Kraft Foods Inc. which has been working to reignite growth in its cheese business, plans to launch a new line of frozen breakfast offerings called Bagel-Fuls. Kraft’s efforts come at a time when the company has been fighting commodity price increases and looking for ways to energize its brands in the face of competition from cheaper private-label products.
Kraft’s new Bagel-Fuls brand are frozen bagels, which come stuffed with Philadelphia cream cheese. Kraft sells everything from Maxwell House coffee to Oscar Mayer meats, but cheese is still a key part of its business. Last year the company’s North America cheese and food-service business had revenue of $6.4 billion.
The company has faced some challenges in its cheese business. Dairy costs have been soaring, hurting Kraft’s margins and forcing it to raise prices for its cheese products. Cheaper private label, or store brands, also have also been trying to build up the offering of cheese products. In recent quarters, marketing and new products has helped Kraft build share in categories like snacking cheeses.
Still, Kraft has had success with several new products like its LiveActive cottage cheeses. It is also betting that new frozen bagel line will help it tap the $1.4 billion market for frozen breakfasts, which is growing at about 3% annually. That line also fits in with another big part of Kraft’s strategy of trying to tap consumers’ demands for so-called quick meals – food that consumers can grab during a busy day.