Marketing

Although Hershey Chocolate USA, a division of Hershey Foods Corporation, did not meet its performance expectations in 1999, the company played an important sold in increasing U.S. candy sales. Retail confectionery sales grew at a rate of 4 percent in 1999, which was greater than the average growth rate within the general packaged foods industry. The past decade has shown an increase in competition in the candy industry, with companies such as Mars Candy Company introducing a variety of new products, brand extensions, and additional pack types. Similarly, Hershey has diversified its product line and formed alliances with other companies, such as Breyer's.

Record sales in the early 1990s resulted in part from the introduction of a number of new Hershey products, the most significant being Hershey's Kisses with Almonds. This product was introduced in 1990 and became one of the top 20 U.S. candy brands during 1991. By reaching the top 20 in less than one full year of national distribution, Hershey's Kisses with Almonds became the most successful new-product introduction in the corporation's history.

In 1991, Hershey Chocolate also received the Equitrend Outstanding Quality Award. This award was based on a national survey that measured how consumers perceived the quality of 190 nationally recognized brand names. Hershey's milk chocolate bar was the highest-rated confectionary brand.

Part of Hershey's strategy is to target mothers. The company reasons that mothers determine children's early taste in candy. In addition, research shows that adults eat more than 55 percent of all candy sold. Bite-size products are especially popular with adult consumers. When wrapped in seasonal colors, these products have tremendous appeal for adults during Christmas and Easter season. Halloween season, however, is more oriented toward candy bars. In December 1998, Hershey targeted the ever-growing snacking segment of the confectionery industry by transforming some of its most popular...