General Mills Blue Buffalo Merger

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Current Merger: General Mills to Blue Buffalo There are a lot of current mergers happening in the world. The one that struck my eye the most was everyone’s favorite cereal, buying out all-natural pet food. General Mills, maker of cereals like Cheerios, and Cocoa Puffs is buying Blue Buffalo, an all-natural pet food brand for dogs and cats. General Mills has stayed in the food realm of products for some time now. They have product lines in yogurt, vegetables, spices, soup, snacks, pizza, pasta, meals, organic/natural, ice cream, dough/pastries, and now additionally adding pet food. The reason for such a drastic change in product choice is the highly competitive food industry. Sales have been dropping the past few years. Their overall sales …show more content…

According to Economy Watch, “[A] product extension merger takes place between two business organizations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. This ensures that they earn higher profits,” (Economy Watch). Going off this definition of a product-extension merger, General Mills merging with Blue Buffalo is a textbook definition. General Mills sells consumable products for humans, whereas Blue Buffalo sells consumable products for pets. They are relatable by them both being consumable but are not interchangeable (humans won’t consume pet food and vice versa). Pet food, and human food are also sold together in many supermarkets, and grocery stores as well therefore relating them in the same market selling point. General Mills is creating a bigger market for themselves when including pet food as well as their typical human consumable food …show more content…

Their food sales may have been decreasing, but they have also bought some more organic/natural types of food to keep up with the current trend of a healthier diet. With Blue Buffalo adding more sales revenue, the company can then expand their branding image even further. They can start to add more organic/natural human food, or even dominate the other main competitive dog food brands and eventually buy those as well. Since General Mills is already a well-established, and now well-rounded competitor for supermarket shelf space, they will have no problem using their newest sales to their own advantage in the ever-growing market. By the end of May, people will start to see General Mill’s logo on the back of the Blue Buffalo pet food products. Although, Blue Buffalo has already made a great name for itself, General Mills backing them will only create a stronger relationship tie to their purchasers. They are a long time stable brand. This will only help consumers make the decision to purchase Blue Buffalo dog/cat food since they already rely on the company so heavily for their own consumption. Now, people can take the high quality of General Mill’s products and associate the company with their pet’s food as

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