Sunday, January 04, 2004

Industry Brief: Kellogg Company The Kellogg Company has an internal dichotomy: it promotes both health foods of various kinds and, at the same time, sugar-laden junk food. Kellogg is the #1 breakfast cereal maker in the world, a bit ahead of rival General Mills. The company was founded in 1894 is to sell healthy, vegetarian breakfasts, and was founded by brothers who were nutrition gurus and Seventh Day Adventists. Part of the Kellogg cure was eating lots of grains, and that's still where the company's business is still oriented. But while the company offers some healthy cereals, it is most identified with Frosted Flakes, a sugary product that is far from health food. The company is quintessentially American, with its corn flakes (they invented the process for making them) and Rice Krispies. But in recent years, it has been instrumental in popularizing the notion of cold breakfast cereal through the world, and now distributes to 140 countries. It is particularly strong in the UK and Ireland. Kellogg has become a major purveyor of ready -to-eat bars, including Health bars (NutriGrain) and sugary snack bars (Rice Krispies Treats). In recent years, the company has diversified from its cereal base. In 2001 it bought Keebler, the #2 US maker of cookies and crackers. That company had already acquired the #3 company, Sunshine. That acquisition gave it a big stake in an important sector in supermarkets, second only to Kraft/Nabisco (Altria). In 1999, Kellogg acquired Worthington Foods, the largest US supplier of meat alternative product (like veggie burgers and veggie hot dogs), as well as egg substitutes. These include both shelf-stable and frozen foods, based mostly on soy and wheat ingredients. Kraft, with its BocaBurger, is a major competitor. Like many oligopolies, Kellogg's has started to diversify, but in a few very specific categories, in this case pretty well related to the same client base. Given the current confusion in the America diet, Kellogg is able to appeal to both comfort food lovers and those who have one of several severe dietary requirements. By concentrating in areas where it can be #1 or #2, it can stay alive in a rather static overall US food market. Like other typically American companies, it needs to extend its presence abroad even further in order to grow. But the likeliest next target for growth is Parmalat's US cookie group (Archway. Grandma's), the #3 cookie maker in the US.   Kellogg brands Category Brands Brealfast cereals 19, All-Bran, Apple Jacks, Coco Pops, Corn Flakes, Cracklin' Oat Bran, Crispiz, Froot Loops, Frosted Flakes, Frosted Mini-Wheats, Frosties, Fruit Harvest, Fruit 'n' Fiber, Kashi, Rice Krispies, Smart Start, Special K, others Breakfast foods Eggo, Pop-Tarts Snack bars Elfin magic bar, Journey bar, Kellogg's Special K bars, Rice Krispies Treats Nutrition bars Krave, Nutri-Grain Pie crusts Ready Crust Crackers (biscuits) Austin, Carr's, Cheez-It, Club, Harvest Bakeries, JJ Flats, Krispy, Old London, Saltines, Sunshines, Town House, Wheatables, Zesta Cookies Chips Deluxe, EL Fudge, Famous Amos, Fudge Shoppe, Keebler, Murray, Plantation, Soft Batch, Vanilla Wafers, others Egg substitutes Better 'n Eggs, Scramblers Meat substitutes Better 'n Burgers, Harvest Burgers, Moringstar Farms, Loma Linda, Natural Touch, Worthington Diet foods GoLean Ice cream cones Colosso, Eat-it-All 2:11:07 PM

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