Quest for a New Chocolate Bar

Project Phase - Consumer Test Analysis

The data from the consumer tests done in Toronto were in by the end of February 1981. Now it was time to evaluate all the product development work done for almost three years. The conclusions were as follows:

* There was no support from the test indicating that deodorized Hershey offered any competitive advantage relative to Nielson's Jersey Milk, compared to that now existing. In either case, Hershey was at a disadvantage.

				Current Hershey	       Deodorized Hershey
		Prefer		Hershey | J.M. 	         Hershey | J.M.
		Total %            42   |  55               41   |  56

* Overall ratings were generally consistent with preference results.

* Both Hershey products were considered to be lighter in colour and milder in taste than is Jersey Milk. The evidence suggested that deodorized has shifted in these characteristics.

* Sweetness was less an area of criticism for Hershey than the aforementioned. Its sweetness, particularly in the case of the current product, was in reasonably good balance. Jersey Milk was subject to some criticism for being too sweet.

In general, Hershey sustained a significant loss well up in the 90% level of significance. Additional analysis was performed on the data by the company that conducted the test. As Larry read on, he felt more devastated. Not only it was a difficult situation for Hershey but for Larry as well. He was feeling the pressure from above to bring this project to a successful close, but what he delivered was a terrible loss. All he could think of was: "After 2½ years into the project, we basically hit the wall. We got clobbered!" Despite the ingenuity of Larry, Judy, the Canadians and R&D personnel -- where Barry made sure the Canadian problems were given high priority -- the "Hershey Lite I" did not even achieve parity with Jersey Milk; it fell well below minimal expectations. That result left them with little direction to follow.

To make matters worse, Larry found out that, again, some Hershey executives were not very fond of the project and the time Larry was spending on it. Larry knew he had to find a way or else... he knew his reputation was on the line. He was determined, almost desperate, to deliver a winning formula for Hershey. Determined as ever, he decided that his ideas about the "dream chocolate bar" were not to be dismissed despite the setbacks and growing criticism. Larry knew that it was time to forget about all the other projects, forget about managing people, and get his mind, body and soul in Canada and spend all his time to this project. More than ever, Larry was intent to succeed in this quest for a new chocolate bar.

The first step was to go back to basics again. All the products -- the current Hershey product, the continuous crumb product, the "Hershey Lites I & II" and the competitive products -- were subjected to a higher level of scrutiny. Answers were needed to the following basic questions: What is the sugar content? What is the milk fat content? What is the amount of milk solids? What is the particle size? The list of questions kept growing... This time, Larry and Judy were careful not to overlook anything. They were searching for directions.

In April, at a meeting in Toronto, Larry relayed to senior managers in the US and Canada that the problem continued to be the restrictions on the purchase of the equipment necessary to get the desired flavor. Despite some past concessions on cost, Larry was still under the directive that new processes had to be compatible with existing equipment in Smiths Falls. David Conn insisted that work on the project had to move on; he felt that more research was needed. He suggested that a totally new system for making milk chocolate -- like the Continuous Crumb Process system -- may be Canada's only solution. It was agreed by senior management in the US and Canada that, as one last ditch effort, Larry would go back to the original continuous crumb sample that was successful in the consumer tests performed in 1978 and try to duplicate that flavor or formula as close as possible, but still employing the existing equipment. The new project objectives were as follows:

1. The formula ingredient cost shall not exceed the cost of the present production formula.
2. Use regular liquor but at an increased concentration to obtain more chocolate flavor.
3. Decrease the particle size if possible.
4. Any other formula changes should be in the direction of the original continuous crumb formulation but with ingredient cost restrictions. The resulting formula would be called "Hershey Lite III."

The discussion then turned to the possibility of preparing a second test sample with a formulation as close to the original continuous crumb formula as possible and with no ingredient cost restrictions. Although David Conn agreed with the proposal to run this sample as part of the next series of tests, he indicated that he was not prepared, at this time, to support capital expenditures necessary for the continuous crumb sample nor live with the higher costs which were originally projected. He could not make any commitments to support it, regardless of the results. Larry insisted that this additional test was needed since it could provide critical information. The argument prevailed and the test was approved. This latter formula would be called "Hershey Lite IV."

Larry and Judy, assisted by Canadian personnel, proceeded -- once again -- to do a careful analysis of the processes and steps currently employed in Smiths Falls. They realized that there were four major steps that, if modified appropriately, just maybe could help produce the caramel flavor. These steps were:

• Pasteurization
• Condensing
• Melange Drying
• Hot Air Drying

It was also necessary to address the issues associated with chocolate flavor, milk solids and sugar.

Now it was up to Larry to decide what to do next.