Although Kraft is struggling against private-label competition in key areas such as its cheese and Planters nuts franchises, its pizza business has enjoyed seven consecutive quarters of double-digit sales growth and has become a prime driver of the company's "convenient meals" business, its fastest-growing U.S. segment, Mike Hughlett reports.
Kraft makes the most popular U.S. frozen pizza, DiGiorno (which pioneered frozen pizza with self-rising dough), as well as other top brands Tombstone and Jack's. It also produces supermarket versions of California Pizza Kitchen Products.
"The quality of frozen pizza has grown dramatically in the past few years and DiGiorno is really high quality," says Technomic analyst Darren Tristano. It's also cheaper than takeout pizza, and Kraft has been driving that point home, so to speak, during the economic turndown.
Credit Suisse analyst Rob Moskow feels that Kraft's overall success will hinge partly on whether it does in other categories what it has done in frozen pizza: Reframe products and brands so they appeal beyond their traditional channels. The problem may be, however, that consumers may not perceive as much difference between peanuts as they may in a slice of pizza.
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