Kraft Heinz spent two years, and refused to charge a premium, solving a problem most of the food industry ignores: an estimated 30 to 50 million Americans who love cream cheese but cannot digest lactose. The result is a lactose-free version of Philadelphia cream cheese that costs exactly what the original does, contains no added preservatives, flavors or dyes, and tastes like real dairy cream. The launch is just one of the first visible outputs of a broader $600 million investment the company is making under new leadership.
Kraft Heinz Strategic Direction Under New Leadership
When CEO Steve Cahillane took the helm of Kraft Heinz in January 2026, the company posted its fiscal 2025 year-end results with a 3.5% sales decline. Still, the company made bold commitments to invest in U.S. operations and future innovation. Recently appointed to a new role, Jerome Drolet, President of Taste Elevation for Kraft Heinz, is excited about the roadmap for the company.
“We talk about $600 million worth of investment in the business. It’s marketing, it’s R&D, it’s people, and all that is going toward fueling that growth. It’s giving me an immense amount of confidence that we can be successful again, being consumer centric, but supporting that with the right levels of resources and investments,” said Drolet in an exclusive interview.
Two things excite Drolet most about his new role: his personal connection to the brands, rooted in backyard barbecues with his dad growing up, and the challenge of helping his team evolve as fast as consumer preferences shift, without losing focus on the consumer across a large, global business. “This combination is what makes the job both difficult and super interesting.”
Two Years to Get Lactose-Free Right
The company revealed one of its first products to market, backed by substantial research and development behind the scenes. The new lactose-free Philadelphia cream cheese targets millions of Americans who are lactose intolerant, as well as, a wider group of consumers who avoid lactose by choice. The global market for lactose-free dairy products is projected to grow from $10.6 billion in 2017 to $17.8 billion by 2027. Drolet explained that Kraft Heinz starts every innovation effort by studying why consumers leave or avoid a category. Once the company decides to invest in a specific product category based on shifting consumer diets, it works to bring a new product to market that meets Kraft Heinz’s standards for quality, taste and price. “We don’t want to put a product to market that’s just an innovation for the sake of innovation,” said Drolet.
Kraft Heinz took two years to bring lactose-free Philadelphia cream cheese to market, a timeline Drolet attributes to a refusal to compromise on taste, texture, or price. “We’re launching a product that tastes the same, looks the same, but also costs the same. There’s no price premium to this it’s making sure that we are democratizing the cream cheese consumption within the lactose intolerant consumer,” explained Drolet. Part of the two-year development process is testing the product.
“We can sit in our Illinois Innovation Center and feel really good about the product in the kitchen, but until you put it to the test of how consumers actually use it like in a cream cheese recipe, not just on its own, you don’t know if it holds up. A lot of the work was making sure that across every usage occasion; the product was a true one-for-one substitution. We tested it internally and externally, in our kitchen and in consumers’ kitchens, across multiple recipes. That’s what takes the time, but it’s also why we’re so proud of the product we’re launching,” explained Drolet. The process that produced lactose-free Philadelphia is the same one applied across Heinz, Jell-O, and the rest of the portfolio.
Where the Innovation Dollars Go
Larger brands like Philadelphia and Heinz command the biggest share of innovation investment, reflecting their scale and category weight. But smaller, more agile brands such as Grey Poupon, Lea & Perrins, Smart Ones, and Velveeta still receive purposeful innovation dollars when the opportunity fits, rather than being starved in favor of the flagship names. Drolet believes, “The brand choices are the last question. It starts first with the consumer.”
Balancing shifting consumer eating habits with new product development is a constant consideration. “As the consumer palate and needs are changing, we want to be there with them along for the journey,” said Drolet. Nearly 6 in 10 Americans report following a specific diet in the past year, a rising trend since 2018, according to a survey from the International Food Information Council (IFIC).
Retail partners are another consideration when bringing new products to market. “The process keeps us disciplined. There’s a need for us to think about it from an internal resource perspective, but it’s also pushing us to make the right decision, not just for ourselves and the consumers, but for what’s accretive for retailers,” explains Drolet.
Why Some Trends Don’t Make the Cut
That discipline shows up in how the company distinguishes between ideas that look similar on the surface. Lactose-free and plant-based cream cheese, for instance, appear to serve the same dietary-restriction need, but Drolet’s team treats them as distinct consumer needs: taste-and-texture loyalists managing a specific dietary limitation versus consumers avoiding dairy altogether. “Conflating the two would mean building the wrong product for both groups,” said Drolet.
Consumer Trends Kraft Heinz Is Betting On
The IFIC survey reports the top diets Americans follow are high protein (23%) and mindful eating (19%), with clean eating (13%) ranking fifth. Drolet pointed to several forces he expects to shape the next five years of the business. Simple ingredients are one, reflected in products like Simply Ketchup. Fiber is emerging as a follow-on to protein’s rise in consumer attention. Diet and weight-management shifts tied to GLP-1 medications are already showing up in zero-sugar Jell-O and ketchup.
Extending Trust Instead of Building New Brands
Rather than following the consumer packaged goods industry’s habit traditional CPG habit of spinning up new brands to chase emerging trends, Kraft Heinz is focused on extending the trust and scale of the brands it already has. “You already have the trust with consumers, you already have a preferred product, and you already have the scale. Consumers don’t want to compromise,” said Drolet. The consumer, not the brand roster, always drives the first decision, a philosophy that runs through every example Drolet raised, from cream cheese to condiments.
Kraft Heinz Bets On Consumer Emotional Connectivity
Kraft Heinz’s calculation is that lactose-free Philadelphia isn’t really a cream cheese story, but a preview of how the company intends to spend the next several years of its $600 million innovation budget. Sugar comes out of Jell-O, ingredients get simplified in Simply Ketchup, and dips get built around chicken’s rise as the protein of choice. All of these decisions run through the same funnel: identify why consumers are opting out, then ask which existing brand has the credibility to bring them back in. “There’s something around real passion and emotional connectivity with our business, the products, and the brands,” expressed Drolet. The wager is simple: Kraft Heinz is betting that consumers will follow a name they already trust into new categories faster than they’ll adopt one they’ve never seen before.
