Market Failure: Kelloggs Cereal-Mates

A Study on Market Failure: Kellogg Cereal-Mates First, I must begin by saying that as most Americans would agree – cereal and milk go together hand-in-hand. However, how would the general public feel about a combination of the two sold pre-mixed? This was essentially the case when Kellogg’s decided to introduce Breakfast Mates. Breakfast Mates included a small box of Kellogg’s cereal packaged with a container of milk and eating utensil. While the product was right in step with the accelerating trend of convenience foods, a fickle and demanding public found the new packaging less than ideal. Essentially the choice that Kelloggs was giving consumers was that you could eat your Kellogg’s Corn Flakes refrigerator cold and pour cold milk over them, or eat your flakes at room temperature with warm milk. This led to a dilemma that would ultimately be proven as a scar on the company’s record of wonderful products and marketing campaigns.
Kellogg’s believe that this would be a popular concept due to increased working hours in the United States combined with the rise of the fast-food industry led the false belief that the product would be successful. Kellogg’s launched the concept on a national basis in ‘kit form’–a four oz. box of cereal, a four oz. container of aseptically packaged milk [no refrigeration required] and a plastic spoon. The line consisted of four popular Kellogg’s brands; Corn Flakes; Fruit Loops; Mini Wheats; and Frosted Flakes. Although the milk did not require refrigeration, Kellogg’s placed Breakfast Mates in the refrigerated dairy case alongside cheese, yogurt, Jell-O pudding, and other refrigerated desserts. The company believed that this would be the best choice since Americans liked to pour their milk over cereal. This caused much confusion, however, because most individuals wouldn’t be searching for breakfast cereals in the dairy case. I feel that there were 5 main factors that actually led to this marketing and product failure.
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