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A Prevedere case studyKraft Heinz overcomes consumer shifts and marketvolatility to transform its go-to-market strategyImplements Advanced Predictive Planning to navigate uncertainty
A Prevedere case study: Kraft HeinzThe Kraft Heinz Companypartnered with Prevedereto modernize its forecasting,planning processes, andculture to respond totwo significant go tomarket challenges:ConsumershiftsCOVID market volatility2
A Prevedere case study: Kraft HeinzThe KraftHeinz storyOperates within volatile global marketsThe Kraft Heinz Company (KHC) is one of the largest CPGorganizations in the world with over 26 billion in annualrevenue. It manufactures and sells products worldwide within80 food and beverage categories, and has a consumerpenetration rate of 97% in the US.“All retailers and CPGs should considermacroeconomic factors to improvetheir business planning. Not only willforecasting accuracy improve, butgo to-market planners will be fullyeducated as to what external factorsare important to their markets.”Bernardo FiauxGlobal Head of Excellence and CapabilitiesForecasting and planning is a critical function, performed on amonthly, quarterly and annual basis by teams around the world.Budgets and resources are constantly re-assessed.In 2020 KHC reorganized and regrouped its categories into6 new product platforms, based around consumer behavior,supporting a transformational new growth strategy.COVID rocked even their most stable categories, and triggereda new initiative to commence all planning with macro economicviews and predictions of each of their key markets.3
A Prevedere case study: Kraft HeinzChallengesConsumer shifts in behaviorCOVID volatilityIn 2019 KHC saw that consumer behaviorIn 2020 the business world was shakenin their markets was shifting, even beforeby the pandemic as every industry wasCOVID. An increase in eCommerce, a desireimpacted in varying ways. KHC experiencedfor greater convenience, more snackinga surge in demand and their teams adjustedand mini-meals and a willingness tothe best they could. It was clear thatexperiment with taste. KHC saw a realforecasting based on historical performanceopportunity to reorganize and focus on aand internal projections was not going to cutnew growth strategy.it anymore.KHC decided to regroup its categories intoThis was the realization that strategicconsumer behavior-based platforms, andplanning and ongoing forecasting needed toto develop objectives, plans, and marketingincorporate external market dynamics, andaround these new trends. They reallyto quantify the unique set of market driversneeded visibility and intelligence aroundfor each platform and market.12To gain predictive insightinto the new consumer-behaviorbased platforms, to be able tooptimize resources for growth.To build market volatilityinto planning and forecastingprocesses, and create top-downmacro views of markets.these go to market platforms, especiallyregards CAGR predictions, in order tooptimize forecasts, budgets and resources.And then COVID struck.4
A Prevedere case study: Kraft HeinzSolutionSolution technical overviewProof of conceptGlobal solutionKHC discussed with Prevedere their desire to incorporateAfter a successful pilot resulting in a much higher degree ofmacroeconomic views into forecasting and planning. An initialforecast accuracy and market visibility, KHC decided to greatlyproject that targeted one of its key consumer platforms wasexpand the number of predictive models across the organization,executed. The goal was to identify contributing market drivers,including Canada and 80 international territories.then create economic-based forecasts and industry outlooksfrom econometric predictive models. Prevedere’s team leveraged its Global Intelligence Cloud andmodeling engine to identify the leading indicators and createplatform forecasts and scenarios. These were presented to the KHC team, along with backtested forecasts. Prevedere was able to review the identifiedeconomic drivers and validate their potential impact onKHC’s business. Forecasts were compared to internally generated forecasts,which were then adjusted based on Prevedere’s input. The KHC team now had a platform forecast validated byThe company’s senior financial leadership realized that theyneeded to supplement planners’ own internal knowledge tiveindicatorsmodelsa better understanding of established and emerging marketexternal drivers.Increased standardization KHC teams across the world do not all use the same practicesfor forecasting, so adding a macro based first step creates acommon foundation for planning.Planning cultureHistorical performance dataOutbound shareInbound shareForecasts Foresight All planners are now enabled with macro data and views thatrelate to their own businesses. Their knowledge has greatlyincreased into the real drivers of their markets.Client private areacorrelated economic data and macro predictions.5
A Prevedere case study: Kraft HeinzThe outcomeEnable transformation and growth, manage volatility and riskContributing drivers from PrevedereForecastaccuracyGuardrailsMarketsavvyKHC leverages Prevedere economicEconomic baseline forecasts andPlanners and leaders around theforecasts and scenarios for each platformscenarios combined with marketworld now understand what reallyand key market around the world.assessments by Prevedere’s economistsdrives their business, and are wayForecast accuracy is improving, andprovide critical intelligence and themore knowledgeable about economicconfidence in planning has skyrocketed.ultimate safety net for KHC planners.impact on supply and demand.6
A Prevedere case study: Kraft HeinzConclusionKHC has recently experiencedtwo significant changes totheir global business, namelyshifts in consumer behavior andsignificant market volatility dueto COVID and increasing externaldisruption.They are ready for all types of operatingconditions, leveraging data driven predictiveanalytics and economist intelligence. KHCis realizing both tactical and strategicadvantages working with Prevedere’sglobal data, AI technology and economists,including: Forecast accuracy, where a 1%supply chain decisions. Ability to attain insights and discover newand impactful consumer level drivers. Ability to attain CAGRs, market sizeprojections and other financial metrics thatwere previously difficult to produce. No more surprises or market blind spots,with a new confidence and ability to planfor future opportunity and risk.Kraft Heinz is an industry leader, nowarmed with an understanding of marketdrivers and predictive models that arecustom fitted to their global operation.Kraft Heinz has literally transformed its goto market strategy.improvement results in millions of dollarsof cost savings or revenue growth. A new layer of understanding, as to whatis happening in the industry, with datadriven predictions to help drive their7
Plan and forecastmore intelligentlyin the new worldAdd Advanced Predictive Planning to your business.Talk to Prevedere to identify how we can benefit your organization.Contact: (888) 686-7746 or inquiries@prevedere.com
A Prevedere case study: Kraft Heinz 7 Conclusion KHC has recently experienced two significant changes to their global business, namely shifts in consumer behavior and significant market volatility due to COVID and increasing external disruption. They are ready for all types of operating conditions, leveraging data driven predictive
