United Cereal
The case
United Cereal, one of the leaders in breakfast cereals, is trying to increase its share in the worldwide 21 billion Dollar market. Because it’s time to change something, to keep up with the market rivals and due to other different issues Ms. Laura Brill now challenges whether she should proceed with a “Eurobrand” strategy, which is an single model for whole Europe, or remain with the subsidiary-led country-by-country model.
The two opportunities
If Ms. Laura Bill could develop and apply a single model for whole Europe, she could reduce the expenditure and as a consequence the costs significantly.
The focus on local products and markets, with its need for significant marketing and product development teams in each country, had led to a situation where general and administrative expenses were 25% higher than in the U.S. operations. In the same time she could increase the effectiveness of United Cereal by reducing the staff, straighten up the hierarchy and gain advantages towards their biggest competitor Kellogg.
With these savings she could effort, for example, more proceedings in the Research & Development division, invent new cereal flavors and speed up the purse in publishing new products.
Based on melting boarders, conglomeration of cultures and their eating behaviors, it will become easier to establish single products for a wider potential target audience. Good examples are several Fast Food companies like Burger King and MC Donald who offer almost the same product in the whole world. Compared to them the expectations for this model should be good as well and recommend its bringing onto the market.
The downside of a single model is the leak of individual products for each country so you have to envisage with a weakening demand. Different countries with their own cultures in habits of eating prefer different flavors and tastes. With a smaller product diversity people will change over to other products, but also new customers can be
United Cereal, one of the leaders in breakfast cereals, is trying to increase its share in the worldwide 21 billion Dollar market. Because it’s time to change something, to keep up with the market rivals and due to other different issues Ms. Laura Brill now challenges whether she should proceed with a “Eurobrand” strategy, which is an single model for whole Europe, or remain with the subsidiary-led country-by-country model.
The two opportunities
If Ms. Laura Bill could develop and apply a single model for whole Europe, she could reduce the expenditure and as a consequence the costs significantly.
The focus on local products and markets, with its need for significant marketing and product development teams in each country, had led to a situation where general and administrative expenses were 25% higher than in the U.S. operations. In the same time she could increase the effectiveness of United Cereal by reducing the staff, straighten up the hierarchy and gain advantages towards their biggest competitor Kellogg.
With these savings she could effort, for example, more proceedings in the Research & Development division, invent new cereal flavors and speed up the purse in publishing new products.
Based on melting boarders, conglomeration of cultures and their eating behaviors, it will become easier to establish single products for a wider potential target audience. Good examples are several Fast Food companies like Burger King and MC Donald who offer almost the same product in the whole world. Compared to them the expectations for this model should be good as well and recommend its bringing onto the market.
The downside of a single model is the leak of individual products for each country so you have to envisage with a weakening demand. Different countries with their own cultures in habits of eating prefer different flavors and tastes. With a smaller product diversity people will change over to other products, but also new customers can be