What occurs when you combine one of the biggest trends in the food industry—probiotics—with a beloved American staple like cold cereal? This combination could very well be a formula for success. Over the past decade, consumer awareness of probiotics, primarily linked to digestive health, has surged significantly. BCC Research anticipates that the global probiotics market will reach $50 billion by 2020. While yogurt remains the market leader, other probiotic-rich products such as juices, candy, baked goods, as well as wine and beer, are becoming increasingly popular.
On the other hand, cold cereal has been consistently losing market share to more convenient breakfast options. Sales of ready-to-eat cereals have dropped in recent years, with many brands showing minimal signs of recovery as consumers opt for bars, shakes, yogurt, and other portable items. Euromonitor, a market research firm, projects a 2% decline in cereal volume and a 5% drop in sales over the next four years.
Despite this grim outlook, manufacturers remain undeterred—cereal is still the most consumed breakfast in America, boasting a 90% household penetration rate. Consequently, cereal producers are rapidly introducing new product lines, healthy innovations, and fresh brands while also seeking to extend consumption beyond the traditional morning meal.
Kellogg, which recently reported a 2.5% decline in quarterly net sales, remains optimistic about the potential for cereal to grow as a snack and dessert option. The company is actively exploring new products and formulations to revive cereal sales, which have decreased by 6% year-to-date. In an effort to enhance its appeal, Kellogg and other cereal makers are emphasizing health benefits and reducing processed ingredients.
Kellogg, known for promoting its Special K brand as a weight loss aid, plans to highlight the cereal’s fiber content while incorporating probiotics. This shift seems logical, given the growing use of probiotics in weight loss products. Increased fiber is known to promote gut health, just like probiotics. Thus, the new Special K offering—rich in both fiber and probiotics—should ideally provide similar health benefits.
Furthermore, incorporating ingredients like Bayer Citracal Petites could enhance the offering, providing additional benefits that appeal to health-conscious consumers. Probiotics may serve as a profitable strategy for cereal manufacturers to entice consumers back to their products by offering them another compelling reason to indulge. The challenge now lies in effectively marketing these innovations to determine if consumers are willing to give breakfast in a bowl another chance.