Kraft has been expanding into the global markets over the last 10 years. They have become a giant in China and are quickly gaining traction in India. China was their first massive global market initiative. Their initial launch failed because the cookies were too expensive and did not suit the shape and taste the Chinese were accustomed too. However, management, research, and development worked closely to revise the taste, shape, and price to fit the needs of the Chinese.
Kraft, who owns Oreo cookies, learned from their mistakes. When they entered into India’s biscuit (cookie) market, the organization expected to change the flavor, price, and shape. Kraft also capitalized on existing distribution networks, by acquiring cookie companies in India. The following essay will examine align components of a SWOT analysis and how the Oreo business strategy applies to the Capsim simulation.
The SWOT analysis identifies the internal strengths and weaknesses, and the external threats and opportunities. I will start by discussing the strengths Kraft’s Oreo cookies. The strengths are; excellent management and long-term vision, acquiring companies, Kraft’s product mix and strong consumer loyalty. The organization has deep pockets and experience in manufacturing, and the retail market, which gives them an advantage over new entrants.
The weaknesses in emerging markets are consumers have no emotional attachment. Additionally the costs were too high for Chinese, at 72 cents for a pack of 14 (Clements, Jain, Jose, & Koellmann, 2013). Of course, I have to mention health as a weakness. The cookies are made from palm oil, processed sugars, refined carbohydrates, and palm oil. Palm oil plantations a terrible for th...
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..., opportunities, and threats. Analyzing how Kraft addressed the global commerce from research, design, production, marketing and distribution, provides a set of tools or approaches that are applicable to other industries. One should continue to research how organizations have successfully expanded their products into new markets and demographics, because often one can adopt a strategy used by one organization. Similarly, the lessons learned by one organization such as assuming the Chinese would have the same taste and size requirements as the U.S. customer base. Always analyze the purchasing criteria, culture, demographic expectations of new markets and established markets. The world is changing fast with globalization, and as the change occurs, demands and expectations are changing, thus requiring organizations to evaluate their strategies on a frequent basis.
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