Hershey Adds First New Brand in 30 Years; Lancaster Caramels Were Launched Initially in China
October 11, 2013 Leave a comment
Hershey Adds First New Brand in 30 Years
Lancaster Caramels Were Launched Initially in China
LESLIE JOSEPHS
Oct. 10, 2013 11:15 a.m. ET
Hershey’s Lancaster caramels first debuted in China.The Hershey Company
NEW YORK— Hershey Co. HSY +2.30%plans to start selling a line of caramels—its first new brand in 30 years—in the U.S. early next year, after launching the product this year in China. The new brand, dubbed Lancaster, is the first from Hershey to have its debut outside of the U.S., the company said Thursday. It started selling them in three Chinese cities in June, as part of an effort to grow its presence there, where candy is becoming more popular.Sales of chocolate, candies and gum in China climbed 46% from 2007 to 2012, reaching more than $13 billion, according to market research firm Euromonitor International. Hershey has said it aims for China to become Hershey’s second-largest market after the U.S. in the next several years. Hershey is also working on products for the Indian market, and other treats tailored for specific countries, like China and Brazil, under its existing brands.
The new brand is named after founder Milton Hershey’s first candy company, The Lancaster Caramel Co., which he started more than 120 years ago in the Pennsylvania city of the same name near the candy giant’s current headquarters in Hershey, Pa.
While the brand is the same as the one started in China, Steven Schiller , a senior vice president for sweets and refreshments at Hershey, said the Lancaster caramels in the U.S. will be softer and creamier than the China version. “We’re not taking the China product into the U.S.,” Mr. Schiller said. The candies for the U.S. market will be made in Canada.
Hershey has been broadening its product lines through acquisitions, including the purchase of Brookside-branded candy, dark chocolate with fruit-juice centers. While sales growth of plain chocolate bars has pared back in the U.S., caramels and toffees have been on the rise, according to Euromonitor analyst Matt Hudak said. He said Werther’s Originals, the most well-known brand in the space, has spurred interest among older Americans who are nostalgic about the taste, and looking for a little treat that won’t ruin their diets.
The “premium” packaging of Hershey’s new caramels is also something you “don’t normally throw at kids,” he said.
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