Essay on Kraft Foods Presentation

1484 Words Apr 7th, 2010 6 Pages
The product manager for coffee development at Kraft Canada must decide whether to introduce the company's new line of single-serve coffee pods or await results from the United States. Key strategic decisions include which target market to focus on and what value proposition to signal. Important questions are also raised as to how the new product should be branded, which flavors to offer, whether Kraft should use traditional distribution channels or direct-to-store delivery, and what forms of advertising and promotion to use. The case provides a basis for discussing consumer decision making, and stresses the importance of providing a clear incremental benefit when introducing a new product in an established category.

Decision
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Consumers were characterized by high levels of consumption, and their interests included exercising, entertaining at home, gourmet cooking, household decorating, gardening, and taking exotic vacations. Maxwell House and Nabob had similar profiles to SSP machine owners, except that individuals were typically over the age of 45 Buyer Behavior: Consumers typically purchased pods of the same brand as the machine they bought On the other hand, focus group research suggested that SSP machine owners valued flexibility of using different coffee brands in their brewers. Coffee quality was critical since it defined the entire coffee experience Market Share: Kraft expected that, of the 12.5 million households in Canada, SSP machines would be adopted by approx. 6% by the end of 2004 and 8% by the end of 2006. To maintain Maxwell House and Nabob’s share of the Canadian coffee market, Herzog estimated that Kraft would need to capture at least 35% of the coffee pod segment Product: By proceeding with the launch, Herzog needed to decide on a flavor selection Variety of pod offerings would be critical for building market share and category growth. Kraft’s manufacturing facility also had the ability to offer the product in a resealable bag with zip

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