Packaging Meets Kids' Needs and Desires The Meal Items Category The Snacks and Desserts Category The Beverages Category Flags Distinguish Fortified Foods The Market
Table 1-1: U.S. Supermarket Sales of Kids' Foods, 1994-2003 (dollars) Meal Items Lead in Kids' Food Sales Table 1-2: Supermarket Sales of Kids' Foods by Product Category, 1995-2003 (dollars): Meal Items, Snacks/Desserts, Beverage Products Meal Items Make Up Half of Market Figure 1-1: The U.S. Kids' Foods Market: Share of Supermarket Sales by Product Category, 1995 vs. 1998 (percent): 3 Product Categories Snacks and Desserts Lead Market Growth A Mature Market Supermarket Sales to Reach $12 Billion by 2003 The Marketers
Brand Strength and Innovation Kids Growing Up Faster Cyber-Marketing Takes Center Stage Packaging is Powerful Kids Prefer Extreme Colors, Fun Shapes Added Calcium Targets Parents $700 Million Plus in National Consumer Advertising Distribution and Retail
Direct-Store-Delivery to Large Retailers Alternative Distribution Outlets Retailers Court Kids as Present and Future Customers Customized Merchandising Techniques Supermarkets Account for Majority of Sales The Consumer
Percentage of Households with Children The Kellogg Kids' Cereal Purchaser Lunch Packs Favored by Working Parents Baked Goods/Snack Cakes Purchasers Pudding Purchasers Kids' Frozen Novelties Purchasers Kids' Powdered Drink Mix Buyers Scope and Methodology
Report Methodology Introduction
Products Excluded from Kids' Foods Market Definition Packaging Meets Kids' Needs and Desires Three Product Categories Meal Items
Sugared Cereals the Quintessential Kids' Food Cereal Ingredients Cereal Packaging and Labeling Other Breakfast Items Lunch Packs Lunch Pack Packaging Dinner/Hot Meal Entrees Packaged Pasta Frozen Kids' Meals Snacks and Desserts
Cookies, Crackers, and Baked Goods Animal Shapes a Staple Cookie, Cracker, and Baked Goods Unit of Sale Packaging Targets Kids Puddings, Gelatins, and Yogurt Puddings and Gelatins Children's Yogurt: Sweet and Smooth Ice Cream and Frozen Novelties Frozen Novelty Tie-Ins Peanut Butter Fruit and Produce Snacks Beverage Products
Government Regulation
Flags Distinguish Fortified Foods Health Claims for Certain Nutrients General Claims for Others Figure 3-1: Estimated U.S. Supermarket Sales of Kids' Foods, 1994-1998 (dollars) Market Size and Growth
Supermarket Sales at $9.8 Billion in 1998 Table 3-1: Estimated U.S. Supermarket Sales of Kids' Foods, 1994-1998 (dollars) Meal Items Lead in Kids' Food Sales Table 3-2: Estimated U.S. Supermarket Sales of Kids' Foods by Product Category, 1995-1998 (dollars): Meal Items, Snacks/Desserts, Beverage Products Kids' Meal Items by Segment Table 3-3: Estimated U.S. Supermarket Sales of Kids' Meal Items by Product Segment, 1995-1998 (dollars): 4 Product Segments Snacks and Desserts in Second Place Table 3-4: Estimated U.S. Supermarket Sales of Kids' Snacks and Desserts by Product Segment, 1995-1998 (dollars): 5 Product Segments Kids' Beverage Products Rank Third Market Composition
Figure 3-2: The U.S. Kids' Foods Market: Share of Supermarket Sales by Product Category, 1995 vs. 1998 (percent): 3 Product Categories Cereal Comprises 65% of Meal Item Category Figure 3-3: The U.S. Kids' Foods Market: Share of Meal Item Sales Through Supermarkets by Product Segment, 1995 vs. 1998 (percent): 4 Product Segments Cookies, Crackers, and Baked Goods Lead Snacks and Desserts Category Figure 3-4: The U.S. Kids' Foods Market: Share of Snack and Dessert Sales Through Supermarkets by Product Segment, 1995 vs. 1998 (percent): 5 Product Segments Snacks and Desserts Lead Market Growth Table 3-5: Dollar Change in U.S. Kids' Food Supermarket Sales by Product Category, 1997 vs. 1998 (dollars): 3 Product Categories Grocery Stores Account for 90% of Sales Figure 3-5: The U.S. Kids' Foods Market: Share of Total Retail Sales by Outlet Type, 1998 (percent): Food Stores, Mass Merchandisers/Warehouse Clubs, Other East Central a Prime Region Table 3-6: Regionality of Consumption of Kids' Foods: By Brand Line, 1998 (indices): Northeast, East Central, West Central, Southeast, Southwest, Pacific Factors to Market Growth
Population of 5- to 14-Year-Olds Will Approach 41 Million by 2000 Table 3-7: Projected Growth of U.S. Population Age 5-14, 1995-2050 (number and percent) Threat of Recessionary Periods Kids Spend $9 Billion a Year on Food and Beverages Quicker, More Convenient Foods Play Value a Big Hit Parents and Nutrients Growth Potential in Dairy and Produce Fortification Programs Boost Parental Approval Licensing a Major Factor More Fast-Food Competition Thinking Small at Full-Service Restaurants Snacking the Rule in Kids' World New Beverages on the Block Figure 3-6: Projected U.S. Supermarket Sales of Kids' Foods, 1998-2003 (dollars) Projected Market Growth
3% Growth Rates for Meal Items Snacks and Desserts Make Largest Gains Beverage Products to Approach $2 Billion Table 3-8: Projected U.S. Supermarket Sales of Kids' Foods by Product Category, 1998-2003 (dollars): 3 Product Categories The Marketers
Food Conglomerates Rule Most Marketers Are Multi-Category Table 4-1: U.S. Kids' Foods Market: Top Ten Marketers and Their Product Categories Recent Mergers and Acquisitions Table of Marketers and Brands Table 4-2: U.S. Kids' Foods Market: Leading Marketers and Brands (103 Marketers and Their Brands) Marketer and Brand Shares
Four Marketers Claim Three-Fifths of Sales Table 4-3: Estimated Marketer Share of U.S. Kids' Food Supermarket Dollar Sales, 1998 (percent): 12 Marketers Kellogg Tops in Meal Items Category Table 4-4: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Meal Items, 1998 (percent): 10 Marketers General Mills Edges Out Kellogg in Cold Cereals Kellogg Dominates Other Breakfast Items Segment Table 4-5: Estimated Marketer Share of U.S. Kids' Food Retail Dollar Sales: Cold Cereals, 1997 vs. 1998 (percent): 4 Marketers/35 Brands Table 4-6: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Other Breakfast Items, 1997 vs. 1998 (percent): 5 Marketers/7 Brands Oscar Mayer Dominates Lunch Pack Segment Table 4-7: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Lunch Packs, 1997 vs. 1998 (percent): 3 Marketers/3 Brands Campbell Maintains Lead in Dinner Entrees Table 4-8: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Dinner Entrees, 1997 vs. 1998 (percent): 6 Marketers/6 Brands Six Marketers Make Up Half of Snacks and Desserts Table 4-9: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Snacks and Desserts, 1998 (percent): 13 Marketers McKee Foods Number-One in Cookies, Crackers, and Baked Goods Table 4-10: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Cookies, Crackers, and Baked Goods, 1997 vs. 1998 (percent): 7 Marketers/7 Brands Kraft Leads in Kids' Puddings, Gelatins, and Yogurt Table 4-11: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Puddings, Gelatins, and Yogurt, 1997 vs. 1998 (percent): 5 Marketers/17 Brands Unilever Remains on Top with Good Humor-Breyers Table 4-12: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Ice Cream and Frozen Novelties, 1997 vs. 1998 (percent): 8 Marketers/17 Brands Procter & Gamble Leads Peanut Butter Segment Table 4-13: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Peanut Butter, 1997 vs. 1998 (percent): 6 Marketers/8 Brands General Mills Dominates Fruit Snacks Table 4-14: Estimated Marketer Share of U.S. Kids' Food Supermarket Sales: Fruit Snacks, 1997 vs. 1998 (percent): 5 Marketers/25 Brands Four Major Companies Battle Over Kids' Beverages Table 4-15: Estimated Marketer Share and Retail Sales of U.S. Kids' Food Supermarket Sales: Beverages, 1997 vs. 1998 (percent): 12 Marketers/19 Brands The Competitive Situation
Focus Groups Give Marketers Competitive Edge Advertising in the School Yard Competition Can Be Direct, Indirect, or Across Categories Seasonality Influences Sales Cereal Giants Face Competition from Private Labels Lunch Packs Inspire Competition Dinner Entrees Not Diverse New Varieties Could Reshape Peanut Butter Market Fruit Snack Segment Constantly Churning Out New Offerings Many Marketers Compete in Kids' Beverages Category Competitive Profile: Bestfoods
Strategy for Growth Skippy Brand Number Two in United States Competitive Profile: Campbell Soup Co.
Swanson Spun-Off U.S. Sales Flat 35-Year-Old Goldfish Experience Double-Digit Growth Goldfish in the Courts Franco-American, Campbell Soup Brands Court Kids Competitive Profile: Children's Beverage Group, Inc.
Packaging Distinguishes Products The Battle Over Pouches The Machine Behind the Pouch TCBG Seeks to Rapidly Expand Market Coverage Competitive Profile: Coca-Cola Co.
Hi-C a Perennial Favorite Coke in the Classroom Competitive Profile: ConAgra, Inc.
A Proliferation of Consumer Products ConAgra Taps Kids' Foods Market with Major Offerings Competitive Profile: Fran's Healthy Helpings
Going Mainstream Competitive Profile: General Mills, Inc.
A Long History of Food Marketing The Cereal War Recovering from the Cereal Wars Covering the Bases with Kids' Foods Competitive Profile: Kellogg Co.
Past and Present Kellogg Plots Strategy for Growth Kellogg Hedges Bets with Convenience, Kid-Appeal, and Nutrition Competitive Profile: Nestlé S.A./Nestlé U.S.A., Inc.
Nestlé to Focus on Integrating Acquisitions Significant Position in Kids' Foods Market Competitive Profile: Philip Morris Cos., Inc./Kraft Foods, Inc.
Food Buffer Against Tobacco Woes Recent Comer to the Kids' Foods Market The Return of Tang? Kraft Undertakes Major Marketing Initiative Competitive Profile: Procter & Gamble Co.
P&G Knows Consumer Products Lackluster Sales Mark Recent Performance Something New in Peanut Butter Sunny Delight Shining Example of Kids' Food Success Moving Away from Food? The Battle Over Olestra Hawaiian Punch Goes on the Block Competitive Profile: Quaker Oats Co.
Snapple Fiasco Leads to Sell-Off Hot, Cold Cereal Targeted to Kids Kids Monitor Keeps Pulse of Younger Set The Importance of Gatorade Competitive Profile: RJR Nabisco Holdings Corp./Nabisco Holdings Corp.
Nabisco Reorganizes to Protect Company from Tobacco Litigation Nabisco Shores Up SnackWell's Kids' Cracker Plans on Hold Extension Strategy Adds Kids' Food Offerings Competitive Profile: Tanimura & Antle
Introducing Fresh-Cut for Kids Competitive Profile: Unilever
Acquisition Yields Position in Kids' Foods Market Deep Pockets Purchased Ice Cream Position Hundreds of Ice Cream Products Under Good Humor-Breyers Co-Branding and Licensing Abundant in Good Humor Competitive Profile: Vlasic Foods International
The Swanson Division Advertising an American Icon Vlasic Narrows Its Exposure to Kids' Market Marketing Trends
Cyber-Marketing Takes Center Stage Co-Branding Successes Inspire More Licensing Aggressive and Competitive Marketers Have Strong Tradition of Creating Their Own Characters Table 4-16: Major Cereal Marketers: A Matrix of Selected Characters Names Convey Personality of Product Packaging is Powerful Holidays/Seasons Add Novelty to Established or New Products Corporate Citizenship New Product Trends
Kids Prefer Extreme Colors, Fun Shapes Changing Colors and Tastes a Hit Gross Is Good Added Calcium Targets Parents Lunch Packs Head to the Ball Park Healthy Snacks Get a Hip Makeover Milk-Based, Flavored Drinks: An Emerging Beverage Choice? Water Marketers Follow Milk Trend New Product Introductions Table 4-17: U.S. Kids' Foods Market: Selected New Product Introductions, 1998 - Spring 1999 Advertising and Promotion
Top Three Advertisers Spend $595 Million General Mills the Big Spender Kellogg Also Commits to Consumer Advertising Philip Morris Third in Consumer Advertising Second-Tier Marketers Spend Nearly $100 Million Third-Tier Marketers Account for $25 Million in Expenditures TV Advertising Drives Sales Advertisements Promote Interactivity Fantasy Versus Reality: Pitches Depend on Age Parent vs. Kid Ads Coupons the Most Frequent Promotion Admission Coupons Offer a Variation Package Promotions Prizes Drive Impulse Sales Mail-In Promotions Proliferate Internet Opens New Playing Field Examples of Consumer Promotions Trade Advertising Trade Promotions Are Standard Distribution Overview
Direct-Store-Delivery to Large Retailers Advantages of Direct-Store-Delivery Disadvantages of Direct-Store-Delivery Advantages of Warehouse Delivery Disadvantages of Warehouse Delivery Smaller Marketers Work Through Brokers Alternative Distribution Outlets Targeting Consumer Needs via ECR Keeping Goldfish Lively The Warehouse Club Sector: Eliminating the Distributor Warehouse Club Prices and Packs Distributors vs. Warehouse Clubs Retail Overview
Customized Merchandising Techniques Marketers Assist at Retail Retailers Support Nutritional Education Supermarkets Account for Majority of Sales Figure 5-1: The U.S. Kids' Foods Market: Share of Total Retail Sales by Outlet Type, 1998 (percent): Food Stores, Mass Merchandisers/Warehouse Clubs, Other Supermarket Business and IRI Are Major Data Sources Retail Focus: Meal Items
Drugstores: Small But Growing Outlet for Kids' Cereals Making Space for Cereals Cereals Grouped by Marketer Cereal Margins Average 26% Grocery Stores Garner 95% of Frozen Breakfast Entree Sales Freezer Space Scarce for Breakfast Foods Supermarkets Sell 88% of Toaster Pastries Supermarkets Claim 85% of Lunch Pack Sales Lunch Pack Locations Lunch Pack vs. Packaged Meat Margins Over 97% of Frozen Dinners Sold Through Supermarkets Freezer Pressures Lower Profits Frozen Entree Margins Are Down 92% of Pasta Sales Through Supermarkets Varieties of Pasta Shelving Retail Prices Generally Range from 59˘ to $4.69 Table 5-1: The U.S. Market for Kids' Meal Items: Suggested Retail Price of Selected Products Retail Focus: Snacks and Desserts
Cookies and Crackers at 30-50 Linear Feet End-Aisle Display Fuels Purchases Cookie and Cracker Margins Average 34% Pudding, Gelatin, and Yogurt Sales Merchandising Kids' Puddings, Gelatins, and Yogurt Yogurt Margins Out-Whip Puddings, Gelatins Heated Competition in Ice Cream Case Ice Cream and Novelty Margins Average 35% Peanut Butter by the Jelly Fruit Snack Display Strategies Fruit Snack Margins Unchanged Retail Prices Generally Range from 89˘ to $3.49 Table 5-2: The U.S. Market for Kids' Snacks and Desserts: Suggested Retail Price of Selected Products Retail Focus: Beverages
Juices Grouped by Marketer Drink Mixes and Milk Flavorings Sold Apart Sunny Delight Sold in Refrigerator Case Squeezing in Kids' Waters Beverage Margins from 24% to 31% Population Overview
Kids Population Will Reach 40 Million by Year 2001 Males Outnumber Females to Age 24 Table 6-1: Share of U.S. Population Age 5-14 by Gender, 1998 (percent) Percentage of Households with Children Two-Parent Households Giving Way to One-Parent Households One-Fifth of Children Live in or Near Poverty Consumer Overview
Simmons Data on Kids' Foods Overview by Brand Table 6-2: The U.S. Market for Kids' Foods: User Overview by Product Type and Preferred Brand, 1998 (U.S. Principal Shoppers, Median Age, Median Household Income) The Kellogg Kids' Cereal Purchaser General Mills Kids' Cereal Purchasers Toaster Pastry Appeal Varies by Brand Frozen Waffles, Pancakes, and French Toast Have Upscale Skew Lunch Packs Favored by Working Parents Canned Macaroni Purchasers Kids' Complete Packaged Dinner Mix Buyers Purchasers by Kids Frozen Dinner Brand Kids' Cookies Purchased by Moms Baked Goods/Snack Cakes Purchasers Pudding Purchasers Gelatin Cup Purchasers Kids' Yogurt Purchasers Kids' Frozen Novelties Purchasers Peanut Butter Purchasers Vary by Brand Kids' Powdered Drink Mix Buyers Single-Serve Fruit Drink Purchasers Table 6-3: Demographic Characteristics Favoring Use of Kellogg Cereals by Variety, 1998 (U.S. Principal Shoppers): Frosted Flakes, Rice Krispies, Froot Loops Table 6-4: Demographic Characteristics Favoring Use of General Mills Cereals by Variety, 1998 (U.S. Principal Shoppers): Cheerios-Any, Lucky Charms, Cinnamon Toast Crunch Table 6-5: Demographic Characteristics Favoring Use of Toaster Pastries by Major Brand, 1998 (U.S. Principal Shoppers): Kellogg Pop-Tarts, Pillsbury Toaster Strudel, Nabisco Toastettes Table 6-6: Demographic Characteristics Favoring Use of Frozen Waffles, Pancakes, and French Toast by Brand: Aunt Jemima vs. Eggo Minis, 1998 (U.S. Principal Shoppers) Table 6-7: Demographic Characteristics Favoring Use of Lunch Packs by Brand, 1998 (U.S. Principal Shoppers): Oscar Mayer Lunchables, Bryan Lunch 'N Munch, Eckrich Lunch Makers Table 6-8: Demographic Characteristics Favoring Use of Canned Macaroni by Brand: Chef Boy-Ar-Dee vs. Franco-American, 1998 (U.S. Principal Shoppers) Table 6-9: Demographic Characteristics Favoring Use of Complete Packaged Dinner Mixes by Brand: Kraft Macaroni & Cheese Kid Fun Shapes vs. Chef Boy-Ar-Dee, 1998 (U.S. Principal Shoppers) Table 6-10: Demographic Characteristics Favoring Use of Frozen Dinners and Entrees by Brand: Kid Cuisine vs. Swanson Fun Feast, 1998 (U.S. Principal Shoppers) Table 6-11: Demographic Characteristics Favoring Use of Cookies by Brand: Nabisco Teddy Grahams Sandwich vs. Betty Crocker Dunkaroos, 1998 (U.S. Principal Shoppers) Table 6-12: Demographic Characteristics Favoring Use of Baked Goods/Snack Cakes by Brand, 1998 (U.S. Principal Shoppers): Little Debbie, Hostess, Dolly Madison Table 6-13: Demographic Characteristics Favoring Use of Pudding Snacks by Brand, 1998 (U.S. Principal Shoppers): Jell-O-Pudding Snacks, Hunt's Snack Pack, Swiss Miss Ready-to-Eat Table 6-14: Demographic Characteristics Favoring Use of Gelatin Desserts by Brand, 1998 (U.S. Principal Shoppers): Jell-O Gelatin Snacks, Kraft Handi Snack, Del Monte Gelatin Snack Cups Table 6-15: Demographic Characteristics Favoring Use of Yogurts by Brand: Jell-O Kid Pack vs. Dannon Sprinkl'ins, 1998 (U.S. Principal Shoppers) Table 6-16: Demographic Characteristics Favoring Use of Frozen Novelties by Brand, 1998 (U.S. Principal Shoppers): Popsicle, Good Humor, Nestlé Table 6-17: Demographic Characteristics Favoring Use of Peanut Butters by Brand, 1998 (U.S. Principal Shoppers): Jif, Skippy, Peter Pan Table 6-18: Demographic Characteristics Favoring Use of Powdered Drink Mixes by Brand, 1998 (U.S. Principal Shoppers): Kool-Aid, Hawaiian Punch, Hi-C Table 6-19: Demographic Characteristics Favoring Use of Single-Serve Fruit Drinks: Capri Sun vs. SqueezIt, 1998 (U.S. Principal Shoppers) Appendix I: Advertisements. This appendix appears in bound editions only. |
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