M&M's, the nation's No. 1-selling candy, is getting a brand makeover, as U.S. consumers' growing preoccupation with healthy eating has stagnated volume growth in the U.S. chocolate industry.
Starting this week, U.S. chocolate-lovers should notice brighter colors on M&M's' signature candy shells, as well as redesigned packaging that includes a bigger and bolder logo.
The changes will be accompanied by an aggressive advertising campaign by Omnicom Group Inc. unit BBDO Worldwide that will include prime-time television ads premiering Thursday on television network NBC.
But why all these changes for a brand that generated over $300 million in sales — more than any other U.S. chocolate brand — in the 12 months that ended in January?
"This was an opportunity to take the whole brand and literally freshen it," said M&M's spokesman Jeffrey Moran, adding that U.S. consumers have proven to prefer bright colors in all types of products, including cars. "Everything will be updated and will be much more colorful than it had been before."
But experts said snack food makers like M&M's parent Masterfoods USA, a unit of privately held Mars Inc., are looking for ways to drive growth as concerns about health and obesity have kept sales of cookies, chips, and candy relatively flat.
Healthy future for snacks?
Unit sales of M&M's typical single-serving packages rose just 0.14 percent in the 52 weeks ended Jan. 25, while unit sales for the total chocolate category rose slightly less than 1 percent, according to Information Resources Inc. The firm tracks spending in U.S. groceries, mass retailers and drugstores, excluding the world's largest retailer, Wal-Mart Stores Inc.
"It's a very tough time in the snacking business to find growth because of all the health concerns," said Harry Balzer, a vice-president with market research firm NPD Group. "You have to keep up your position ... or you are going to find that someone is going to come out with something that is healthier, or just new."
Last year, Hackettstown, New Jersey-based Masterfoods spent more than $73.5 million on marketing M&M's, according to TNS Media Intelligence/CMR. The spending helped grow unit sales of M&M's bigger products by 8.8 percent, according to IRI, making it the biggest-selling chocolate candy brand in the country.
But at least one marketer had doubts about whether cosmetic changes to M&M's and their wrappers will have an impact on sales of smaller M&M's packages.
"Changing the logo on anything really doesn't accomplish very much," said Jack Trout, president of marketing strategy firm Trout & Partners. "Candy is all about taste, and logos and colors don't usually play into that."
