will help in meeting the customer requirement of health and nutritional breakfast option with no side effect. The new product line of the company will company will also the business of the company in a positive manner as it will help in increasing the market share of the company and will also help in developing the brand image of the company which witnesses de-growth due to the perception among the customer regarding its ingredients.

1. As stated by Blankson, Cowan, Crawford, Kalafatis, Singh and Coffie (2013) in order to increase market share by 20% in every Australian City, Kellogg’s need to increase brand awareness of the new product line of the company by using online videos to quickly build the star power of the company, developing a compelling press release which is newsworthy in nature, attracting customers to the website of the company using content rich blogs, utilizing various social media tools to help develop brand image and developing paid search ads of the company.

In order to create KPI awareness to achieve sales target, the staffs of the company must be well informed about the Key performance Indicators of the company and the sales target of the company. The employees of the company must be updated by the company regarding KPI and monthly sales target of the company regarding the new product line of the company through the intranet network of the company.

1. The objectives of the new product line of the company are consistent with the forecasted needs of the business as the new objectives of the business are set in accordance with the forecasted needs of the business. The forecasted need of the business is to introduce such a product line which will help in addressing the de-growth of the company faced in the cereal breakfast sector and therefore the objective of the new product line is to satisfy the needs and requirements of the health conscious consumers of the company by marketing the benefits associated with the cereal drink of the company.
2. The objectives of the new product line are compatible with the organization projected forecasted in the way as follows:

Objective of the new Product Line	Projected forecasts of the company
Achieving a market share of 30% after 2 years of introduction in the market.	Net sales to rise from 5 % to 4 % in fiscal 2018.
Increasing the profit margin of the product from 31% to 34.5%.	Increase in earning per share from 11% to 13%.
Communicating the benefits of cereal drinks to the customers along with its nutritional values.	Customers opting for low sugar options, protein bars and yoghurt for breakfast over cereals.

1. As stated by Xie, Xie Qian and Zhao (2018) the new product line of the company complies with the Competition and Consumer Act 2010, which ensures that trading done by the business is fair in nature for the customers of the business. The products meets the standards and ethics by complying with the laws and legislations which are implemented by the government of Australia regarding business in the country and it also complies with the fair trading laws implanted by the government of Australia. The products also meet the standards and ethics by ensuring that the ingredient of the products follows all necessary quality standards and checks. The products also meet the standards and ethics by ensuring that the activities of the company such as sourcing. Manufacturing, operations and marketing are not misleading or deceptive in nature. The government of Australia provides various benefits to the domestic companies of the country to compete against foreign countries by allocating funds, reducing the interest rate and taxation rate for the companies.
2. The current legal requirements that Kellogg’s needs to abide by are Competition and Consumer Act 2010, Australian Consumer Law and Fair Trading Act 2012 and Australian Consumer Law.

The ethical factors that the organization is a part in are as follows:

• The company must help in promoting equality.
• The company must focus on egalitarianism and individuality as it strongly affects the corporate structure and hierarchy.
• The company must value privacy and relationship in the organization culture.
• The company must focus on promoting equality among all gender roles.
• The company must display full information about the products in the packaging of the company.
• The company must not indulge in unfair trading services.
• The company must not indulge in deceptive marketing campaign.

Kellogg’s Special K got rid of the red bikini lady running along with the beaches by modifying the market positioning strategy of the company. Earlier the company positioned itself its product which will help a women to fit into a bikini but as the customers have moved away from the above mentioned style of dieting and towards nourishing their body towards a healthy lifestyle as they want to eat well and feel confident that the brand can deliver it and therefore it modified its positioning strategies.

1. The strategic direction of the company focuses on addressing the misconception of the customers of the company regarding the ingredient of the cereal breakfast products of the company. The strategic direction of the company also focuses on increasing the market share of the company which had reduced due to the increased consciousness of the target customers regarding various health related issues.

Long term objectives

As opined by Srivastava (2016) the strategic direction of the company may impact of the future marketing activities of the company as the future marketing activities of the company are dependent on the strategic direction of the company. The future marketing activities of the company are influenced by the strategic direction of the company as the marketing strategy of the company is influenced by the strategic direction of the company.

1. The risk assessment chart of the company is as follows:

Risk	Contingency Strategy
Lack of products awareness in the other segments of the market Lack of products awareness in the other segments of the market.	Introducing new product lines for the rest of the market segments of the company according to their requirements.
Concerns regarding the quality of the product.	Providing awareness regarding the quality of the product in the brand awareness campaign of the company.
Downturn of the economy	According to Uggla(2015) reducing the prices of the product of the company by reducing the margin of the product.

1. The marketing opportunities of the company fit with the organizational capability in terms of manufacturing, marketing, technology, personnel and financial requirements. The market fits with the organizational structure and design as the organizational structure of the design in tall hierarchical structure and the market of the company is diverse in nature with multiple segments.

References

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