Kraft Foods

Kraft Foods Case Analysis - Part B

Situational Analysis
Market/Context
The market still involves Coffee in Canada though it can be narrowed perhaps to Coffee produced at home in Canada, due to the lack of switching from corporate buyers. Although it is still in the introduction stages the growth in the market is much less then what was anticipated and required for the product to be successful in the Canadian market.

The macro-economic factors which affect the coffee industry are quite limited. The main ones now involve social factors, as consumers currently aren’t making the switch to SSP machines and thus demand in the industry hasn’t grown as expected.

Competitors
The main competitors in the industry include:

• Melitta One-to-One SSP machine. They are second in the market behind Kraft with 31% of the coffee pods share. At the present time they are Kraft’s biggest threat in the market as they have a machine as well as there own pods and there machine does not interchange with other companies pods (from Case A, Case B does not specify whether this has changed). There pods cost $4.99 for a pack of 16, though are larger then the standard ones on the market.

• Home Café, Proctor and Gamble, Applica Inc and Jardine Corp (The last two being leading makers of small appliances) Cofee brand is third on the market of pods, currently selling 11%. They aren’t as big a threat to Kraft, though their product is more closely related with the pods being the same size and same price ($4.99 for 16). The Home Café machines and thus their brand image suffered a blow when they were forced to pull it from the market soon after launch due to a defect.

• Senseo who was originally seen as a major competitor, didn’t enter the Canadian market due to the poor sales they experienced in the US.

• Bunn My Café could be seen to have teamed up somewhat with Kraft as they shared a booth at home shows, and Bunn My Café doesn’t sell pods. There machines unfortunately were...