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Kraft Foods Inc. manages over 100 different brand-name food products and tracks operating - income to five specific consumer segments. Exhibit 2 provides a summary of the Kraft Brands and operating segments. Snacks—primarily biscuits (cookies and crackers), salted snacks, and chocolate confectionery- Beverages—primarily coffee, packaged juice drinks, and powdered beverages • These—primarily natural, process, and cream cheeses Grocery—primarily spoon able and pourable dressings, condiments, and desserts convenient Meals—primarily frozen pizza, packaged dinners, lunch combinations, and processed meats Exhibit 2 provides a percentage breakdown of the segment sales for the U.S. and international- operations. Note that U.S. Grocery comprises the largest segment followed by U.S. Cheese. According to the Neilson Company, Kraft Foods only lost 0.3 percent market share during 2008 despite a 9.8 percent increase in pricing.-, - MarketingThe reintroduction of Kraft Foods Inc. in February 2009 was accompanied by the launch of a new corporate Web site: http://www.newkraft.com. Visitors at the site can view commercials from around the world while learning about new product innovations. Kraft Foods Inc. has also launched several Web sites that would be considered viral in nature. One of these is the Orea Double Stuf Raci?ig League (DSRL) site: httpJ/www.dsrl.com; visitors can watch videos, play games, and of course they can join the league.Even the main Web site for Knit Foods Inc. has undergone a facelift. The new site address is http://www.kraftfoods.com. In its review of the site, brandchannel.com said the following:The site is well conceived as a portal for an audience that might access the Internet through a dial-up modem. Staying away from roll-over images, the HTML-based home page is efficient, using fairly compact pictures—except for a promotional 180 x 150 banner that flirts with a surprisingly high 30K. Surfing through the site, the visitor will enjoy the same consistent experience. Besides recipes, noteworthy features include Product Info and a Recipe Box, lithe former is self-explanatory, the latter is a smart way of creating some interactivity with the visitor. The Recipe Box allows one to store and retrieve favorite recipes, whether personal ones (up to 100) or from Kraft. The registration process is in line with the overall browsing experience: painless and respectful. To illustrate this point, it is worth mentioning that the visitor is not asked to provide a last name and the newsletter(s) options are off by default.FinancialsKraft' recent income statements are provided in Exhibit 3. Note the company's revenues increased to $42.2 billion 2008, while earnings increased to $2.9 billion. Kraft weathered the 2008 global recession really well from a revenue/earnings perspective.Kraft's recent balance sheets are provided in Exhibit 4. Note the company has over $27.5 billion in goodwill, which is not good, and also has over $18.5 billion in long-term debt, which is also not good. Kraft's long-term debt increased about 50 percent in 2008 from 2007.Current Strategy
CEO Rosenfeld has been leading the Kraft through a turn-around process designed to return the company to sustainable growth.
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