Monday, August 31, 2015

It’s All How You Market It: Beer for Breakfast


Remember when you were growing up and they told you to “start your day with a good breakfast?” And then the joke when you were in college, “Beer – it’s not just for breakfast?” Well, here’s what happens when categories weaken and worlds collide!

Wheaties (the “breakfast of champions”) is partnering with a craft brewery to create a limited-edition beer called “HefeWheaties.” That name is a takeoff on a German style of beer called “hefeweizen,” a malt beverage made from – you guessed it – wheat.

It had to happen. All breakfast food cereals have been suffering over the past few years and brands have been losing their snap, crackle, and pop. General Mills hasn’t been immune to shifts in consumer eating habits (moving away from cereal bowls to foods like granola bars and yogurt) and expectations (moves from sit-down to grab-and-go options).

General Mills reported their fiscal 4th quarter numbers in July indicating that their net income of $186.8 million was down from $404.6 million in the year-earlier period. They, and every other cereal brand, are looking for ways to engage customers and increase sales, so why not license the name and logo to a different category – in this case, craft beers – that is growing? Right now the 16-ounce tallboy cans will only be available in the Minneapolis-St. Paul market, appearing at the end of August and, as you might have already guessed, don’t really contain any Wheaties.

Is that important? Well, what years of research and in-market validations have proven, companies can have the financial and production wherewithal to do something like this, but can’t be sure that it will take in the marketplace. A good leading-indicator of that is brand engagement. Not awareness of the brand, but consumers’ engagement with the brand; that is, the degree to which the brand is seen to meet expectations that consumers hold for the category in which the brand competes. In the category of Breakfast Cereal brands, the drivers are: “Tasty Lifestyle,” “Price-Value,” “Nutrition,” and “Healthy Options,” all of which one could judiciously apply to craft beers. They are the same ingredients in many instances. Anyway, brands that have high engagement can help fuel such line-extension efforts, up to six times greater than brands with low engagement.

According to our most current Customer Loyalty Engagement Index, Adult Breakfast Cereal engagement rankings for the top-10 brands are as follows:
  1. Cheerios
  2. Special K
  3. Wheaties
  4. Honey Nut Cheerios
  5. Frosted Mini Wheats
  6. Honey Bunches of Oats
  7. Fiber One
  8. Kellogg’s Corn Flakes
  9. Rice Krispies
  10. Kellogg’s Raisin Bran
Based on primary ingredients and their consumer engagement levels, Cheerios (oat bran) could team with a distillery to offer a craft vodka, another growing category. And, if that engages consumers, does that mean we can look forward to a Special K gin, Honey Bunches of Oats mead, or Rice Krispies rice wine?

With Wheaties at #3, they just might have a better chance than some other breakfast cereal brands that might be considering entering a crafted, alcoholic beverage category. Ryan Petz, the Fulton Brewery’s president acknowledged that this is only a test-market. “If it’s something everybody loves, we’ll obviously consider doing it in a bigger and more widely distributed way in the future.” Obviously.

In closing, it’s worth reminding you to start off each day with a good breakfast. In this particular instance it may be the only six-pack some consumers will ever be able to manage for themselves!


Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

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