Marketing and all things related

If you think your grocery dollar is not what it used to be, there is more bad news to come. We learned from Advertising Age (free registration required) that Kellogg’s is preparing to raise cereal prices this fall. Oh, and competitors are expected to follow suit. But wait—there’s more. In addition to an expected 2% price hike, Kellogg’s will reduce the size of their cereal boxes. Mind you, the Kellogg’s folks are not greedy. Commodity and fuel prices are increasing the cost of producing and delivering the goods. Oh the plus side (we think) the price increase and box reduction is not intended to sustain cereal margins—but rather—to sustain cereal advertising budgets. Kellogg’s claims their cereal prices are already on average, 5% less than competitor General Mills. There is no need to protest or boycott. Just remember to eat at least 2% less cereal every morning to try and stay even. Photo Credit: Advertising Age