Kraft Foods: Strategies and Consequences Essay

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Kraft Foods claims that the company is consistently growing with its high performing organization, manufacturing products that are relevant to consumers, sales capabilities, and lower product costs without compromising quality (Kraftfoods). Kraft is one among the leading food and beverage companies in almost 150 countries.

Major actions Kraft Company took to market its products

In an online published article dated February of 2008, Kraft reaffirms its three-year growth plan beginning 2007. Initially, after one year on the process, Kraft has gained growth in sales. And in order to maintain the momentum, it announced its guidance and discloses product innovation during the conference. To maintain the progress, its strategies such as improving the brands and product quality, upgrading the product pipeline, and empowering the management team, the company is committed to reduce the operating cost and other expenses in order to carry out the strategies more effectively in 2008. “Unprecedented input costs” as mentioned will entirely affect the implementation of the plan (“Kraft Highlights”).

In December of 2008, Kraft formulated another strategy called “Open Innovation Strategy” in recognition of the external innovation partners who they believe could help the company grow further. This strategy is a partnership with people outside the company such as customers, business partners, and competitors who could input ideas through certain means such as conducting diagnostic tool or other means of engagements (Jusko). Any input the company could get from the external partnership will be subjected to research and development until new approach or product is formulated.

Consumer Reaction

Initially, at the turn of economic recession in the country, many companies including Kraft Foods understand that consumers will pull back their spending. This scenario will greatly affect their sales and profit. Thus, though there is a great need to push through price increases but it really hampers them knowing that it would push back the consumer. Predicting consumer reaction is such a great deal for Kraft.

Kraft Foods Company with its endeavor to innovate the brand and product has launched recently a research study in order to get the feedback of almost 7,000 employees and consumers around the globe on the kind of Food Company they look for, what food they like, and the relationship they thought important for the food company. Mainly, the consumer and employee feedback has a positive result toward Kraft Foods Company. The latest renovation in the Kraft logo is perceived to give the company a boosting effect as the style and typeface is very contemporary. On the other hand, the feedback as they noticed is the number reason for consumer preference (Wong).

Another report released in April 2009 conducted by Experian Simmons found out that fifty percent of the mother-respondents believed that their children get necessary nutrients in drinking Capri Sun juice, a Kraft owned juice (“Survey”). This indicates the consumers’ positive patronage of the product despite the financial crisis of the country.

These are just few of the feedbacks and reactions of the consumers. Until now, Kraft Foods continues to gather necessary feedbacks and reactions from the consumer that will help to improve the products and strategies.

Competitors’ Reactions

The latest report conducted to measure Kraft Foods competitiveness noted that the company gained a ten percent increase in profit despite stronger dollar scenario according to Predrix. The strategy on cutting back on costs and expenses helped the company to boost while the foods keep attracting consumers to buy the product despite they pull back their spending. This is contrary to the feedback published in an internet article, which stated that due to consumers’ cutting back of spending will affect the competition and businesses (“Analysts”).

The Revere Hierarchy would map Kraft Foods to a product level in order that consumers, investors, and other professional in the field of marketing would understand the strength and weakness of Kraft Foods products against its competitor. This is in response to the new strategies and approaches made by the latter that in one way or another, stakeholders can decide exactly correct choice.

Revere Hierarchy is just one among the many competitors of Kraft Foods that without fully analyzing the scope of changes to be made, it may be caught unaware about the possible attack to be made by other competitors. On one hand, this methodology is a good point for Kraft because of open innovation, it can prepare for more harder advertisement.


Kraft Foods, Inc. can be considered unbeatable because of continuously innovation it does to the company and product, which is a good attitude especially that idea or concept is derived from feedback made by stakeholders including the competitors.


Analyst Downgrades Kraft Foods on Volume Risk. (April 2006). Coshocton

Fredrix, E. (May 2009). Kraft Foods 1st– Quarter Profit rises 10 percent; stronger US Dollar

Drags on Foreign Sales. The 33TV.Com.

Jusko, J. (2008). Kraft Crafts an Open Innovation Strategy: Consumer Packaged Goods

Manufacturer Finds Innovation Value in Collaborating with Suppliers. IndustryWeek: Connecting Manufacturing’s Leaders.

Kraft Highlights Growth Strategy, Reconfirms 2008 Guidance and Unveils Product Innovations

at CAGNY Conference. (Feb. 19, 2008). BNET.

Strategies. Kraftfoods.

Survey Finds Kids May Not Be Getting the Most Out of the Most Important Meal of the Day.

Kraft Foods.

Wong, E. (Feb 2009). Kraft Unveils New Brand Identity. AdWeek.

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