02 Apr Redefining breakfast: two strategies that are breathing new life into a tired category

A new brand that’s rocketed from zero to £44-million in sales within three years and is helping redefine a category, and an old brand that has found growth by using an approved health claim to connect to one of the biggest consumer needs – these two cases illustrate the way the breakfast category is being redefined and provide key lessons for any company. [Click pic to enlarge]

Kraft’s Belvita Breakfast Biscuits are a phenomenon. Long-established in mainland Europe, Kraft launched the brand in the UK – where there was no consumer habit of eating biscuits for breakfast – in 2010, since when retail sales have jumped from zero to £44-million ($72-million/€54-million) in 2012. In 2012 alone sales grew 70%. Prorata Belvita’s sales in the UK (a country of 60 million people) to a country the size of the US and it’s equivalent to a $350-million brand.

A NEW TYPE OF CONVENIENCE

One of the elements of Belvita’s success is that it provides a new type of convenience at a time when consumers’ breakfast habits are changing and traditional breakfast options are no longer convenient enough. According to one consumer research company, 40% of UK consumers take breakfast either at work or on the way there.

People – and especially younger consumers – are increasingly looking for something that is:

• convenient and easy to eat in a hurry
• delicious
• satisfying
• provides an energy boost
• and is healthy (or has a halo of health)

Breakfast cereal companies have failed to respond to these needs, focusing instead on their traditional brands, which are little more than inconvenient big boxes containing some dry grains. This failure to respond to a changing market has created an opportunity for a disruptive innovation and it was Kraft Foods that first seized the initiative.

The success of Kraft Belvita shows the power of the following elements, which anyone can use to underpin their own innovation efforts:

• Permission to indulge
• Simple marketing message innovation
• Creating a new brand
• Creating a new category or new segment of an existing market
• An expert brand

Faced with the huge challenge of selling a sweet biscuit as a healthy breakfast option, Kraft’s positioning of its brand is skilful and key to its success. The aim is “permission to indulge” – enabling people who would like to eat healthily, or believe that they do, to make Belvita their breakfast choice without any guilt.

There are two steps to the Belvita message. The first is messaging on the pack and in advertising which tells people that biscuits can be part of a healthy breakfast: What is a balanced breakfast? 4 Belvita Breakfast Biscuits + 1 serving of dairy + 1 portion of fruit.

The second part emphasises the product’s slow energy-release carbohydrates, reassuring people that they can eat sweet biscuits for breakfast and still feel virtuous.

NEW BRAND THE SAFER OPTION

Kraft used a new brand to deliver this new proposition and create a new breakfast category (as well as a new segment of the biscuit market) – a success factor that has been shown over and again. Contrary to marketers’ conventional wisdom, new brands are always more successful and the delivery of totally new propositions is less risky than extensions of existing brands.

Kraft has also shown it understands that what helps drive successful brands today is a steady pipeline of new tastes to hold the interest of people who quickly get bored.

Starting from a basic four variants in 2010, Belvita today has eight flavours. The result of this strategy has been massive success. In the UK 2012 sales jumped 70% compared to 2011 to £44-million ($72-million/€54-million). Belvita has become the UK’s 6th-biggest biscuit brand and by itself in 2012 generated 50% of the entire growth in the UK’s £1.589-billion ($2.594-billion/€1.956-billion) biscuit category.

Belvita has become “the expert brand” for breakfast biscuits and established a position that will be hard for anyone to challenge. The best any competitor can hope for now is to be in a distant second place.

Faced with the challenge and the opportunity of changing breakfast habits, the breakfast cereal companies failed to respond. But just like the management textbooks say, now that their market is being attacked by a new entrant from outside their category, the cereal companies’ managements are waking up.

Kellogg has decided to be the follower to Kraft, launching its own line of breakfast biscuits as an extension of its Nutri-Grain brand, which experienced a 1.5% sales decline in 2012. [Click pic to enlarge]

Kellogg’s approach reveals weak senior management marketing skills. By launching it as a brand extension Kellogg has already increased its chances of failure. Kellogg is investing a £4.5-million ($7.3-million/€5.5-million) marketing budget behind the new launch. It’s a big spend – but history shows that me-too products that challenge expert brands and bring no new point of difference perform poorly.

CAPITALISING ON FIBRE CLAIM

Away from the breakfast-on the go convenience market there’s better news for Kellogg in the UK. In this market the company was the first company in Europe to use a regulator-approved digestive health claim – a step that has begun to pay dividends.

Kellogg harnessed two of Europe’s Article 13.1 health claims to one of its oldest brands, giving its 90-year-old All-Bran brand – a high-fibre brand long established as “a digestive health remedy for older people” – a new lease of life. The re-launch was a bid by the company to broaden the appeal of All- Bran, which is widely recognised for its high fibre content.

Kellogg was explicit in stating that it is aiming to capitalise on the approval by EFSA of two Article 13.1 health claims linking wheat bran fibre with digestive health. The claims, which are to be included on the EU’s generic list of structure-function claims that anybody can use, are: “Wheat bran fibre contributes to an acceleration of intestinal transit” and “Wheat bran fibre contributes to an increase in faecal bulk”.

Considering the claims are not the most consumer-friendly use of language it is understandable that the digestive health benefits are instead expressed on-pack as: “Introducing a new way to feel All-Bran new! New Kellogg All-Bran Golden Crunch is a light and crunchy multi-grain cereal made with wheat bran, oven baked into delicious clusters so it’s not only good for your digestive health, but tastes great too.”

Kellogg threw its marketing muscle behind the new positioning, investing £5-million ($7.9-million/€5.5-million) in a multi-media campaign under the strapline “Feel All-Bran New”.

The strategy made sense because although digestive health is consumers’ biggest need and has for a decade been one of the two biggest trends driving our industry, only the probiotic yoghurt category has responded. Every other category in the supermarket has studiously ignored the opportunity.

Only Danone’s Activia brand has capitalised fully on this key trend – with its “speeds intestinal transit time” claims. Consumers have rewarded Activia by helping it become the world’s biggest digestive health brand.

This editorial from New Nutrition Business’s magazine was first published in its February 2013 edition.

About New Nutrition Business

New Nutrition Business is a London-based research, publishing and consulting company which specialises in researching, analysing and forecasting developments in the business of food, nutrition and health around the world.

The strategies and success factors it  has identified in the 1990s have become the benchmarks for strategy development and brand positioning in the worldwide nutrition business. It works with companies all around the world, from the United States to Australia and from Sweden to South Africa.

New Nutrition Business is headed by executive director Julian Mellentin (right), one of the world’s very few global specialists in the business of food, nutrition and health.

He is the editor-in-chief of New Nutrition Business and Kids Nutrition Report, the only industry journal in the world on the rapidly developing kids’ nutritional marketplace. See www.new-nutrition.com