Crunchy Nut loses bite as sales plummet

Crunchy Nut: sales down
Crunchy Nut: sales down

Sales of the cereal are in decline as more people opt for breakfast-on-the-go.

Long working hours have forced many consumers to turn to the 'deskfast' - breakfast eaten in the office.

Meanwhile, several reports released in the past year have highlighted the high sugar and salt content of many popular cereals. These are the two main factors blamed for the decline in sales of breakfast cereals.

Kellogg is one of the hardest-hit companies. Nielsen figures for the year to mid-October 2012, reveal that the Crunchy Nut brand is down 10.3% (a £9.4m drop) to £81.3m.

The brand has also slipped down in the top 20 rankings (by volume sales) of breakfast cereals in the survey, having been overtaken by Quaker, which is now at number three, behind Weetabix and Special K.

Profits at Kellogg's European business fell by 20% in the first quarter of 2012. At the time, the cereal maker said most of the issues in the UK related to its Crunchy Nut and Special K brands.

Two years ago, Kellogg unveiled a £13m, celebrity-fronted campaign for the cereal, featuring Rob Brydon, with ads created by Leo Burnett.

In 2012, the brand revisited its traditional endline 'The trouble is, they taste too good,' with the first ad in the campaign featuring a snake. Kellogg also invested in new product development, including the launch of a Crunchy Nut variant with cranberries, almonds and yoghurt flakes, with ads inspired by the film Jurassic Park.

How can the brand reverse its sales slump? We asked Matt Edwards, chief executive at WCRS, which has previously handled the Weetabix account, and Simon White, European chief planning officer at Draftfcb.

He previously worked at Unilever and Pedigree Petfoods, and was joint managing director and head of planning at Grey London, which has worked on the Jordans & Ryvita Company business.

 

CRUNCHY NUT STATS

Sales were down 10.3% to £83.1m for the year to Oct 2012

£6m - The cost of the brand's latest campaign

Source: Nielsen, Kellogg

 

BRAND HEALTH CHECK DIAGNOSIS

MATT EDWARDS, CHIEF EXECUTIVE, WCRS (which handled the Weetabix account)

I love Kellogg's Crunchy Nut; it's delicious. The trouble is, it tastes too good, being delicious in a way that only a product with 35g of sugar per 100g serving can be.

In a world where more people are conscious of wholesome, healthy eating, that's not a recipe for growth.

The brand must also contend with a rejuvenated porridge sector, smart NPD that allows consumers to eat breakfast on the go, and recent press coverage highlighting the nutritional value of toast. Considering the brand was launched in 1980, around the same time as the Walkman and Cabbage Patch Kids, to have stayed so big for so long is a remarkable feat.

 

REMEDY

- Demonstrate affordability; 12p per bowl is a bargain for a snack this delicious.

- Use communications to argue on an emotional level; advertising can get straight to the decision-making part of the brain and bypass a logical health story.

- Extend consumption occasions. Sofa-snacking, after-sport refuelling and home-from-work boosts are all good candidates.

 

SIMON WHITE, EUROPEAN CHIEF PLANNING OFFICER, DRAFTFCB (ex-Grey London, which worked on the Jordans account)

Crunchy Nut faces many challenges beyond its control. Consumers want to eat healthier, are too busy for breakfast anyway, and the price has been pushed above £2.50.

In addition, its once distinctive 'irresistible' positioning has been adopted by several brands.

That said, we still like treats and we're not really any healthier. Psychological research shows all food choice is emotional, involving the reward system. It's here the battle is won or lost. Tempt us, surprise us and make our mouths water, as well as entertaining us. Seduce our subconscious: seeing true, uncontrollable desire will excite both our mirror neurons and taste buds.

 

REMEDY

- Evoke the unapologetic appetite appeal that is at the heart of the product.

- Update the creative expression of irresistibly delicious. Crunchy Nut needs to genuinely surprise its audience if it wants to drive reappraisal.

- Crack snacking on the go, or 'own' an eating occasion that taps into existing consumer behaviour.

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