Snack and confection giant Hershey spent much of its 127-year history by catering to people sweet tooth with enticing chocolates. But as snacking is becoming bigger part of their daily routine, often at the expense of a meal, the maker of Kisses discovered much of the increase was coming from so-called impulse snacks — candy, chips and other offerings consumed within an hour after they’re purchased.
At the same time, the rate of impulse snacking was higher in the morning than at other times of the day when Hershey’s core confection products and snacks were traditionally more dominant.
The discoveries soon prompted Hershey to take a deeper look at its portfolio and entered the indulgent snacks with chocolate, peanut butter and other ingredients to capture a bigger portion of morning impulse snacking.
The company has previously leveraged its brands in the morning through a series of partnerships, lending its name in 2020 to General Mills for Hershey, Reese’s and Jolly Rancher cereals. It has worked with Mrs. Freshley’s on chocolate cupcakes, collaborated with Dunkin’ on drinks and doughnuts flavored with Kit Kat, Heath and Hershey’s Cookies ‘n’ Creme candies, and most recently partnered with Krispy Kreme on s’mores doughnuts.
In an August 2020 survey, Hershey found 83% of consumers ate dessert before noon in the past month. A month later,Hershey introduced Reese’s Snack Cakes, a soft-baked chocolate cake with peanut butter crème and covered in milk chocolate. The product, recently expanded to include a line with crunchy peanut butter, was aimed at consumers craving a mid-morning snack. And this August it debuted a Reese’s snack bar to compete in convenience stores with similar offerings from cereal makers.
Hershey plans to target bakery offerings like snack cakes, cupcakes, doughnuts and muffins and most likely introduce the products under brands within its portfolio that have the broadest appeal like Hershey and Reese’s, minimizing the inherent risk that comes from expanding into a category.
The expansion into the morning also is particularly attractive for Hershey because new product launches have a lesser chance of cannibalizing existing offerings since they would be located in a different part of the store versus the traditional confection aisle. In addition, the products would provide different experiences and textures for the consumer, such as a Reese’s Snack Cake instead of a traditional Reese’s confection item like a peanut butter cup.
People in the past traditionally viewed the morning as a time to focus on eating healthier and getting nutrients, with a greater permission to indulge later in the day. In recent years, consumer sentiment has started to change, with indulgent consumption playing more of a role earlier in the day.
The expansion comes as part of a broader shift by Hershey CEO Michele Buck to make inroads into other categories that would provide shoppers with more opportunities to consume her company’s products.
Hershey is focusing more attention innovating its core confection products through low- or no-sugar, organic and bite-size offeringsin an effort to grab a larger share of the better-for-you snacking category. As part of that push, Hershey announced last month it was trialing a plant-based chocolate bar in some markets called Hershey’s Oat Made. Only 6% of candy, mint and gum sales come from products defined as better for you, or about $1.3 billion per year.