Company Name – Kelloggs
Founded by- W. K. Kellogg
The Kellogg Company was founded by W. K. Kellogg in 1906 at Battle Creek, Michigan, USA. It sells convenience foods, cereals and several other eatables under the world-famous brand name ‘Kellogg’s’ in over 180 countries. The company is headquartered in its birthplace, Battle Creek, Michigan and has regional offices in Chicago, Dublin, Shanghai and Querétaro City (Mexico).
The company is bestowed with a prestigious “Royal Warrant” by the British Queen and Prince of Wales to supply food items to their household. The Kellogg Company employs around 33,000 employees all over the world and had earned total revenue of about 12.92 billion US Dollars in 2017.
How it all Started
Dr. John Harvey Kellogg, the elder brother of Will Keith Kellogg, was the director of Battle Creek Sanitarium. To serve his patients better, Dr. J. H. Kellogg along with his brother co-founded the Battle Creek Sanitarium Health Food Company during the year 1898. This food production unit specialized in processed preparations for the current and former patient of the sanatorium. The company became known as the Battle Creek Sanitarium Food Company by 1901 and produced health foods like Corn Flakes, Cereal Coffee and Granola.
As the business thrived, the operation of another food processing company named Sanitas Nut Food Company, also founded by Dr. J. H. Harvey in 1899, was merged with Battle Creek Sanitarium Food Company to form Kellogg Food Company in 1908. The new company added nut butters and meat replacement food to their product lines and their products sold under the brand name “Kellogg’s” for the first time during this period.
Dr. J. H. Harvey, being first and foremost a doctor, forbade his younger brother from selling the company products to anyone apart from his patients. This led to fallout between the two and Will Keith Kellogg established a separate food processing company named “Battle Creek Toasted Corn Flake Company” in 1906.
Will Keith also acquired the rights of The Sanitas brand from his brother and started selling the product “Kellogg’s Toasted Corn Flakes”. This product became hugely successful among the masses and formed the basis of its success. The company was renamed as “Kellogg Toasted Corn Flake Company” in 1909 and later taking the current name “Kellogg Company” during 1922.
The Road to Popularity
While Will Keith Kellogg’s company was gaining popularity at a steady rate, the turbulent times during the Depression Era of the 1930s was taking its toll. To counter this stagnating effect, he took a novel approach and started the weekly 30-hour work shifts for his employees at the production unit instead of the usual 40 hours per week norm.
The idea behind the strategy was to employ more workers through an extra shift, thus supporting more people while meeting his production targets and keeping the business thriving. The company continued with this strategy till after the 2nd World War for its various departments and production units.
During the end of 1960s, the advertising focus shifted towards commercials during morning television shows which were the nation’s favorite during the times. Along with supporting the ever-growing demands for its products, Kellogg’s added various smaller food businesses into its burgeoning conglomerate status like Eggo, Mrs. Smith’s Pies, Salada Foods and Fearn International to name a few. However, the company also faced competition from peers which included Quaker Oats and General Mills during this period which eroded its market share in the business.
Mr. William E. LaMothe was the pioneer chairman during the 1970s to revive the company’s declining fortunes through targeted marketing to entice the potential customers between the ages of 25 to 49 into consuming more cereal products.
These people, so-called “baby boomer” generation were convinced with the campaign into consuming 26% more cereal when compared with similar age group’s cereal product consumption five years ago. This trend continued in the 1980s with the market valuation of ready-to-eat cereals soaring from 3.7 billion dollars in 1983 to 5.4 billion dollars in 1988, therate of expansion being almost three times compared to other grocery products.
To meet the demands of this burgeoning market, Kelloggs introduced new products like Crispix, Nutri-Grain Biscuits and Raisin Squares and also looked to expand internationally by targeting country-specific products like Genmai Flakes in Japan and Just Right for the Australian market. The new Millennium saw Kelloggs further consolidating its position among the top food production companies of the world with the acquisition of the Keebler Company, its largest till date.
Keeping up with the strategy of acquisition, Kelloggs also bought or assimilated many other popular food product brands like Austin Cookies and Crackers, Cheez-It, Gardenburger, Bear Naked, Murray and Plantation to increase its influence in both domestic and international markets. In 2012, The Kelloggs Company attained the second position among the snack food producing companies with its key acquisition of the Pringles brand for a 2.7 billion dollar deal with Procter and Gamble. The last notable acquisition by the company was Rxbar for 600 million dollars in 2017.
The Kelloggs Company has been a pioneer in the field of popularizing its food products through innovative marketing strategies and promotions.
- In the 1970s and 80s, they promoted cereal consumption by highlighting its various benefits and nutritional values. The Saturday Morning Show during the times featured the company’s slogan “Kellogg’s puts more into your morning”
- The easily distinguishable logo of the company was created by Ferris Crane with artistic supervision from Y. Ames, the famous type designer of the times
- The company has a long and fruitful association with the television and has been sponsoring the hit panel show “What’s My Line?” It also associated its kids’ food product lines with popular children’s shows such as “Dragon Tales”
- The Kelloggs Company founder, W. E. Kelloggs, was the first to introduce gifts and prizes in its cereal boxes, a trend continuing to the current times
- The Company has a strong association with Motorsports – it sponsored the Chevrolets racing car from 1993 to 2006 and has used the game’s champion’s pictures on its cereal boxes multiple times
- The Kelloggs Company sponsors the American Olympics Gymnast Team and promotes a multi-city tour performance of the team’s medal-winning champions after the Olympics event. Also, many American Olympics athletes frequently adorn their cereal boxes as a part of sponsorship deal with the event organizers.
To sum up, The Kelloggs Company has been at the forefront of the American ready-to-eat food product market for more than a century. Its innovative products and marketing strategies have combined to elevate the company at its current world-dominating status in the cereal and snack food categories. The current focus of the company is on putting healthy and wholesome eatables on the tables of its loyal customers is bound to further increase its global reach and contribute further to its overall growth in future business.
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