CAGNY: Kraft CEO: Food firms must adapt price, SKUs
Kraft CEO Tony Vernon highlights the changing consumer behaviour in America
Food manufacturers will have to adapt their prices and product offering if they want to remain relevant to a consumer now shopping in different ways, Kraft Foods Group CEO Tony Vernon has said.
Speaking to at the Consumer Analyst Group of New York conference yesterday (18 February), Vernon said consumer buying patterns had dramatically changed in recent years, in part due to the downturn.
Planned shopping trips were dominating the mix and impulse buys had dropped.
"This is largely due to the income pressures on American families," explained Vernon. "It would also explain why consumers have become less responsive to promotional marketing that so many companies in our industry hope will boost their volumes," he added.
He noted consumers were increasingly shopping in the less traditional channels of trade such as dollar outlets, club stores and online.
"The customer base infrastructure is changing. That means if we want our brands to compete effectively in those channels, we have to have the right price pack combination in a single unit to satisfy the consumer for that purchase occasion. And in more cases than not, a different pricepack architecture than they'd find in traditional stores," he said.
Grocery volumes in the US have been in the doldrums for a number of years and there are some concerns sales will struggle to rise this year, with economic gloom hanging over the country.
However, Vernon was optimistic about the outlook for the sector.
"I've heard the bearish talk about our industry's prospects and I'm just not buying it. Those who can adapt, can contemporise their offering, who can get their products in the right breadth of locations at the right price - they will prosper.
Nevertheless, he added: "We have to adjust. There's no question about it."
Companies: Kraft Foods Group
Kraft Foods Group, Inc. - SWOT Analysis company profile is the essential source for top-level company data and information. Kraft Foods Group, Inc. - SWOT Analysis examines the company’s key busine......
A new global packaged food player was created in October 2012, as Kraft Foods Inc restructured its operations into two independently listed entities and spun off its North American grocery business un...
Synopsis Canadean's "Kraft Foods Inc. : Consumer Packaged Goods - Company Profile, SWOT & Financial Report" contains in depth information and data about the company and its operations. The profile con...
Kraft Foods Group has launched bacon jerky under the Oscar Mayer brand in a bid to tap into growing demand for protein snacks....
- Focus: The impact of Heinz's stevia ketchup
- Focus: Gen Mills turns to M&A to bolster US ops
- Viewpoint: US health food in play - at a price
- Comment: Kingsmill "youth" appeal bodes well
- BRICs: How dairy deal bolsters Lactalis and BRF
- Burton's "eyeing" United Biscuits merger
- Glanbia to buy US sports nutrition firm Isopure
- Premier Foods revamp creates three divisions
- Arla joins race for Egypt's Arab Dairy
- Unilever to boost presence in Nigeria