Kraft Foods: the Coffee Pod Launch Case Analysis

Kraft Foods: The coffee Pod Launch case Analysis

Main issue

This case revolves around the decisions and issues faced by Geoff Herzog, coffee development project manager at Kraft Foods Canada. The main issue being faced is whether a launch of coffee pods within Canada should be done at the same time that the US Kraft division. As pointed out in the case, delaying the Canada launch would give Herzog the chance to study US demand, allowing for better target marketing to Canadian customers, and it would also minimize risk in the event that the launch was to fail. In accordance with the rule of investing however where great risks equals great rewards, waiting may allow competitors to get a firm grip within the marketplace, making it more difficult for Kraft’s pods to enter later on. Other issues that Herzog would face if he decided on a simultaneous launch with the US include:

Product Pricing – Being one of the conceptual frame works in marketing, Herzog would have to determine a suitable price that would not only be competitive and drive sales, but would also be profitability. Herzog may want to target customers who fall within the Bargain Basement or Passive segment of the Customer Classification Matrix. (See Exhibit 1)

Limited Budget – With only $1M to spend, Herzog would need to formulate a promotion strategy that would yield the most return for every dollar spent.

Advertising and Promotion – Herzog would need to coordinate an effective market segmentation campaign to determine the best means to gain the attention of potential customers. To avoid the common pitfalls of segmentation he would need to avoid making general segmentations and create segments that are relevant to the product.

Flavor Variety – With a number of varieties to choose from, thorough market research should be conducted to determine what flavors are currently in high demand.

Distribution Channels – A decision needs to be made on what distribution channels should be used. Two that...