Krafts Marketing and Sales Strategy - Assignment Example

Kraft’s Marketing and Sales Strategy Abstract Although the Oreo Cookies is the top-selling cookies in the U.S., it is not as easily accepted by the Chinese consumers. Kraft Foods has to reinvent new image of Oreo cookies to make it acceptable for the Chinese. It was not easy for Kraft to do the new strategy because they have to change the whole management team and come up with local Chinese entrepreneurial team to handle the study. Several factors were discovered why U.S. type Oreo cookies did not pass the Chinese taste. After learning all the factors, Kraft improved the marketing strategy of selling and reinvented the new look of Oreo cookies. The profit of Kraft in European Union and the developing countries grew outpacing the U.S. profit growth. Keywords: reinvent, outpace China, being the fourth largest country, and has the highest population estimated to 1,330,141,295 (as of July 2010) gave Kraft Foods an opportunity in introducing Oreo cookies. Although Kraft introduced the top-selling U.S. style Oreo cookies in 1996, it was only in 2006 that Oreo cookies was totally accepted all over the parts of China. The original Oreo cookies presented was too sweet and too expensive for the Chinese consumers. Kraft however, was not discourage to continue introducing and selling the Oreo cookies in China. This made them think that reinventing the Oreo cookies is the only way that the populous country of China would accept Oreo cookies. Several marketing strategies were made to make their product more acceptable to Chinese consumers. In the event of their study, they found out that, first, the Chinese are not accustomed to sweet foods particularly chocolates (most of the Chinese’ food pattern is more on rice-based products, spices, low calorie diet, soy products, and fruits and vegetables), secondly, China is big which is also divided in two regions, the North and the South, wherein, the two regions has two extreme climate condition (Northern part is extremely cold, while the Southern part is tropical), and third, the Chinese are born thrifty (they find Oreo cookies too expensive). Kraft considered other alternatives to make Chinese consumers patronize Oreo cookies. OREOS AND MILK, CHINESE STYLE 4 Discussion In 1996, Kraft Foods introduced Oreo cookies in China in the form of the original top-selling Oreo cookies of the U.S. However, even a lot of marketing effort has been done, the sales of the Oreo cookies in China remained flat. This statement is supported with my aforementioned discussion in the research. The study is limited to Kraft Food and its marketing strategy in selling Oreo cookies in China. Kraft’s respond to the macro-environment of China is through research of the different demography of Chinese consumers, their capacity to purchase, and their eating patterns. This led Kraft to reinvent the traditional Oreo cookies to Chinese style cookies; from cookie form to wafer and lesser sweet, the packaging and the content of the package (wherein the original content is 14 Oreos which costs 72 cents reduced to fewer pieces of Oreos and costs only 29 cents), and the Chinese style Oreo can withstand the extreme climate of both Northern and Southern region of China. In the micro-environment, Kraft responded in dealing with the management team, wherein all the members of the management team were replace by entrepreneurial team of local Chinese managers thus, creating positive output of introducing Oreo to Chinese consumers. Kraft also outsourced marketing teams, in the form of students to become ambassadors of Oreo wherein, the job of these local students is to campaign the Oreo to 300,000 consumers. These ambassadors also campaigned the Oreo through basketball wherein, introducing the Oreo being dunked in the milk. This type of strategy also helped Kraft to be responsive to global environment’s opportunities. They also studied the eating habits and preferences of different countries and OREOS AND MILK, CHINESE STYLE 5 were able to produce Kraft products according to the preferences of the consumers in different countries. They used the same approach to be able to reach out and penetrate the markets of different countries. The type of approach made Kraft and their Oreo outpaced their competitors in China and the Chinese Style Oreo was also introduced and accepted in different parts of Asia, as well as Canada and Australia. Kraft believed that if you “think globally, act locally”, which means that for them to be able to penetrate global markets, you have to go deeper to their local markets by studying their cultures and food patterns and preferences. The global marketing environment includes cultural, demographic, and economic wherein, each environment are related to marketing and sales output. Kraft studied the cultural background of the countries outselling the Oreo product which includes the demographic profile of the consumer and the economic standing of these countries. They were successful and achieving a positive outcome of their efforts in studying these areas. The result of this is their penetration of the market of these countries, creating large profits from their products. In global marketing, it is very important to review the aforementioned marketing environments. The results will be very transparent and truthful as to whether your product will become acceptable or not, will gain profit or loss, will last. Another type of marketing approach or strategy that can create a global appeal to the consumers is through the use of technology. Being in the digital age, especially to consumers who are in the group of what we called Millennial, it more powerful to use the technology, such as social networks sites, to view and campaign the product. It will gain more potential customers/consumer. OREOS AND MILK, CHINESE STYLE 6 Kraft’s marketing strategy is truly remarkable and dynamic. Oreo was able to pass the Chinese’ simple taste and was able to outpace their competitor HaoChiDian, a local biscuit made by the company Dali. Kraft’s patience led them to success, and Kraft was so lucky then, they were able to come up with a good product that has an appeal to Chinese consumers. Kraft truly has a global strategy. Their continuous study and research of the marketing environment helped them gauge the appeal and the acceptability of the product to consumers. The approach helped Kraft reinvented and developed new kind of product that gained profit as the result of their study of the marketing environment. OREOS AND MILK, CHINESE STYLE 7 References McWilliams, Margaret (2007). Food Around the World A Cultural Perspective. China, 307-316. Read More