Its US sales and profit may have dropped in the first quarter of 2016, but Kellogg’s has decided not to cry over spilt milk. To diversify its business, the Michigan-based food giant is making an incursion into foodservice. Having run a one-week pop-up cereal café in Sydney last April, Kellogg’s was confident enough to launch its first-ever permanent café in Manhattan, New York, serving dishes featuring Kellogg’s cereals mixed with creative ingredients, such as lime zest, marshmallows and blueberry jam.
Meanwhile, trying to turn around its retail performance, the company is turning shelf layout to its advantage, by working with chain Meijer to have its cereals placed alongside fruit and veggies in the produce aisle. This juxtaposition is supposed to trigger a ‘halo effect’, linking cereals to health and freshness in consumers’ minds. According to analysts, Kellogg’s migration into the produce section (and far from the cereal aisle, which has become a fierce battleground for brands), can create a sales boost. On the other hand, nutritionists have pointed out that not all cereal products ‘deserve’ to appear next to fresh produce. The risk, they said, is that of sending out misleading ‘subliminal’ messages.