How to Optimize Your Cereal Aisle With Honey Bunches of Oats

With revenue in the breakfast cereal market expected to reach $22.53 billion in 2024 and grow annually by 2.35% (CAGR 2024-2028), grocers are eager to optimize their cereal aisles to ensure every shelf features sure bets. After all, one of IGA's most-read blog of all time is 4 Ways to Boost Cereal Sales.

IGA spoke with the cereal experts at Post, who recently launched a new campaign for the popular Honey Bunches of Oats, about how independent grocers can optimize their cereal aisles, from the best SKUs to stock to merchandising best practices.

Basket Building

As mentioned, Post's Honey Bunches of Oats is a beloved brand: one of every five households in the U.S. buys the cereal every year*.

With strong shopper preference, Honey Bunches of Oats is also a basket-builder. Consumers who buy the cereal are most likely to visit the produce section on their trip where they purchase:

Bananas
Grapes
Apples
Strawberries

The Campaign

Recently Honey Bunches of Oats launched a campaign to reach a younger demographic called "Engaged Achievers." These achievers are a diverse set of 25-40 year-olds who are in various stages of adulthood, meaning they could be single, partnered, parents, or anywhere in between.

They are split into two shopping groups:

Lapsed users who need to be reminded of Honey Bunches of Oats and how great of a product it is. They have purchased before but not regularly.
Current buyers who need to be convinced to add Honey Bunches of Oats to their basket more often on their grocery trips.

The campaign strategy will utilize a new color palette, key design elements, and social media messaging to remind shoppers how much they already love Honey Bunches of Oats.

Shopper Behavior

While Honey Bunches of Oats appeals to consumers of all demographics and ethnicities, it highly over-indexes (158) with Hispanic shoppers.

Hispanic consumers are extremely important to the cereal category because they are:

Larger households (49% of Hispanic households have 4+ members) who buy more and larger cereal packages.
Younger households (~60% have children under 18 years old) who purchase in the kids' cereal segment.

Stock These SKUs

The two fastest-selling flavors of Honey Bunches of Oats are Honey Bunches of Oats Honey Roasted and Honey Bunches of Oats with Almonds.

“We recommend bringing in those flavors in 12 oz boxes first,” said Rick Kassing, director of customer category management at Post. “After those, it is most incremental to bring in larger sizes of those key flavors next. Where more space is available, we recommend the 18 oz boxes, then the 23 oz boxes.”

Kassing says that if your store already carries those three key sizes of both flavors, they recommend the 11 oz Strawberry SKU.

Post is also launching a 32 oz bag of Honey Bunches of Oats Honey Roasted in January 2024. This is an excellent addition to IGA stores who are seeing success in the bagged cereal segment.

The most popular UPCs from Honey Bunches of Oats.

Merchandising Best Practices

Kassing recommends the following merchandising practices to achieve high sales. Ready to Eat (RTE) cereal is one of the most efficient categories retailers can display because it is a key category in stock-up trips. More than 55% of cereal baskets are stock-up trips (meaning they contain 12+ items).

Cereal endcaps, in-aisle displays, and cross-department displays will drive higher ROI than almost any other category.
Honey Bunches of Oats is one of the fastest selling cereal brands on display because it appeals to all family members.
Honey Bunches of Oats performs best when both flavors are displayed together at a key single price point.
Signage, displays, and digital assets are all available from your Post Consumer Brands reps.