Globalization in Oreo Renault
GLOBALIZATION (strategic decisions in context of Oreo and Renault)
OREO:
Kraft Foods, a part of Mondelez International, is one of the leading manufacturers of FMCG goods in the World- best known for its confectionary lines. Under Kraft Foods, Oreo has expanded all over the World- thus necessitating a perspective on marketing in hitherto unexploited markets in developing nations such as China & India. Kraft uses a multidomestic approach to Globalization, which they have adopted in view of several failures among Multinational FMCG companies in the 1990s while entering into developing markets. Thus, there was a realization that existing Market research & prevailing trends were not sufficient to explain or exploit new Markets.
Thus, in the past decade, there has a multi-pronged strategic outlook towards FMCG marketing in developing nations. Kraft Foods Oreo has overcome several challenges in this regard, problems that have been explained at length under the titles: Logistical, Strategic, & Social.
Logistical Observations:- Firstly, a major disadvantage Kraft Foods faces is the fact that local competitors are able to utilize their distribution networks & knowledge far better than new foreign entrants. Lack of proper Infrastructure impedes Sales in the early days whereas Price factors play a major role in impeding sales in developing markets- especially in case of FMCG goods like Oreo. Bureaucratic inefficiency within the Indian market further retarded avenues for growth- especially in case of new entrants starting from scratch like Kraft.
Strategic Observations:- Oreo’s competitors in India were entrenched local competition in Parle (25% market share), Britannia (28% market share) and ITC (12% market share). While the Indian cookie market is big (5500 crore Rupees in 2010, 12500 crore Rupees in 2013) & fast-growing, Kraft Foods had near-zero Brand recognition and no Brand loyalty. Also- Brand awareness is ironically higher for ‘local’ intra-national brands among
OREO:
Kraft Foods, a part of Mondelez International, is one of the leading manufacturers of FMCG goods in the World- best known for its confectionary lines. Under Kraft Foods, Oreo has expanded all over the World- thus necessitating a perspective on marketing in hitherto unexploited markets in developing nations such as China & India. Kraft uses a multidomestic approach to Globalization, which they have adopted in view of several failures among Multinational FMCG companies in the 1990s while entering into developing markets. Thus, there was a realization that existing Market research & prevailing trends were not sufficient to explain or exploit new Markets.
Thus, in the past decade, there has a multi-pronged strategic outlook towards FMCG marketing in developing nations. Kraft Foods Oreo has overcome several challenges in this regard, problems that have been explained at length under the titles: Logistical, Strategic, & Social.
Logistical Observations:- Firstly, a major disadvantage Kraft Foods faces is the fact that local competitors are able to utilize their distribution networks & knowledge far better than new foreign entrants. Lack of proper Infrastructure impedes Sales in the early days whereas Price factors play a major role in impeding sales in developing markets- especially in case of FMCG goods like Oreo. Bureaucratic inefficiency within the Indian market further retarded avenues for growth- especially in case of new entrants starting from scratch like Kraft.
Strategic Observations:- Oreo’s competitors in India were entrenched local competition in Parle (25% market share), Britannia (28% market share) and ITC (12% market share). While the Indian cookie market is big (5500 crore Rupees in 2010, 12500 crore Rupees in 2013) & fast-growing, Kraft Foods had near-zero Brand recognition and no Brand loyalty. Also- Brand awareness is ironically higher for ‘local’ intra-national brands among