1> Following are the reasons why Kellog’s failed in the initial stage-
• Kellogg’s failed to recognize the consumption behavior of the Indians. Its ‘crispy flakes’ where taken along with hot milk which made them soggy and did not taste good. People had to add extra sugar if they had it with cold milk.
• Rice and wheat versions were not appreciated by Indian consumers.
• The taste of the product did not suit the Indian consumers.
• They were pushing their products rather than identifying and aligning with the needs and consumption pattern of Indians.
• Kellogg’s positioned its product as ‘health product’ rather than successful ‘fun-and-taste’ image. This new image of product might have seized the sales volume.
• Competitive pricing was not followed and therefore sales was restricted to only affluent customers (niche market).
• Distribution channel was limited to only premium and middle-level retail stores. Thus product was not available readily.
Kellogg’s poor entry strategy was responsible for poor performance of the company in the initial stages. They were pushing their products rather than identifying and aligning with the needs, consumption pattern and paying capacity of Indians. They failed to have a proper distribution channel.
2> Steps taken by Kellogg’s to revamp its marketing mix-
• Successful brands like Chocos and Frosties were launched to boost sales
• Indianising the flavor and launching Mazza series to further penetrate the Indian market
• Products of suitable size were launched to target different consumer groups
• Packaging was changed from glossy cardboard to pouches
• Price was reduced
• Increased the number of outlets from 30000 in 1995 to 40000 in 1998
• Plan to set-up more manufacturing plants
• Product was...