How Kraft Changed the Oreo and Its Global Marketing Strategy for Success in China

Gale Business Insights: Global Case Study Collection

Learning Objectives

After analyzing this case study, students should be able to do the following:

Explain at least three benefits of market research in product development for international and emerging markets
Identify traditional and nontraditional strategies for increasing revenue through entering new global markets
Appreciate the effect of cultural norms and tastes for firms expanding to new markets
Discuss how firms can focus products to local tastes while increasing brand value globally
Introduction

One of the more popular strategies for firms to increase profits in the 21st century
In a 2011 feature on Khosla in Chicago Magazine, Khosla noted that "[c]ompanies were just planting their flags, with a one-size-fits-all attitude that didn’t work. You can’t just force stuff from one country to another."

Instead, Kraft Foods would redesign the way it, and other firms, entered emerging markets. Khosla coauthored an article with Mohanbir Sawhney for Strategy+Business magazine, called "Growth Through Focus," in which the authors details the many changes that took place at Kraft Foods to succeed in developing markets. "A typical ‘growth through more’ strategy," they write, "diffuses the organization’s efforts. It increases the complexity of the organization and its operations." Companies should not produce more to drive growth but should instead focus its operations and strategy to achieve growth. "The engines of growth," write Khosla and Sawhney, "are focus (fewer brands, fewer categories, and fewer markets) and simplicity (simple vision, simplified execution, and simpler organizational designs)." Kraft Foods would choose which brands have the best chances of winning in which markets and then supply its management and employees with an abundance of resources to succeed. "We have found that seemingly mature businesses can be energized by making fewer but larger bets."

The executive team at Kraft had a strategy for winning but had to ensure that its employees at all levels understood and executed the strategy, so it came up with a