Kraft Foods Announces Marketing Changes to Emphasize More Nutritious Products

NORTHFIELD, IL -- 1/12/2005 -- Kraft Foods Inc. (NYSE: KFT) announced today two new initiatives to increase the visibility -- among both adults and children -- of many of the more nutritious products in the company’s portfolio. Using nutrition criteria that are derived from the proposed 2005 U.S. Dietary Guidelines, as well as authoritative statements from the U.S. Food & Drug Administration, National Academy of Sciences and other public health authorities, Kraft will:

-- Introduce a Sensible Solution labeling program in the United States, featuring a prominent on-pack "flag" for food and beverage products that meet specific, "better-for-you" nutrition criteria that Kraft has established for each category of products.

-- Shift the mix of products it advertises in television, radio and print media viewed primarily by children ages 6-11, such as many popular cartoon programs, toward products that qualify for the flag, and phase out advertising in these media for products that don’t. This means that, over the course of 2005, a number of well-known Kraft products -- including regular Kool-Aid beverages, Oreo and Chips Ahoy! cookies, several Post children’s cereals, and many varieties of Lunchables lunch combinations -- will no longer be advertised in these media. Kraft will continue its existing policy of not advertising in media with a principal audience under age six.

"We’re working on ways to encourage both adults and children to eat wisely by selecting more nutritionally balanced diets" said Lance Friedmann, Kraft’s Senior Vice President, Global Health & Wellness. "We believe that these initiatives are a step in the right direction"

Sensible Solution Program

The Sensible Solution flag, which will help consumers more easily identify Kraft’s "better-for-you" choices within a food or beverage category, will begin to appear on qualifying products in the United States in April. In many cases, the flag will contain specific information about a product’s key nutritional benefits.

"We want to provide a range of options that help people make more informed decisions about the foods and beverages they buy for themselves and their families" said Friedmann. "With one quick glance at the Sensible Solution flag, it will be easier to identify Kraft products that offer better nutritional choices in their respective product categories"

Among the products in the U.S. that will carry the flag are: Kraft 2% Milk Shredded Reduced Fat cheese, Post Shredded Wheat cereal, Minute Rice Instant whole grain brown rice, Triscuit Original baked whole grain wheat crackers and Crystal Light beverages. Plans are under development for similar programs in other countries, based on regulatory requirements and other local considerations.

A product can qualify in one of two ways for the Sensible Solution flag:

-- By providing beneficial nutrients such as protein, calcium, fiber or whole grain at nutritionally meaningful levels, or by delivering a functional benefit such as heart health or hydration, while staying within specific limits on calories, fat (including saturated and trans fat), sodium and sugar; or

-- By meeting specifications for "reduced" "low" or "free" in calories, fat, saturated fat, sugar or sodium.

The detailed criteria for this program were developed by Kraft’s nutrition experts, include input from the company’s external council of advisors from key health and wellness disciplines, and incorporate guidelines from acknowledged public health authorities.

Product Advertising in Media Seen Primarily by Children Ages 6-11

Kraft will continue its existing policy of not advertising in television, radio and print media with a primary audience under age six. In addition, the company now will begin to change the mix of products it advertises in television, radio and print media seen principally by children ages 6-11.

Over the course of 2005, Kraft will increasingly advertise in these media products that meet the Sensible Solution criteria, with a particular emphasis on foods and beverages offering beneficial nutrients or a functional benefit. In 2006, as existing commitments expire, advertisements of all products not meeting the criteria will be phased out completely around the world. Kraft will continue to advertise its full portfolio of products in television, radio and print media seen principally by parents and all-family audiences. The company will also, in accordance with policies that it regularly evaluates and revises, market its products through means such as packaging, websites and in-store promotion.

"Despite broad agreement that there is no simple way to effectively encourage better nutrition and more physical activity, we recognize that parents are concerned about the mix of food products being advertised to younger children" said Mark Berlind, Kraft’s Executive Vice President, Global Corporate Affairs. "The initiatives we’re announcing today are part of our ongoing efforts to help address that concern"

Examples of existing products that the company will continue to advertise in media aimed specifically at the 6-11 age group include: Sugar-Free Kool-Aid beverages, Lunchables Fun Pack Chicken Dunks and 1/2 the Sugar Fruity Pebbles cereal. As part of this initiative, Kraft’s research and development team is creating more new products for children that will meet the more rigorous set of Sensible Solution criteria.

"A recent Institute of Medicine (IOM) report on preventing childhood obesity calls for strengthened self-regulation of food and entertainment advertising to children" added Berlind. "We believe that the IOM’s proposal is constructive, and hope that all stakeholders will join together to make real progress on this issue"

Kraft and other food companies have a history of responsible self-regulation of their marketing practices to children. For example, in 2004, Kraft eliminated all in-school marketing and set specific nutrition criteria for products sold in school vending machines. In addition, the company is a founding member of the Children’s Advertising Review Unit (CARU) of the Council of Better Business Bureaus.

The company’s new initiative will have the largest impact on its advertising in North America; in other countries, the company’s advertising in media specifically directed to children ages 6-11 is minimal.

Initiatives Part of Larger Kraft Efforts

Both initiatives announced today align with Kraft’s broader efforts to address consumers’ health and wellness concerns, including the global public health challenge of rising obesity rates. Other steps taken by the company include improving nutrition labels to make it easier for consumers to choose the portion size of the foods they eat, enhancing the nutrition profile of its portfolio by reformulating existing products and creating new products, and supporting and developing community-based health and wellness programs.

Further information on Kraft’s marketing practices, its broad-based health and wellness initiatives and the Sensible Solution program can be found on Kraft’s corporate website at http://kraft.com/responsibility/home.aspx. In addition, Kraft has added a Sensible Solution section to its consumer website at http://kraftfoods.com/kf/HealthyLiving/sensiblesolutions to provide more information on the program, the category-by-category Sensible Solution nutrition criteria, and the products meeting those criteria.

Kraft Foods markets many of the world’s leading food brands, including Kraft cheese, Maxwell House and Jacobs coffees, Nabisco cookies and crackers, Oscar Mayer meats, Philadelphia cream cheese, Post cereals and Milka chocolates, in more than 150 countries.

EDITOR’S NOTE: Digital images of the new Sensible Solution labels can be obtained by visiting http://www.kraft.com/newsroom/sensiblesolution.html.

Contact Information

Nancy Daigler

Press Contact

Kraft Foods Inc.

Contact via E-mail