Marketing paper

Executive Summary

A description of your business and the people involved in your team.

Here, it’s all about telling your story. Provide a short overview of the history of your brand, including the size of its current customer base (if there is one), its structure, sales figures, along with the skillsets/expertise of the people involved and their relevance in helping you achieve your goals.

Include other professionals involved with the operation too, such as your suppliers, accountants and marketing experts.

A description of the key market trends and the products/services you are marketing.

Here, you are delving into your marketplace and specific industry sectors to explore the core trends shaping and impacting them. What factors are influencing their evolution? How are they innovating? Who is listening and engaging?

Describe the product or services clearly and concisely. Outline their unique selling proposition (USPs). These highlight the reason/s people will buy your product or service over your competitors’ offering.

A description of your customer base, where you will find them, and how you will target them via specific marketing activities to reach your goals.

Describe the characteristics of your target audience/s and how you identified these.

Explain where you will find them and how you will target them. Note your promotional strategy, i.e. the communication channels and implementation of software or specialists to support your marketing activities and materials, along with the main objectives of these and their associated timelines.

Detail what the core marketing priorities are and specify whether these relate to key business activities, such as the launch of a new product/service or entry into a new marketplace. Outline your distribution strategy, explaining how you will deliver the product or service (e.g., online through downloadable content or conference calls, by post for a physical product or in-person when offering specific types of service).

A summary of the financial planning and projections of the project to manage budgets.

Support both short-term and long-term marketing activities with clearly defined financial information. This should outline the associated budget attached to each activity and the metrics used to measure its success.

A summary of the overall objectives of the project and the strategies you will employ to achieve them.

This is effectively an overview of the executive summary.  As succinctly as possible, explain your overall objectives and the strategies you will use to achieve these.

Magic Spoon is a U.S based Cereal brand that promised ‘Guilt-free’ nostalgia and has successfully created High-protein, Low-carb and Keto based cereal options for adults, bringing back flavor options like Cinnamon, Peanut butter, Cocoa and Maple Waffle among other child-hood favorites of current generation adults. Gabi Lewis and Greg Sewitz, the cofounders of Magic Spoon started the Cereal Brand in 2019 as a solely online-sales based brand and intend to bring it to retail stores in the near future. Gabi and Greg started magic spoon after they sold Exo, their Cricket based Protein bar company to Aspire Group in 2018.

Cereal used to be an American favorite Breakfast for a very long time, however, according to IBIS World, the sales of breakfast staples dropped by 17% from 2009 to 2016. Cereal is known to have high sugar content and the consumers have started seeing and realizing side-effects of high sugar intake. Smoothies, oatmeal etc. became substitutes to cereal since then and still are. Greg and Gabi, saw this as an opportunity to create healthier versions to the good old American favorite cereals with young adults and adults as their main targeted segment. As a healthier alternative to sugar, Magic Spoon uses Allulose, a Keto based sweetener. Magic Spoon cereal comes with an average of 140-170 calories, 14 grams of protein, 4 Grams of net carbs (Carbohydrates), 2 grams of Fiber, and 0 (Zero) grams of sugar per serving. Magic Spoon cereal are both Keto friendly and gluten-free. Also, unlike most other cereal brands in the market that contain grains, sugars and GMOs as their basic ingredients, Magic Spoon’s ingredients are grain-free and sugar-free.

Historical Data:

Like any other industry, the Cereal industry has faced Monopolistic Competition since early 1960’s. However, the signs of Monopoly were ignored for a very longtime being overshadowed by other major industries like Airlines, Electronics and tele-communications. Brands like Kellogg’s, Quaker and General Mills have accounted for 90% of the market share for Ready- To- Eat (RTE) cereal industry. These Brands allegedly dissuaded any new RTE cereal brands through their wide range of product variability, leaving little room for new market products to prevail and succeed. (Scherer, 1979). This trend continued till late 1980’s. This resulted in the industry being highly concentrated. Extensive Advertising is another characteristic of RTE cereal industry. We have witnesses this since 1950’s- the extensive advertising cereal brands invest in. Hoardings, television advertisements, sponsorships are among them. Statistically, smaller industry brands tend to advertise more than the larger industry brands. On an average, 30% of the sales value is spent on advertising in the RTE Cereal industry as of 2002. As discussed above, product proliferation by leading brands is another characteristic of the RTE Cereal industry as they accounted for 100 new product launches per year since 1989. Due to actions like this, Post, Kellogg’s, and General Mills were sued by the FTC for shared Monopoly in 1981. (Jeffrey J. Reimer, 2002)

Current Industry:

As of 2016, the value per size of Global Breakfast Cereal market was at USD 37.44 Billion. The Compound Annual Growth Rate (CAGR) projections show an increase of 4.3% between 2017 and 2025. According to Market Research.com, this market is projected to experience an annual growth of 3% in its global revenue and to reach USD 40 Billion by 2023. In the U.S alone, the Market size of the Cereal Insutry is USD 12 Billion with 86 U.S based businesses in the Market. The growing awareness of health, preference to on-the-go/ quick breakfast options, and heaving demand for organic, keto friendly and other dietary alternatives by the consumers is to contribute to this surge in market value. This includes both RTE and hot cereal, with RTE being the majority market share holder with 68% of the global revenue in the insutry. On the contrary to Magic Spoon’s mantra, beliefs on grains-based breakfast consumption benefits by the consumers is another factor that holistically contributes to the industry. Among this, the most common grains used are corn, wheat, oats, rice, and barley. In addition to on-the-go breakfast options for adults, cereal industry has also had breakfast and snack options for kids. Although the quick and healthy breakfast needs of consumer showed booming sales, the rising concern and consciousness of sugar consumption has statistically slowed down sales as mentioned on the Introduction section of this Marketing Plan. As a result, leading cereal brand, Kellogg’s has reduced the sugar content in some of its high sugar content products by approximately 19%. In addition to this Kellogg’s also added Vitamin D to the ingredients mix to improve nutritional value of their products. In addition to the RTE Cereal industry, the Hot cereal segment is also expected to improve sales from its grain-based healthy cereal options. Holistically, ever evolving and improving flavors has always been an attracting factor for consumers among cereals. (Grand View Research, 2018)

Distribution Channels Analysis:

As per Grand View Research Statistics, Super Markets and convenience stores are recorded to be the major distribution channels for breakfast cereal. E-Commerce is the third largest means of distribution followed by miscellaneous channels. However, supermarkets are projected to remain the leading channels of distribution at least till 2025 with increase in the number of supermarkets globally. (Grand View Research, 2018) . On the other hand, as a result of the COVID- 19 Pandemic, E-Commerce industry has also been emerging due to its convenient shopping format. As of 2019, E-commerce’s Global Market value has been recorded at USD 9.09 trillion and is expected to grow by 14.7% from 2020 to 2027. (Market Analysis Report, 2020).

Regional Sales Analysis:

The overall market is currently dominated by North America, followed by European countries and Asia Pacific countries. (Grand View Research, 2018)

Global Trends:

· Repositioning to anytime food from breakfast.

· Influence of American culture boosts cereal consumption worldwide

· Accounts for increase in developing markets

· New cereals intend snacking and indulgence along with breakfast

· Health trends play a major role in Mature markets like the U.S

· Supermarkets to remain top distribution channels for cereal

According to Grand View Research and research conducted on Market Conduct on the U.S RTE Cereal industry, Kellogg’s, General Mills Inc., Post Holding Inc. have been known as the ‘Big Three’ since the 1970’s followed by Private label and Quaker Oats. The fact that the ‘Big Three’ was sued by the FTC for ‘Shared Monopoly’ in 1970, and still continue to be the top cereal brands shows that these companies have been the market giants in the cereal industry for almost a century.

References Grand View Research. (2018). Breakfast Cereal Market Size, Share & Trends Analysis Report By Product (RTE, Hot Cereal), By Distribution Channel (Supermarket, E-Commerce, Convenience Store), By Region, Vendor Landscape, And Segment Forecasts, 2018 - 2025. Retrieved from Grand View Research: https://www.grandviewresearch.com/industry-analysis/breakfast-cereals-market Jeffrey J. Reimer, J. M. (2002). Market Conduct in the U.S. Ready-to-Eat Cereal Industry. West Lafayette: Purdue University. Retrieved from file:///C:/Users/asles/Downloads/SSRN-id1242151.pdf Market Analysis Report. (2020). E-commerce Market Size, Share & Trends Analysis Report By Model Type (B2B, B2C), By Region (North America, Europe, APAC, Latin America, Middle East & Africa), And Segment Forecasts, 2020 - 2027. Retrieved from https://www.grandviewresearch.com/industry-analysis/e-commerce-market Scherer, F. M. (1979). The Welfare Economics of Product Variety: An Application to the Ready-to- Eat Cereals Industry. The Journal of Industrial Economics, 28(2), 113-134. Retrieved from https://doi.org/10.2307/2098031