Why kelloggs failed in indian market

Hence, from a macroscopic lens, India seemed like a great choice. Despite this, certain factors gave the company some hope. Increased demand for convenience: With urbanization spreading across the country, more hectic work schedules, and lifestyle changes, the demand for convenience was larger than ever before.

Hence, consumers were now more open to the consumption of ready-to-eat meals. Increase in disposable income: People now had a higher capacity to spend money on things they liked.

Raising health standards: Indians were now more afraid of ailments like heart disease and diabetes. They wanted food options that would keep them safe from such health-related problems.

The Indians liked their breakfast hot and savory, if not sweet. Higher prices. But when the Indian consumers used those flakes with hot milk they liked it hot, as I said above , they became soggy. They misjudged the correct way to advertise their offerings. Maybe it was impossible to do so without trying and failing once. Who knows. This article was originally published by Kiran jain on medium. Created by Kiran Jain. The products were no longer positioned as premium products, in order to make them a regular rather than a one-off buy.

The brand also localised its branding and advertising approach to make it more acceptable. Accompaniments such as curd and pistachio, which suited the local palate, were suggested. These days, cornflakes are offered with mango and banana puree to suit local tastes. All raw materials, including packaging, are sourced in India, and the main plant is located close to the largest market; all of which minimises costs. Using a network of agents, the brand has established a distribution network including storage facilities.

Overheads are minimised by giving distributors large responsibility for sales. Larger multinationals including Dr Oetker and PepsiCo are also muscling in on the market. Though milk was a daily part of their breakfast, cereals were still alien to the majority of the user base.

Magnum media promotions, advertising, and attractive marketing strategies could inspire consumers to try the products as a novelty. But certainly not repeated purchasing. Many analysts believe that there was a lack of cultural insights on the part of this international brand; the price bracket was also much higher than the regular groceries.

The Indians were habituated to have their milk hot and with added sugar. But the cereals were to be eaten with cold milk, and consequently, the sugar could not be dissolved when the milk is cold. The Indian consumers would rather have the cereals with hot milk so that the flakes are soggy and then add sugar to it.

The Indian palette was surely not happy with the resulted taste. It launched Frosties, which came with added sugar, and with milk, the taste would be automatically sweet, without any more sugar by the consumers. The Indian or the desi breakfast menu comprises of paratha, vada, idli, poha, dosa, etc.

In comparison to the diverse and tasty list of breakfast options, cereals became very bland and insubstantial.