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June 28, 2016

The Appearance of Assortment: Why Kraft-Heinz Cross-Branded

“People achieve more as a result of working with others than against them.” -Dr. Allan Fromme

Facing a highly competitive packaged food industry and a shift in demands and drop in growth, Kraft-Heinz decided to take an offbeat-path to win consumers back. In a series of collaborative efforts with other brands, Kraft-Heinz has been able to achieve the appearance of more premium and diverse products. As the food community changes, Kraft-Heinz is changing with it.

The recent surge in the demand for products appearing natural, protein rich, or sugar free has no doubt affected the processed and packaged food aisles of your grocery store. The mounting distrust of big food companies led to a stagnant 2015 for Kraft-Heinz. But, in 2016, a new Mac ‘n Cheese product and healthy lunchable-style sandwich pack gave Kraft-Heinz’s brand the pick-me-up it needed.Kraft article image

Kraft Mac ‘n Cheese was a product losing momentum and credibility as consumers started looking suspiciously at the product once viewed as a “convenient dinner option.” After collaborating with Cracker Barrel, Kraft-Heinz released a new line of Mac ’n Cheese made with premium “Cracker Barrel award winning cheese”.

The tag line title made to say “you may not have liked our old cheese, but check out this shiny new cheese, it has won cheese awards!” By isolating an element of their product, and substituting it with the same element from another reputable brand, Kraft Mac ‘n Cheese looks a little less scary in the eyes of the consumer.

But not all cross branding efforts necessarily have to be the collaboration of a “better” or more premium version of a product to make it seem improved. Kraft-Heinz’s release of the “P3”packs, a protein packed twist on the traditional Lunchables feature packaging, which boldly advertises both the Oscar Meyer and Planters brands, is an example of a new branded product that is an equal collaboration. Although neither brand is any more or less reputable than the Kraft brand, the diversity created by using the equity of two brands gives the appearance of a superior product.

Variegating its products with similar or better brands makes Kraft-Heinz look more appealing in the less popular packaged food aisle, even if they’re collaborating with other packaged food. Two seems to be consistently better than one in the eyes of an untrusting consumer. Kraft Heinz’s 0.2 percent increase in U.S. sales to $4.7 billion from the first-quarter since the release of the “P3” packs to back up this phenomenon, after 2 years of declining sales. Tying in another brand freed Kraft-Heinz from a potentially dangerous product rut.

But why is that? Do buyers feel as if brands put more effort into products born from a multi-branded collaboration? Do we view a combination of brands who lack efficacy working together makes them more accountable?

Whether the new products are truly leaps and bounds improved is still up for discussion, but this was no doubt beneficial to the Kraft-Heinz brand. In a recent Trib Article author Alex Nixon adds that Kraft- Heinz’s new products” have been anything but revolutionary, but small changes can make a big difference with consumer”. If anything, it shows an implementation of strategy in creation of new product, and a targeted response to the consumer demands. Kraft-Heinz’s cross branding strategies show they’re listening, and they still care about being in the game

Next time your eyes linger on a cross branded product, allow yourself to wonder what is getting better by the collaboration of others. Let me know what you find.

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