Beware of the hotness creep
"Hotness creep is a face that doubles as a proof of purchase."
Letter is late this morning because I wanted to go get a cookie and a coffee :)
Hospitality letter didn’t come out this week but hopefully next week. I want to send a sincere thank you again for everyone who subscribed to the letter this week. Although my takes in Wednesdays letter felt uncomfortable to write and controversial, it drove more subs than any letter I’ve written. Which means i’m doing important work. So thank you, seriously.
Kellogg’s is ditching their cereal business. I know cereal is all sugar, but it’s sad guys. I have a famous story with my best friend, where I was maybe very drunk and called an ex while I was home alone eating cereal, and left him a voicemail that said “Cereal is a pillar of our society.” And you know what? It was. But Americans have fallen out of love with cereal, and I have fallen out of love with my ex. In the 80s and 90s American families gorged on cereals. Powered in part by a not-quite-right belief that eggs were dangerously high in cholesterol, carbs ruled the morning. The only time I really eat cereal is at shitty hotel breakfast buffets. I don’t even really eat breakfast. A lot of my friends don’t. Unit sales of ready-to-eat cereal in the U.S. rose 5.2% in 2020 because of the pandemic, but they plummeted 8.7% in 2021 and another 3.9% in 2022. Magic Spoon, a high-protein (Americans want protein at breakfast now) cereal brand, was founded in 2019 and has raised $100 million to date — cereal is a huge market, and they were the first to decide to attack it at this level. In 2021, another cereal brand OffLimits raised $2.3mm. Three Wishes, another new cereal brand told Forbes that they’re “keeping their funding private” in 2021. I don’t know man. I think cereal is like ice cream, fun to have sometimes but not every day. Kellogg, the home of faded but possibly still iconic cereal ambassadors Tony the Tiger and Toucan Sam, has the most radical solution: Make it somebody else’s problem. Next month, the company will spin off its North America cereal division into an entirely new company, to be named WK Kellogg after its founder who invented modern cereal over a century ago. This will leave Kellogg’s top management to focus on the more attractive snacking segment, with brands such as Pringles and Cheez-It, at a company renamed Kellanova. Kellllaaanovvvaaaa 🌕 ☄️💫🪐