KANSAS CITY — Food manufacturers are trying to outdo each other’s ready-to-eat cereal innovations to make up for less than stellar sales in the category.
In the 52 weeks ended Oct. 6, dollar sales in the ready-to-eat (RTE) cereal category totaled $11.02 billion, basically unchanged from the same period a year ago, according to Chicago-based market research firm Circana. Unit sales, on the other hand, were down 2% in the category.
WK Kellogg Co, the Battle Creek, Mich.-based cereal manufacturer spun off from The Kellogg Co. in October 2023, saw a decrease in dollar and unit sales in the RTE cereal category, as well as protests against its use of synthetic dyes, during the most recent 52-week period.
Yet Gary Pilnick, chairman and chief executive officer, said during a conference call on Sept. 4 that the company can regain momentum in the second half through creative cereal partnerships.
Those partnerships, which Pilnick said are “performing well in market,” include cookie franchise Crumbl (Kellogg’s Crumbl Chocolatey Chip Cereal) and streaming platform Netflix for its popular “Wednesday” series (Kellogg’s Wednesday Cookies & Creme Cereal).
New products also remained a staple for WK Kellogg over the past year. In January, the company introduced Eat Your Mouth Off, a vegan cereal that contains 22 grams of plant-based protein, 2 grams or less of net carbs per serving and no sugar.
“It’s been just a year since this team, driven by curiosity and a hunger for something new, began envisioning cereal not only as a nutritious option, but as a way to inject fun into your breakfast, snack or meal experience,” Sadie Garcia, senior marketing director at WK Kellogg, said when the cereal debuted at the start of 2024. “From there, Eat Your Mouth Off was born as a brand that goes beyond being good for you … it’s a high-protein option that doesn’t sacrifice taste.”
Dollar sales for WK Kellogg in the RTE cereal category for the 52-week period totaled $2.92 billion, down 2.2% from a year ago, according to Circana. Unit sales came in at 635.34 million, down 3.1% year over year.
Another major cereal maker that experienced slower RTE cereal sales in the most recent 52-week period was Minneapolis-based General Mills, Inc. But like WK Kellogg Co, executives at General Mills are confident that the company is headed in the right direction behind several iconic cereal brands, such as Cheerios, Wheaties and Chex.
In a quarterly report issued June 26, Jeffrey Harmening, chairman and CEO of General Mills, said introducing 40% more “big bet” market launches “increased our innovation pressure in fiscal 2024,” which helped lead the company into a strong innovation year for cereal.
In the first half of 2024, General Mills launched five cereals, all of which were the largest new products in the US cereal category, said Harmening.
The new offerings include the Kelce Mix breakfast cereal, which combines the three favorite breakfast cereals (Cinnamon Toast Crunch, Lucky Charms and Reese’s Puffs) of National Football League star Travis Kelce and his brother, former NFL star Jason Kelce; waffle-shaped Cinnamon Toast Crunch cereals; Loaded Birthday Cake cereal; two Ghost Protein cereals (peanut butter and marshmallow); and Wheaties Protein cereals.
Harmening said that the company would “significantly increase” brand investment to ensure its brands are “front-and-center for consumers” in the 2025 fiscal year.
Dollar sales for General Mills in the RTE cereal category totaled $3.45 billion, down 2.7% from the same period a year ago, according to Circana. Unit sales totaled 740.04 million, down 5.1% from a year ago.
St. Louis-based Post Holdings, known for Honey Bunches of Oats, Pebbles and Grape-Nuts cereals, was one of the few major food manufacturers to see dollar sales gains in RTE cereal over the 52 weeks ended Oct. 6, according to Circana data. Dollar sales for Post Holdings in RTE cereal totaled $2.01 billion, up 0.1% from the same period a year ago. Meanwhile, unit sales totaled 423.32 million, down 2.8% year over year.
Many of the new cereal products that Post launched during the period were seasonal offerings. For example, the company introduced a limited-edition Winterfest Fruity Pebbles cereal, featuring red and green flakes, in the winter of 2023.
During the summer of 2024, Post launched three limited-edition cereals, including Fruity Pebbles Waffles, Summer Fruity Pebbles and Frosted Chocolate Cake cereal. Another seasonal launch was a salted caramel variety of Honey Bunches of Oats cereal that was rolled out in the fall.
“Our business continues to benefit from diversification in product,” said Robert V. Vitale, president and CEO of Post Holdings, in a Feb. 2 conference call.