Kellogg dished out $600 million for RXBar, and Post paid $1.5 billion for breakfast sausage maker Bob Evans Farms last year.īut cereal remains core to their businesses. General Mills bought Annie's organic pastas and snacks for $820 million in 2014 and Blue Buffalo pet food for $8 billion earlier this year.
Millennials have been at the front of the shift to healthier and more portable snacks, and companies have expanded their lineups in recent years to spark growth. General Mills' overall sales have dropped for three straight years and Kellogg's have declined four years in a row. Kellogg's Chocolate Frosted Flakes debuted in 2017.Ī new FDA nutrition labeling rule will go into effect by 2020 that more clearly labels how much added sugar and calories are in their food.Ĭhanging consumer preferences have hurt General, Kellogg and Post, the largest cereal producers in the United States. "Sugar remains one of the biggest concerns for consumers in breakfast cereal, and future regulatory changes will only magnify this importance," she said. More Americans are swapping out a bowl of cereal in the morning for protein and fruit bars, and on-the-go yogurts that offer more convenience and less sugar, according to Euromonitor research Ana Sepulveda. In the past, brands pitched cereals as a healthy way to start the day and provide energy for kids, but the marketing started to fall flat as healthier options emerged. They will drop an additional 5% during the next five years, market research firm Euromonitor predicted. Related: Does anybody eat cereal for breakfast anymore?Ĭereal sales in the United States have dipped 9% over the past five years to $10.5 billion. Post added cinnamon to its classic Fruity Pebbles brand. It also brought back artificial coloring and flavors in Trix last year after an outcry from customers. General Mills rolled out Chocolate Peanut Butter Cheerios in 2017 and unicorn-shaped marshmallow Lucky Charms earlier this year. Kellogg isn't the only company trying this strategy.
It hopes people who haven't thought about Toucan Sam in years may come back to try the brand again. "Everybody is trying to reposition themselves into the snacking space." Kellogg's new Fruit Loops flavor is Wild Berry.īy putting a new spin on fading childhood breakfast staples, Kellogg is playing on customers' nostalgia. "The companies are likely diversifying their marketing strategies to try to capture new occasions," AllianceBernstein analyst Alexia Howard said.
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