Kraft Restructures as It Eyes More Brand-Building

Kraft Restructures as It Eyes More Brand-Building: Food Giant Will Separate Meals and Desserts From Snacks and Sauces

Nine months after Kraft Foods split in two, one of the new companies is restructuring as it looks to boost brand-building.

Kraft Foods Group, which was formed in October as a North American food and beverage business, today said it will divide its grocery division into two units: one focused on meals and desserts and the other housing snacks, sauces and dressings.

The change means Kraft, as of July 1, will have six divisions: beverages, cheese, refrigerated meals, international and foodservice and the two new ones: meals and desserts and “enhancers” and snack nuts. The move is meant to put more focus on brand-building and simplifying the portfolio, which has many brands and categories, the company said in a statement, referring to the former grocery division, which will be eliminated.

Under the new setup, each of the units will have an exec VP reporting directly to Kraft Foods Group CEO Tony Vernon.

Michael Osanloo, exec VP of the soon-to-be defunct grocery business unit, will be promoted to exec VP-president of meals and desserts, which will include Cool Whip whipped topping, Jet-Puffed marshmallows, Jello, Kraft Mac & Cheese, Shake 'N Bake, Stove Top stuffing mix and Velveeta dinners and meal kits. Together, those brands spent $69.3 million on measured media in 2012, according to Kantar Media, or about 11% of Kraft’s total $614.8 million in spending.

Jane Hilk, senior VP of marketing for Oscar Mayer, will take over as exec VP-president of enhancers and snack nuts, which will include A.1 steak sauce, Grey Poupon , Kraft and Bulls-Eye barbecue sauces, Kraft and Good Seasons dressings, Kraft and Miracle Whip spoonable dressings and Planters nuts, trail mixes and peanut butters. Those brands spent a combined $47 million on measured media last year, according to Kantar, or nearly 8% of Kraft’s total.

Oscar Mayer, one of Kraft’s largest spending brands at $105.8 million in measured media, is housed in the refrigerated-meals division, which will continue to be overseen by Nick Meriggioli

Marketing for all of the divisions will still be led by Kraft Chief Marketing Officer Deanie Elsner, who was promoted to the role in January. She has already overseen some agency changes, including recently moving the Philadelphia brand to Roberts & Langer DDB to Roberts & Langer DDB from McgarryBowen. “We appreciate [McgarryBowen’s] work on the brand the past four years and wish them continued success as they continue to support other Kraft brands now and in the future,” said a Kraft spokeswoman.

McgarryBowen still has Miracle Whip, Oscar Mayer and Lunchables, the company confirmed.

Kraft Foods Group was formed in October, when Kraft Foods Inc. split into two companies. The other company is Mondelez International, which houses global snacking and candy brands such as Trident, Cadbury and Oreo.

Original article written by E.J. Schultz for AdvertisingAge.com and can be found here.

Published: June 14, 2013