Kraft Foods was faced by stagnation in the domestic market that limited opportunities for growth. Kraft decided to explore emerging markets in China and India. They used different strategies to win over the new markets, made mistakes, rectified them and eventually won (Koellmann, 2010). The manager faced the challenge of researching the Chinese market and devises a strategy that suited the needs of the Chinese. In India, the primary challenge was launching a niche in a market that already had players. The paper will address the establishment of stakeholder problems and goals, analysis of the issues, solutions, implementation, and justifications for the solutions through theories and models.
Kraft’s introduction of Oreo in the Chinese market performed dismally that they almost pulled out of the market. They had also failed to devise a method of consuming the cookie that would suit the Chinese. The Chinese consumers had the problem of adjusting to the exotic taste of Oreo. They also found the cookie pack of 14 Oreos for 72 cents too expensive since they were value-conscious (Koellmann, 2013). In India, Kraft faced the challenge of establishing itself in a market occupied by other firms.
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Kraft aimed at entering the Chinese and Indian markets successfully using its domestic market formulae. The Chinese consumers expected that the cookies would suit their tastes and purchasing power. The case study indicates that the way to the Indian consumer’s stomach entails competitive pricing, high volumes, and reliable distribution. Therefore, the Indian consumers' goal was the provision of a competitively priced cookie in a timely and accessible manner.
Kraft, therefore, needed to devise a strategy that would win the culturally different Chinese market by conducting research. The research would identify the Chinese consumers’ tastes and preferences. In India, Kraft had to create a strategy to get a market share in an already occupied industry. They launched in the Indian market using a different stronger name. They also focused on generating awareness and speedy trials. Initially, Kraft had failed to conduct market research to identify the diverse demographics of the target markets.
Kraft could have used the 4 C’s marketing model for the Chinese and Indian markets; Customer, Cost, Convenience, and Communication. A marketing model positions a company on a higher pedestal for growth (Paul, 2013). They could have identified what the Chinese customer needed regarding ingredients and consumption. Secondly, research on the purchasing power of the Chinese to establish a cost that resonates with the value-conscious Chinese. In the Indian market, Kraft identified the preferred taste for the typical Indian consumer by sweetening it. They also fixed a competitive cost for the cookies. Kraft used togetherness concept in advertising, bus tours in major and small towns in a bid to communicate. For convenience purposes, Kraft eyed more stores and small towns to reach more consumers.
It is challenging to enter a new market and establish a substantial market share without conducting extensive market research and implementing various strategies (Nguyen, Terlow, Pilot, & Elliot, 2010). Kraft almost pulled out of the Chinese market until when they conducted research and acted on it. This realization helped Kraft devise strategies that helped them enter and succeed in the Indian market. Companies need to do extensive research on the specific needs of current and new markets so that they can adequately position themselves competitively and maximize revenues (Cotton, 2010).
References
Cotton, D., (2010). The Business Strategy Toolkit . Management Books 2000 Ltd: Oxford.
Koellmann, B. (2013). Business Today: Smart Cookie . Retrieved From https://www.businesstoday.in/magazine/lbs-case-study/how-kraft-foods-won-over- customers-in-china-and-india/story/193162.html.
Kotler, P., Keller, K., Brady, M., Goodman, M., Hansen, T. (2009). Marketing Management . Pearson Education: London.
Nguyen, P., Terlouw, C., Pilot, A., Elliott, J. (2010) “Cooperative Learning that features a Culturally Appropriate Pedagogy”, British Educational Research Journal, 35 (6): 857- 875.
Paul, T. (2013). Mental accounting of mutual fund investors and marketing mix-a study from 4C marketing mix perspective, Asia Pacific Journal of Marketing & Management Review, 2(2): 12-22.
