Fine Chocolate Lovers Take a Hit from Hershey

Hershey announced yesterday they were closing the Scharffen Berger Berkeley plant. Those of us who had visited the plant knew it as more than a plant. It also had a terrific although too small restaurant. The people who worked at the plant obviously loved as family making special chocolate. The plant tours were delightful and full of their passion as lovers of fine chocolate. A tour and a lunch was a memorable experience that symbolized the meaning of the brand.

Now it's gone.

Hershey either didn't seem to know or else didn't seem to care about the symbolic importance of that plant to the brand. It embodied the brand; it served as a solid touchstone of what Scharffen Berger meant, much more solid, tangible, touchable, than any written brand description of promise and personality will ever convey.

Now it's gone.

Hershey purchased Scharffen Berger and Joseph Schmidt to gain entry into the rapidly growing premium segment of the chocolate market. While they are one of the largest chocolate companies in the world, entering this elite club of fine chocolate eluded them and the other large American chocolate companies. Europeans and a few specialty chocolatiers were driving the market as Americans discovered the many French, Belgium, Swiss and other European fine chocolate makers. Rather than learn how to manufacture and market to this fine niche, Hershey bought.

Back about thirty years ago a few enterprising foodies started Dove Chocolates in Chicago to offer an incredible chocolate ice cream bar. The ice cream was from rich whole cream, the chocolate rich and thick. But then they sold to Mars. And slowly it changed. Now Dove is still a good ice cream bar but it doesn't carry the cache it once had. It went from being the Ferrari of bars to just being a fast BMW. Companies that value tonnage rarely have the fine touch to stay on the leading edge of a specialty market.

And now Dove is chocolate pieces, and cookes and whatever. An expensive Hershey bar.

Hershey will never understand the challenge of being a specialty marketer. It is not in the genes of a company that large. They understand tonnage. Not specialty. Just another Mars.

The challenge of creating and nurturing the customer base for a specialty product is in a different world than marketing Hershey Kisses. Tonnage marketers fail to understand the critical importance of a touchstone such as the Berkeley plant. They think they can use their tonnage approach to market their specialty product. The customers are different; they value different things. And they expect that their loyalty will be honored with challenging new and exotic tastes.

Kisses with caramel doesn't work.

Scharffen Berger will probably continue to be a great -- at least very good -- product. But when the chocolate market continues to move to greater heights, to country of origins, to fine chocolatiers like Vosges and the many fine Europeans, Hershey will once again be left behind as they watch their specialty brand turn into just another very good chocolate.

It's not that they closed the plant. They closed the soul of the brand.