Kelloggs Profile

Kellogg's is the world's leading producer of cereal and is one of the largest producers of convenience foods. Being a worldwide company, Kellogg's has many influences that affect many different aspects of their business. From the economic environment to socio-cultural environments and ever changing technological advances, The Kellogg's Company continues to make strides toward keeping the company updated on all levels. This paper will discuss some of the things that impact Kellogg's and some of their strategies to meet these challenges.

Today, the Kellogg Company faces the most difficult operating environment it has experienced in many years. Prime among the challenges confronting Kellogg are rapidly rising prices for several of the key inputs for its cereal and snack foods, including corn and wheat. Rising energy prices exacerbate high input process by increasing the cost of transportation and delivery to Kellogg's distributors. Kellogg purchases large quantities of agricultural commodities including cereal grains, corn products, wheat, cocoa and dairy products. Kellogg is more vulnerable to fluctuation in oil prices compared to its competitors due to its direct-store/door delivery (DSD) system. Finally, Kellogg faces intense competition in its core US market where a slowdown in consumer spending, as a result of America's ongoing economic hardships, threatens to hurt sales.

Being a worldwide distributor of food products brings the socio-economic environment to light. When distributing to the many different countries it serves, Kellogg must take into account the different cultures, religious dietary restrictions and societies of its customers. In the United States and Canada, the two of the largest consumers of Kellogg products, the dietary restrictions do not have much of an impact on sales. Most cultures have little to no restrictions on the consumption of grain and sugar products. The main focus is on the individual tastes of the different cultures. For example, Kellogg's markets five different products with "Black Sesame" which is specifically designed to match the taste of Taiwanese consumers. Most countries are adaptable to foreign cultures as well, which helps the company market the sweet cereals and sugary snacks to children all over the world.

The technological environment is a key component in the marketing of Kellogg products. Some of the countries where Kellogg's has product distribution are not as technologically advanced as others, making marketing the products a bit more difficult. With the limited incomes and resources of the potential customers, the company must be creative in their marketing strategies when reaching these countries. Television is the best source of advertising in these somewhat technologically limited countries, with the internet being a close second. In more updated countries, such as The United States, Canada and the United Kingdom, advertising and marketing opportunities are abundant.

More and more, consumers trust companies that care about the things they care about. Beyond the product itself, this included a wide range of environmental concerns that arise, such as the impacts of agriculture and food processing on climate change, water availability and energy use, as well as food safety. Kellogg has adopted certain goals to achieve 15 to 20 percent reductions in their energy use, greenhouse gas emissions, water use and waster per metric ton of food produced by 2015. Some of these goals have already been achieved before the 2015 year mark. Kellogg conducted a water risk assessment for all plants worldwide and was among the first companies to submit water use data to Water Disclosure, a new global data repository. Kellogg has also made sustainability commitments (together with other members of the Consumer Goods Forum) relating to carbon measurement, refrigeration, packaging and helping to achieve net-zero deforestation and has implemented a new environmental and safety management system at all Kellogg's sites globally.

Consumers are constantly inundated with advertisements, TV commercials, special offers and coupons from the many manufacturers of goods and services. The Kellogg Company is no different than any other company with its major competitors always ready and willing to grab the number one spot as the largest producer of cereal and snack products. Kellogg's main competition is the

General Mills Company. General Mills is also a leader in breakfast cereals and snacks as well as chilled