Category Advisor: Breakfast Foods—Hot Cereal: Sturm McCann’s

McCann’s Irish Oatmeal has been making its steel-cut oats the same way for more than 150 years. But this specialty food staple is using modern-day techniques to evaluate its market position and determine how to build the hot cereal category.

The McCann’s brand, a longtime darling of specialty retailers, is expanding its reach to mainstream supermarket shoppers. For many years, supermarkets treated McCann’s as an imported food and shelved it as such in the specialty food section of the store. Unfortunately, the steel-cut oatmeal was shelved away from the hot cereal category and away from mainstream shoppers.

McCann’s crafted a breakout plan to deliver premium sales and profits for the hot cereal category by bringing steel-cut oats into the mainstream set. Its multi-pronged strategy included targeted distribution growth with retail stores that cater to $75,000-plus households and establishing a shelf plan to expand the hot cereal category to include steel-cut oats. Identifying the correct product assortment that would attract the premium oatmeal shopper was critical, as was increasing in-store shopper awareness, which was accomplished by a shipper program that featured authentic Irish mugs and jars.

Retailers that have transitioned steel-cut oats to the mainstream hot cereal aisle have garnered higher category growth rates, according to IRI category data for the 52-week period ending July 31. General hot cereal/oatmeal sales increased 1.1 percent in dollar sales, while unit sales posted a 0.8 percent growth rate. McCann’s experienced a 17.2 percent increase in dollar sales and a 16.6 percent increase in unit sales.

Among the brand’s key accounts, virtually all reported dollar and unit sales increases. While the median increases were in the 25 percent range, one retail store experienced an impressive 95 percent increase in unit and dollar sales, underscoring the effectiveness of McCann’s platform.