The Hershey Co is launching a new candy brand, its first new brand in 30 years, a soft caramel-creme line called Lancaster. And for the first time it is taking a double-barreled approach, debuting the candy in the US and China at once.
The move comes as China increasingly becomes a focus for US-based consumer goods companies that are seeking to offset slower growth in developed markets like North America.
Hershey, which makes candy such as Kit Kat, Twizzlers and Hershey’s Kisses, said in its most recent quarter that new products in both the US and overseas helped its net income rise 18 percent.
“China and the US are major focus markets for the company,” Hershey senior vice president of sweets and refreshment Steven Schiller said.
China is the second-largest sweets market behind the US, he added.
The Lancaster name stems from founder Milton Hershey’s first candy company, The Lancaster Caramel Co, founded in 1886. The candy comes after two-and-a-half years of research into consumer tastes and the global confectionary market.
A category the company calls “comforting richness” — caramel or milk-based soft candy — was under-tapped, Hershey found, even though at US$1.5 billion dollars it was big business in China.
Caramel is also a fast-growing category globally, Schiller said, growing faster than chocolate and other non-chocolate candies.
“It is one of the fastest growing segments in the food industry,” Schiller said.
So Hershey developed caramels that could fit into the niche. The products in each country are not completely the same, but tailored to their markets.
In the US, Lancaster caramels will come in three flavors: caramel, vanilla and caramel, and vanilla and raspberry. In China, where the company already sells Hershey’s Kisses, Hershey and Ice Breakers, the candies will be more similar to milk-based candies that are popular in that country. The target demographic is men and women in their twenties and early thirties.
The candy is to hit store shelves in January next year and come in two sizes for about US$4 and US$2.50. In China, it has already launched in three cities, with wider distribution set for next year.