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Kellogg secretively reformulates Special K to outwit private label copycats

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Kellogg secretively reformulates Special K to outwit private label copycats

Kellogg secretively reformulates Special K to outwit private label copycats
May 24
10:27 2013

Only a handful of employees at Kellogg will be privy to the secret recipe of its newly formulated Special K brand for Europe as the cereal giant works to stave off mounting private label mimics.

Kellogg has spent two years reformulating its flagship dietetic cereal brand in a bid to establish a point of difference from copycat private label manufacturers.

“We don’t make cereal for anyone else so Special K has always had a unique, premium quality but many own brands have attempted to copy both the look, taste and packaging within IP limits,”  Louise Thompson-Davies, brand communications manager at Kellogg UK, told BakeryandSnacks.com.

“For the last ten years own label versions of a variety of branded products across supermarkets have grown and flourished,”  Thompson-Davies said.

While the trade secrets act doesn’t stop other manufacturers developing versions of the Kellogg product, she said it should work to provide extra privileges to protect the unique recipe.

Following in Coca-Cola’s footsteps…

Steve Osborn, business innovation manager at Leatherhead Food Research, said Kellogg’s move to protect its formulation was understandable. “Why would you let anybody copy your product and allow them to eat into your opportunity?”

“The trade secrets act is a mechanism that some of the most famous brands have used for many, many years – like Coca-Cola for example. It’s one of the only sure fire ways of keeping a formulation confidential and retaining intellectual property,” he said.

The difficulty with patents is that manufacturers need to prove there is an ‘inventive step’; something completely original, which can often be difficult to achieve in formulations, Osborn said.

He also flagged another concern for manufacturers – the explicit and extensive nature of a patent filing.

“It’s the confidentiality aspect of trade secrets that appeals – it’s one of the only real controls that you have,”  he said.

The ‘best’ of private label

Kellogg is sending out a message to reinforce the uniqueness of its product, Osborn said.

“Predominantly, the threat is always going to be from private label because of the financial and competitive edge of that sector,”  he continued.

There are now ‘better’ and ‘best of’ private label ranges, he said, and this philosophy has really gained traction.

“The retailers have got those funds and the contract manufacturing network. It is a serious threat not only on price, but quality – the retailer brands are becoming trusted,”  he said.

Brands need to work hard to establish a strong point of different in the market place, Osborn said.

However, Thompson-Davies said Kellogg isn’t worried about the level of private label competition. “We love competition… Clearly private label has a role in the market place but you can see consumers voting with their feet, with the clear majority of sales in the cereal category coming from branded cereals,” she said.

According to data from Euromonitor International 84.9% of global cereal sales for 2012 were branded.

In the US branded sales totaled 84.2%, in Western Europe 68.4% and Eastern Europe 69.8%.

‘Bang up to date’ with a healthy twist

Kellogg has reformulated its Special K to include three grains instead of just two, added wholegrain and eight vitamins and minerals. The fat content has been slashed by 40%; salt reduced by 11% and the cereal now contains 80% more fiber.

Shipping across Europe started in April and a full roll-out is anticipated by June.

 


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