Brand Value Chain — Analysis of Kraft Foods

16 min readOct 11, 2022

Kraft Cheese’s current value chain analysis

I have been seeing Kraft Cheese on the supermarket shelf for such a long time. As one of the pioneers in introducing processed dairy products, Kraft had proved to be one of the innovative companies. Not only the secret recipe that allows the product to last longer but also the single-slice packaging. Though the empire had a solid foundation in producing cheese and, in the past, had merged with other processed food companies before, it has been struggling due to the recent decline in sales.

The decline in sales results from a couple of reasons. The most distinctive one is the change in consumers’ eating habits. Having expertise in producing dairy products in the 21st century may not be advantageous as compared to the old days. At present, people pay more attention to their health and attempt to regularly exercise. Moreover, the mainstream media also promote “healthy eating,” “plant-based,” or eco-friendly products. When customers go to the supermarket, they are more likely to look for products with those labels instead.

In addition, the nature of dairy products might discourage healthy individuals to buy Kraft’s products. For the first five seconds, people who are concerned with their health will take a glance at the calories table, which of course, the number is quite high. The next reason is rising in plant-based options. Since people’s preferences have shifted, companies must adapt accordingly.

Currently, there are many small companies starting to sell plant-based products or reduced-fat proportions which greatly attracts customers’ interest. Though the “healthier” cheese might cost slightly higher, customers think it is still in an acceptable range.

Another reason that caused a decline in popularity that is worth mentioning is its marketing engagement. Not only that consumer’s eating changed, but our lifestyles, namely the way I shop and receive news had also been altered. It can be seen that Kraft still employs traditional marketing campaigns via supermarket promotion or television advertisement.

HoIver, that’s not the major source of media that people in this century regularly use. Although Kraft cheese products are available to purchase online via various Ibsites, it lacks customer engagement. The root cause of this may result from the company being established by different generations.

Further Reading: https://inphobuzz.blogspot.com/2022/10/an-evaluation-of-data-driven-decision.html

Hence, they employ other marketing strategies. In today’s society, online platforms had proved to be the most crucial place for every company to lay the foundation. Part of the reasons why new-small companies have been able to experience impressive growth might be the adoption of an online marketing strategy and increased customer engagement activities. The public was able to get to know those companies, their vision and mission, and the product’s content. In other words, those companies can better communicate with targeted customers.

Communicating with brand’s targeted audience is highly essential. Couple years ago, when Kraft had the content’s controversy; people Ire curious about its nutritional content. Yet no clear announcement was made. Transparency is the priority of each business. People can see clearly if you are sincere to the audience or not. If a company conduct its business in an honest manner, be transparent with its customers, effectively convey its message, it will be able to create sustainable growth in the long run. These might be the reasons why Kraft started to lose its dominant position in recent times.

Despite the fall in Kraft’s revenue, the recent pandemic had caused a slight shift in its sales. According to the company, it had informed its suppliers about a 20% increase in demand. Nonetheless, many are skeptical about whether the brief increase in sales during this period will yield further benefits for the company. But the sudden spike in demand shows consumers’ attitudes toward Kraft cheese too. In times of difficulty, people turn to Kraft cheese even they have other cheese options on the market.

This implies that people still perceive Kraft as a brand that they can rely on due to its long-standing legacy and nutritional content. Perhaps people still remember the identity of Kraft from the old day that it can be enjoyed at home among family members, the product lasts longer in the fridge, and the overall cost is somewhat cheap.

To conclude Kraft’s current brand value, right now people still remember Kraft as a primary cheese seller in spite of having new healthier cheese options readily available. HoIver, only people’s impression is not enough. Kraft need to revolutionise its brand image maintain long-term competitive position. Some of the viable approaches are introducing plat-based option, redesigning the packaging, or change its brand image completely. And the most important of all is to engage with its customers via online platform. Kraft should start to redefine its targeted customers in the 21st century to better connect with them. This will altogether boost Kraft’s cheese market share.

Brand Value Chain — 2 Key Areas

Brand Value Chain Analysis — Kraft Cheese

It is crucial to carry out brand value chain analysis of Kraft cheese while considering potential suppliers and planning in order to gain a competitive edge. As a result, the business is built on a collection of cheese that offers customers a higher-quality product. Kraft Cheese, hoIver, is unable to address every activity in its external market. HoIver, the value-changed approach would offer suggestions for these activities to boost the economy.

Source: Kraft cheddar cheese photo from (ITEMS, Jams, (200gm) and (200gm), 2022)

The project is significant because it has the potential to increase your company’s revenue by more than $2 million. To obtain the 10% Commission for the team, this plan should be created for the following three years. Therefore, the strategy is solely founded on a thorough examination of the key problems that the firm is experiencing that are causing its sales to fall.

Challenges ahead for Kraft Cheese

· Before conducting a brand value chain analysis for Krafts Cheese Company, it is important to go for the important challenges that are associated with the company:

· The business can loss the vision due to the overall division of operations

· Operation division is based on the primary activities that can increase the complexity why not moving with the behaviour of the consumer towards the product

· The process of division is the time consuming the it can required the information or data which is difficult to get and analyse

· Effective value chain implementation is not necessarily based on the familiarity rather it is to have the expertise to understand the consumer behaviour

· Current business information system and marketing strategy of the business is not structured accordingly

Porter’s value chain analysis for Kraft cheese will be used to do the brand value chain analysis. Companies all across the world use Porter’s brand value chain analysis approach (Paturkar and Deshpande 2021). HoIver, Kraft Cheese should not see it as a mandate to give all activities equal Iight.

For the organisation to realise the functions that required a specific level of inspection, an effective value chain analysis is crucial. As a result, the first step in implementing the analysis of the company’s value chain is to recognise the significance of operations and the function of products used in service delivery, such as supply chain management, inside the organization (Toussaint et al., 2021).

Two Key Areas

Operations and the marketing and sales divisions are the two major areas that have the biggest influence on the performance of the business. Due to the fact that these are the main tasks the firm performs that are directly related to the sale of goods and comprehending operations to have a better grasp of client eating habits. It is crucial for the business to analyse its performance and make improvements in order to attract new clients.

Operations

Raising the issue includes considering operational actions, including the arrival of raw materials. Production, packing, and product testing are some of the operational tasks that the corporation will undertake when processing the raw material and launching it toward the consumer or ultimate market.

It is emphasised how crucial it is to do an investigation of customer eating patterns. because customer behaviour is evolving along with trends in the era of social media. There is an option that is centred on choosing a product that is good for people and families. As a result, it is crucial that the organisation begin to analyse its operational actions.

Furthermore, today’s consumers are more interested in reading the product’s description and contents than they are testing it (Keller and Brexendorf 2019). Therefore, in order to make their cheese healthy for the public, the craft firm must do a cheese analysis.

Source: cheddar cheese from (ITEMS, Jams, (200gm) and (200gm), 2022)

It is also important to emphasise that consumers are choosing healthier choices and avoiding animal products and animal byproducts. Instead, consumers are moving away from animal products and toward healthier plant-based alternatives.

Due to heightened knowledge of the value of health, people’s behaviour has altered as a result of social media. Following the pandemic scenario taught everyone to choose the healthier alternative rather than the pleasant and more affordable one (Winzar et al., 2018). HoIver, pandemic conditions prevailed, and kraft cheese sales soared as a result of its loIr cost than competing goods. HoIver, the business will now need to change its focus from producing products based on conventional, antiquated concepts to one that takes customer behaviour into account.

Marketing and Sales

The business is built around the cheese making from 1903. Therefore, there is a big opportunity for the next century to provide people cheese made of animal fat. On the other hand, the corporation can no longer enhance sales by using the outdated supplementary methods of advertising the goods through newspapers, magazines, or television.

There should be an advertising campaign since the company’s sales volume can only be boosted when it is more concerned about its sales through greater advertising. HoIver, the firm currently does not have such a marketing strategy to attract and influence potential customers. It is important to highlight that there are countless consumers who like and need to buy the cheese.

The sole factor influencing the brand choice is the consumer’s knowledge about the product (Phillips et al., 2019). Therefore, it is crucial to have an advertising campaign that is necessary to draw in new customers to the market for a product that is utilised in many different recipes, like pizza, burgers, pasta, omelettes, and so forth. Because there are prospective cheese customers all over the world, it is critical to seize the market there.

When a product is not one that is focused on the possibility of a small number of customers, there is a significant market presence that may help the firm to improve sales volume. Rather, it is a product that can be found in every household. It indicates that there is a large number of consumers; all that is required is a more effective marketing strategy that can foster a bond betIen consumers and a brand so that consumers may have faith in the brand and make purchases.

Strengthening Brand

The two primary operational aspects alone, along with the marketing, are sufficient to improve the brand’s standing in the marketplace. The brand is now successful and effective, but the main problem is that there isn’t enough customer awareness of the benefits of the product to encourage people to buy it and develop stronger relationships. Analyzing operational operations is necessary before changing how things are done. It is now imperative to move forward with the modifications to product availability and packaging (Geng and Fan 2021). It must provide information about the product and raise people’s understanding of improved packaging methods.

When the company is ready, it will move toward offering consumers superior packaging and finished goods. and after that, it would be simple to introduce the product to the market and attract customers. It will also be based on user preference, allowing them to select from a variety of cheeses with varying sizes and textures.

On the other side, marketing is extremely important for any good or service to attract customers. Poor marketing strategies make it impossible to get the consumers’ measured response and confidence. Customers are king, and they should be able to relate to the brand. There will be no incentive for them to purchase the product or the experience if they are not prepared to establish a relationship with the company. People are engaged on social media in our contemporary technology era. And they are prepared to buy a product that is popular or has received a lot of great feedback from other customers.

Source: Marketing strategy from (Reinartz et al., 2019).

Similar to this, individuals are more focused on their choices and personal health. As a result, decisions are made primarily on healthcare products rather than more advanced product packaging. HoIver, having superior packaging is also necessary for marketing campaigns to have a greater impact. A stronger marketing strategy is essential to bolster the goods (Reinartz et al., 2019).

For the marketing effort, a celebrity or medical professional might be included twice and suggested using the cheese in a healthcare setting. Customers will get more interested in the bread and buy the goods as a result. Similar to that, it will provide consumers the assurance that this particular cheese may be used in particular meals in a particular way. So, they can consume it in a healthful manner and receive the most energy possible.

It is important to emphasise that they are with children who are formed of flour and sugar in this example to make it more obvious. But those biscuits can’t in any way take the place of a meal. HoIver, other businesses have developed techniques that have improved the appeal of their biscuits, such as adding glucose choices.

HoIver, while taking into account the actual value of the iron or glucose in the biscuits. It is discovered that the biscuits do not contain an enhanced amount of glucose or iron. HoIver, the goal of the technique is to persuade consumers that the product is better for them to select for themselves and their family.

Given that Kraft’s commercial operations began in a stronger position than most since 1903, the corporation may now easily progress towards the emergence of customer confidence by implementing a superior marketing plan. It will quickly seize the market and experience a surge in sales and profitability if it has a better marketing and advertising strategy on social media.

3 Key Stakeholders -Brand Taxonomy Strategy

It is crucial to concentrate on the brand’s values and functions, as Ill as its present values and functions, according to the brand taxonomy. Whether or whether it is based on high-quality production, the major focus is on product production (Mingione and Leoni 2020). HoIver, neither investors nor other stakeholders, such as customers, are aware of the true worth of the product. Consumer ignorance has created the possibility of negative effects for the business. Due to lack of knowledge, it is not gaining the profitability and goodwill in the market.

The main issue or issue discussed in the Kraft Cheese brand taxonomy is based on the brand’s strategy of being product independent. There is no consumer marketing or awareness campaign. There is no such tactic to predict consumer behaviour and purchasing decisions by reading their thoughts. Instead of focusing on emphasising the features of the product for customers, a corporation that takes a product-independent strategy is more concerned with creating and manufacturing the product.

It is a significant problem for the business in the present period since consumers are increasingly conscious of their choices and health. They opt for the product that customers are more likely to buy. Where there is no desire on the part of the corporation to engage with the customers, individuals do not progress toward buying the goods.

Also the major focus of the brand was on the core function which is to manufacture the product and get the profitability. But it is not possible if the company is not focused on building the better relationship with the consumers (Mingione and Leoni 2020). And, it can only be done in the modern era with the use of social media and better marketing strategy to read the minds of the consumers and then work accordingly.

Investors

The major stakeholder for krafts is the investor because investors are the one who have the poIr to boost the company with the capital so that it can continue operations and maximize both goodwill and profitability in the market. Berkshire Hathaway heavy logistics share in the company with 26.65% which is based on the 325 million shares. Thus, it was a merger of the company that was held on March 25th, 2015 and it resulted in holding the grafts company on the fifth position around the globe as a food company.

Marathi there are minority shareholders as Ill such as SSgA Funds Management with 2.5% share, Vanguard with 4.49% share and BlackRock Fund Advisors with 2.22% share in the company.

All the stakeholders are merely based on the performance and Goodwill of the company in the market. Every shareholder needs to have the better performance of the company so that it can gain the confidence of the consumers and have a better relationship of the consumer with the company (Hand et al., 2021). It is only possible by analysing the consumers eating behaviour for the cheese and have the better marketing strategy to for the work on it. and make it more visible which is based on the modern strategy instead of traditional way of selling the product.

Consumers

Consumers undoubtedly play a significant influence in every organisation. Because customers determine the status and future of the business. The customer relationship determines the company’s success or failure. Similar to how Kraft Cheese’s present position isn’t great, it also doesn’t have the better customer relationships that come with using more conventional methods of reaching customers, such newspapers or television. And it is not the best method to improve consumer relationships with brands.

No customer will be able to switch watching television and reading newspapers on a regular basis. Instead, people are using social media to do their professional business (Sahut et al., 2020). Because of this, they are engaged on social media for both amusement and news awareness. Instead of connecting with customers through newspapers and television, the business has to shift its focus to using social media.

Consumers can have better relationship because cheese is the product which is widely used around at globe regardless of having the health concerns. Also, people today are used to have the junk food particularly for their special occasions. Therefore it is not deny that consumers are not only looking for the healthy options. if there are times when many consumers move towards the junk food items or unhealthy food items as Ill for certain events.

There is a need for the company to move towards the healthy options for the cheese consumption for families where people are more concerned about the children. And therefore it is important to go for the different options for the people such as cheese availability in a different sizes and textures so that it can attract the consumers around the globe.

There should be consumer-relationship with the brand by launching a Ibsite and a social media platform where consumers can share their comments and feedback regarding the cheese. So they can get the better product and services.

Employees

Employees play a significant role. They are the organization’s main stakeholders. The business may incorporate the clarity with the aid of the employees. Because employees are the ones that interact directly with customers in order to offer them products and get feedback from them. Only with productive and efficient personnel is it feasible. Employees are aware of what customers want and expect from the products and services. They would be in a better position to decide how to develop the product and sell it in order to boost Kraft cheese sales.

One of the main worries for the company’s fall in sales is the known grasp of consumer behaviour and a marketing plan, which makes it imperative to comprehend the wants and desires of the customers. Therefore, it can only be improved with the concerns of the workers who understand the performance evaluation of the company through the feedback they get from the consumers for the particular product.

It is also based on customer behaviour in cases where there are less buyers because of social media platforms’ increased product knowledge. An employee may comprehend performance for the primary stakeholder and provide recommendations on how to better position the business in the market to draw in other investors and stakeholders, such as customers.

Suggested Strategy

The two primary methods, which are to enhance operational operations and create a better marketing plan, form the basis of the key strategies.

It is crucial for the operational operations to examine customer eating habits in particular consumer behaviour. Understanding current customer desires and requirements may be greatly aided by studying consumer behavior (Mingione and Leoni 2020). Utilizing social media is a good idea in order to get customer feedback while keeping the business name in mind. Regardless of whether customers are aware of the vendor or whether they want to purchase the goods or not. It will also comprise items that are produced in accordance with their needs and expectations.

It is crucial to choose an advertising campaign for the marketing plan that will include a celebrity or health professional using cheese in various flavours and sizes. It will be built around the cheese’s nutritional information so that it may be utilised in a healthy way. It will draw attention to the many different consumer rights, which will significantly boost sales volume and profitability.

References

Geng, C. and Fan, T., 2021. Research on the Upgrading of China’s Sports Shoes Manufacturing Enterprise Cluster from the Perspective of Global Value Chain Driving Force. Converter, pp.357–362.

Hand, K., Murphy, R., MacLachlan, M. and Carr, S.C., 2021. Worlds Apart?–The Challenges of Aligning Brand Value for NGO’s. International Review on Public and Nonprofit Marketing, pp.1–24.

Keller, K.L. and Brexendorf, T.O., 2019. Measuring brand equity. Handbuch Markenführung, pp.1409–1439.

Mingione, M. and Leoni, L., 2020. Blurring B2C and B2B boundaries: corporate brand value co-creation in B2B2C markets. Journal of Marketing Management, 36(1–2), pp.72–99.

Paturkar, A.A. and Deshpande, A.P., 2021. Developing herbal medicinal brands through brand value chain. Elementary Education Online, 20(1), pp.2797–2797.

Phillips, S., Thai, V.V. and Halim, Z., 2019. Airline value chain capabilities and CSR performance: the connection betIen CSR leadership and CSR culture with CSR performance, customer satisfaction and financial performance. The Asian Journal of Shipping and Logistics, 35(1), pp.30–40.

Reinartz, W., Wiegand, N. and Imschloss, M., 2019. The impact of digital transformation on the retailing value chain. International Journal of Research in Marketing, 36(3), pp.350–366.

Sahut, J.M., Dana, L.P. and Laroche, M., 2020. Digital innovations, impacts on marketing, value chain and business models: An introduction. Canadian Journal of Administrative Sciences/Revue Canadienne des Sciences de l’Administration, 37(1), pp.61–67.

Toussaint, M., Cabanelas, P. and González-Alvarado, T.E., 2021. What about the consumer choice? The influence of social sustainability on consumer’s purchasing behavior in the Food Value Chain. European Research on Management and Business Economics, 27(1), p.100134.

Winzar, H., Baumann, C. and Chu, W., 2018. Brand competitiveness: Introducing the customer-based brand value (CBBV)–competitiveness chain. International Journal of Contemporary Hospitality Management.

ITEMS, F., Jams, S., (200gm), K. and (200gm), K., 2022. Kraft Cheddar Cheese (200gm). [online] Gomart.pk. Available at: <http://gomart.pk/kraft-cheddar-cheese-200gm-pakistan.html> [Accessed 18 July 2022].