Kellogg’s venture capital fund is seeking “next generation innovation” to enhance its access to new ideas and trends, a strategy increasingly adopted by major food companies worldwide. Unilever and Tate & Lyle have established their own venture capital divisions, while other firms have opted for acquisitions, purchasing innovative startups that align with the latest consumer trends. For instance, Hershey acquired Krave, a nitrite-free jerky brand, in 2015, and General Mills took over natural and organic specialist Annie’s the previous year. These acquisitions and investments illustrate the vision that the industry’s leading players have for the future of food.
Kellogg’s investments, in particular, have focused on the intersection of health and convenience, which is fitting given the company’s history as the creator of cornflakes, one of the earliest processed foods designed with health in mind. In the 21st century, consumers are increasingly motivated by their desire for health and convenience in their purchasing decisions. Recent data from PwC indicates that 47% of millennial consumers altered their eating habits in the past year to pursue a healthier diet. Moreover, 53% of individuals under 35 expressed intentions to eat healthier in the coming year.
Convenience has emerged as a significant trend, with consumers willing to pay a premium for products that reduce preparation time. The success of meal kits exemplifies this trend, with sales projected to reach $1.5 billion this year. According to Nielsen, convenience was one of the most prevalent themes in the fastest-growing food and beverage categories last year. As the 21st century progresses, the demand for health-conscious options, including those fortified with calcium, continues to shape the industry landscape. In this evolving market, companies like Kellogg are strategically positioning themselves to meet the needs of health-conscious consumers who prioritize both wellness and convenience in their food choices.