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Why Kellanova’s Pop-Tarts sales are going strong 60 years later

December 26, 2023
in General
Why Kellanova’s Pop-Tarts sales are going strong 60 years later
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Sixty years after their invention, Pop-Tarts remain beloved by consumers who bought about three billion of them in 2022.

“We didn’t realize that this thing was going to go as well as it did,” said 96-year-old Bill Post, who helped develop Pop-Tarts in the early 1960s. “It went beyond any expectations we had.” 

Post remembers when Kellogg’s came to Keebler, the cookie and cracker company where he worked at the time, to ask that Keebler make a breakfast snack for the cereal giant. Post said the two companies collaborated on the product, with Keebler as the manufacturer and Kellogg’s as the marketer.

“It was an unusual, cooperative thing,” said Post. “We got along famously.”

Pop-Tarts were initially released in Cleveland, a test market, in 1963.

“They wanted 10,000 cases of each flavor. But it was such a success that we made 45,000 cases of each flavor,” he said. “The production was not enough. They ran out.”

Now Pop-Tarts, owned by Kellanova, the business made up of Kellogg’s snacking brands, is on the cusp of becoming the company’s next billion-dollar product. In 2022, the toaster pastry brought in about $978 million in U.S. sales, according to Circana, a Chicago-based research firm. By October 2023, U.S. sales for the year were already at $985 million.

“The reality is we’re looking for that next billion and how we start to continue that wonderful journey,” said Oli Morton, the general manager of the portable wholesome snacks division at Kellanova. “We’re actually even more excited about how we go and close the next opportunity down and how we continue to be relevant.”

One way the brand is trying to keep itself top of mind is the first annual Pop-Tarts Bowl on Dec. 28 in Orlando, Florida.

In October, the Kellogg Company split into two independent, publicly traded companies. Kellanova, which kept the “K” ticker symbol, is focused on snacks. W.K. Kellogg Co., which trades under the symbol “KLG,” runs Kellogg’s cereal brands. 

In 2022, snacking brought in $7.5 billion, or 60%, of Kellogg’s sales. The company’s five snack brands in order of profitability are Pringles, Cheez-It, Pop-Tarts, Eggo and Rice Krispies Treats. 

Robert Moskow, a food and agribusiness analyst for TD Cowen, said Pop-Tarts’ biggest competitors are “real” pastries, rather than similar products.

“There really haven’t been any other copycats that have had any success in the toaster pastry,” he said. 

“I think that’s a testament to very consistent branding for the product,” he said.

Watch this video to learn more.

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : CNBC – https://www.cnbc.com/2023/12/22/why-america-will-never-give-up-on-kelloggs-pop-tarts.html

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