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Filled-Chocolate Candy Bars: Category Overview

History/Description of Category: Chocolate has been around for centuries. In 600 B.C. the Maya Indians established large plantations of cacao in Guatemala. When they moved to the Yucatan Peninsula in Mexico they brought with them the cacao. It was not until 1847 that an English company introduced solid chocolate. The introduction of milk chocolate by Daniel Peter followed in 1876. During the 1900s, chocolate became a part of everyone’s life regardless of income status because of the low production costs. Companies started developing new varieties of chocolate bars. In 1908 the Hershey Company introduced the first chocolate bar filled with almonds. During this time Hershey continued to make chocolate bars in mass-production at a price everyone could afford. Therefore, they became known as the “Henry Ford” of chocolate. Afterwards, many other companies developed similar filled-chocolate candies. In 1923 Frank Mars introduced the Milky Way while his son invented the Mars bar. The chocolate industry has continued to grow over the year making over $50 billion in retail sales worldwide.

Key Competitors: There are two top competitors to Hershey Chocolate USA in the filled-chocolate bar category. The top two category competitors to Hershey’s are M&M/Mars (now known as Masterfood’s), a division of Mars, Inc. and Nestlé USA, Inc. The key products for Hershey’s are Reese’s, Kit Kat, Peter Paul Almond Joy and Peter Paul Mounds. The key products for Mars that compete against Hershey’s are M&M’s, Snickers, 3 Musketeers, Milky Way, and Twix. Nestlé’s key products are the Butterfinger, Baby Ruth, and Nestlé Crunch.

Current Situation: Hershey’s and Mars are the top two leaders in the category with Hershey’s being the dominant leader with 44 percent market share in the chocolate bar segment. Mars holds 35 percent share of the category and Nestlé comes in third with 11 percent share. The chocolate dollar...