The move to a single CEO has been long rumored among Kraft insiders, but until the company's North American business began to slide in its biggest categories such as cheese, coffee and biscuits earlier this year, Ms. Holden seemed to be top candidate for the job.
$600 million in marketing
In recent quarters, however, Kraft has repeatedly lowered earnings expectations, citing price gaps with private label brands in North America that it hopes to narrow through the influx of as much as $600 million in marketing during the next year.
Analysts, among them Credit Suisse First Boston analyst Dave Nelson, agree with Kraft's decision to choose Mr. Deromedi over Ms. Holden because, as Mr. Nelson said in a note, "most of the management missteps in not adapting to a changing environment has largely been in North America under Betsy Holden."
Mr. Deromedi has been, according to one Wall Street food analyst, "a solid, capable leader ... more of a detail guy" than Ms. Holden, and he is expected to lend a much-needed open-mindedness to the business that will likely result in changes to the organization in the coming year.