Kraft just reported a 72% drop in earnings during 2008 - the majority during the last quarter. Consumers are cutting back in a lot of ways and turning more to store brands to save money. However, Kraft still plans on increasing its marketing budget to 8% of its total budget (up from 7% last year).Very smart move! The best way to counter store brand growth is to emphasize the value in the Kraft: Consumers have to believe that they get more value and better products if they spend the additional money. Brandweek reports that, "Kraft will rely on product innovations and value marketing to drive growth behind its brands.
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