Case Study Description of Kraft Foods Canada: Targeting the Millennials
In 2014, Kraft Foods Canada was working on an action plan for Kraft Singles, the company's brand of processed cheese slices. Although the product had been targeted at Canadian families for decades, Kraft Singles needed to be repositioned toward Canadian millennial moms (those born between 1980 and 2000). The company faced three dilemmas. How should Kraft Canada make the brand messaging of Kraft Singles compelling to Canadian millennial moms? What product innovations should coincide with the new messaging? How should Kraft Canada ensure that it would not alienate its traditional customer group?
Swot Analysis of "Kraft Foods Canada: Targeting the Millennials" written by Allison Johnson, Ramasastry Chandrasekhar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kraft Singles facing as an external strategic factors. Some of the topics covered in Kraft Foods Canada: Targeting the Millennials case study are - Strategic Management Strategies, Innovation and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Kraft Foods Canada: Targeting the Millennials casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, technology disruption, talent flight as more people leaving formal jobs, geopolitical disruptions, there is backlash against globalization,
supply chains are disrupted by pandemic , increasing commodity prices, etc
Introduction to SWOT Analysis of Kraft Foods Canada: Targeting the Millennials
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kraft Foods Canada: Targeting the Millennials case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kraft Singles, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kraft Singles operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Kraft Foods Canada: Targeting the Millennials can be done for the following purposes –
1. Strategic planning using facts provided in Kraft Foods Canada: Targeting the Millennials case study
2. Improving business portfolio management of Kraft Singles
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kraft Singles
Strengths Kraft Foods Canada: Targeting the Millennials | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kraft Singles in Kraft Foods Canada: Targeting the Millennials Harvard Business Review case study are -
Learning organization
- Kraft Singles is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Kraft Singles is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Kraft Foods Canada: Targeting the Millennials Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Sales & Marketing field
– Kraft Singles is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Kraft Singles in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Kraft Singles has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Kraft Foods Canada: Targeting the Millennials HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Kraft Foods Canada: Targeting the Millennials Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Effective Research and Development (R&D)
– Kraft Singles has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Kraft Foods Canada: Targeting the Millennials - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Kraft Singles is present in almost all the verticals within the industry. This has provided firm in Kraft Foods Canada: Targeting the Millennials case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Cross disciplinary teams
– Horizontal connected teams at the Kraft Singles are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Sustainable margins compare to other players in Sales & Marketing industry
– Kraft Foods Canada: Targeting the Millennials firm has clearly differentiated products in the market place. This has enabled Kraft Singles to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Kraft Singles to invest into research and development (R&D) and innovation.
Organizational Resilience of Kraft Singles
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kraft Singles does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Kraft Singles is one of the most innovative firm in sector. Manager in Kraft Foods Canada: Targeting the Millennials Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Kraft Singles is one of the leading recruiters in the industry. Managers in the Kraft Foods Canada: Targeting the Millennials are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Kraft Singles in the sector have low bargaining power. Kraft Foods Canada: Targeting the Millennials has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kraft Singles to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Kraft Foods Canada: Targeting the Millennials | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kraft Foods Canada: Targeting the Millennials are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Kraft Foods Canada: Targeting the Millennials, it seems that the employees of Kraft Singles don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Products dominated business model
– Even though Kraft Singles has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Kraft Foods Canada: Targeting the Millennials should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Kraft Singles needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Kraft Foods Canada: Targeting the Millennials, is just above the industry average. Kraft Singles needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Aligning sales with marketing
– It come across in the case study Kraft Foods Canada: Targeting the Millennials that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Kraft Foods Canada: Targeting the Millennials can leverage the sales team experience to cultivate customer relationships as Kraft Singles is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kraft Singles is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kraft Foods Canada: Targeting the Millennials can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Kraft Singles has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Kraft Singles supply chain. Even after few cautionary changes mentioned in the HBR case study - Kraft Foods Canada: Targeting the Millennials, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kraft Singles vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Kraft Singles has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Kraft Foods Canada: Targeting the Millennials HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Kraft Singles has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Kraft Singles is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Kraft Singles needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kraft Singles to focus more on services rather than just following the product oriented approach.
Opportunities Kraft Foods Canada: Targeting the Millennials | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Kraft Foods Canada: Targeting the Millennials are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kraft Singles in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kraft Singles is facing challenges because of the dominance of functional experts in the organization. Kraft Foods Canada: Targeting the Millennials case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kraft Singles can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Kraft Singles can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kraft Singles can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Kraft Foods Canada: Targeting the Millennials, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Kraft Singles has opened avenues for new revenue streams for the organization in the industry. This can help Kraft Singles to build a more holistic ecosystem as suggested in the Kraft Foods Canada: Targeting the Millennials case study. Kraft Singles can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Kraft Singles to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kraft Singles can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Kraft Singles can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Kraft Singles can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Buying journey improvements
– Kraft Singles can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Kraft Foods Canada: Targeting the Millennials suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Kraft Singles can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kraft Singles to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Kraft Singles to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Kraft Singles to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Kraft Foods Canada: Targeting the Millennials External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kraft Foods Canada: Targeting the Millennials are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kraft Singles can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Kraft Foods Canada: Targeting the Millennials .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Kraft Singles needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Kraft Singles business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Kraft Foods Canada: Targeting the Millennials, Kraft Singles may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Stagnating economy with rate increase
– Kraft Singles can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Shortening product life cycle
– it is one of the major threat that Kraft Singles is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Technology acceleration in Forth Industrial Revolution
– Kraft Singles has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Kraft Singles needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kraft Singles in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Kraft Singles in the Sales & Marketing sector and impact the bottomline of the organization.
Regulatory challenges
– Kraft Singles needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
High dependence on third party suppliers
– Kraft Singles high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Weighted SWOT Analysis of Kraft Foods Canada: Targeting the Millennials Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Kraft Foods Canada: Targeting the Millennials needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Kraft Foods Canada: Targeting the Millennials is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Kraft Foods Canada: Targeting the Millennials is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Kraft Foods Canada: Targeting the Millennials is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Kraft Singles needs to make to build a sustainable competitive advantage.
