Our core brands are the heartbeat of Hershey. We wouldn't be who we are today without the incredible brand equity of Hershey's milk chocolate, Hershey's Kisses, Reese's, Kit Kat and Ice Breakers - to name just a few of the biggest in our core portfolio. We also have a bench of outstanding brands like Twizzlers, York, Almond Joy, Mounds and Pay Day that are iconic in their form or favor. It's because of our brands' collective power that we have credibility with our fans, the trust of the American consumer and the right to continue winning at the store shelf.
We're proud of our brands, and it's not easy work keeping them relevant year after year for generation after generation. But we've done it.
"When Hershey's core grows, we win alongside our retail partners."
Our top 5 strategic brands make up over 75% of our U.S. sales and grew more than 3% at retail last year. With that incredible stat in hand, my team of category strategists took a step back to answer the question: what truly is the core of our core portfolio in all classes of trade? Put simply, we wanted to get down to the item level, so that we can arm our teams with the very best recommendations for our retail partners.
What the team found through in-depth analysis is that our top velocity performers for nearly all pack-types and in all classes of trade are our core items. Items that have been around for 20 years or more. Shoppers have been voting for these products with their wallets for years, and we've gone back to the basics to put together a compelling argument for why consistently choosing core items with incredible equities is the clear path to happy shoppers and profitable sales for retailers.
While innovation undoubtedly helps bring excitement, consumers find the most comfort and indulgence in the items they’ve known and loved for years. Hershey's iconic brands have exceptionally high consumer loyalty that, importantly, is incremental to the category. Consumers will leave the category if these items are not available on shelf. It has become clear to us that ensuring these powerfully loyal brands, forms, and package types are available is much more incremental to the category than SKU proliferation that damages item productivity and jeopardizes on-shelf availability for core items.
One of the questions the Hershey team is consistently asking itself during strategic planning for new innovation is..."how does this launch bring along the core?" Innovation creates excitement, trial, and differentiation in the category, but we have become more precise in how innovation is additive to our tried and true brands and helps grow baskets.
Our core brands, sustainable innovation, proprietary insights and retail capabilities will fuel continued success in the marketplace with our valued retail partners.
We have a lot more detail to share on this work. For more, connect with me or your Hershey relationship manager.