I. Situation analysis

Kraft foods successful launch of its single serve coffee pod system in Europe has led to the company’s decision to release the same product in North America. Greg Herzog, Product manager of coffee development for Kraft foods Canada will be the ultimate decision maker in the situation. Mr. Herzog will determine whether to launch the product to the Canadian market at the same time as the United States launch or wait results from the Unites States launch to gain more market insight. In order to make an informed decision Mr. Herzog needs to analyze four key components: a suitable branding strategy for Maxwell House and Nabob, wholesale and retail pricing, distribution methods, and an effective advertising and promotional strategy. Lastly, Mr. Herzog must make these decisions within a 1 million dollar budget and determine if he will be able to meet his market share objective of an initial 35% and still breakeven. As a company, Kraft enjoys a worldwide reputation of leading edge innovation and has a stated company mission to achieve leadership in the markets it serves. Currently, Kraft holds a leadership position in market share for coffee sales worldwide as well as in Canada. Kraft sells its coffee in Canada under the brands, Maxwell House and Nabob which enjoy a combined market share in Canada of 32%. Maxwell House holds the largest market share in Canada, with top sales in both roast and ground coffee. Nabob coffee is Canada’s leading premium brand of coffee and leads with the largest market share in Western Canada, while following second nationally after Maxwell House. A SWOT analysis for the possible Canadian launch of single serving coffee pods is located in the Appendix in section 1.

II. Issues and Problems

The main issue Kraft faces in this situation is whether or it should be aggressive in its launch date into the