The Kraft Foods Canada has been planning

Running head: MARKETING
MGT-2020-Y
Name of the Student:
Name of the University:
Author Note:

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Table of Contents
Executive Summary:........................................................................................................................1
1. Current Market Situation:............................................................................................................1
a. Market Description:..................................................................................................................2
b. Product Review:.......................................................................................................................2
c. Target Segment:.......................................................................................................................3
d. Competitive Review:................................................................................................................3
2. SWOT Analysis:..........................................................................................................................4
a. Strength:...................................................................................................................................4
b. Weakness:................................................................................................................................5
c. Opportunities:...........................................................................................................................6
d. Threats:.....................................................................................................................................6
3. Objectives and Issues...................................................................................................................7
a. Objectives:................................................................................................................................7
b. Issues:.......................................................................................................................................8
4. Marketing Strategy......................................................................................................................8
a. Product:....................................................................................................................................9
b. Price:........................................................................................................................................9
c. Place:......................................................................................................................................10
d. Promotion:..............................................................................................................................10
5. Budget:.......................................................................................................................................10
6. Control:......................................................................................................................................11
References:....................................................................................................................................12

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The report provides an insight into the marketing plan of Kraft Foods Group in
repositioning its processed cheese segment known as Kraft Singles. The report portrays how the
company would design the marketing plan by targeting the millennial mom.
Executive Summary:
The Kraft Foods Canada has been planning to reposition Kraft Singles, the firms brand
for processed cheese. The firm now plan to devise a marketing plan solely aimed towards
attracting the millennial moms of Canada who are born between the 1981 and 2000. The
necessity for repositioning the cheese brand arose because of the exponential rise in the number
of millennial in Canada and the expanding market for the unprocessed cheese. Canada witnessed
a stagnancy in per capita consumption which indicated a chance of growth for processed cheese
in Canada.
The key marketing objectives of the plan has been to capture the Canadian cheese market
and generate a revenue more than $3.8 billion and lead the market by a higher percentage of
market share for the processed cheese.
1. Current Market Situation:
Kraft Canada has been a part of Kraft Foods Group found in the year 1903 by James L.
Kraft who perfected the art of manufacturing processed cheese which later has been categorized
as Kraft Singles (Chandrasekhar 2020). Cheese has been one of the key categories of Kraft
Canada since it generated close to 25 percent of the sales revenue. The sales revenue for the
cheese market stood at $3.8 billion as per the records of 2014. Thus, sales volume of the cheese
fell by 1 percent on a yearly basis while the annual sales portrayed a growth of 2 percent. There
has been a market expansion for unprocessed cheese while the market for the processed cheese

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faced major contraction. This demanded the revival of Kraft Singles which has been a processed
cheese.
a. Market Description:
The cheese market of Canada had mostly been consolidated by four big players which holds 84
percent of market share. The unprocessed cheese captured close to 28 percent of the market share
while the segment for processed cheese witnessed slower growth but the segment had been
hugely competitive and differentiated (Moubarac et al., 2014).
Close to 99.8 percent of the cheese sales in Canada happened through store format. In
particular the grocery retailers accounted for close to 96.9 percent of the cheese sales. This is
because, for the retailers, cheese happened to have a higher margin in the business in comparison
to milk. Hence, retailers on a regular basis tried to strengthen the sections of the cheese. Most
store had in store displays of cheese while the others appointed ambassadors for not only
promoting the cheese but also expanding its occasions for usage.
b. Product Review:
Cheese has been one of the chief product in households of Canada as well as the
Canadian food services Moubarac et al., 2017). In recent times, the consumption of cheese
underwent noticeable patterns. For instance, the food consumption other than meals had boiled
down to snack items like the granola and candy bars. But the rising trend amongst the health
conscious young Canadians had led to the emergence of cheese as snacking option. These
Canadians also remained interested in trying out newer flavors. Kraft Singles, the processed
cheese by Kraft Canada had an iconic status in the beverage and the food industry. A whole
generation of consumers in developed world comprising of both Generation X and baby boomers

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grew up watching this Cheese melting into grilled sandwiches and barbecued burgers. Various
families have witnessed the peeling of individual slices of the processed cheese thereby layering
it on the bread toast. What did not change with time had been the square shape and orange color
of the cheese slice along its blue packaging.
c. Target Segment:
The target segment of Kraft Food for its processed cheese brand, Kraft Singles, had been
millennial moms whose population had been increasingly progressively in Canada. Compared to
the 33.9 percent of the Generation X and the 31.1 percent of the baby boomers, the Millennial
represented a percentage of close to 36.8 percent (Ng, Lyons & Schweitzer, 2017). These
millennial mom belonged to the age that had been characterized by the disruptive phenomena.
Their consumption and shopping habits had also been influenced by unique experiences. As far
as the technology was considered, the millennial believed in deriving real time information that
actually mattered. Hence, while cruising the aisle of the grocery store that displayed the farm
produce, the millennial preferred to have access to the meal solutions and recipes. Besides, they
further wanted to completely connect them with the brands that provided them with unique
experience. A survey conducted on the millennial moms discovered that beside the smartphone,
the millennial mom had been found to spend close to 4.6 hours on consuming the digital media
of the overall 7.8 hours. In fact, the millennial mom of Canada had been found to spend more
time on the smart phones in comparison to the Gen X moms.
d. Competitive Review:
The Canadian market remained consolidated by four key players that held close to 84
percent share in the market. Saputo, a product of Saputo Inc and an unprocessed cheese segment
captured close to 28 percent of market share. This unprocessed segment of cheese had been

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hugely undifferentiated and growing. The other prominent competitors included cheese
manufactured by Agropur Cooperative Ltd that captured had 21.5 percent market share and
Parmalat Canada Ltd that captured 13.9 percent. Kraft Singles also faced competition from
Lobloys Cos Ltd whose products captured 2.3 percent, Arla Foods Canada Inc that captured 1.7
percent and Sobeys Inc that captured 1.4 percent.
2. SWOT Analysis:
Kraft Foods had powerful strengths while its major weakness lies in the lack of image
and the awareness of the brand. The key opportunity lay in the rising demand for the cheese. The
company also face immense threat from competitor and a downward pressure on the pricing. The
following paragraphs discusses the key strength, weakness, opportunities and threat faced by the
processed cheese manufacturing firm.
a. Strength:
1. Wide range of products: Kraft Canada had been one of the key consumers of
packaged goods that comprised of close to seventeen beverage and food categories. The
company marketed refreshed beverages, cheese, coffee, refrigerated meals and grocery related
products. Some of the brands of the Kraft Foods included Philadelphia, Cracker Barrel, Nabob
and Philadelphia, Kraft Singles, Peanut Butter, Tassimo, Maxwell house and the salad dressings.
2. Wider Channel for Distribution in United States: Kraft Foods has an outstanding
channel for distribution in United States and has been able to earn the confidence and trust of the
various wholesalers and retailers for pushing the products. This will also easily help in the
redistribution of Kraft Singles

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3. Innovative Kraft Recipe: The key target market for the Kraft products has been the
homemakers and hence to capture the market Kraft introduces an innovative means known as
Kraft Recipe which is made using the Kraft mixes and products. This also helps in better
capturing the mind of the target audience for Kraft Singles especially the millennial moms.
Besides the cooking tips and the recipes put forward to these moms particularly focused on
recipes that required lesser time for preparation and less number of ingredients compared to the
typical meals.
b. Weakness:
1. Reduced Level of Sales Volume: There has been a decrease in the volume of sales for
Kraft Foods brands due to the competition from the domestic players and the multinational
companies. Kraft Singles, the processed cheese segment has experienced a slower growth due to
the increasing demand for the non-processed cheese segment. The increase in demand for
flavored cheese as a snacking item amongst the health conscious Canadians has been a reason for
the slower growth of the Kraft Cheese. This is because the higher range of choices prevented the
customers in remaining loyal to the single brand.
2. Availability of Too Many Brands and Products: Kraft Foods has been burdened
with huge number of products and hence adopting unique innovative means becomes quite
challenging for the company.
3. Lack of Presence in the Organic Market: Most of the food processing companies
have entered the organic food market. Kraft Foods however did not make any attempt in making
its presence felt in organic market. Hence, this also acted as a reason for stagnancy in the
processed cheese segment (Hamzaoui-Essoussi, Sirieix & Zahaf, 2013).

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c. Opportunities:
1. Rise of the Millennial: There has been a massive growth in the millennial population.
They account for close to 6.3 million people across Canada. A research by NPD Group found
that the millennial are not only health conscious but also value conscious people. These
millennial has been more attracted to the dollar stores compared to the departmental stores for
the low prices. Hence, Kraft Singles, the processed cheese from Kraft Foods can only capture the
market has a chance of revival if they are able to make certain value additions to the customers in
terms of the price.
2. Changes in the Pattern of Consumption: In the emerging economies there has been
a shift in the trend of consumer habits where the consumers have increasingly shifted towards the
global norm in terms of food habits. Cheese has not only been part of the breakfast ritual in
families but it has also been a part of the snacking option for the health conscious millennial. The
Canadian millennial has also been inclined towards trying out newer flavors (Fedusiv & Bai,
2016). This acts as quite a lucrative opportunity for the revival of the processed cheese market.
d. Threats:
1. Competition: Kraft Foods faces immense competition in marketing its processed
cheese segment. The key competitor have been Saputo that capture close to 28 percent of the
market share. Although, Saputo has been the unprocessed cheese still it acted as a threat to Kraft
Singles thereby slowing its growth in spite of the processed cheese segment being highly
competitive and differentiated.

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2. Fluctuations in Cost: The food processing industry has been immensely dependent on
raw materials that are mostly farmed and whose cost fluctuate at an excessive rate. It might not
be possible in accommodating the fluctuations within the price.
Table 1: Kraft Foods’ Strength, Weakness, Opportunities and Threats
Strength
 Wide product range
 Wider distribution channel
 Innovative recipe
Weakness
 Reduced volume in sales
 Availability of various brands and
products
 Absence in the organic market
Opportunities
 Rise in the population of Millennial
 Changes in the consumption pattern
Threats
 Intense competition
 Cost fluctuation
3. Objectives and Issues
Kraft Foods has tried to portray achievable objectives in the years following the entry of
Kraft Singles with the revitalized plan in 2013.
a. Objectives:
Kraft Foods believed in following a decentralized operation where the local managers
seem to have certain level of autonomy. The company primarily targeted the chain of
supermarket, supercenter, wholesaler, club store, distributor, convenience store, merchandisers,
supercenters, retail outlets for food and the value stores. To revitalize the market for Kraft
Singles, the company tried to deploy traditional tools for tracking such as the metrics and the

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scorecards. It also looked forward to using a dedicated approach for promoting innovation. Kraft
Foods tried to set up what is known as the innovation garage where the designated teams acted
like startups within framework of the larger organization. In addition to this, to capture the
maximum market share, Kraft Singles tried to eliminate the artificial preservatives.
b. Issues:
The best means for Kraft Canada in attracting the millennial moms had been its focus on
the four core attributes which included nutrition, health, convenience and taste. The message
portrayed by the company must remain rooted in the attributes. It is only then that the messaging
will be considered as authentic. The issue faced by the company lay in the determination of the
attributes that needed to play a role for meeting the unique needs of the millennial moms of
Canada. Kraft Singles did not rank in the health attributes since it has been a processed cheese
and has acted as major limitation. The millennial moms remain influenced by the practices that
ensured sustainability of the environment. Hence, putting across the operational process would
ensure the authenticity of messaging. For instance, messaging must focus on origin of the cheese
and its production. The company faced major contradiction in huge sense and the consumers
kept evolving in a constant manner. Thus, it became inevitable that the Kraft Singles also
required to evolve which indicated the only means through which the brand could remain
relevant to the consumers.
4. Marketing Strategy
The marketing strategy of Kraft Singles, the processed cheese depended on the
positioning of the product differentiation. The key target consumer has been the millennial moms
who considered products based on their attributes and nutritional value. This segment of the

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target market fell within the age group of 18 to 32 years. The secondary target market has been
the Hispanics and the low income population.
As far as the business are concerned, Kraft Foods primary targeted the major chain of
supermarket, merchandizers, convenience stores, distributors and the food outlets. Walmart
accounted for close to 26 percent of the net revenue of the company in the year 2013. The four
marketing mix strategies convey the differentiation of Kraft Foods towards the segments of
target market.
a. Product:
Kraft Singles has been a processed cheese that had remarkable status in the beverage and
the food industry. This processed cheese needs to be free of preservatives and used in the grilled
sandwiches and over the barbequed burgers. Cheese has always been a breakfast trend in most
Canadian families. Keeping with the tradition the cheese will be square shaped and will have an
orange color and made available in a packaging of blue color.
b. Price:
In Canada consumption of cheese has undergone some visible change and represented
one of the staple food products of the Canadian household. In Canada, however, the prices of the
dairy products had been regulated. Hence, the manufacturers did not have any chance for
increasing the price. Therefore, in order to maintain price point on shelf, the cheese
manufacturers were found to reduce the size of the cheese packaging. For instance, a 500 gm.
cheese pack will be reduced to about 460 gm. at same price. The major trend in the packaging
has been the demand of the retailers for the exclusive pack sizes that was done intentionally for
avoiding the phenomenon of the price matching that grew amongst thee competitive retailers for

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the products having the similar pack sizes. Hence, to capture a substantial portion of the
millennial market share, Kraft Singles should keep up with the trend.
c. Place:
It has been found that 99.8 percent of the cheese sales took place via store format. The
grocery retailers accounted for close to 96.9 percent of the cheese sales. As far as the place is
concerned, Kraft Singles should capture the market of Canada particularly the chain of
supermarkets.
d. Promotion:
As far the promotions are concerned, the company looks at the development of
innovative promotions. The retail innovation that the company must work on includes
encouraging the retail customers to linger at cheese counter during store promotions through
establishment of particular brand elements like color logo, symbol and melody for accompanying
the Kraft Singles. The company also looks forward to the development of flavor that is not only
adventurous but also bold. Kraft Foods also plans to undertake promotions through creation of
cheese experience, educating the customers at the point of sale of every store, appointment of
cheese ambassador, promotion of sampling and providing suggestions on the ways of cooking,
serving and pairing of the cheese with wines.
5. Budget:
The Canadian cheese market already generated a sales revenue of close to $3.925 billion
for the year 2013 which was higher compared to the figures of 2012 and 2013
(kraftfoodsgroup.com,2015). This revenue was primarily generated by the four major players of
the unprocessed cheese segments who held close to 84 percent of the market share. To capture

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the bigger share of the market, Kraft Singles, the processed cheese variety, needed hold a major
portion of the market share and generate an annual sales revenue which is higher than the
unprocessed cheese segment in order to reposition itself in the market. Records have however
portrayed Kraft cheese, Oscar Mayer meat, salad dressing along with 25 more brands to already
have an annual revenue between US $100 million and US$1 billion.
6. Control:
As far as the control is concerned, the company will undertake measures in closely
monitoring the quality as well as the customer satisfaction. This will help us in undertaking quick
reactions and correcting the problems that might have occurred. The other warning signals would
include monitoring the deviation including both the monthly sales and expenses.

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References:
Chandrasekhar, P. (2016). Ivey School of Business Foundation. Kraft Foods Canada: Targeting
The Millennial.
da Silva, R. R. (2018). Exploring microbial peptidases for cheese production: a viewpoint on the
current conjecture.
Fedusiv, A., & Bai, C. (2016). Millennials and Healthy Food Consumption: Factors Influencing
Intentions and the Intention-Behavior Gap.
Hamzaoui-Essoussi, L., Sirieix, L., & Zahaf, M. (2013). Trust orientations in the organic food
distribution channels: A comparative study of the Canadian and French markets. Journal
of retailing and consumer services, 20(3), 292-301.
kraftfoodsgroup.com , 2015. [Online]. Retrieved from http://ir.kraftfoodsgroup.com/annuals.cfm
Moubarac, J. C., Batal, M., Louzada, M. L., Steele, E. M., & Monteiro, C. A. (2017).
Consumption of ultra-processed foods predicts diet quality in Canada. Appetite, 108, 512-
520.
Moubarac, J. C., Batal, M., Martins, A. P. B., Claro, R., Levy, R. B., Cannon, G., & Monteiro, C.
(2014). Processed and ultra-processed food products: consumption trends in Canada from
1938 to 2011. Canadian Journal of Dietetic Practice and Research, 75(1), 15-21.
Ng, E. S., Lyons, S. T., & Schweitzer, L. (2017). Millennials in Canada: Young workers in a
challenging labour market. In The Palgrave handbook of age diversity and work (pp.
325-344). Palgrave Macmillan, London.

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