Kraft Foods Essay

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Kraft Foods 1. Situation Analysis A. Company Profile: Kraft Foods Inc. (NYSE: KFT) is the largest food and beverage company headquartered in North America and the second-largest in the world after Nestlé SA. With 97,000 employees in over 70 countries, the firm operates in two main segments: Kraft North America Commercial and Kraft International Commercial. In addition to these two geographical divisions, Kraft's products are divided into one of five categories: snacks & cereals, beverages, cheese & dairy, grocery, and convenient meals. Kraft Food was the world leader in the coffee sales with 15% in the global market. In Canada, Kraft’s Maxwell House and Nabob brands enjoyed a combined 32% share. B. Strategic Issues and Problems: One of biggest challenge for Kraft Foods Canada was to make the decision if they should launch their coffee pods in Canada simultaneously with its launch in USA. They had another alternative; they could choose to wait for the outcome of its product response in USA. Kraft Foods Canada decided to follow the footsteps of its launch in USA and In November 2004 it introduced a line of single serve coffee pods (SSPs) in Canadian Market. The results of the launch of the product were not promising and it did succeed their anticipations. Another issue with Kraft Foods Canada had been with their business strategy for the launch of coffee pods. There are different elements to its business strategy that affected its launch, and they are as follows:  The launch of four different flavors such as Maxwell House Dark Roast, Medium Roast, Decaffeinated Blend, Nabob 100% Colombian.  The pods were distributed in through major grocery chains and average price of $4.99 for a package of 16.  To save some cost on delivering, they opted for direct to store distribution in partnership with Mr. Christie cookies division.  Advertising for the coffee

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