Mondelez wants to expand in US chocolate segment

Mondelez wants to expand in US chocolate segment

Mondelez International has outlined its latest plans of how it aims to grow in the US chocolate market, where it is extending its organic Green & Black's chocolate range and launching cross-branded Milka and Oreo items.

Speaking at the Barclays Global Consumer Staples Conference today (7 September), Mondelez's chief growth officer, Tim Cofer, said the company wants to use its brands and expertise to ramp up its US chocolate operations, which are relatively small. Mondelez, which recently abandoned its attempt to takeover US chocolate giant Hershey, said it aims to capitalise on the potential for increased chocolate consumption in the country. 

"With our strong brands and global expertise in chocolate, we see enormous potential to grow our US business and expand the category," Cofer said. "The US is the world's largest chocolate market, valued at US$14bn. However, per capita consumption is only about half that of many developed European chocolate markets."

Mondelez's co-branded Oreo and Milka chocolates, already on sale in 20 countries internationally with items such as Milka Oreo Alpine chocolate bars, will target the mainstream segment of the US market. Meanwhile, in the premium segment, the company said it is "dramatically" expanding its Green & Black's range, Mondelez said. 

Cofer, meanwhile, used the conference to highlight two areas on which Mondelez will focus as it works to grow its global business - healthy snacks and e-commerce.

Mondelez said it wants to become the "global leader" in "well-being snacks" by 2020. To deliver on this ambition, the Ritz crackers maker is "simplifying and enhancing" the ingredient and nutritional profile of its base business while also introducing "breakthrough innovations". For example, Mondelez stressed its "wholesome thins" platform, which includes Oreo Thins, Chips Ahoy Thins, Ritz Crisp & Thin and Good Thins biscuits, will surpass $300m in sales this year. 

On e-commerce, Cofer said Mondelez has targeted sales of $1bn by 2020. The group has built a cross-functional international team to drive "stronger execution" in e-commerce. Cofer highlighted some signs the strategy is paying off, including the relaunch of Belvita biscuits on Amazon, which lifted sales by more than 60%. Through the first six months this year, the company's global e-commerce sales were up more than 30%, while in China, online sales have more than doubled, Cofer noted.

Click here for our analysis of what could lie ahead for Mondelez and Hershey in the wake of the end of the Cadbury's interest in its US peer.