TARGET MARKET CEREAL – CONSUMER PSYCHOLOGY AND BEHAVIOR
Objective:
When conducting a global research, common pitfalls are
· Making assumptions
· Believe stereotypes
· Using self-reference criterion when developing research criteria and questions
· Using self-reference criterion when analyzing research results
· Incorporating ethnocentric views when strategizing business decisions
The objective of this assignment is to practice refraining from such pitfalls. The assignment will take a quintessential American breakfast, cereal, and examine what a cereal company should use as their criteria to enter a global market.
The pitfall you must avoid are
· Make assumptions that the easiest market to enter are those where consumer practice similar behavior of eating cereal for breakfast
· Believe the stereotypes that certainly countries only eat certain items for breakfast
· Use self-reference criterion that cereals should be consumed as only breakfast item
· Incorporate ethnocentric view that the American way of marketing this product (i.e. a business decision) is the only correct way for all countries and for all target markets
Instruction: Part 1 Individual Work – 25 points Part 2 Group Work – 25 points
For submission and presentation in class, research the following questions. College level research and critical thinking responses are expected. MLA citation required.
Let’s assume that you are the International Marketing Manager of Kellogg’s. Your responsibilities include keeping the Kellogg’s share of market (SOM) high in as many countries as possible.
In the U.S., cereal is a common breakfast item. The behavior of eating cereal with milk is practiced in many states (in the U.S.) and almost throughout the entire season, regardless of weather or season. Now, is this true for other countries Kellogg’s has entered or is contemplating on entering? Visit
· https://www.statista.com/statistics/270203/net-sales-of-the-kellogg-company-worldwide/
· http://newsroom.kelloggs.com/2019-06-03-Kellogg-Company-unveils-ambitious-next-generation-Kelloggs-R-Better-Days-global-commitment-to-address-food-security-driving-positive-change-for-people-communities-and-the-planet-by-the-end-of-2030
· https://www.prnewswire.com/news-releases/kellogg-company-provides-an-update-on-its-global-packaging-goal-300941422.html
· Other sites for further information
Individual Work
1. Select one country (excluding the U.S. and Canada) in which Kellogg’s holds number 1 market share in the breakfast food category in that country. (i.e. higher share-of-market than Kelloggs competitors)
a. Name the country
b. How are Kellogg’s cereals consumed in that country?
c. Is it a breakfast food?
d. Consumed with milk as Americans do?
e. Give me details of what typical families eat for breakfast.
f. What other Kellogg’s product line extension (derivatives of cereals, e.g. cereal bars, etc.) are popular in that country?
2. Select one country where Kellogg’s barely hanging on to the market share.
a. Name that country
b. Why do you think Kellogg’s is not doing well in that country?
c. Who are the other players?
d. Why are they doing better than Kellogg’s?
3. For the country you chose for Q2, from strategic point-of-view, why is Kellogg still in that market if they are not making that much money? Or are they?
Group Work
Now, look at Kellogg’s activities in Japan. Japan is the 3rd strongest economic powerhouse in the world. Consumers in Japan have high disposable income, making Japan a very viable market for many companies to enter.
Make sure you do the research. Do not fall into the pitfall of making assumptions nor believing in the stereotypes. You will have to dig deep into the research. First tier of research will give you stereotypical answers of Japanese people eat rice and fish in the morning. Consumers in Japan do not all eat rice in the morning!! Most of the people in Japan eat toast, egg, milk, etc. for breakfast.
1. Why isn’t Kellogg cereals’ sales high in Japan?
2. What cultural/behavioral differences make Japan a difficult market for Kellogg’s to penetrate further? Research not just their behavior but also of their psychology. Research along the lines of what the Japanese society dictates as roles of moms and what are expected of them.
Consider also what moms themselves perceive as what their roles and responsibilities should be to be a good mom.
3. Acknowledging this, why does Kellogg’s insist on having its presence in Japan?
4. What should Kelloggs do with the product idea?
a. If the brand insists on cereal, what should be the positioning of the product?
b. How should it be used?
5. If the brand wishes to introduce a cereal derived product, what should it be?
Ishihara 2
