Hershey heads to China

SHANGHAI — Hershey is heading to China to launch a candy brand called Lancaster, marking the first time in its 120-year history that the company has launched a new brand outside of the United States. It’s also the first time in 30 years that Hershey launches a brand that is neither a brand extension nor an acquisition.

The brand will be available in the cities of Wuhan, Hangzhou and Chengdu in June, with wider distribution following next year.

Lancaster products will compete with traditional candies in China’s milk candy confection category that account for one quarter of the total candy market in China and about 7.5 billion RMB, or $1.2 billion. The Lancaster brand will enter the market’s milk candy segment, which is currently showing the strongest growth in the entire category.

“Consumers in China love high-quality, delicious candy that reflects care and craftsmanship and gives them a rich taste experience that is distinct and premium,” said Jane Xu, VP and GM of Greater China for the Hershey Company. “Lancaster was carefully developed with the consumer experience in mind. We believe that quality ingredients and craftsmanship are what make Lancaster extraordinary and making something extraordinary takes time.”

The candy will come in three flavors: Original Pure Nai Bei, Pure Nai Bei filled with Rich Nai Bei and Pure Nai Bei filled with Strawberry.

Hershey considers China a priority market. The country plays a critical role in the company’s long-range growth vision, which includes reaching $10 billion in worldwide net sales by 2017. Hershey has substantially strengthened its brands’ in-store presence in China during the past five years and its products are becoming closely associated with key gifting occasions, including holidays, weddings, Chinese New Year and Chinese Valentine’s day.

“It’s significant that Hershey chose to launch its first new brand in three decades here in China,” said Steven Schiller, SVP of the global sweets and refreshment business unit for Hershey. “This demonstrates the company’s deep commitment to China, as well as the importance of this market in Hershey’s global growth plans.”