• Reuters, Friday, January 13, 2006 12 PM

General Mills is stepping up its competition with bigger rival Kellogg Co. The cereal marketer told investors Wednesday it will increase its advertising spending at a double-digit percentage rate in the second half of its fiscal year in an attempt to regain market share from Kellogg. The company's market share dropped last year after it raised prices to offset a surge in costs of raw materials such as food commodities and fuel. Since then, sales of General Mills' Big G cereals have improved as competitors' prices, particularly on promoted products, have crept up. General Mills also lowered its prices on promoted products, further narrowing the price gap.

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