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Honey Nut Cheerios

Lawrence Washington

MKT 305Professor William Bodlak

September 16, 2013

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Industry Analysis

Honey Nut Cheerios is a competitive brand in the cereal industry. Cereal is the seventh

most popular supermarket product (behind carbonated beverages, milk and natural cheese,

beer/ale/alcoholic cider, fresh bread and rolls, salty snacks, frozen dinners and entrees). In

2008, the cereal industry had $9.1 billion in sales (Highbeam Business). In 2009, sales

increased to $10.8 billion (Prepared Foods Network). In 2010 and 2011, sales were nearly

unchanged, with both years bringing in approximately $10.2 billion (Mintel). In 2012, the

industry saw a decline to $9.51 billion (Food Navigator).

Cereal had its strongest growth in 2006-2007, but has since seen a fairly steady decline

in sales recently, due to consumers choosing healthier foods, or choosing more convenient

breakfasts that can be eaten “on-the-go”. Other than a slight spike in 2009 due to the recession

and consumers opting for the lower price of RTE cereal, US consumption of cereal has dropped

an average of 1% per year for the past decade (Bakery & Snacks).

The cereal industry can be broken up into the following segments: ready-to-eat (RTE),

hot cereals, and cereal bars. Honey Nut Cheerios is a ready-to-eat breakfast cereal. The RTE

segment makes up the majority of the sales in the industry at nearly 90% (Mintel).

Major trends affecting the cereal industry now are: as the economy improves, people are

returning to work and no longer have time to sit down to breakfast at home; breakfast has

switched from being one of three square meals a day to more of a snack; declining birth rates

are contributing to a decline in one of the cereal industry’s primary target demographics,

children; new innovations in getting cereal to consumers are changing the products cereal

companies are putting out (eg. the drinkable cereals General Mills is coming out with or the

increase in cereal bar sales); and consumers are more interested in the health benefits of

breakfast and are choosing more health-conscious items.

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Environmental Scan

Economic

Some of the biggest trends in taxation and income sources that have an impact on the

firm are the effect of inflation on operating costs. There is a rise in supply chain costs that have

doubled the annual inflation rate. These statistics have thrown off projections that are used in

the long-term planning process.

Another factor is the impact of a slow economic recovery on a global scale. After the

world economy was crippled by recession, there has been a slow recovery process. Consumer

budgets have not yet returned to levels of the past. In lieu of these challenges the company has

been able to keep pace through a restructuring that has been able to hit on growth strategies.

Issues stemming from the trend of higher operating costs have forced General Mills to

invest more money internally. In order to make adjustments to current trends, the company has

established a set of goals for the 2013 fiscal year. Planning begins with making a bigger

investment into traditional media sources. Also the company will have a bigger presence in

digital and social media. General Mills recognizes that technology has provided new marketing

possibilities through outlets such as Facebook and Twitter. These tools allow the company to

market products in a unique way where it is possible to reach out and receive feedback from

consumers. Essentially, the company is able to get valuable feedback that can help determine

the success of a product from a marketing standpoint.

General Mills also plans to zero in on sales and earnings growth based on products that

are already established within the company umbrella. Through analyzing the marketing

strategies of these successful products, new products can be released to a warm reception.

While General Mills hopes to maintain their core developed markets, there will be a shift in

focus toward expansion into a wider developing global market. These goals are the key to

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counteracting new trends that are affecting the economic future of General Mills.

Social cultural

The company focuses on bringing out nutritious and convenient foods for its consumers

by offering a variety of product innovations. In 20ll, the company launched cereals and

brownies that have lower calories in them. The company also made health improvements in

many other products they offer. General Mills added gluten-free and low-sodium offerings as

part of their nutrition-conscious offerings. The company focuses on controlling obesity by

maintaining healthy products. General Mills offers whole grain, gluten-free, all-natural yogurt,

and organic products. Some of them were core products for the company, such as Honey Nut

Cheerios and Big G cereals. The company also focused on the positive outlook for the yogurt

market. The consumption of yogurt is growing worldwide, especially in General Mills’

developed and emerging markets.

Demographics

General Mills is one of the largest global producers of packaged consumer foods. The

company’s headquarters is in Minneapolis, Minnesota. The company operates in over 100

countries besides the U.S. The company also has another 28 locations within the Unites States.

The company operates through three business divisions: US retail, international bakery

services, and foodservices. In the 1960’s General Mills began an extensive change and the

company continued to divest nearly all of its non-food operations until 1980. General Mills

strengthened the company by creating two international ventures, Cereal Partners worldwide

(CPW) with Nestle, and Snack Ventures Europe (SVE). In 1995, General Mills sold off their

remaining side businesses and the company again focused on its most beneficial principal

business, food. The company continues to grow by partnering with other businesses and with

help from scientists and engineers. Last year, the company announced productivity and cost

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savings plan to improve organizational changes that would strengthen business placement; they

also announced other new ideas to increase administrative efficiencies across the company.

Political, Legal, and Financial

Laws that are being proposed that could affect marketing strategy for cereal:

Federal government’s proposed nutrition guidelines, which recommend no more

than 26% sugar content. Only one in four cereals currently marketed to children

would meet these guidelines (Food Politics).

Unlike many other countries, right now the US has no genetically engineered or

GMO food labelling laws. However, 47 states currently have proposals to add

these laws. Many ingredients in cereal, especially corn products, would fall

under these laws, should they take effect (Prison Planet).

Recent changes in laws regarding GMOs in other countries affect General Mills’

marketing worldwide. In many countries, they are now required to label their products with all

GMO foods that are used in manufacture of the product. The recent proposals about the way

sugary cereals are marketed to children have prompted the industry to declare that they will

self-regulate these practices.

General Mills takes a proactive approach to address any issues in the current political

climate. General Mills has made efforts to reduce their environmental footprint and sustainably

source their raw materials in response to the current political climate of being environmentally

responsible. In 2011, General Mills joined forces with 16 other food and beverage companies to

establish uniform nutrition criteria for foods marketed to children fewer than 12. General Mills

has made a commitment to human rights and are signatories to the United Nations Global

Compact, promoting responsible sourcing.

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Technological

Honey Nut Cheerios uses advertising as their primary promotional means. They teamed

up with Fox network to get additional support. They want to attract younger users by putting

games on back of the box and a puzzle inside. Separate tie-in with Musicland Group includes

an in-store sweeps to win a walk-on part and tour of the TV show set. Aggressive advertising is

critical to capturing a piece of this huge market. Two recent projects exemplify the types of

advertisements that are being generated to enhance product recognition. According to

company, they will not only advertise select fruit snack products, such as Fruit Gushers, on the

Web site, but will also advertise in Mama Media’s print magazine, Mama Media a Kids' Guide

to the Net.

Environmental

The company offers a variety of items that are related to a low calorie diet. Yoplait

Yogurt was one that achieved approximately $1.49 billion in sales in 2011. Bundled with

attractive packaging and aggressive promotions, the company’s leading market position would

help it to leverage the opportunities in the US as well as the global market. They are expecting

to exceed $67 billion by 2015. With new launches and expansion of the present product

platform, the company expects these opportunities to contribute towards future growth.

According to industry sources, the emerging companies are expected to contribute 95% of

global population growth, more than 60% of global GDP growths, and three times faster

disposable income growth. In 2012, General Mills announced a productivity and cost savings

plan to improve organizational effectiveness and to focus on key growth strategies. General

Mills is focusing on commodities such as grains, sugar, dairies, vegetables, fruits, and other

agricultural products. Since the prices of these commodities increased, General Mills decided to

cut the costs by cutting 800 jobs and increasing the production of cheerios cereals and

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Progresso soups. Increase in the costs of key raw materials could bring in pricing pressures and

impacts the margin unfavorably. General mills are an environmental friendly company that is

trying to make people lives heartier and healthier.

Competitive Analysis

The top three competitors of General Mills are: Kellogg Company (K), Kraft Foods Inc.

(KFT), and PepsiCo-Quaker Oats (OAT). They are the biggest competitors competing against

General Mills, as together the three companies’ control 55% of the market. General Mills

controls 31% of the market. Kellogg is #1, followed by General Mills # 2, followed by Kraft at

#3, and PepsiCo’s Quaker Oats at # 4.

Special Strengths: Kellogg Company has a very strong brand portfolio aided by

appropriate investments on brand building. They focus on product innovation that helps to

retain customers and improves the product mix. Furthermore, Kellogg has a strong market

position in the breakfast cereal category as it is the current leader in the market over General

Mills. One of their top selling cereals is The Special K series. Kraft Foods Inc. has a strong

market position worldwide. They also have diversified product offerings complemented by

strong brands. Third, they have a strong global distribution network. Their top selling cereal is

Honey Bunches of Oats. PepsiCo-Quaker Oats has a diverse product portfolio and strong brand

equity. They also have a unique robust growth in revenue and operating income assures a

competitive position in the cereal market. Finally, they also enjoy a growing presence in

emerging markets. Their top selling cereal is the Life cereal series. The top selling cereal for

General Mills is Honey Nut Cheerios.

The competition is very effective and fierce, like a great baseball game. The

competition is so intense that over the past five years, Kellogg Company (K) and General Mills

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(GIS) have been neck and neck for the top spot in the cereal market. General Mills (GIS) held

the top spot until 2012 when Kellogg Company (K) finally took over it and has been able to

maintain it to present day. The Private labels, Kraft, and PepsiCo-Quaker are also beginning to

gain ground in the market. Slowly these companies are trying to build their brands to become

players rivaling the top dogs in the cereal market.

Kellogg Company offers the Special K challenge as a benefit. The new line of cereals

designed to help consumers lose weight and eat healthy has brought tons of consumers to

Kellogg. It has helped spark a new healthy eating phenomenon that now has an app of its own

that can be used on Facebook, to share and track weight management with friends. Kraft is

building brand loyalty through social media and other channels. They are also building

consumer affection in unprompted ways. Who doesn’t have a Facebook page these days? We

all have some type of social media access and Kraft is putting their product for us to see, like,

and purchase. This is a great benefit that Kraft Foods, Inc. offers. PepsiCo-Quaker has its

products packaged using environmentally-friendly materials. Through innovative technologies

that benefit the environment, they are garnering consumers that are environmentally friendly.

One of their highly touted creations is the (PET) bottles, made from plant based materials.

The current market shares of our competitors are Kellogg Company (K) they control 34% of

the market and are our current leader in the cereal market. We at General Mills (GIS) are a

slight second with 31% of the market. Kraft Foods Inc. (KFT) has 14% of the market share.

Lastly, PepsiCo-Quaker (OAT) holds 7% of the market. The rest of the market is held by tiny

scattered private labels and organic brands of cereal.

The marketing strategy of Kellogg Company is called “Volume to Value” Brand

Building. They will put emphasis on new products, nutrition news, and promotional news also

developing less sugary cereals for nutritional healthy eating habit trends. Kraft and their

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marketing strategy will be a mobile first approach designed to improve point of sale purchases

via smart phones. It will include in store marketing, location based advertising and social

television applications thus, hopefully being able to increase impulse sales for 2013. Pepsi-Co

Quaker and their marketing strategy will focus mainly on entertainment TV as a piece of the

puzzle. Consumers like entertainment and Pepsi-Co Quaker will push their products via

television. They have teamed up to create “Yo Sumo” a documentary with Eva Longoria. They

have also launched “Circle of Eight” on my space and “If I Can Dream” on Hulu. They have

also been heavily involved with NBC and Saturday Night Live too. On CBS on Entertainment

Weekly They showcase Pepsi-Max exclusively. The ultimate goal is to create content that

engages consumers, getting them closer to the brand and thus creating a revenue stream and

also increasing product demand and sales. Two indirect competitors for the market are Mars

Inc., privately held not traded. The other indirect competitor would be Nestle USA Inc.

(NSRGY)

Company Description

General Mills reputation overall is that customers are very satisfied. “General Mills is

one of the world’s largest companies”. Their product quality is graded with an “A” as well as

their service quality which is an “A”, as listed by Standard and Poor’s surveys. General Mills’

current market share is 52.67% +0.23 (0.44%) listed by Google finance. They have been in

business since 1856. They also offer many different varieties of foods which you can find even

in your household and may not even know that it was General Mills that helped produce the

items. Some things that the company offers are baking products (Betty Crocker), cereal,

dough/pastries, fruit, ice-cream, pasta, pizza, snacks, soups, vegetables, and yogurt. Some of

the major products that they sell are highlighted as told by Standard and Poor’s. General Mills

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has been around for over a hundred years and has grown to be one of the biggest companies.

Some products that they produce that are market leaders are their cereal that everyone loves.

The reason is because when someone thinks of General Mills, they think of cereal. Some great

examples of market leaders for General Mills are Cheerios, Lucky Charms, and Trix. One more

major marketing brand that they have is Yoplait, which everyone knows of, and is one of the

first yogurt brands thought of when thinking of yogurt. General Mills is a very large company

and can manage and continue to grow and also provide great food that everyone loves. They

will continue to grow and continue to be successful and leave families happy, leaving memories

in homes because of the foods that they produce.

Mission Statement

“Our Mission is to make lives healthier, easier, and richer. General Mills is Nourishing

Lives.”

General Mills clearly meets the criteria outlined for what industry standards consider a

good mission statement. This statement is broken down into three key components that are vital

to the success of any organization. General Mills main focus is to make lives healthier. This is

accomplished through refining the products released under the organization’s umbrella.

Products such as Yoplait yogurt, Small Planet Foods products, Fiber One, and a full line of

whole grain cereals are marketed to the public as viable health options.

General Mills is making lives easier. There is a clear emphases placed on convenience.

The company provides a full line of sensible meal options that aim to be child friendly while

cutting down on preparation time. This concept is unique in the sense that families can have

quick quality meals without having to compromise health and nutritional standards. Essentially

with products such as Betty Crocker box dinners, General Mills is telling the public there is an

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alternative to dining at fast food restaurants.

General Mills last area of focus is to make lives richer. This has been accomplished

through identifying needs of potential buyers, and tending to these needs. In the United States

health and nutrition has been made a priority during recent years. In 2005 General Mills gave

the company a facelift buy improving the health profile of its products. Almost 70 percent of

United States retail sales are comprised of these products.

This organization seeks to find a balance between just making a dollar, and genuinely

listening to the needs and wants of customers.

Overall, General Mills displays good corporate citizenship. This is achieved through the

increase of environmental efficiency during business practices. The organization decreases

usage of water, and uses recycled materials in packaging. With the three key areas of focus

General Mills is achieving its goal of nourishing lives.

SWOT Analysis

Strengths

General Mills has a diversified portfolio of products available to the public. Established

brands such as Pillsbury, Betty Crocker, and Yoplait have been the catalyst of the

organization, while generating significant revenue worldwide. General Mills Net sales

show a 12 percent increase that accumulates to an estimated $16.7 billion for the 2012

fiscal year. This shows that the organization does not gamble its future on any one

particular product in the fold.

General Mills has built a track record of consistent growth. From the inception of a

global economic recession to the recovery stage, General Mills has managed a double

digit compound annual return to shareholders.

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Versatility is the greatest strength of the company. Innovative business strategies allow

the organization to maintain its relevance. Through a detailed analysis of industry and

public demands for today’s market, General Mills is able to provide a line of products

that appeal to the masses. Brands such as Yoplait yogurt, and fiber 1 cereal bars have

been distributed in an effort to capitalize off America’s new obsession with health

consciousness.

General Mills is a leader within the food industry in regards to ethical and

environmental practices. The organization has gone to great lengths to reduce their

environmental footprint. General Mills continues to lead the way through exploring new

options for production through the recycling of resources.

General Mills is a well-established organization with strong brand equity. The company

delivers quality products in a variety of markets around the world.

Consumers remain loyal to the company’s products due to the recognition of

consistency and quality of products.

Weaknesses

The corporation is heavily invested in the marketing of products in the United States.

Although revenue has been steady in recent years this is not a guarantee for the future.

More emphasis needs to be placed on the global marketplace where there are more

lucrative opportunities.

Company expenses are rising at a very high rate. Industry operating costs have caused

General Mills to spend more money internally for production of their products.

Little exposure in up and coming markets. Only ten percent of General Mills total sales

revenue is generated from newer emerging markets. In order to overcome this obstacle

the organization has to rely on the acquisitions of other already established brands.

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Expansion has taken place too fast in certain small international markets. Marketing of

the Haagen-Dazs ice cream brand did not do well in the Philippines, due to various

factors such as complications with the marketing strategies and difficulty importing

products with a strained relationship with customs officials.

General Mills is having a difficult time dealing with the price of grains, which is

currently priced at a high rate. This commodity cost dramatically affects the company’s

profit margin.

Opportunities

Refine consumer marketing techniques. The opportunity to effectively capitalize off

social media is a great possibility. Although General Mills has many established brands

in the United States, using current internet technology to increase international brand

awareness could be a great tool.

Consumer marketing should be used. This would allow the company to zero in on the

target market and better understand what these consumers are looking for from the

product.

The company should continue to expand on their promotion of health consciousness.

Current trends show that the American public has gravitated to healthy lifestyles.

In order to gain more customers, the company could focus on marketing products in

international markets. There are greater opportunities to generate revenue in Europe.

Revenue could see an increase through more effective technological marketing. Social

media is the greatest tool available in the current marketplace. Social media changes

how business is done by having a direct interaction with consumers.

Threats

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General Mills products have significant brand recognition. However, sometimes

consumers bypass these brands opting for the local grocery store house brand. This

move is usually motivated by the house brand being sold at a lower price.

The greatest threat for the company is the emergence of private labels. Reports show

that consumers tend to gravitate towards private labels. Growth in this market is

increasing dramatically.

Commodities such as grain are high in demand. The prices on commodities continue to

increase. The amount the company spends on commodities for products effects overall

profit. This usually results in the increase of prices on the consumers favorite products.

Kellogg is the greatest competitor in the cereal market today. Kellogg produces a high

variety of popular brands that range from kid friendly brands to health conscious

options for the sophisticated adult. Due to the fact that both companies offer many of

the same options, the battle for consumer’s brand loyalty makes Kellogg a viable threat.

Any competitor currently operating on the international market is a threat to the

company. General Mills has not yet fully established itself internationally. Any direct

competition that beats them to it may secure brand loyalty from consumers.

Target Market

Honey Nut Cheerios is the number one selling cereal in the US (NY Times). General

Mills therefore considers all of America as their target market, but they break their marketing

down into different forms directed at different segments of the population. They use a “two

story” approach: the fun story and the health story. General Mills uses the sweet taste and the

cartoon bee on the logo to focus marketing to children, while the health benefits of all the

Cheerios products are promoted towards consumers who are striving to eat more health

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consciously.

Honey Nut Cheerios has the American Heart Association’s certification for being “heart

healthy,” helping the brand retain its positive reputation for being a healthy breakfast option.

Shoppers view the price of Honey Nut Cheerios as about average for a brand name cereal, but

price of cereal in general is a frequent complaint amongst consumers. General Mills’ Cheerios

line as a whole is primarily marketed to families, particularly those with young children. A

recent ad brought some free (and possibly unwanted) publicity to the company after they

featured a racially mixed family in a commercial; the negative reaction of a few brought out

many old and new fans coming to the cereal’s defense. The main focus of advertising for

Cheerios is to be “so ubiquitous as to be almost invisible” (AdWeek); General Mills strives to

make the product so much a part of peoples’ lives that they don’t even notice it. The

controversy surrounding the mixed family advertisement brought the Cheerios name to the

forefront of news topics, but it helped solidify the brand in many peoples’ eyes as a brand that

is for everyone and a brand that has good values.

The most common way for consumers to find out about Honey Nut Cheerios is

commercials on TV. The Saturday morning cartoon time slot is the primary time the brand is

advertised. However, the brand is now branching out into social media, using Facebook and

Twitter as a way to reach a new audience. Many consumers have been buying Honey Nut

Cheerios for so long that it is now habit, while others decide to purchase the brand based on the

purported health benefits. The Cheerios line as a whole is often placed at children’s eye level in

stores, a prime location for marketers because children often are the ones who select which

cereal a family purchases. For shoppers who don’t buy Honey Nut Cheerios, the primary

reasons are: too much sugar and cereal as a whole is seen as an unhealthy choice for breakfast

now that there are so many other convenient options available.

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As the number one selling brand of cereal, Honey Nut Cheerios doesn’t need to change

much about their target market strategies. One thing they could focus on is focusing more on

the adult market. The cereal has many healthy attributes, but the strong marketing to children

leaves many thinking that it’s nothing more than a sugary children’s cereal with no health

benefits at all. They need a stronger social media presence, as that is one of the top ways

consumers get information now. Lastly, expanding their marketing emphasis to groups other

than families (eg. the highly sought 18-34 year old demographic) would result in a new

customer base for the brand.

Product and Positioning

A company profile of General Mills, which provides packaged consumer foods ranging

from frozen vegetables and refrigerated yogurt to refrigerated dough and dessert mixes, is

presented. Made with 100 percent natural whole grain oats, Cheerios is the only major

breakfast cereal grain proven to help lower cholesterol. Cheerios is a healthy start to the day or

a perfect, crunchy snack for the entire family. One strategy used by producers includes

repositioning of existing products to emphasize health benefits as that of Quaker Oat Cereals

and General Mills' Cheerios. Adding oats into the new product and making it gluten-free will

help satisfy consumers. The cereal company's announcement in late 2008 reinforces data from

Mintel Consumer Intelligence in Chicago, which shows gluten-free new-product launches have

grown significantly over the past several years.

Consumers diagnosed with celiac disease, a nonfatal sensitivity to gluten, a composite

protein found naturally in grass-related grains including wheat, rye and barley, are pursuing

gluten-free foods more frequently. Consumers are increasingly turning packages over and

making their own decisions about health using the information found on the back of the Cereal

box. Most consumers confirm that they read nutritional information before buying a Cereal.

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The product bears uniformity to the consumer by using similar messaging across categories. It

should be a high-quality product with innovative packaging that is organized. General Mills is

in the growing stage of the product life cycle. This is evidenced by the target segment and

positioning of the company analysis from the positioning map. The company is more

sustainable by introducing new products. Recently they introduced Fiber one, which performed

well and has good consumer recognition. General Mills is still facing increasing competition

from store brands, because store brands offer lower prices without advertising costs.

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Pricing

Pricing should be used as alternative product variances, where General Mills attempts to

sway the developments of its debt so as to not have too large a portion of its debt due in any

given year. Packaged foods are stable, slow growing stocks that aren’t subject to the wide

instabilities of the market. General Mills is the relatively low betas (calculated by running a

lapse comparison) of industry to the market as a whole. Pricing decisions are used as a means

of seizing value. The brand will provide General Mills the ability of attaining additional profit

margins in addition of increasing market share from the high-end, health orientated segment.

General Mills’ sales are a function of their ability to anticipate consumer needs. The more

products that are offered that suit consumer needs, the more sales increase with the new

products. They are raising prices on refrigerated baked goods, hot snacks and frozen

vegetables on January 3, 2010 in response to higher input costs for products.

Boxed, ready-to-eat cereals range in price from $2.00 to $6.00 per box. Honey Nut

Cheerios falls just above the middle ground, averaging $3.68 for a 17-ounce package.

Distribution

General Mills uses an intensive distribution strategy for marketing Honey Nut Cheerios;

they are sold in nearly every location in which cereal is sold. General Mills’ primary

distribution channel is producer to wholesaler to retailer to consumer. In order to maximize

sales, Honey Nut Cheerios can be purchased through many channels, mainly retailers or on the

Internet. Consumers of Honey Nut Cheerios are not willing to travel any particular distance to

buy them, so it is necessary for General Mills to move the product through as many channels as

possible to get it to the largest number of customers. Most Cheerios are purchased in retail

locations, mainly grocery stores; this is the most convenient place for consumers to buy them

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because they are readily available and don’t require a special trip to purchase them. Grocery

stores are located nearly everywhere that there is a large population concentration, and their

atmosphere allows customers to select from many products quickly; this is a perfect

atmosphere for breakfast cereal to be sold in. Honey Nut Cheerios are distributed year-round;

consumers are able to purchase them at any time; many grocery stores are open 24 hours, so

customers are even able to purchase Honey Nut Cheerios any time of day.

Promotion

Honey nut cheerios are currently advertised through various marketing avenues. While

media and technology has advanced, the honey nut cheerios brand has kept up with the times.

The company has focused on internet promotional strategies via cheerios.com. On the website

information is available about the history of Honey nut cheerios and all other cheerios related

products. Coupons and special promotions are available online for print as well. The company

provides a platform on the web page describing how the brand affects the environment,

supports healthy lifestyle, and lists ingredients for people with allergies.

Honey nut cheerios has revamped the brand through social media promotions. Using

platforms such as Twitter, and Facebook the company is appealing to young and hip audiences.

On the cheerios twitter page there is a video posted with the latest advertisement depicting a

hip-hop music video. The song is recorded by hip-hop artist Nelly. The video is entitled “Must

be the honey.” Honey nut cheerios are also advertised in local sales papers, magazines, and

television commercials. As of 2011 General Mills had spent more than any other company on

the promotion of cereal. General Mills has also spent the most amounts of money marketing

Honey nut cheerios. These include totals spent on all media marketing platforms. Information is

not provided on the specific dollar amount spent for the promotion of honey nut cheerios.

However, General Mills has spent $1.2 billion for its entire cereal line up.

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Honey nut cheerios are sold everywhere cereal is sold. The most traditional place to find

the product is in a local supermarket. However, it’s also common to see the product fully

stocked at major retailers such as Wal-Mart and Target.

The typical person finds out about General Mills through shopping at grocery stores.

Some product advertising that General Mills does is the pictures on the boxes of cereal. The

overall message of the advertising campaign is to be healthy and happy. The trucks that carry

their products place to place are a source of promotion for them. One way that General Mills

reach its target in media is by their Facebook, twitter and other social networks. Some sales

promotions that they use are going through nonprofit organizations and using their department

members by addressing the promotional and branding problems of those businesses. General

Mills sales promotion is done many ways but one that I know and experienced as a kid is by

them building the company around learning services. Another way they are promoting

themselves is by going through other companies such as Yoplait, green giant, Pillsbury and

many more.

R ecommendations for General Mills

Recommendations for General Mills (GIS) are: Make using Facebook, twitter, Skype,

and other social media a staple of General Mills to increase international brand awareness.

Develop a rival to Kellogg’s Special K challenge. Increase spending on international marketing.

Keep outspending the competition in marketing; the trend that we have seen in the cereal

market is that whatever company spends more on marketing usually goes on to control the

bigger share of the market.

Develop a pricing strategy that goes toe to toe with local grocery store house brands.

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Use aggressive tactics to target the consumers drifting towards the private label sector of the

cereal market. Invest more in the Global Marketplace.

Develop a strategy to lower company expenses or offset them. Devote resources and

manpower to increase exposure that will lead to higher sales revenues in newer emerging

markets. Find ways to offset commodity costs to increase company profit margin. Develop a

pricing strategy that is not too low and not too high, in order to appeal to all communities and

markets, and all loyal consumers of General Mills (GIS) cereals and products worldwide.

Having a clear plan involving the 4 P’s for the foreseeable future is crucial to success of our

company General Mills (GIS).