Kellogg's Promotional Strategy

Many marketing managers believe the only meaningful objective for their promotional programme is sales. They believe that the main reason a firm spends resources on advertising and promotion is to sell its product or service. Spending on promotional activities represents a firm 's commitment towards investing its scarce resources that requires an economic justification. Managers generally compare investment options on a common financial basis, such as return on investment (ROI).

However, managers usually believe that resources spent on advertising and other forms of promotion should result in measurable outcomes, for example, increase in the sales volume by a certain percentage or amount or increase in the brand’s market share. They believe

Interestingly, the few bright spots came from heavily advertised brands. Kellogg 's Smart Start and Special K brands showed sales increases of 72 and 22 percent, respectively, in the first quarter of 2002, when their advertising budgets were significantly increased. The increases continued as a result of more brand differentiated advertising, putting Kellogg 's back into the leadership position. Kellogg 's and Post’s goal was to increase sales and market share versus store brands. This goal not only became the basis of the marketing plan but carried over as a primary objective of the promotional programme. The success of the advertising and promotional campaign was judged only by attainment of these

Criticism of Sales as an Advertising Objective: Given Kellogg 's and Post’s failures to reverse their sales declines, does this mean the advertising and promotional programme was ineffective? (For Kellogg’s the new advertising seemed to work). Or does it mean the price cuts didn 't work? It might help to compare this situation to a football game and think of advertising as a quarterback. The quarterback is one of the most important players on the team but can be effective only with support from other players. If the team loses, is it fair to blame the entire loss on the quarterback? Of course not. Just as the quarterback is but one of the players on the football team, promotion is but one element of the marketing programme, and there are many other reasons why the targeted sales level was not reached. The quarterback can lead his team to victory only if the linemen block, the receivers catch his passes, and the running backs help the offence establish a balanced attack of running and passing. Even if the quarterback plays an outstanding game, the team can still lose if the defence gives up too