Kraft Heinz has long been America’s go-to when it comes to mac and cheese.
But that dominance is starting to crack.
The Chicago-based food giant has seen its grip on the category loosen as upstart rival Goodles wins over shoppers with its premium “Cheddy Mac” offering.
In just three years, Kraft Mac & Cheese’s market share has slid to about 39% from 45% in 2022, according to Circana data cited by the Wall Street Journal.
Kraft Mac & Cheese is being squeezed in the middle — too processed and conventional to win premium shoppers, but too expensive to beat store brands on price.
That vulnerability created an opening for Goodles, which launched in November 2021 with a pitch that comfort food doesn’t have to be nutritionally empty.
The brand, co-founded by CEO Jen Zeszut, positioned itself as a premium, modern alternative built around higher protein and fiber content and a loud, playful identity designed to stand out next to the iconic blue box.
Goodles initially leaned on direct-to-consumer sales to build demand before expanding into major retailers, including Target. It later grew its lineup to a dozen SKUs and branched into pasta.
The company said it achieved 33x growth in 2022, tripled sales in 2023 and doubled again in 2024. In September 2023, it raised $13 million in a Series A funding round led by L Catterton to fuel further expansion.
Inside Kraft Heinz, employees recognized early that the category-leading blue box was due for an upgrade.
After Goodles hit shelves, Kraft Heinz staffers sampled the product internally and concluded that while the upstart still had flaws, it was good enough to signal trouble ahead.
But with roughly $1 billion a year in mac-and-cheese sales still flowing in, executives were reluctant to tinker. Internal discussions dragged on for years as teams debated whether to add more protein, roll out new flavors or change the cheese profile.
The hesitation was compounded by broader turmoil following the 2015 Kraft-Heinz merger.
Years of aggressive cost cutting, underinvestment and leadership churn left decision-making slow and fragmented, even as premium challengers gained traction and Kraft Mac & Cheese quietly ceded market share.
Kraft Heinz has been fighting a two-front battle.
On one side are premium challengers like Goodles and organic stalwart Annie’s, which was acquired by General Mills for $820 million in 2014.
On the other are private-label store brands, which have been steadily gaining share as inflation pushes shoppers to cheaper alternatives.
Mac and cheese sold by Walmart and Aldi now accounts for a combined 14% of the category, up roughly three percentage points since 2021, according to industry data.
Other retailers have leaned into the trend as well.
Trader Joe’s sells multiple exclusive store-brand mac-and-cheese products, while Target has rolled out Good & Gather versions marketed around cleaner labels and updated packaging — part of a broader private-label push that drove store-brand food sales to a record $271 billion in 2024.
The pressure has forced Kraft Heinz into a dramatic reset. In September, the company announced plans to split into two publicly traded businesses, effectively undoing the 2015 merger that created the food giant.
The separation, expected to be completed in the second half of 2026, would carve out a company focused on global sauces and meals — including Kraft Mac & Cheese — from a slower-growing North American grocery business.
The Post has sought comment from Kraft Heinz.
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