Special K US annual sales slump 9.7%

Total sales for the 52 weeks ending August 10, 2014 were $521,636,864 - down 9.7% from the same period in 2013, according to data from Chicago-based market research firm IRI.
While sales for its flagship Special K brand were up 14%, the majority of its portfolio was down.
Red Berries sales dropped 13.57%; Multi Grain was down 58.66% and Cinnamon Pecan sales fell even further (70.59%). Special K Blueberry posted sales drops of close to 100% - 98.15%.
Discussing the total 9.7% slump, David Jago, director of innovation and insight at Mintel, said it was “a reasonable drop off”.
“Obviously there’s a concern… They need to do something to keep people interested in the brand,” he told BakeryandSnacks.com.
Packaging innovation versus product change
Over the past few years Kellogg had done little to alter the formulation and product of its Special K cereal line, Jago said, choosing to stick to package redesigns instead – some of which had proved successful.
Kellogg launched night-themed packs this summer, for example, promoting its cereals as a night-time snack, he said. “It’s quite interesting – that’s going to stand out in the Special K line. And the pack re-design is actually a really low-cost way of keeping consumers interested in the brand. You change the pack but there are no formulation costs – it’s just a bit of printing.”
However, Jago said Kellogg would need to do more to spark increased interest in Special K and turnaround waning sales.
“I don’t think they want to do anything too radical, because let’s not forget it’s still a multi-million brand. But they need to think about some of the varieties – maybe editing the range just to keep consumers interested,” he said.
Red Berries for example was perhaps not as interesting for consumers as it was a few years ago, he said. “Most flavors in any range have a certain life cycle – that’s not unusual. It might pick up again; it might just be a bit tired.”
Forget dieting, think lifestyle
Kellogg had long positioned its Special K line as more of a good lifestyle choice as consumers lost interest in dieting, and this was a strategy the company should keep, Jago said.
“The number of consumers in any country on a diet has typically been falling, not growing. They don’t have the same believability in those diet plans; Weight Watchers has struggled and you’ve seen Slim Fast fall through the floor. Special K has traditionally been the one that’s survived that, by getting in quite early on with a lifestyle branding.”
US sales of some Special K variants were indicative of the success lifestyle positioning had, he said.
Special K Protein had done exceptionally well with a sales growth of 531% for the period, IRI data indicated, and Special K Oats & Honey also posted a 152% rise in sales.
“Oat is a destination ingredient; consumers are really turned on by oats. Anything with oats and protein is doing really well,” he said.
“…For the longer term, focusing on healthy lifestyle is absolutely the right thing to do.”