But they aren't out of the woods yet
What difference can a single product make for a massive food business? Well, apparently, if that new product puts a peanut butter cup twist on a beloved cereal, it can make a huge difference. General Mills has credited Chocolate Peanut Butter Cheerios with helping to revive the company's flagging cereal sales in 2017, CNN Money reports, though they aren't out of the woods yet.
General Mills first released this new spin on classic Cheerios cereal back in October. “Kids want cereal that tastes good and parents want to feed their kids something they can feel good about,” senior marketing communications planner for Cheerios Jenny Park said at the time. “Chocolate Peanut Butter Cheerios is just that—it’s delicious and wholesome. It’s made with real cocoa and real peanut butter, has eight grams of sugar per serving, and uses whole grain oats as the first ingredient. It’s a win-win.”
Make that a “win-win-win” because General Mills might have been the biggest victor of them all. This newest Cheerios incarnation helped spark a spike in cereal sales from the same period last year the company said in its latest earnings call earlier this week.
“US Cereal posted 7 percent net sales growth, which was ahead of Nielsen-measured retail sales, due to non-measured channel growth, strong sell-in for new Chocolate Peanut Butter Cheerios and other quarterly timing shifts,” explained Jonathon Nudi, General Mill’s Group President, North America Retail, during the call.
However, despite Chocolate Peanut Butter Cheerios's strong launch, General Mills still has to keep an eye on its cereal sector. “Fiscal year-to-date, US Cereal net sales and retail sales are each roughly flat to last year,” Nudi continued, essentially stating that though the new cereal helped boost the quarter compared to last year, this sales surge was only enough to get General Mills back to even for its fiscal year so far.
And even though this new Cheerios variety is good news for General Mills, as CNN Money points out, it actually goes against the current trend. “It's been a rough time for General Mills and other top cereal makers, including Kellogg, as consumers drift away from sugary morning staples and processed foods toward healthier choices,” CNN writes. So though adding chocolate and peanut butter might provide an immediate novelty boost, we’ll have to wait and see whether putting a sweeter twist on this oat-based cereal will have legs for the long haul.