Sep 18, 2013 • By

Big G bullish on cereal category

As one of the largest categories in U.S. grocery stores – with $9.4 billion in annual retail sales in the U.S. – the ready-to-eat cereal category’s reliable performance over the years has long been a significant contributor to General Mills’ success.

Jim Murphy, senior vice president and president of Big G Cereals, today addressed how the company will continue to drive growth in this relevant and important category during our fiscal 2014 first-quarter earnings webcast.

Jim shared Big G’s plans for this fiscal year – which include a strong level of meaningful product innovation and new advertising – and explained why “we are bullish on the U.S. cereal category.”

A top choice for breakfast

Cereal delivers the taste, convenience, health and value consumers are looking for at breakfast, with more than 90 percent of U.S. households purchasing cereal each year. The number of breakfasts eaten at home in the U.S. is growing – which is good news for cereal, the most popular at-home breakfast food by far.

Big G leading growth

General Mills’ U.S. cereal business, Big G, boasts many of the most iconic brands in the cereal aisle and has led category growth in recent years. Jim shared that we’ve added a full point of market share over the last five years.

Today the company reported that first-quarter net sales for Big G increased 4 percent and the business also gained market share.

Here are just a few examples of how Big G is bringing news to the category.

Nana ad

The One & Only Cheerios

Cheerios is the largest franchise in the U.S. cereal category – by far.

Today, one out of every eight boxes of cereal sold in the U.S. is a variety of Cheerios.

“We’ve also launched new advertising on the original, Yellow Box Cheerios, that reminds consumers of the heart-health benefits and their emotional connection to this great brand,” said Jim.

Send Cheer

Cheerios is also rolling out a new promotion just in time for back to school. The “Send Cheer to Teachers” program gives parents and kids an easy way to thank teachers they admire by cutting a postcard from specially marked boxes of Cheerios, writing a message, and sharing it. These boxes are on shelves now through mid-October.

Nelly and BuzzBee

Must Be the Honey

New commercials for Honey Nut Cheerios – the top-selling cereal in America – feature multi-platinum and Grammy award-winning artist Nelly collaborating with BuzzBee. The campaign includes a remix of Nelly’s hit, “Ride Wit Me” that has people saying “Must be the Honey.” See the commercials and learn more about the campaign in this post on our blog.

Breakfast of Champions

In August, Wheaties unveiled the first of three limited-edition boxes that will feature NFL MVP Adrian Peterson. For these limited-edition boxes, Wheaties is partnering with Blippar, an augmented reality platform that uses image recognition technology to bring the boxes to life. After downloading the Blippar app on your phone or tablet, you can “blipp” or scan the box to unlock a video game, photos and more. Here’s what the experience looks like:

Adrian Peterson Blippar

Monsters Back Together for Halloween

While Count Chocula, Franken Berry, and Boo Berry cereals are regularly available around Halloween, this year we’re bringing back Frute Brute and Yummy Mummy by popular demand. Our Monster Cereals have gained a strong fan following over the years and initial shipments of them are well ahead of last year’s pace.

Monster CerealsAnd there’s more!

We’re planning a birthday celebration for Lucky the Leprechaun in 2014, when Lucky Charms cereal will turn 50 years old. Adults account for nearly half of the brand’s total consumption and adult-focused advertising has led to great results – including an 11 percent increase in retail sales the first quarter.

Jim also shared an update on new product innovation. He said that Honey Nut Cheerios Medley Crunch, which launched in January, continues to be the single largest launch in the U.S. cereal category in calendar 2013.

Big G’s new products that launched this summer included Vanilla Chex, Hershey’s Cookies ‘n’ Creme, Nature Valley Protein granola cereal and BFast, with more new items slated for the second half of our fiscal year.

“We’ve got plans to drive sales and profit growth for our cereal business in 2014, with product news on established brands, a strong new product line-up, and effective marketing and merchandising initiatives,” said Jim.

Editor’s Note: This post contains non-GAAP financial information and forward looking statements regarding future results. Please see our press release dated Sept. 18, 2013 for a reconciliation of these non-GAAP measures and for risk factors that could affect the results anticipated in these forward looking statements.