Kraft Case Study

EXECUTIVE SUMMARY (RW)

Kraft, as a whole, is the largest consumer packaged food and beverage company in North America. The company’s subsidiary, Maxwell House, is currently ranked second in the instant coffee market behind Folgers. This is mostly due to weakened brand awareness because of reduced effort in marketing. Kraft is in a good position, however, to reclaim this market with the financial resources to back a sales and marketing and public relations push.

The following two charts summarize the strategic group that Maxwell House belongs to and the SWOT analysis.

Summary of SWOT Analysis

Strengths:

S1. Product research and development

S2. Sales and marketing Opportunities:

O1. Increase interest in flavoring options

Weaknesses:

W1. Weak brand Threats:

T1. Intense competition

Based on this, and further information found later in the report, Kraft should implement a broad differentiation strategy that focuses on the following elements:

1. Introducing a new product line focusing on flavored syrups – addresses S1, S2, and O1

2. Strengthen Gevalia and Tassimo single-serve product lines – addresses S2, W1, and T1

INTRODUCTION (RW)

When hearing the name Kraft, the first thing to come to most people’s mind is cheese. Kraft, however, is a massive international company that owns and operates 30 different food and beverage brands. Ten of these brands accounts for more than $50 million of the company’s $18 billion in annual sales (“Our Mission”). Kraft products can be found in 98% of households in the US and 99% of households in Canada which allows the company to enjoy a position as one of the largest consumer packaged food and beverage companies in North America (Kraft Foods Group…, 2013, p. 1).

BACKGROUND / HISTORY OF KRAFT (RW)

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...impact coffee prices whose producers are found all over the world. Then, in today’s world, there is always the threat of terrorism. However, the Bioterrorism Act of 2002 helps to ensure the safety of imported goods while improving the FDA’s scope of control in enforcing importation safety and regulation. Finally, Kraft and its industrial peers have made corporate social responsibility an important component of their overall strategy.

INDUSTRY ANALYSIS / PORTER’S FIVE FORCES (DH)

Porter’s Five Forces provides a strategic model from which Kraft can assess its position in the coffee industry. Within this model, a thorough analysis of the following elements will be executed: (1) potential entrants, (2) current rivalries among existing firms, (3) bargaining power of suppliers, (4) bargaining power of buyers, and (5) substitute products.

(“Porters-five-forces”, n.d.)