Kraft Foods

Kraft Foods

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Times New Roman 12 pt font, 1 inch regular margins, single spaced.
1 page with very brief descriptions of the main elements of the case analysis:
1. Defined problem
2. Brief Description of the situation Analysis and Relevant Information
3. Alternatives and chosen alternative
4. Decision-making and calculations for chosen alternative.
Calculations include Break-even analysis and customer lifetime value.
All calculation should be based on calculated assumetion, if the case dosn’t support enough numbers!

also add any nummber or formilas that could be usefule, becuse 40% of the mark is based on number. Numbers and formilas can be added as apindex in a sepret page!

The Coffee Pod Launch (A)
23 :l NTRU STE Oi} M m _ W

Geoff Herzog, product manager for coffee development at Kraft Foods Canada (Kraft),
sat in his office after reviewing encouraging results for the single-serve coffee pod
system in Europe. On a typical day, Herzog would have used the office coffee station
for his morning cup of coffee, but today he had brewed his own cup using a
single-serve coffee pod machine. It was July 6, 2004, and Herzog had just learned that
Kraft Foods North America was planning an aggressive launch of coffee pods in the
United States. He had less than a month to decide whether Kraft should proceed with
a simultaneous launch in Canada, or await the U.S. results.
If Herzog went ahead with the launch, he would have to make several
decisions. First, since Kraft owned two major coffee brands in Canada, Maxwell
House and Nabob, a suitable branding strategy would be needed. Herzog would
also have to set a wholesale and a suggested retail price for the coffee pods, choose
which flavors to offer, and decide whether Kraft should use traditional distribution
channels or direct-to-store delivery (DSD). In addition, he would have to develop
an effective advertising and promotion strategy on a relatively limited budget.
Herzog knew that whatever recommendations he made, he would need to make a
convincing case that his plan would help Kraft expand its share of the Canadian
coffee market, while generating a satisfactory return on the company’s marketing

2 Rani-i momenta.

Founded as a cheese manufacturer in 1903, Kraft Foods Inc. (Kraft Foods) had
evolved into North America’s largest food and beverage company and the number
two player in the world. In 2004, Kraft Foods had operations in more than
155 countries. Although the company had previously been a division of Philip

Morris Compames (Since renamed Altrra Group), it had become a public company
in June 2001.
AleemVisram prepared this case under the supervision of Professor Robin Ritchie solely to provide material
for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a
managerial situation. The authors may have disguised certain names and other identifying information to
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fl Services on November 5, 2008.