On Monday 4th July, cereal giant Kellogg’s opened its first ever restaurant in New York’s Times Square. While it may seem a little strange to open a café dedicated to cereal, Kellogg’s is not the first, with similar outfits including the Cereal Killer Café in Camden and Brick Lane, London. Both businesses are capitalising on the experience economy which has evolved from the modern consumer’s desire to interact with brands and experience something which is, ultimately, Instagram worthy.
Kellogg’s is not the first brand to tap into the experience economy; other companies include Magnum which has created a series of ‘pleasure stores’ where customers can craft their perfect Magnum from a variety of indulgent toppings, and Italian fashion house Armani, which has its own luxury hotels in Milan and Dubai.
The move by the cereal giant to open a café comes as it was recently revealed that in the past 15 years, cereal sales have fallen by almost 30 per cent*. Cereal companies are often vilified for producing products containing too much sugar, fat and salt, and now they are struggling to impress a cynical, health-conscious audience.
Once considered the only breakfast option, and a fast one at that, cereal is no longer quick enough to keep up with our busy lives, with consumers favouring breakfast bars or yoghurt which they can transport more easily. Almost 40 per cent of millennials surveyed by Mintel* also said cereal was an inconvenient breakfast choice because they had to clean up after eating it!
Kellogg’s has engaged top American chef, Christina Tosi, to devise new recipes from the home favourite cereals, including creations such as ‘Pistachio & Lemon’ (spiked Frosted Flakes and Special K) and ‘The Circus’ (Raisin Bran, peanuts and banana chips). Andrew Shripka, associate director of brand marketing at Kellogg’s, said: “We could have put a great recipe on the box. But this is much more powerful.”
It appears the company didn’t want to just stage a PR stunt – although the opening has been covered by everyone from Reuters, to The Wall Street Journal and The Guardian – instead they are trying to encourage consumers to experiment and look at cereal as a dining event rather than a mundane experience. Each customer also gets a free toy, which goes some way to recapturing the joy of childhood!
Tapping into the experience economy is a good way for companies to engage with their consumers, and while it may initially be the novelty factor which will draw people in to the café, the space will serve an important function for Kellogg’s in the long term. Other brands that have set up cafés, for example Chobani – an American yoghurt brand which opened a café in New York in 2012 – has seen its café double in size since opening, with sales growing annually by 40 per cent.
Chobani’s New York café has also served as a place for the company to try out new items and a number of new product lines, including a range of mezze dips, have been created following customer feedback and trials.
So while the venture may seem a little surreal at first mention, the Kellogg’s Times Square café could breathe new life into the brand and perhaps even become a cereal success!
Acceleris is no stranger to launching brands and has helped many companies – from local confectioners to large third sector organisations – build and maintain their reputations, both in the UK and worldwide. For more information on our credentials, take a look at our website.
*Mintel report, 2015