Why is Kraft Changing its Cheese? Changing with the Market

Millions of kids eat Kraft cheese every year in the form of American and White Kraft Singles. The company will be moving from the preservative sorbic acid to the more natural mold inhibitor natamycin. The change is in response to growing consumer trends that are pushing for more natural foods. Kraft is meeting the trend in their own crafty way. 

Even though the preservatives are FDA approved the decision makers of the organization are responding to customer preferences and needs. It took nearly five years for them to test the shelf-life and taste to ensure that they do not lose market position or damage the product in anyway. It is hoped with new commercials that the company will be able to gain more market share by the improved product. 

The change helps us understand how the market and market preferences can impact strategic decisions within an organization. It takes time to adjust and change successful products to enhance their market position. Seeing these trends in advance and branding your change can be a game changer for growth. This takes a level of analysis and customer market study.

Beside the push for more natural products parents are also concerned about the food they are giving their children. This is natural parental responsibility to the young. Kraft cheese appeals to this market demographic and naturally does well when showing interest to their needs. The adjustment is a wise choice for Kraft and helps them maintain long-term competitiveness while pleasing their target customer. 

Commercials will be airing soon and products are already on the shelf. Look for a red circle that says No Artificial Preservatives or Flavors. 

Recipes You Can Make with Kraft Products

Market Research and Market Forecast

Understanding the needs of the customer is a fundamental activity that coincides with the development of the business. As customers and their patronage are the lifeblood of an organizations existence it is extremely important for organizations understand their needs and wants. One way to do this is to determine the market trends and attempt to find products and solutions that will appeal to customers. To do this well would require a level of market research and market forecasting.

The American Marketing Association defines market research as, “the systematic gathering, recording, and analyzing of data with respect to a particular market, where market refers to a specific customer group in a specific geographic area” (2011).  Market research collects specific information to study market characteristics while a marketing analysis puts the information into a framework that is understood for prediction purposes.

Some assessment tools, such as Ansoff’s Matrix Analysis, provides for a systematic analysis of four general classes product/market growth strategies which include 1.) market penetration; 2) market development; 3) product development; 4) and diversification (Finch, 2012). Even though the analysis is beneficial one must go into greater detail and research to understand these concepts to make them useful.

Market Penetration: Increasing current sales to existing markets.

Market Development: Increasing sales by selling existing products in new markets.

Product Development: Selling additional products to current customers.

Diversification Growth: Selling new products in new markets to create diversification.

Each strategy has its own particular benefits and detractors. For example, if a market is currently saturated it may not be beneficial to create additional market penetration. Likewise, sometimes it can be beneficial to diversify products and markets when traditional products and services are on the decline. To know when each strategy is likely to be successful requires the ability to forecast the market properly.  Inaccurate or misaligned strategies can cost companies their competitive abilities and possibly their future sustainability.

When one has useful information and has analyzed trends it is possible to forecast the market. In general, forecasting the environment should be completed in the context of competitive market demand of both internal and external factors within the market (Pilinkiene, 2009). This means that one should understand the trends, available products, and even the company’s internal abilities to determine whether or not its offerings are competitive.

The constantly changing market requires a new way of thinking about forecasting. As most forecasting models use mathematical models they often ignore the qualitative aspects of the market and therefore become stale (Pilinkienu, 2008).  It is necessary to understand that older models may be limiting in terms of their accuracy. Relying too heavily on one strategy, means that one is not getting the full market picture. 

When organizations do not take into account the full spectrum of relevant information the market has to offer or take in multiple methods of evaluating that market there is a high potential of poor judgment. Executives cannot make proper decisions unless proper information and analysis is conducted. Ensuring that analysis are thorough take into account varying circumstances and offer contingency plans can be helpful in the decision making process.

 Companies should seek to reevaluate their marketing strategies at least once every five years with yearly adjustments. Adjustment periods depend on the type of industry one is in. For example, traditional services have a longer projection time than fast paced technology bubbles. In fast paced markets it may be necessary to develop a marketing plan for each product or service and continue to adjust it as needed or new information arises.

American Marketing Association. (2011). Retrieved from http://www.marketingpower .com/_layouts/Dictionary.aspx

Finch, J. (2012). Managerial marketing. San Diego, CA: Bridgepoint Education, Inc.

Pilinkiene, V. (2009). Forecasting environment and its factors when assessing the competitive market demand. Economics & Management, p. 878-883. 

Pilinkienu, V. (2008). Market demand forecasting models and their elements in the context of competitive market. Engineering Economics, 60 (2).

Identifying and Fostering Creative Individuals in the Workplace

The creative personality can be a benefit for companies that seek to find new avenues to develop market niches and exploring those niches for higher revenue. Creativity is a cognitive process that allows people to see the novelty within information and focus on that novelty to find new and unique solutions. Fostering creativity in the workplace has many benefits for organizational goal attainment. Creative employees should be nurtured as they can provide positive benefits for years as their solutions are converted to financial benefits.  

The creative personality is unique when compared to the general population. They are strong at creative problem-solving, remote association tests, ideation fluency, and creative works (Martinsen, 2011). Creative people are often tested by a variety of different assessments that help identify their unique abilities. The tests help recognize the way in which their thinking processes operate and the creative outputs that are drawn from these processes. 

This does not mean that all creative people need to be tested to be identified. Generally, people can be discovered by their ability to use divergent thinking to solve problems from multiple perspectives and their ability to take complex data and break it down to elemental meanings and rules that can be used for understanding. In any given situation they can see multiple answers and solutions to problems when primed with relevant information and offered opportunities to solve these complex problems.

Creative individuals are hardwired a little different than the rest of us. Their neurobiological foundations offer opportunities for fast paced neural transmitter systems that foster speed and additional activations between concepts (Chavez-Eakle, et. all 2012).  It is this connection between wide ranging ideas where new paths and methods can be identified and explored. Many of us simply cannot make the same wide reaching connections because it requires logical deductions that include many layers of detailed information. 

The speed of their brains can be faster than the logical understandings of others. This occurs when creative individuals can intuitively find an answer to a complex problem but must go back and pull out the details bit by bit so others can understand it. People who make much smaller connections will need to follow the long chain of information which could take them a considerable amount of time to understand. This is why others get lost in their train of thought and abandon it. 

Since it takes considerable time and effort to understand the concepts others often lose interest and cut the conversation short. Some might simply make quick assumptions that the creative person has little idea what they are talking about even though their thought processes are valid and logical. It is a difficult balance between giving the answer that others cannot logically follow or boring them to death with the details. Due to the constraints of the social environments they are often misunderstood.

Such creative development doesn’t happen in a vacuum and often relies on various life events to foster it. The nature (i.e. biological) is enhanced by the nurture (i.e. life events) to culminate into higher forms of adaptations. People who are creative have learned throughout their lifetimes to overcome obstacles and have the self-efficacy to see tasks through to their completion. Without the right environmental challenges the Ferrari that sits inside their heads never puts the pedal to the metal. A considerable amount of self-belief must occur to move beyond normal constructive methods into realms of the unknown where great discoveries are found.

There are a number of factors that separate creative students from other students long before they make their way into the working world. According to a study of 1,300 creative Chinese adolescents by Qian, et. al (2010) creative individuals have unique internal, external and self factors.  Internal factors included self-confidence, norm-doubting, internal motivation, and persistence. External factors included curiosity, risk-taking, openness and independence. Self-factor includes self-acceptance. Such individuals simply see the uniqueness in a number of situations and have the motivation and risk-taking behavior to make things happen.

Successful innovators are not just good on paper, they are also important to entrepreneurship and overall successful business development. Such individuals express need for achievement, locus of control, creativity, innovative and also strategy to grab market opportunities (Halim, 2011). These entrepreneurs must be motivated to achieve, rely on their own abilities, find creative solutions and be able to devise unique strategies. Without the ability to use their creativeness they will not be able to find those market openings that help develop new products and services for the benefit of their organization and others.

Today’s business world relies heavily on finding solutions to customer problems. Fostering creativity in both education and employment gives competitive advantages to those organizations that do so. The modern capital doesn’t rely on tangible products but on unique uses for those tangible products that find solutions to market problems. The creative and entrepreneurial spirit fosters higher levels of organizational and strategic development due to its unique nature to turn novelty into practical form. 

A study by IBM’s Institute for Business Value surveyed 1,500 executives about creative individuals. They indicated that communication skills, pro-activity, problem-solving, curiosity, and risk taking are essential elements of a creative and motivated person (Glei, 2013). Such people experience themselves finding problems before others, making effort, putting solutions together, and willing to take a risk when necessary. They can be selected through observation, interviews, or past experiences. Asking the right questions and seeing such individuals for what they are makes all the difference to organizations in the long-run. 

Creativity is often beneficial in the high technology environments but can be put to good use in many places. As your organization conducts interviews for their next creative candidate use situation questions, problem-solving questions, what if questions, and complex problems in order to find the creative side of the candidate. Once hired keep an eye out for that creative potential that is trying to find the right environment to come out.  The environment is one of the largest factors in connecting creativity to an appropriate path that won't be stifled by the self-interest of others before full fruition.

Chavez-Eakle, et. al. (2012). The multiple relations between creativity and personality. Creativity Research Journal, 24 (1). 

Glei, J. (2013). The top five qualities of producing creatives (and how to identify them). 99u. Retrieved June 27^th, 2013 from http://99u.com/articles/6736/the-top-5-qualities-of-productive-creatives-and-how-to-identify-them

Halim, et. al. (2011). The measurement of entrepreneurial personality and business performance in Terengganue Creative Industry. International Journal of Business & Management, 6 (6). 

Martinsen, O. (2011). The creative personality: a synthesis and develop of the creative person profile. Creativity Research Journal, 23 (3). 

Qian, M. et. al. (2010). A model of Chinese adolescents’ creative personality. Creativity Research Journal, 22 (1).