Chocolate industry

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Market Share - Hershey’s, Nestle, and Mars: Chocolate Industry

According to multiple sources, Hershey's market share of the US chocolate industry is approximately 43.5%, followed by Mars at 30.0% and Nestle at 4.0%. However, it should be noted that Nestle chocolate brands are now owned by Ferrero, an Italian company. Below is a complete breakdown of our findings, followed by an explanation of the research methodology used to find this data.

US Chocolate Industry: Market Share

  • A 2018 deliverable for investors produced by Hershey's breaks down the US chocolate industry by market share, with Hershey's leading the industry at 43.5% market share, followed by Mars at 30.0%, and Nestle at 4.0%.
  • A 2017 report from Statista largely corroborates these figures, stating that the 2017 market share percentages were 43.8% for Hershey's, 30% for Mars, and 4.3% for Nestle. A screenshot of this data has also been provided in an attached document, as Statista data may not be accessible to all.
  • A 2019 report from Forbes also corroborates the Hershey's and Mars market shares, stating that their market shares are about 45% and 30%, respectively.
  • Technically, Nestle's US confectionery business is no longer owned and operated by Nestle, as this segment of Nestle's business was sold to Italian confectionery producer Ferrero in the summer of 2018. Nestle cited the company's "low market share," which reduced its "ability to win in that market," as a reason for the divestiture.

Your Research Team Employed the Following Strategy:

To find information regarding the market share of Hershey's, Nestle, and Mars in the US chocolate industry, we first conducted a search of company documents, such as letters to shareholders and annual reports. Both were available in the case of Hershey's and Nestle, which are public companies, but Mars is a private company (and a "historically secretive" one, at that), so little company-provided data was available as a result. This search located the Hershey's deliverable referenced above, which provides the market share for all three companies, as of 7/15/2018. While searching these company documents, we also looked for information regarding each company's units sold, but this data was not included in any company-provided documents.

To find corroborating sources for the market share data provided in the Hershey's deliverable, as well as to continue to search for data regarding units sold, we conducted a secondary research approach, this time searching third-party databases and other entities that might supply relevant data. Sources searched in this regard include Statista, market research organizations like Grand View Research, and company information databases like D&B Hoovers. While some sources that may contain relevant information, such as certain market reports, were hidden behind paywalls, this segment of our research did provide corroboration of the data supplied by Hershey's, in the form of the Statista report referenced above. Still, no data regarding the three companies' units sold was found.

To find additional corroborating evidence and continue to search for units sold data, we conducted a third research approach entailing a search of relevant media organizations. The primary focus in this segment of the research was on media outlets geared toward financial news, such as Forbes, Fortune, CNBC, CNN Money, and similar outlets. Still, none of these sources contained information regarding the total units sold for Hershey's, Nestle, or Mars. However, this search did reveal the Forbes report referenced above that further corroborated two of the market share data points provided in other sources.
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Chocolate - Generation Z Perceptions

Sweets and dessert play a huge part of Generation Z's lives which sometimes goes as far as taking precedent over regular meals. When it comes to chocolate specifically, 19% of Gen Z's favorite brands are chocolate and snack brands, and 82% of Gen Zers are interested in trying different and adventurous chocolate flavors, including flavors such as pickle-flavored chocolate bars, sriracha and s'mores.

Chocolate — Generation Z Perceptions


  • Generation Z is expressing an adventurous palate, desire for functional food, and fondness of culinary self-expression.
  • Sweets and dessert play a huge part of Generation Z's lives which sometimes goes as far as taking precedent over regular meals. Fifty percent of all Gen Z consumers have bought a dessert instead of an entrée at a restaurant.
  • According to a Mars survey, chocolate choices are based mainly on taste, with 85% of Gen Zers prioritizing taste over price, and price being the second most important consideration.
  • In order for chocolate to be appealing to Gen Z, it needs to be Instagrammable: "Generation Z tends to eat with their eyes and everything needs to be ready to go on Instagram."
  • Nineteen percent of Gen Z's favorite brands are chocolate and snack brands.
  • Donut Day survey showed that the majority of Gen Z consumers (82%) are interested in trying different and adventurous chocolate flavors, including flavors such as pickle-flavored chocolate bars, sriracha and s'mores.
  • Younger consumers are more intrigued by complex flavor and texture profiles. This is especially true for sweet and salty flavor combinations.


  • Gen Zers are projected to be huge snackers. Generation Z eats 2-3 snacks a day — however, chocolate is not high on the list, with chips, fruit, pizza and frozen snacks clear favorites.
  • A more biased report by Hershey revealed that 87% of Gen Zers think about having dessert one or more times per day. Moreover, 76% of Gen Zers find dessert to be essential to special occasion, with 48% having a family tradition that involves a specific dessert.
  • Generation Z is engaged in often and shorthanded dieting, with the majority of the generation focusing on low carb, keto, paleo, gluten-free, or low-sugar diets. Therefore, they are looking for chocolate with less sugar, fewer carbs, and more protein.


  • Gen Z will increasingly buy their candy online, even more than Millenials. Regular food shopping is expected to be done online while a trip to the gas station for fuel is expected to be paid for via a Gen Zer's phone, leaving no opportunity for them to go inside and grab a chocolate treat.
  • Gen Zers are also very thoughtful of food waste, packaging, fairtrade practices, plant-based alternatives to animal-based products, sustainability and human labor.
  • When selecting chocolate, Gen Zers look for functionality through portability, added nutrients, and health benefits.


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Threats Facing Chocolate Manufacturers

Our research found that most for the threats that are facing chocolate manufacturers in the U.S. emanate from the source of the raw material. According to our findings, 70% of the global supply of cocoa is from West Africa with Côte d'Ivoire, Ghana, and Nigeria as the top 3 producers of cocoa in the region. These regions are facing massive deforestation, climate changes, and forced labor/slavery which pose a threat to cocoa manufactures. Furthermore, the dwindling appetite for sugary products due to the need for healthy eating in the U.S. also threatens chocolate manufactures.


  • Before now, palm oil, beef, timber, and soybean producers were regarded as the major agents of deforestation in the West African regions. However, the World Cocoa Foundation hinted that in other to expand cocoa production and meet supply demands, there have been massive logging and forest clearing in the region to commercialize the production of cocoa.
  • Each year, Ghana loses 2% of its forest with half of it attributed to agricultural expansion. This trend is expected to be more in Côte d'Ivoire.
  • However, top chocolate manufacturers such as Nestlé, Mars, Mondelez, and others signed an agreement "acknowledging that their cocoa buying habits have helped destroy virgin forests" and agreed to corporate towards stopping it.
  • Rod Taylor — director of the World Resources Institute forests program — opined that deforestation affects the "productivity of cocoa farmers by reducing shade cover, disrupting water supplies, and causing soil erosion." He also added that if not checked, deforestation "endangers biodiversity, worsens climate change, and threatens local livelihood".

Climate Change

  • Cocoa production is most suitable in humid environments. However, a warmer and drier environment as a result of climate changes in West African regions makes the production of cocoa less suitable due to a rising temperature which increases evaporation with no increase in rainfall to offset lost moisture.
  • The impact of the current climate change is expected to occur by 2030. Therefore, "cocoa planted today will need to adapt to changing rainfall patterns as well as higher temperatures during its productive lifespan", endangering the sustainability of cocoa production.
  • As a result of this, chocolate manufacturers such as Nestlé, Mars, and Hershey's joined in a program developed to assist cocoa farmers to adapt to climate change.

Child Labor Lawsuits

  • Our research found that chocolate manufactures in the U.S. are facing lawsuits for unethical sourcing of raw materials from sources involved in child labor or slavery. Chocolate manufacturers are expected to have a slavery-free supply chain in accordance with the international labor organization.
  • In 2009, Mars promised to ensure a slavery-free supply chain by 2020. This move was also followed by Nestlé, Hershey, and Ferrero. However, a study revealed that the number of child labor in cocoa fields in Côte d'Ivoire has increased by 51% from 2009.
  • According to our findings, about "2.1 million children work in cocoa fields in Côte d’Ivoire and Ghana alone."
  • Realizing that they can't meet the 2020 target, Nestle changed their 2020 goal to ensuring that "only 57% of their cocoa will be certified in-house as slavery-free, while the remainder will be bought as normal on the commodity market." However, a Hershey spokesman hinted in 2018 that the company uses 75% certified cocoa and is still on track to use 100% certified cocoa source by 2020.
  • Certification entails a strict regulation of cocoa farms to ensure that there is no illegal use of forced labor or children in the fields by independent authorities based on the guidelines of international labor organization.

Changing eating habit

  • Chocolate manufactures in the U.S. are looking to expand their business by exploring other markets such as the east. This is as a result of the eating trend in the U.S. which involves eating healthy.
  • Consumers in the U.S. are turning away from sugary food in search of healthier options.
  • Producers of cocoa and chocolate manufacturers are targeting emerging markets such as "Brazil, South Africa, Japan, China, and Russia".
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Hershey - Marketing and Product Strategy

Hershey's marketing efforts in entering other platforms such as gaming live streams and digital campaigns were successful in terms of raising brand awareness and boosting sales. Their marketing strategies in launching new products such as Hershey's Gold and Hershey’s Cookie Layer Crunch bars by using social media were also successful in terms of increased engagements and brand awareness. Below is an overview of the findings.

Overall Marketing strategy overview based on annual report

MARKETING CAMPAIGN #1: Hershey’s & Reese’s Pieces Meet Ninja & Dr. Lupo

  • Overview: Hershey's marketing partnered with Twitch streamers to promote their new Reese’s Pieces chocolate bar. Hershey's partnered with two of Twitch’s biggest stars, Ninja and Dr. Lupo.
  • Strategy: The two stars promoted the Hershey’s & Reese’s Pieces mashup through a collaborative live stream and continued the campaign with cross-platform promotion through their secondary channels on Instagram, YouTube, and Twitter in the run-up to TwitchCon 2018.
  • Results:
    • Ninja achieved a maximum concurrent viewership of 83,447 and Dr. Lupo achieved a maximum of 14,315 viewers—above average performances for both streamers.
    • 239,000 likes and comments
    • 2.1% - 3.5% engagement rate for posts

MARKETING CAMPAIGN #2: “Build a Sweeter Easter Basket” on Dollar General

  • Overview: The “Build a Sweeter Easter Basket” campaign on Dollar General’s website enabled shoppers to drag, drop, and mix candies of their choice and make an Easter basket that fits their budget. This basket could then be saved, printed, and brought to the store. Traffic was driven to the site by using digital banner advertisements and social media posts (Dollar General shoppers are predominantly on Facebook, Twitter, and Pinterest).
  • The Dollar General site also shared tips on Easter entertaining and carried a coupon for $1 off Easter items when at least $5 of Hershey candy was purchased. In-store signage directed shoppers to the Hershey candy to help secure purchases.
  • Results:

1. Successful new product: Hershey's GOLD

  • Hershey's is an official sponsor of the United States Olympic Committee (USOC) for Olympic Winter Games 2018.
  • Hershey partnered with celebrated “Gold” athletes, like Apollo Ohno and Rico Roman to promote Hershey’s Gold.
  • "Taste the Gold" promotion: Each time Team USA won a gold medal, Hershey’s tweeted and posted on Facebook a link that gave the first 10,000 fans access to a coupon.

2. Successful new product: Hershey’s Cookie Layer Crunch bars

  • Hershey's partnered with Facebook Creative Shop to develop a pre-launch video advertisement for a mobile audience.
  • They used Facebook Live to broadcast the unveiling of Hershey’s Cookie Layer Crunch bars.
  • They continued to drive awareness by releasing a series of videos featuring Hershey’s three new Cookie Layer Crunch flavors: mint, vanilla creme, and caramel.

Research Strategy

To answer the request we looked for case studies of specific recent marketing campaigns made by Hershey. These case studies gave an overview of the campaigns and the results of the campaigns.

From Part 03
  • "For the first time, key players in the chocolate industry have agreed to cooperate to stop deforestation in major cocoa-growing areas, and they plan to start in Côte d’Ivoire and Ghana."
  • "In signing the agreement (pdf), Nestlé, Mars, Mondelez, Cargill, and Olam are acknowledging that their cocoa buying habits have helped destroy virgin forests. Until now, palm oil, beef, timber, and soybean producers have been targeted as the chief deforestation villains."
  • "Cacao beans grow best in the places where chocolate would melt in your hands, but over the next several decades, many of those environments may grow warmer, drier, and less suitable for its cultivation. While cacao can be grown in warmer places than coffee, cacao thrives in humid environments. As temperatures rise, so will evaporation, and projections suggest that there will not be enough increased rainfall to offset the moisture loss."
  • "Leading cocoa and chocolate companies recognize the threat that climate change poses to cocoa sustainability. Earlier this week, the World Cocoa Foundation (WCF) announced the launch of a new program designed to strengthen collaboration between the public and private sector to address the issue by developing solutions and helping farmers adapt."
  • "Climate modeling suggests that various regions may need to change crops and cropping strategies, or implement adaptive management practices, in order to maintain cocoa supply and viable livelihoods for the millions of smallholder farmers around the globe."
  • "Three young men from Mali are suing Nestlé and others for childhoods spend in slavery. The case has gone through several iterations and is still ongoing."
  • "The individuals alleged they had been trafficked from Mali as child slaves and forced to work harvesting and/or cultivating cocoa beans on farms in Côte d’Ivoire. The plaintiffs allege that they were forced to work long hours without pay, kept in locked rooms when not working and suffered severe physical abuse by those guarding them."
  • "The world’s biggest chocolate maker is looking east for growth amid a waning sweet tooth in the U.S. and western Europe."
  • "The move shows how chocolate companies are eyeing new markets as U.S. and European shoppers snub sugary products in search of healthier offerings."
  • "An estimated 2.1 million children work in cocoa fields in Côte d’Ivoire and Ghana alone."
From Part 04
  • "From the November 1 unveiling of Hershey’s Gold at the 100 Days Out celebration of the Olympic Winter Games 2018, there have been many “golden” opportunities to seize the moment. As an official sponsor of the United States Olympic Committee (USOC), we’ve partnered with legendary “Gold” athletes, like Apolo Ohno—two-time U.S. Olympic gold medalist and the most decorated American Winter Olympic athlete of all time—as well as Rico Roman—2014 Paralympic Winter Games U.S. gold medalist, Army veteran and member of the 2018 Team USA Sled Hockey team—to tell the story of Hershey’s Gold. And the results? How about 2.2 billion earned media impressions and more than 667 media placements to celebrate this historic, unprecedented launch of Hershey’s Gold. "
  • "Take our “Taste the Gold” promotion—every time Team USA wins a gold medal, Hershey’s fans win, too. During Games Time from February 9—March 25, after each Team USA gold medal win, Hershey’s brand is tweeting and posting to Facebook a celebratory link where the first 10,000 fans may claim their coupon. And let me tell you, through Team USA’s first three GOLD medals, our Hershey’s Gold bar coupons are going like hotcakes—four coupons per second!"
  • "The brand is off to a record-breaking start with the fastest distribution build of any instant consumable launch in the history of The Hershey Company. And the brand has already garnered two billion media impressions. The same intrigue and questions we saw early on are now making their way throughout social media as fans discover Hershey's Gold. "
  • "The “Build a Sweeter Easter Basket” campaign scored big with a virtual tool on Dollar General’s website that enabled shoppers to drag, drop and mix in candies of their choice and make an Easter basket that fit her budget. Users could save and print that basket to bring to the store. "
  • "The site also shared tips on Easter entertaining and carried a coupon for $1 off Easter items when at least $5 of Hershey candy was purchased. In-store signage directed shoppers to the Hershey candy to help secure purchases."
  • "Hershey saw Easter candy sales improve by 25% at Dollar General for the holiday and gain 4 share points in the category. The goal was a 15% bump in sales and a 1-point share gain. The newer digital focus clearly helped influence Dollar General shoppers much earlier in the planning phase as the click-through-rate of the digital experience was more than 20% and consumers spent north of five minutes of time on the page."
  • "Hershey’s brand wanted to raise brand awareness for its newest innovation, Hershey’s Cookie Layer Crunch bars, before, during and after the launch with an exciting digital-led campaign focusing on mobile-optimized video ads and Facebook Live."
  • "Hershey’s team partnered with Facebook Creative Shop to develop intriguing pre-launch video ads optimized for a mobile audience. The brief, silent, looping clip featured a poster plastered on a wall, announcing “the classic evolved.” Hershey’s brand targeted the teaser video ad to people aged 18 and older."
  • "On the day of its big launch, Hershey’s brand used Facebook Live to broadcast the unveiling of its newest innovation—Hershey’s Cookie Layer Crunch bars."
  • "Hershey’s brand released another series of mobile-optimized videos and shorter cinemagraphs featuring Hershey’s 3 new Cookie Layer Crunch flavors: mint, vanilla crème and caramel, focusing on the appetite appeal of the new product."
  • "Looking to capitalize on this, Hershey's marketing sought to partner with Twitch streamers to promote their new Reese’s Pieces chocolate bar. The company has employed social media influencers in the past, but typically through more conventional channels such as Facebook or Twitter."
  • "For Hershey’s first foray into influencer marketing through livestreaming, they snatched two of Twitch’s biggest stars, Ninja and Dr. Lupo. Using Twitch, the biggest streaming platform in the world, was a conscious decision—while there are other increasingly competitive options entering the livestreaming market, a large brand like Hershey’s is keen to associate with the most popular influencers on one of the biggest social media platforms."
  • "Their strategy principally involved using the duo to promote the Hershey’s Reese’s Pieces mashup through a collaborative livestream and continuing the campaign with cross-platform promotion through their secondary channels on Instagram, YouTube, and Twitter in the run-up to TwitchCon 2018."
  • "The stream was light-hearted in nature, as expected, featuring them playing the game Fortnite. They streamed together for 12 hours, with Ninja achieving a maximum concurrent viewership of 83,447 and Dr. Lupo bringing in a max of 14,315—above average performances for both streamers."
  • "Our customers are mainly wholesale distributors, chain grocery stores, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, dollar stores, concessionaires and department stores. The majority of our customers, with the exception of wholesale distributors, resell our products to end-consumers in retail outlets in North America and other locations worldwide. "
  • "The foundation of our marketing strategy is our strong brand equities, product innovation and the consistently superior quality of our products. We devote considerable resources to the identification, development, testing, manufacturing and marketing of new products. We utilize a variety of promotional programs directed towards our customers, as well as advertising and promotional programs for consumers of our products, to stimulate sales of certain products at various times throughout the year. "