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Cereal-makers attempt to woo millennials

Jaks Pierre, front, a 25-year-old communication specialist, said she started eating cereal again after her employer installed a cereal bar in their St. Louis Park, Minn., offices. Fellow employee Laura Hansel joins her.
Companies alter ingredients, usage

MINNEAPOLIS — Ashley Peters grew up eating breakfast cereal — from Cheerios to Cap'n Crunch — and now at age 30 she's part of the coveted millennial demographic. But these days, Peters usually reaches for a granola bar at breakfast.

“It's just easier to do,” said Peters, a communications manager at a St. Paul nonprofit group. “I don't have time for milk at work.”

Cereal is still king of the American breakfast, but its realm is shrinking as consumers look for more convenience and variety.

The percent of in-home breakfast meals that include cereal dropped from 31 percent in 2009 to 26.8 percent last year, according to market researcher NPD Group. Meanwhile, U.S. cold cereal sales have fallen 9 percent from 2011 through 2015, according to market researcher Nielsen.

This is bad news for Minnesota, home of General Mills, one of the nation's two mega-cereal-makers along with archrival Kellogg. The state also is a big hub for the No. 3 U.S. cereal company, Post Holdings, which last year bought the former Malt-O-Meal company and its plant in the state. Post now runs its cereal business out of Minneapolis.

Cereal manufacturers haven't been bowling over customers with innovative products in recent years. But they are finding other ways to fight back, eliminating dyes and other ingredients perceived as unhealthy. They're marketing cereal as an alternative to other snacks.

A study last summer by consumer research group Mintel concluded that convenience at breakfast was especially critical among millennials, defined by Mintel as between ages 22 and 39.

Breakfast cereal's woes also are linked to the proliferation of options, from snack bars to different yogurts. Classics like eggs and bacon are back in vogue, and both play well to the protein dietary trend. Fruit consumption at breakfast also has risen over the past decade, NPD data show.

In some consumers' eyes, cereal is on the wrong side of trends that vilify carbohydrates and sugar.

General Mills' main offensive pivots on removing unwanted ingredients from its prime brands.

Last year, the company began selling gluten-free versions of Honey Nut Cheerios and classic Cheerios.

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