retail news in context, analysis with attitude

The New York Times this morning has a story about declining cereal sales, noting that this has happened "as consumers reach for granola bars, yogurt and drive-through fare in the morning. And the drop-off has accelerated lately, especially among those finicky millennials who tend to graze on healthy options … Cereal consumption peaked in the mid-1990s, according to the NPD Group, a consumer research firm. Still, some 90 percent of American households report buying ready-to-eat cereal, which remains the largest category of breakfast food with some $10 billion in sales last year, according to Euromonitor, down from $13.9 billion in 2000. And the consumer research firm estimates sales will fall further this year to $9.7 billion."

The problems are varied - some people simply want a breakfast that is more mobile and convenient, some want a breakfast that they see as being more nutritious, and some people just don't eat breakfast and, in fact, don't eat three traditional meals each day.

The major cereal companies are working to address these issues, by doing things such as making their products more healthy, more environmental (by improving packaging), or even m ore nostalgic. But many analysts seem to feel that the current declines are systemic, represent "death by a thousand cuts," and say that there are so many trends working against the cereal business that they don't know which ones to blame.
KC's View:
I'm intrigued by the "which one to blame" observation made by one analyst, because it addresses the problem as one that can be solved by defense, not offense.

It seems to me that one of the things that cereal manufacturers need to do - and we're already seeing this - is focus on being in the breakfast business, not just the cereal business. Plus, one of the things they need to do is start trying to create and define trends, not blame and defend against existing trends.

Which I'm sure they're all doing.