- Although Kraft Foods Group Inc. still dominates the macaroni and cheese comfort food category, it is losing ground to smaller brands offering new taste variations and a greater health appeal.
- Kraft's net revenue amounted to more than $18 billion last year, with its macaroni and cheese business generating more than $500 million in sales.
- Kraft's macaroni and cheese share fell from 82% in March 2010, to 78% this month, according to Consumer Edge data..
Bad news for Kraft--specialty brands are gaining market share. Annie's Inc., which used to sell its natural and organic mac and cheese exclusively in specialty retailers like Whole Foods Market, has since become available in standard mass-market groceries. This move has been fruitful for Annie's, with its share increasing from 5% in March 2010 to 7% this month, according to Consumer Edge."Even though individual companies by size are quite small, in aggregate they're more on trend with consumer demand and pose a threat to Big Food over time," said Consumer Edge Research analyst Robert Dickerson.
A Reuter's analysis points to baby food and yogurt as "a cautionary tale for Kraft." Nestle SA's Gerber baby food and General Mills Inc's Yoplait yogurt were the leaders in their categories, but they eventually lost market share to smaller brands with greater health appeal. Is seems that no matter how big a brand is, it can never afford to become complacent about dominating market share.