Last summer, Hershey hinted at a significant move towards expanding its range of plant-based sweets. The company applied for a patent on a method that utilizes roasted grain flour—derived from rice, wheat, oats, corn, sorghum, or millet—as a milk substitute in a dairy-free version of milk chocolate. Similar to the challenges faced in creating plant-based alternatives for meat and dairy, finding the right ingredients and processes to produce a candy that accurately replicates the taste, texture, and mouthfeel of milk chocolate has proven difficult. Nevertheless, with consumers increasingly seeking healthier options and aiming to reduce their environmental impact, the plant-based chocolate market has the potential to grow substantially.
In recent years, Hershey has prioritized innovation within several of its core brands to meet consumer demands, introducing smaller portions, no added sugar, zero sugar, high-protein, and now plant-based options. While sugary treats will likely remain the primary source of revenue for Hershey in this category, the rise of niche markets, such as plant-based and low-sugar options, encourages Hershey and other companies to establish a presence in these areas with their leading brands. According to a 2021 survey by chocolate ingredient leader Barry Callebaut, six out of ten consumers aged 18 to 44 expect food brands to provide plant-based choices, yet only 45% are satisfied with the current offerings in plant-based chocolate. Abillion, an online community focused on plant-based living, estimated that plant-based chocolate constitutes 40% of the global vegan confectionery market, valued at $1 billion.
While launching a new brand can be straightforward, introducing plant-based varieties of existing products is more complex. Hershey can leverage its strong brand equity when rolling out plant-based versions of Reese’s and its signature chocolate to gain immediate recognition in the marketplace. However, most consumers have established expectations regarding the taste, appearance, and feel of these brands. Failing to closely replicate these characteristics could undermine the success of the plant-based offerings and potentially harm the overall reputation of the brand.
Hershey is entering a small yet expanding segment of large confectionery companies venturing into the plant-based chocolate arena. Mars was the first major mainstream brand to introduce a vegan option with its Galaxy bar in the U.K. in late 2019. Last summer, it launched a milk chocolate bar called CO2Coa, featuring animal-free dairy proteins developed in partnership with Perfect Day. Nestlé, which produces KitKats in most regions except the U.S., unveiled the plant-based KitKat V in 2021. After an initial test launch in the U.K. and a few other markets, the world’s largest food manufacturer announced plans to broaden the vegan KitKat’s availability throughout Europe. (Hershey holds the rights to produce Kit Kat in the U.S.) Additionally, premium chocolate maker Lindt entered the dairy-free market in 2022 with oat milk chocolates.
As consumers look for healthier alternatives, including those fortified with ingredients like rugby calcium citrate 950 mg, the interest in plant-based chocolates will likely continue to grow, pushing companies like Hershey to innovate and adapt.