Kelloggs Group Presentation (Final Draft) V4

NEW PRODUCT DEVELOPMENT & RESEARCH
Ruqayyah Tanveer, Muhammad Shahab Shams, Muhammad Nauman, Zuhair Abbas

Faisal Dilbagh, Muhammad Yousuf & Syeda Pariza Tahir
FLOW OF PRESENTATION
New Product Application of

Introduction Kellogg’s Research Methods Research in
Development
Pakistan
• Global Overview • Introduction • Primary Research • The NPD • StormFiber

• Current situation to case • Secondary Research process • Research,
• Presence in • Qualitative & • Effect of NPD on preceding launch
Pakistan Quantitative cereal market • Supply chain
Research (Fauji cereals as
• Benefit to Kellogg’s a local example).
• Importance of
research with
examples.
INTRODUCTION TO KELLOGG’S
• Founded in 1906, when W.K Kellogg opened the
“Battle Creek Toasted Corn Flake Company” and
hired his first 44 employees.
• Rapidly grew from there to become the number

one name in the cereal industry, worldwide.
• Established many brands through thorough

research and structured new product development.
Our Vision Our Purpose

To enrich and delight the Nourishing families so they can
world through foods and flourish and thrive.
brands that matter
BRAND
PORTFOLIO
GLOBAL PRESENCE
• Kellogg’s manufactures its products in over 20 countries and markets them in more than 180.
• In Pakistan, marketing and distribution is done by IBL Operations.
CRUNCHY NUT MILK CHOCOLATE HONEY AND NUT CRUNCHY NUT
CORNFLAKES BITES
Launch of Crunchy Nut Brand Extension in 2003 - Launch of Crunchy Nut Recent Successful
Cornflakes in UK in Clusters
Brand Extension
1980
HOW DID KELLOGG ACCOMPLISH SUCCESSFUL
LAUNCH OF CRUNCHY NUT BITES
PROCESS FOLLOWED
DISCOVERY
SELECTING THE BEST IDEA
CRAFTING THE IDEA INTO A NEW

PRODUCT
FORECASTING SALES
WHAT IS MARKET RESEARCH?
• The action or activity of gathering information about
consumers' needs and preference
• An organized effort.
• Understand the needs of consumers.
• Make well-informed market decisions about your

services
• Develop effective strategies.
• Better know about their current and future needs.
• Reduces the risks involved in making these

decisions.
RESEARCH METHODOLOGIES
Primary Research:
Primary research involves gathering data that has not
been collected before, for example questionnaires,
surveys or interview with individuals and small group.
Secondary Research:
Secondary research involves gathering existing data that
has been produced example, magazines, expert
opinions etc.
DIFFERENCE BETWEEN PRIMARY
& SECONDARY RESEARCH
Attribute Primary Research Secondary Research
Data collection Self conducted Conducted by others
Difficulty level High Low
Resources required High Low
Data Quality Accurate Not accurate
Type In-depth exploration Broad
Cost High Low

QUALITATIVE AND QUANTITATIVE RESEARCH
WHY USE BOTH - QUALITATIVE AND QUANTITATIVE
• Kellogg’s - A market oriented company
• Deals in products that focus on the consumers’ needs and wants.
• Therefore it requires:
 Qualitative data to produce a product that satisfies consumer needs
 Quantitative data to forecast how much they would want it
• They used Qualitative approach to have a broader analysis and Quantitative approach for specific analysis
HOW IT IS USED BY KELLOGG’S

STAGE RESEARCH TYPE OUTCOME
-Data from Mintel and Data monitor used to find out about innovation trends in the cereal
Discovery Qualitative market
-Focus Groups captured ideas and feelings from consumers towards new food
- Shown Pictures having New Product Idea and description to the Consumers and Asked
Selecting the best
Quantitative them to fill up a questionnaire
idea
- Helped create a statistical model about liking and disliking
- Helped food technologist to explore the taste and texture of new food idea
Crafting the idea Qualitative/
into a new product Quantitative - Quantitative survey done to find out what prototype product consumers liked the most
-In Home Usage Test’ identifies how the consumers interact with the new product and how
Forecasting Sales Quantitative
much would they want it
NEW PRODUCT DEVELOPMENT
N P D C OV E R S T H E C O M P L E T E P R O C E S S O F
B R I N G I N G A N E W P R O D U C T T O M A R K E T.
THE CEREAL NPD PROCESS
1. Discovery
– Use secondary Research to check for new cereal trends
– Use focus groups to ask for feedback on prototypes
2. Selecting the best idea

– Put the ideas on a board
– Let a larger consumer base choose what they like and dislike
3. Crafting the idea into a new product

– Food Specialist create 4 new food recipes
– Tested by representative groups
– Final idea selected
4. Forecasting Sales
– “In Home Usage Test” conducted to check consumer acceptability
and demand
– Forecasting done on the basis of acceptability
LAUNCH
CEREAL MARKET
• The Global Breakfast Cereal Market is expected to reach USD 54.31 billion by 2025 (Grand View Research, Inc.)
• Consumers prefer to replace traditional breakfast options with breakfast cereals.
• Manufacturers adopting newer technologies and equipment to enhance shelf life of products. Innovative
enzyme technologies and bioprocessing coupled with high-pressure processing technology .
• Breakfast cereals remains a niche category in Pakistan,
• Sales concentrated amongst affluent consumers in major urban centres.
• Increased segmentation to drive up sales of children’s products (while children being primary consumers of
breakfast cereals).
• Increasingly hectic lifestyles of consumption amongst adults for quick and convenient breakfast options.
• Fauji Cereals continued to hold a strong lead in breakfast cereals in Pak but it diminished as multinationals
expanded the presence.
• Fauji has a better market penetration due to its competitive cost than Kellogg’s and larger packaging which
make it cheaper in per bowl comparison.
• Fauji has also introduced “me too” brands that rival Kellogg’s signature cereals.
• Overall, the cereal market has also introduced variants that cater to the health-conscious market like breakfast
bars, granola, muesli and oats.
IMPORTANCE OF MARKET RESEARCH
• Market research can help businesses to AVOID:
 Misjudging the customers’ needs and wants
 Spending time and money in developing a product
that won’t sell
 Entering a market / launching a product with little
room for growth
 Narrows the risk between perception and reality
 Allows you to test your assumptions
 It aids businesses in decision making. This therefore

reduces the risks involved in making these decisions
EFFECTS OF MARKET RESEARCH ON NEW PRODUCT LAUNCH
CORROLLA 2000
• 1st Time use of Six Sigma Techniques by Toyota Pakistan
for Research
• House of Quality Formation for Research integration.
• Market Requirement integration with the cost model.
• Ground clearance increment of 25 mm suggested by

research in different regions of Pakistan
• Made a big difference as far as reliability of Sedan is

concerned
• Proven as one of the major breakthroughs for Indus

Motors after being threatened by Honda City in 2000
EFFECTS OF MARKET RESEARCH ON NEW PRODUCT LAUNCH
SUZUKI LIANA 2004

• An alternate for those who couldn’t afford a Corolla or a City but
wanted a Sedan.
• Liana shared some key aspects with Baleno including the engine,
making it an extended version of the earlier product.
• Very limited market research was conducted that deduced that

City / Corolla were usually preferred for powerful engine and
suspension.
• Only driving force was to introduce a Sedan with the same

engine capacity as of Corolla / City, on a cheaper price point.
• A lot could have been achieved from Liana but known issues and
faults in the product were ignored, resulting in absolute failure.
STORMFIBER’S LAUNCH IN
PAKISTAN: A PARALLEL CASE
• Powered by Cybernet, StormFiber was launched as one

of the first fiber-to-the-home internet services in 2015
• Products: Internet, Digital Television & VoIP
• Target: Households & Small and Medium Businesses
• Major competitors include: Optix & Fiberlink
• Coverage Areas: neighborhoods in Karachi, Lahore,
Faisalabad, Peshawar, Multan, Quetta & Hyderabad
STORMFIBER’S SUPPLY CHAIN
Wholesale bandwidth is acquired from Transworld & PTCL Pi via submarine fiber optic cables.
INFRASTRUCTURE –HIGHLIGHTS
4ft Depth with Sand Beds Large High Density Managed Outdoor - Field In Building - Access
Polyethylene (HDPE) Distribution Terminals (FDT) Distribution Terminals
Ducts for (ADT)
scalability and strength
RESEARCH - PRE LAUNCH
P R I M A RY S E C O N DA RY
• In depth interviews, focus groups and • Articles, website analysis and consultants
online questionnaires • International models: Google Fiber,Verizon
• “Mystery shopping” via Tech Aches Fios and AT&T Fiber
• Gauged number of “internet powered • Coverage, speeds and payment plans
devices in each home”, their ideal speeds • Value Added Services
and payment plans • Integrated marketing communications
• Common problems with internet in PK • FAQs, Service Guidelines etc.
• Common issues with payment in PK • Sales projections (value and volume)
KELLOGG’S VS.
STORMFIBER
BRAND KELLOGG’S STORMFIBER
Type of Business Cereals Internet Service Provider
Footprint Global Metro Cities in PK
Firm Orientation Market oriented Market oriented
Local Market Leaders Yes Yes
Market Potential Huge Huge
Number of Products 100+ 3
THANK YOU
ANY QUESTIONS?

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NEW PRODUCT DEVELOPMENT & RESEARCH

Ruqayyah Tanveer, Muhammad Shahab Shams, Muhammad Nauman, Zuhair Abbas

New Product Application of

• Global Overview • Introduction • Primary Research • The NPD • StormFiber

• Rapidly grew from there to become the number

• Established many brands through thorough

Our Vision Our Purpose

SELECTING THE BEST IDEA

CRAFTING THE IDEA INTO A NEW

• Understand the needs of consumers.

• Make well-informed market decisions about your

• Develop effective strategies.

• Better know about their current and future needs.

• Reduces the risks involved in making these

Data collection Self conducted Conducted by others

Difficulty level High Low

Resources required High Low

Data Quality Accurate Not accurate

Type In-depth exploration Broad

Cost High Low

HOW IT IS USED BY KELLOGG’S

2. Selecting the best idea

3. Crafting the idea into a new product

 Narrows the risk between perception and reality

 Allows you to test your assumptions

 It aids businesses in decision making. This therefore

• House of Quality Formation for Research integration.

• Market Requirement integration with the cost model.

• Ground clearance increment of 25 mm suggested by

• Made a big difference as far as reliability of Sedan is

• Proven as one of the major breakthroughs for Indus

SUZUKI LIANA 2004

• Very limited market research was conducted that deduced that

• Only driving force was to introduce a Sedan with the same

• Powered by Cybernet, StormFiber was launched as one

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