THE CEREAL WARS

Group 4:
Nguyen Khoa An Hung IBC02-K43
Dao Bao Ngoc
Ho Bùi Yen Nhi Course: Customer Behaviour
Vo Quynh Nhu Lecturer: Dinh Tien Minh,
Nhu Mai Hoàng Dan Phong
Ph.D
Nguyen Ngoc Nam Phuong
Nguyen Duong Thanh Tam
Summary the case
 • For, Cereal market has grown for decades
• The cereal market is highly competitive

General Situation
• But in the mid 1990s, Americans’ eating-breakfast
style changed: many people chose to eat on the
run or skip it due to their hectic lives

• Breakfast cereal is seen as “marketing sensitive.”

A successful story in the time of breakfast cereal
market downsize: General Mills 
-> thanks to aggressively marketing strategy

6% 1st

VS
 • Increased promotion expenditures, especially for advertising
• Did not introduce any highly successful new products by only
promoting its existing cereals, targeting especially the pool of
80 million baby boomers

FEATURES
OF THE
TOPIC
 Cutting back on Inaffective in adapting to
advertising the healthier, faster-paced
American lifestyle

 Lack of strong brand

identification

WHAT IS THIS TOPIC ABOUT?

→ Offering various gift items inside boxes of
selected cereals

→Develope Web site (www. kelloggs.com)

→  International arena India

. Launch of a product from rice
. Sponsored TV and radio shows featuring
dieticians and nutritionists
. Set up billboards with nutritional messages
along busy highways near big cities
 Adverstisng and Sale Promotions for numberous of products
Teamed up with many partners:
→  In 1996, successful in-store promotion tied into its
sponsorship of the Olympics

General
Mills
 → Kids’ market: Cheerios logo on books, toys,
clothings, puzzle

General
Mills
 →  Teenagers:
• Coupons for Sony PlayStation video games on boxes
• Web site:  includes games, educational information, and an
opportunity for kids to email their favorite cereal
characters. 

→  Adult consumer: an oatmeal-fortified cereal produced

toward health conscious women through TV and print
advertising campaign.
General → Americans’ breakfast trend:

Mills
 → International arena
• Partnerships with Pepsi and Nestlé.

General • A line of cereals ( Para su Familia ) with bilingual

Mills packaging to appeal to the growing Hispanic population in
the United States. 
Question 1
1.1
Use the means–end model to
describe the consumer–
product relationship for three
segments of the breakfast cereal
market: kids (ages 6 to 12),
1.2
teens/young adults (ages 16 to What implications do your
22), and baby boomers (ages ideas suggest for promotion
35 to 50) strategies targeted toward
these three groups?
 WHAT MAKES “A GOOD
MARKETING STRATEGY”?

Understanding
Promotion mix the competitors

Understanding Understanding
the market the customers
 MEAN-END
CHAIN MODEL
to understand how consumers perceive the self-
relevant outcomes of products use and consumption

• Link product attributes with

consequences and values

• Product’s attributes are supposed

to lead to various consequences
 meet the consumers’ values
 MEAN-END
CHAIN MODEL
observable effect or the what the consumers
benefits of the deeply want and try to
product’s attributes achieve
Psychologi
Functional
cal
Attribute consequen Value
consequen
ces
ces
tangible features or likely emotional, the feeling
the characteristic of the that the consumers get
product when they experience the
product.

• Different for each consumer because of each consumer’s background and personal interests.
• Once the consumers have not experienced functional and psychological consequences yet,
 the product attributes do not mean much to them.
 The consumer–product relationship for three
segments of the breakfast cereal market
Teens/young adults Baby boomers
Kids (ages 6-12)
(ages 16-22) (ages 35-50)

Attributes Toy in box (It can be puzzle, - Video game coupon  on box - Organic, less sweetened
cartoon characters, - Games, educational - Calcium added
worksheet, colorful box …) information - High protein, high fiber, low
calorie

Functional Eating cereal is delicious and Get parents to buy video game Healthy and nutritional  
Consequences happy because they can play with coupons
with toy.

Psychosocial Excited Enjoyable - Good for diet or good for

consequences health
- Less guilty and concern
about sugar consumption

Values Impress their friend Self-esteem  - Dietary needs

- Healthy lifestyle
- Nutritional value
PROMOTION STRATEGY

Kids (ages 6 -12)

Teen/ Young adults

( ages 16-22)

Baby Boomers
( ages 35-50)
 Kids (ages 6-
12)

The products need to be associated with

something that is interesting to them.
They tend to well-responded by being
offered various gift items inside the box,
favorite cartoons in popular children’s
movies or the prize in the box

Television Advertising Cobranding with  a cartoon or TV

Exposure character 
Television commercials use music Breakfast cereal companies can utilize the
and familiar songs and jingles to highly profitable market of children’s
enhance the perceived quality of a toys, books, and clothing to co-brand
brand and to serve as a vehicle for their products. Moreover, they can use this
children to remember the name of a strategy to promote messages
product emphasizing taste, convenience, and fun
 Teen/ Young adults ( ages
16-22)

They tend to response well to the products which

include games, educational information,
Moreover, they also like developing new, more
mobile breakfast products, coupons for video
games on boxes.
Advertising on various
channels
Advertising and marketing reach young adult
consumers through many settings (e.g., schools,
child care, grocery stores, shopping malls, theaters,
sporting events, sponsored events, kids’ clubs) and
media (e.g., network and digital television, cable
television, radio, magazines, books, the Internet,
video games,…)
 Baby Boomers ( ages
35-50)

A promotion mix of extensive TV and print advertising

combined with various types of sales promotions, sport
sponsorship; sponsored TV and radio shows featuring
dieticians and nutritionists, and set up billboards with
health messages along busy highways near big cities.
Sugar, sodium or high fat content makes negative impact on
advertising to adults who are health conscious.

Co- Branding with sport

events or health and  Trade Association
fitness influencers FPA has also implemented diverse food and nutrition
Key messages about the labeling education initiatives to help families and
nutritional qualities such as the educators support choosing food smartly. Moreover,
wholesomeness or health FoodFit.com, a website to promote consumer ’s health
benefits of branded products through clean eating and healthy lifestyle . It emphasizes
seems to be attractive to the advocacy of nutrition and health claims to food
mothers. products to benefit consumers' food choices
Question 2
Both companies discussed in this case
use a mix of promotions to market their cereals.

2.1.
Discuss how
consumer reactions to
brand-oriented advertising
& sales promotions (coupons
versus prizes and premiums)
are likely to differ.
Question 2
2.2.
Discuss the likely effects
on consumers’ behavior,
affect, and cognition for a
75-cent coupon for cereal
versus a price reduction
deal such as “buy three for
the price of two.”
Advertising Sales
any paid, promotions
nonpersonal
presentation direct inducements
Promotion
mix
Personal
Publicity
selling
unpaid form of
direct personal communication
interactions
effect
Brand-oriented
advertising Sales promotions

affect (feeling) & cognition (thinking) behavior (especially short-run purchase behaviors)

consumers’ minds in the long run intended to be “immediate”

Brand-oriented advertising & sales promotions
relationship NEVER BUY
- BUT
FAVORABLE

MờiDISLIKE
em -
NEVER BUY
Okay I’ll
give you a
chance!

Reference: CONSUMER BEHAVIOR & MARKETING STRATEGY (J. Paul Peter, Jerry C. Olson)
General Mills
Brand-oriented
advertising Sales promotions

Affect both children & adults (parents) Catch the trend – Be satisfied
 Both companies discussed in this case
use a mix of promotions to market their cereals.

2.1.
Discuss how
consumer reactions to
brand-oriented advertising
& sales promotions (coupons
versus prizes and premiums) are
likely to differ.
2.2.
Discuss the likely effects
on consumers’ behavior,
affect, and cognition for a
75-cent coupon for cereal
vs a price reduction deal
such as “buy three for the
price of two.”

Question 2
Buy 3 for the price of 2
“I’ve used this product many
times before, I like it. I will
•Surprised
consider buying it more •Buy larger quantities
•Happy
because it can save me an •Rebuy
•Excited
AFFEC amount of money due to the •Inform promotion to others
•Satisfied
T COGNITI BEHAVI
promotion offer”
ON OR
(feelin
g) (thinking) (action)

•Curious “I may try this product •Try this (new) product

•Interested because of these discount •Tell their friends
coupons” •Look into more
information

A 75-cent coupon
Buy 3 for the price of 2

AFFE COGNI •Enhance loyalty

CT TION BEHAV
IOR •Boost the unit sales
(feelin (thinkin
g) g) (action)

•New potential buyers

•Encourage buyers to
try the products

A 75-cent coupon
 Question 3
3.1 3.2
Discuss the likely effect What do you think are
on consumers’ behavior, the effects on both
affect, and cognition of parents and kids?
the various forms of
promotion General Mills
has used to target
children.
 1. Put
Cheerios
on the cover of children’s
logosbooks, clothes and toys!
2. Produce
4 marshmallows
promoti shapesbased on kids’ favorite
characters!
on
strategie 3. Placing figurines
s aimed outside cereal boxes
4. Creating
at kids
websites
that have games, educational
information and email.
Have effect
on
both children and parents
 Effects on
1. Put Cheerios logos
on the cover of children’s
books, clothes and toys! children
Behavior

Affect & Cognition

These would attract kids’

attention, then might become
familiar to kids
They might insist their
parents to buy those for
them
2. Produce marshmallows Effects on
shapes children
based on kids’ favorite characters!

Affect & Cognition Behavior

Kids love these Insist on their parents

characters so much
 Effects on
3. Placing figurines children
outside cereal boxes
Affect & Cognition

Behavior

Insist on their parents to

buy that cereal just for
 General Mills is trying to develop an Kids can even see the toys the toys only
emotional bond with children to its brands by without having to open the cereal
using adorable, fun characters. boxes
4. Creating Effects on
websites that have games, educational
information and email. children
Affect & Cognition

Behavior

Decide to email their

favourite cereal character.
Develop a strong fondness for these adorable characters
 EFECTS ON
PARENTS

Recall beautiful memories

Put logos on items

Buy Cheerios to create

similar good memories for
their own children.
 EFFECTS ON
PARENTS

Parents give their kids

something they like.

POSITIVE
Put FEELINGS
toys General Mills cares deeply
inside
the
about children’s overall
box happiness, not just what
they eat for breakfast
EEFECTS ON
PARENTS

Increase brand
awareness

Save money

Encourage consumers to
purchase more
$15 in coupons when buying 2 General
Mills and three Hershey products
Question 4
1.1
Why do you think the
breakfast cereal market is
so
sensitive” ?
“marketing
1.2
Why do consumers respond to
good marketing promotions but
not at all to weak ones?
INVESTIGATE SEGMENTATION
BASE

Everyone can have Vary depending

Basic
cereal for breakfast on diet plan
Consumers nowadays are BOMBARDED with ADS! However, they DO NOT remember much out of them!
Forming a Consideration Set of Brand
Choice Alternatives

Adapted from Consumer Behavior and Marketing Strategy, 9th edition, P. Peter, C. Olson
What is good marketing promotion?
What is weak marketing promotion?