A consumer-centric, global innovation pipeline has led Hershey’s to outpace industry growth
The name Hershey’s is practically synonymous with chocolate in the U.S. Expert at leveraging its beloved brands, and attentive to partnerships with retailers, the company came to over rely on variety innovation (seasonal or added-ingredient takes on long-time favorites like Reese’s, Kit-Kat, and Kisses) by the mid-2000s.
Hershey’s hired Diane Lorello in 2008 to focus on reboosting its innovation capabilities. Beyond putting in place a stage-gate process, the company was looking to grow its innovation bench strength, establish a common vocabulary, strengthen skills and behaviors, and build a community to drive strategic-growth initiatives. As the confectionary brand’s vice president of Global Portfolio Innovation, Lorello partnered with ?What If! to tackle this challenge.
The company came to over rely on variety innovation by the mid-2000s.
Consumer centrism has led to a behavioral change that allows the company to two-track innovation for short- and long-term goals.
Together, the Hershey’s-?What If! team put in place a product-development approach that aligned the company’s innovation program with its strategic-growth ambitions; broke down silos within the organization through capability training; and created a broad-based program to source foundational insights. In a sequenced rollout, we trained cross-functional teams of people at various levels in the company. It let Hershey’s build a common set of innovation tools and behaviors that everyone could draw on to boost creativity, collaboration, and insights. And to help accelerate progress and establish social proof for innovation, ?What If! codelivered innovation projects with some of the initial teams. This allowed us to create energy, grow confidence, and build momentum.
Lorello’s principal shift was to refocus the lens on the end consumer, whose guidance would help steer the existing product line and help Hershey’s build for the future. Moving beyond line extensions, the company started looking at how people snack, treat themselves, and share. It examined how today’s fast-paced lifestyle impacts the types of occasions in which people enjoy treats.
Consumer centrism has led to a fundamental behavioral change that allows the company to two-track innovation for short- and long-term goals. A flowing pipeline is one that mixes heavy hitters (big money potential, worthy of advertising and a splash in stores) with more tactical strikes to protect shelf space. Lorello wants to focus on both, with disruptive thinking about where equity can remain relevant. One line of exploration has revolved around the health benefits of cocoa.
Increased collaboration across marketing, global innovation, strategy, operations, R&D, and sales is driving innovation companywide. The results of Hershey’s ongoing transformation to date include outpacing industry growth (and strategic launches to sustain that growth) as well as share gains.
The company examined how today’s fast-paced lifestyle impacts the types of occasions in which people enjoy treats.