Kraft Foods - Company Overview, Products, And Market Analysis Essay. (70 Characters)

Select a well-known brand that you are familiar with. You could choose one from the Banking, Airline, Hospitality, Fashion, Automotive, Technology or FMCG industries. Undertake individual research and complete both Part A and Part B of the assignment. Submit both parts on to Turn-It-In as one file.

Part A:

Research assignment Research and write a 2,000-word individual report that uses a selected reputable brand to describe and analyse brand elements, brand equity, the brand’s market positioning, brand loyalty activities, potential threats to the brand.

Part B:

Media Plan You are also required to develop and submit a 12-month integrated marketing communications plan for a campaign relating to the brand.
 

History of Kraft Foods

Introduction

The report is focused towards finding out the essential elements connected with the brand Kraft Foods. The various aspects that are related to the functional dimensions of the organization is assessed through the report. Kraft foods groups incorporated is a manufacturing and processing company specializing in groceries located in Chicago, USA. The company is a part of the larger Kraft Heinz organization. Kraft was initially established as a cheese-delivery business in 1903 by James Kraft. The restructuring of the company was done in 2012. In 2015, the company merged with Heinz, owned by Berkshire Hathaway and 3G capital. It is currently the fifth largest company considering food and beverages. The company has a current revenue of 18.2 billion dollars. The company has performed significantly well in the food and beverages market and has worldwide presence. The CEO of the company is John Cahill.

Kraft Foods filed a registration form in 2012 to split into two companies that were publicly traded. The business of the company was focused towards the grocery business of North America. October of the same year Kraft Foods Inc. was created as a new company. The merger with Heinz happened in 2015 and the company’s shares rose by 17% after just the announcement of the merger. The company has since witnessed steady growth in the industry. The company is a well-known brand in the food market.

Brand Attributes

The motto of the company is “Brands people love” and the logo is Kraft written in red text and enclosed within a blue somewhat oval shaped box.

The slogan of the brand is focused towards providing the customers with a large number of healthy products. Like the parent organization Kraft Heinz, the company also focuses on the element of environmental values. The designing of the products need to be done in accordance of the benefits that companies want to provide to its customers. The brand takes into account customer satisfaction as the top priority while the various marketing and brand promotion activities. The company is focused towards using more environment friendly and organic factories for enhancing their productive functions. The brand focuses on reaching out to more health conscious consumers through their products. Kraft Foods is known to provide products such as A.1. Sauce, Claussen pickles, Boca Burgers, Jell-O, Gevalia, Grey Poupon, Lunchables, Complan, Heinz, etc. 

The value system of the company is focused towards taking more environment friendly initiatives concerning both the production process and the CSR initiatives. The values of large companies in the present corporate situation is more inclined towards environment and sustainability. Likewise Kraft Foods as a brand is always focused towards improving its performance in the environment field. The company has added a slogan, “growing a better world” to focus more towards environmental sustainability. Moreover, the company is also providing much emphasis on safer, more inclusive and happier workplace for its employees. The environmental values of the company focus on reduction of gas emissions, reduction of energy consumption and reduction of water wastage. Concerning the customers, the company is always focused to provide the value of homemade taste.

Products Offered by Kraft Foods

Company Positioning

It becomes much important that a company like Kraft Foods significantly consider the environment around them for the development of strategies that can address the factors that affect the organization. The most important factors that tend to affect the organization are competitors, external environment and various legal and political issues. The fact that the company engages in worldwide operations add to the various external factors that can affect its operational feasibility. The performance of Kraft Foods can be essentially classified through the consideration of the various factors that are present with relation to its functions.

The target market of the company is the food and beverages product segment. The company boasts of having over 20 brands with close to 1000 products available in the market. Kraft Foods’ most important market USP is due to its mostly organic based products. The company manufactures products that are inclined towards providing more natural food value to the customers. The company takes into account the target market that consists of the differentiated, undifferentiated and concentrated. The company focuses towards reaching a large number of customers across the world through its differentiated product offerings.

The completion of the company is mainly from the other large players in the food and beverages market. The larger competitors are Unilever, Nestle and Hershey’s. The competitive advantage of Kraft Foods lie in the natural products that are provided to the customers. The more important market advantage is gained due to the unique taste of its products, which is different from the other brands. The company is among the overall market leaders in the area of food and beverage. The research and development that takes place continuously in the company helps it to remain on the top of completion greatly.  

Figure 1: Positioning of Kraft Foods

(Source: Kraftfoods.com 2018)

Brand equity estimation

The valuation of Kraft Foods is large considering the market. The current value of the organization is 58.24 Billion Us Dollars. The revenue of the company is 18.2 Billion US Dollars. In 2015, the company merged with Heinz, owned by Berkshire Hathaway and 3G capital. It is currently the fifth largest company considering food and beverages. The company along with its larger parent company Kraft Heinz is one of the top performing countries with regards to the food and beverage sector of the country. The company’s net income has dropped in the last financial year. The operating income had dropped from 10.35 million to 10.27 million. There are some products that can be considered through sales per measured category.

Amount	Product
18.1 billion	Powdered coffee Liquid beverages
23.4 billion	Cheese and other milk products
20.6 billion	Processed food
13.1 billion	Healthy and Nutritious processed food
11.3 billion	Confectionary items
8.6 billion	Pickled items
18.4 billion	Mayo and Ketchup

Target Market for Kraft Foods

Figure 2: Kraft Foods sales value

(Source: Kraftfoods.com 2018)

The recent trends that affect Kraft Foods are not very satisfactory. However, there have been more growth oriented changes that can be seen. The customer satisfaction of the organization have improved significantly. It can be seen that the company is focusing towards further developing its potential in the market. As mentioned previously the company is increasingly focusing towards providing customers with organic and healthy food substitutes. The company focuses on its motto, “brands people love”. This motto is connected with providing customers with the best food products made from the best produce. The company also wants to provide the best quality of food to the customers.

Description of the target market

The competitors of the company are focused more towards quantity than quality. Apart from Nestle, all other brand competitors are specialized in just a few products. This can work to the advantage of the company as Kraft foods are specialized in the sale of many items. The Target market of the company is more focused towards attracting the customers through processed foods, cheese products, and ready to cook macaroni, flavored milk, vegetarian burgers, confectioneries and other food items. Taking into consideration the target market the company focuses on mainly the differentiated, concentrated and undifferentiated. This results in the provision more flexibility to the marketing functions.

Considering the differentiated target market, Kraft Foods mainly promote their cheese based products. The company manufactures cheese based products to the customers that already have developed an affinity towards these products. It is important to understand that that the company already has a customer base that is attracted to its cheese based products. The undifferentiated products are mainly the confectionary products that are mostly jelly and milk based. The company at the same time sells flavored milk. The concentrated market of the company is regarding the macaroni products that it sells. Considering, this the market of the company is quite diverse. The company is essentially banking on the success of its more popular products like the Boca Burgers, Macaroni, Jell-O, Velveeta cheese and other essentially popular food items.

The target market is however larger in case of the ready to cook products such as the macaroni and cheese products. These are the pre-existing product market for the company. Hence, the company is also focusing on enhancing the target market with regards to these specific products. 

Competitors of Kraft Foods

Competitors, threats, outlook

The competitors of the company is mostly Nestle, Hershey’s and Pepsico. The company that is the largest competitor is Nestle. The threat specifically from Nestle, is the large number of products that it provides to the customers. Apart from Nestle, all other brand competitors are specialized in just a few products. However, the specialized products of Hershey’s like the chocolate spread are very serious competition to the flavored milk of the company. The company is affected greatly by the products of Nestle as it is present in mostly across all the wide number of sectors that are also part of the Kraft Foods brand. The threat is very large with respect to some of the products. Hence in markets that are normally dominated by the Nestle products cannot be penetrated by the products of Kraft Foods. The market cannot be essentially dominated and this will lead to further consolidation of the market of Nestle and the further disintegration of the market of Kraft Foods. However, this is not the only large factors from the competitors that tend to affect the company. As discussed above the Hershey’s syrup provides customers with the option to be used in many different types of food and dessert items. Hence, this leads to a significant threat to a number of products that are provided by Kraft foods, such as flavored milk. The options that are provided by Hershey’s at the same time provide tough completion to the spreads and sauces that are provided by Kraft foods.

The outlook of the company is hence towards the provision of food items to the customers that are quality wise more effective. Moreover, the company is focused towards giving the customers better options that are more quality efficient. More natural products are provided by the customers. Hence, through this the company is focusing towards improving their product value for the customers. Kraft Foods are becoming efficient and quality enriched solutions.

Sample marketing material

 

Summary

Considering the analysis that was done in the study, it can be said that Kraft Foods is one of the most effective brands in the food and agro based markets. Kraft foods is however facing stiff competition from the other more established companies such as Nestle. The initial phases of the study pointed towards the lower revenue of the company in the recent years. However, Kraft Foods also has many other companies under the Kraft Heinz parent company. The FMCG industry is greatly affected by the performances of the players such as Nestle, Hershey’s or Cadbury. It needs to be remembered that the company should take into consideration the changing demands of the customer base. The revenue division of the company pointed towards the more prominent and revenue efficient products of the company. It needs to be said that the FMCG manufacturing enterprises are more efficient with regards to the number of customers that can be reached. The Kraft foods Inc. has been in the FMCG industry for a long time. Hence, it becomes much important that they take into consideration the past growth statistics and the future growth opportunities to frame better strategies for improving their overall performance figures.

Market Analysis of Kraft Foods

Objectives

The objectives of media oriented function will be to reach a large number of customers and find out about their essential needs. It needs to be remembered that the organization will be looking forward to use the information generated from these to increase the productivity of the entire marketing processes. The target audience will be people aged between 15 to 30 years of age. The frequency will be large as a large number of consumers form the market base of food products. The reach will encompass the urban areas, the suburban households and the rural households. The company will be offering the customers with products that they can consume. The objectives from there onwards will be to provide the customers with better opportunity to promote their products. Hence, the channels that will be used for the promotion will be television, radio, online, digital, print, etc. Along with the same the company will be using banners and posters. The key message will be to provide the customers with healthy food solutions. The company will focus towards promoting healthier food habits among the consumers. This will make sure that an optimally efficient product promotion initiative will be taken by the company to promote their product offerings. It becomes much important to understand that the company needs to invest in more efficient means of media for the essential promotion of the products. The company will focus towards increasing the frequency of people coming across the promotional materials of the company. The message that will mostly be used will be the healthier benefits that can be received from the usage of the products. 

Target market

The target market need to be addressed through an effective media plan. This need to go beyond the aspect of the promotional media. It will be important for Kraft Foods to have an efficient Public relations plan. This will improve the relationship with the target market. The company is focused greatly towards increasing the customer reach. This can positively affect the productive performance of the organization. The target market is to be analyzed with regards to the products and services that are offered by the company. It is important that the target market is significantly analyzed. Since as earlier discussed the company essentially focuses on reaching a diverse range of people through their initiative, it becomes important that multi-dimensional media channels are used. The message need to be optimized directly to address the requirements of the large number of customers that are to be reached through the media promotions. Online media will be given increasing importance as they are very likely to reach a very large number of diverse customers. It becomes important that the media channels are very judiciously selected in order to reach the maximum number of target base customers. All ages of customers will be given important however the maximum focus will be towards reaching the children and the urban youth. 

Media selection and justification

Selection of media becomes an important criteria with regards to the market of the organization. Media is a device that can be effectively used towards generating positive reviews among the intended customer base. It becomes important that the media is given increased importance. Omni channel promotion need to be very importantly utilized towards improving the audience reach. Omni Channel media makes sure that the customers are continuously exposed to the message that is being promoted by the organization. Hence, it is an important choice. The channels that can mostly be used in case of television are sports channels. The identified customer base for the products of Kraft Foods are very attracted towards sports. Moreover, sports channels are one of the most viewed channels in the country. Hence a large number of customers can be reached effectively through the promotion at sports channels. More importantly, print and online channels have to be used. Print is effective medium as the company can also use this medium to provide special discount vouchers to the target audiences. Moreover, online channels will mostly be used to promote the diverse ranges of products that the company produces.

Estimated costs of Media

Factors	Cost (USD$)
Television	18,000
Radio	14,000
Print	11,000
Digital	8,000
Outdoor	11,000
Total	45, 800

Table 3: Media costs for Kraft Foods

(Source- Kraftfoods.com)

The estimated media costs will be 45, 800. The mostly used media channel will be Television, Radio and Print. However, the organization is also spending much towards the outdoor and Digital promotion. It needs to be understood that the cost that Kraft foods will assign towards the chosen media channels will contribute largely towards the success of the promotional aspects of the company. Since, the identified customer base for the products of Kraft Foods are very attracted towards sports. It will be important to venture more towards the initially expensive advertising slots in between very important and most viewed matches.  Additionally, it is an already established fact that sports channels are one of the most viewed channels in the country. Hence a large number of customers can be reached effectively through the promotion at sports channels. Print and online channels have to be used judiciously, the company is considering to invest in only those companies that have far greater audience reach and a nationwide circulation. The online media however, will be much cheaper and greatly effective.

Campaign success criteria and measuring

Media planning is intrinsically related to the growth of the organization. The success of the campaign will depend on how effectively media has been utilized and how better investments towards the most efficient media channels that can be used. A very important mark of success can be said to be the increase in the sale of products. The sale of the products would determine the effectiveness of the media promotions. Moreover, an important factor determining the assessment of the success is, the rate of sales. In this case an example can be given of the Macaroni and cheese product of Kraft Foods. A 15 day sales report of the macaroni and cheese product will be implemented. If around 200 packs of the same is sold in the first 15 days of the media promotions, then the entire process can be said to be successful. It is important that the advertisement screening frequency can be increased from seconds to minutes if feasible. 

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