Business Plan Kraft Foods
Kraft Foods Mission
Kraft Foods is the world-famous brand, which sells food and beverages in more than 145 countries. The company’s main goal is to have the ability to create the future within every person. This is why the company cares about the quality of provided services and tries to improve them every day, as well as to achieve the new aims. Due to the fact that the project of building the future is formulated in the basic goals and values, positioning ideas, and working principles, it was decided to expand the new areas of influence of the company (Turner, 2007). Thus, medical area is considered as one of the most interesting ones, because it meets the company’s positive role, which it wants to play in people’s lives. O'Rourke (2007) stated that “one of Kraft’s key strategies is to “build superior consumer brand value” through “great-tasting products, innovative packaging, consistent high quality, wide availability, helpful services and strong brand image”” (p. 75).
Kraft Foods, Inc. was founded by James Kraft in 1903. It presented the world lots of different products that became very popular. Initially, the company was engaged into the wholesale of cheese. Then, in 1914, it started producing different varieties of cheese. The company is famous for its coffee, which is sold under the brand Maxwell House, and gained popularity around the world after the Second World War. The market capitalization of the company now stands at $72.82 billion (Lussier, 2009). Over 126,000 employees work there. Company’s brands and products are sold in approximately 170 countries. The company operates in the three segments represented in North America, Europe, and developing countries. Kraft’s business is concentrated in more than 80 countries, which carries out activities in over 220 production and processing plants. The competitors of the company are Campbell Soup, Coca-Cola, Danone, Heinz, Nestle SA, PepsiCo, and others (Siegert, 2013).
Product and Service Description
North American division represents several departments, such as the production of drinks, cheese, food for fast food (semi-finished), groceries, snacks, biscuits, confectionery, as well as the Canadian and North American division of catering. The European division of Kraft Foods manufactures the following products: biscuits, confectionery, beverages, cheese, grocery, and semi-finished products. The Kraft Foods division in developing countries produces biscuits, confectionery, beverages, cheese, grocery, and semi-finished products (Kumar, 2012). It was decided to design fast food menu and menu for the people, who like healthy food. All the variety of products and services will be available through Internet, by phone, and in the restaurants. A large promotion campaign will be provided along with hot offers in order to enter the market faster. For example, the company can provide discount offers on weekends, and different special promotions on the main website of the company. Discount cards can give the clients additional funds on their account once they register on the website within 10 days after getting a card, for example.
In order to establish a proper marketing strategy for entering the medical market, it is necessary to outline Kraft’s main competitors. The investigation showed that the medical market has a low level of competition due to the fact that such fast food companies as McDonalds and others are only presented there. Kraft Foods has a big advantage over its competitors. It has excellent reputation, as well as the world-known brand. Kraft Foods will be able to strengthen its position within the medical area, because there is a lack of specialized restaurants providing healthy food for the patients in hospitals. Thus, the company’s main priority will be focused on creating such areas with the aim to help people to treat their health. In addition to this, the company can also become a strong competitor for the companies producing fast food. For example, it can be offered an opportunity to order such food directly in a hospital room. However, the company will also give customers a reminder of the importance of healthy food to prove that its mission is to take care of people. Thus, a medical orientation of restaurants and delivery services will become a winning strategy for the company.
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According to Porter’s approach, discussing of the five forces can be helpful in establishing the strategy against the competitors. They are threat of the new entrants, rivalry among the existing firms, threat of substitute products or services, bargaining power of buyers, and bargaining power of suppliers (Porter, 2008). In addition to this, Freeman proposed the sixth force in the fight with competitors, which is a relative power of other stakeholders (Freeman, 2010). The strategy of entering the medical area will be focused on the two targets. They are middle class earners, who prefer healthy food over fast food, and everyone, who does not think about the importance of healthy food. Thus, the new strategy will be oriented on the patients, the stuff of the hospitals, where Kraft’s services will be provided, and people, who leave in the nearby areas. In order to attract people’s attention to the product, the company decided to offer average prices for the services. However, the forces described by Porter and Freeman will have a significant effect on the price and help Kraft’s management to create the best one. For example, threat of the new entrants, rivalry among the existing firms, and threat of substitute products or services will help the company to maintain the equality of services and products on a high level in order not to let new competitors take a strong position on the market (McDonald, 2007). Customers would rather prefer to buy a qualified product for a higher price, rather than bring damage to the health (Berry, 2008). However, the company will also track the level of supply and demand on the market in order to correlate the market price along with the ability to offer special promotions not only to the customers, but to the suppliers as well. This would help to adjust both bargaining power of buyers and that of suppliers (Berry & Wilson, 2005). In addition to this, a relative power of other stakeholders can affect the price and product demand for the company. Thus, the company should carry out joint actions with the competitors.
The offered marketing strategy has a short-term period due to the low competition presented in the medical market. However, in order to strengthen Kraft’s position on the new market, the company is planning to develop the strategy within the next 3 years. Thus, a pre-entering promotion campaign will be launched in order to evaluate people’s wishes and expectations regarding the features that this niche has. Moreover, in order not to create a monopoly in the market, Kraft’s strategy presupposes the existence of smaller competitors. The main aim of this strategy is not only promoting the company’s mission, but also creating an ability to cooperate and establish large campaigns with the competitors aimed at the well-being of the people.