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Q.1: What are the advantages and disadvantages to Kraft Foods (Cadbury) of producing new lower-calorie versions of their existing chocolate bars?
Kraft Foods is one of the leading producers of chocolate bars in a number of different countries around the world, especially the UK. With inclining rates of obesity in countries like France, South Korea, USA, England, Greece and Italy, a decision to produce low-calorie versions of their chocolate bars could be a healthier alternative to the country. There are a number of advantages and disadvantages to Kraft Foods while producing these.

Advantages : a) They attract a new and major segment of the market which is more health conscious. This new segment of the market includes people who are on the path to obesity yet desire to consume their favourite chocolate. They would much rather turn to the lower-calorie chocolate bars. Also, as mentioned in the case study, 15-24 year olds are heavier consumers of chocolate and in todays world, that same generation is becoming health conscious. b) The implement of ‘fat tax’ in the country automatically turn consumers to buying lower-calorie products in order to avoid paying the tax. Therefore, producing more of the new chocolate bars will be profitable to Kraft Foods, as their sales would multiply immensely. c) They have a higher chance of obtaining customer loyalty because of their new chocolate bars as customers will trust that they can serve every segment of the market (health-conscious ones, chocolate lovers, diabetic people, etc) and cope up with changing trends. d) They will be competitively forward as other chocolate producers and companies may not switch to producing healthier chocolate bars and chocolate lovers turn to Kraft Foods’ new products in order to avoid paying fat tax on other companies’ chocolate bars which are not altered according to the tax...

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