Former Kraft CMO Deanie Elsner Joins Kellogg

Ms. Elsner Will Run the Company's U.S. Snacks Business

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Deanie Elsner
Deanie Elsner

Kellogg Co. has hired former Kraft Chief Marketing Officer Deanie Elsner to run its U.S. snacks business.

Ms. Elsner left Kraft Foods Group in February as part of a management overhaul. The company later merged with H.J. Heinz Co. to create a new company called Kraft Heinz.

Kellogg CEO John Bryant confirmed Ms. Elsner's hire as president of U.S. snacks during the company's second quarter earnings call. She replaces Brian Huff, who recently left the company, a spokesman confirmed.

Kellogg's snack brands include Pringles, Cheez-It and Special K-branded snacks like cracker chips. Sales in the U.S. snacks division fell to $1.689 billion year-to-date ending July 4 from $1.715 billion the year-earlier period, the company reported on Tuesday.

Ms. Elsner's hire comes as Kellogg continues to overhaul its management team. Kellogg has been battling sluggish sales trends that have affected most big packaged food companies. In April, Kellogg tapped former Wendy's chief marketing officer Craig Bahner as president for its morning foods division. The company also promoted its chief growth officer, Paul Norman, to president of Kellogg North America. "I believe that our management team is now the best we've had in years and represents the right mix of experienced industry professionals from outside the organization, and talented, long-term Kellogg employees," Mr. Bryant said on Tuesday's earnings call.

Total comparable net sales in the second quarter fell 5.4% to $3.48 billion, but sales only dropped by 0.1% on a currency-neutral basis. The company has been hurt by its slumping cereal business. But on Tuesday, executives touted improving trends, noting that the company's six largest cereal brands collectively grew sales and share in the quarter.

The company's move to reposition its struggling Special K cereal as a "wellness" brand -- and away from a diet marketing approach -- is showing signs of promise, executives said. "I'm pleased to say we have seen steady improvement in performance over the past few months," Mr. Norman told investment analysts.

But for Kashi -- which has also struggled -- "we have yet to see the kind of turnaround we've seen on Special K," Mr. Norman added. But he added that "the team is making good progress on renovation and innovation plans, and we expect to see the fruits of these efforts begin to come through in improving trends over the coming months and as we enter 2016." Part of the plan includes launching new Kashi cereal varieties such as Sweet Potato Sunshine and Sprouted Grains. Kashi also recently completed an agency review, selecting VML, Pereira O'Dell , Krispr Communications and Starcom as its new partners.

Erin Lash, who covers the company for Morningstar, said Tuesday in a note to investors that "we think Kellogg's rebuilding efforts are starting to gain traction." She pointed out that Special K sales "turned positive for the first time after five quarters of declines," but added that cereal sales "continue to be hindered by Kashi, though, where sales are still trending lower."

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