Candymaker set to expand classic line to other seasons
REVERE, Mass. — After 162 years, New England Confectionery wants to be more than your Valentine.
The maker of Sweethearts — the tiny heart-shaped candies inscribed with messages like "I Love You" and "Kiss Me" — and other sugary nostalgia such as Mary Janes, Necco Wafers and Clark Bars says now is the perfect time to broaden its offerings, despite the recession and saturated candy market.
"It's the oldest multiline candy business in the United States. There are some iconic brands here that are just marvelous," said Necco's new chief executive, Richard Krause. "We thought it was an excellent opportunity to take this company to the next level."
When Necco first opened in 1847, there were only 29 states in the Union, the Civil War had yet to start and Abraham Lincoln was in Congress. It began making its signature Sweetheart Conversation Hearts in 1866, spreading G-rated messages of affection.
It has since introduced many different themes, with hearts in Spanish or more modern messages such as "Text Me." It also offers Sky Bars, Double Dipped Peanuts and Thin Mints, but the tiny hearts — billions a year — are still Necco's best sellers.Krause said if the company wants to survive in a global economy — and take advantage of consumers' need for less-expensive entertainment — it needs a little change of its hearts.Next month, Necco plans to unveil a new line of Sweethearts connected to "Twilight" — the young-adult vampire-romance book series. They'll be released at the same time as the DVD of the movie and feature such sayings as "Bite Me," ''Bedazzle" and "Live 4 Ever." Around Memorial Day, Necco will introduce a "Red, White and You" series aimed at veterans returning from Iraq with messages like "Proud" and "Love the USA.""We're going outside of just the seasons," said Jackie Hague, the company's new vice president of marketing. "And during the seasons we want to expand at the right time. And these brands are perfect for that."Krause, who joined the company in August as its chief operating officer, said Necco needs to expand its brand in the U.S. now so it is in a better financial position to expand globally later. He is aiming for 30 percent growth within two years for Necco, whose annual revenue has hovered around $100 million since 2005.
Necco isn't the first confectionery company to try expanding a seasonal product's appeal. Brach's Confections, now owned by Farley's & Sathers Candy, began seven years ago to expand its Candy Corn brand beyond Halloween, said company spokeswoman Michelle Graber. The conical sweets can now be found year-round in a variety of flavors and colors, including a pink and white version at Valentine's Day."It's been very successful for us," Graber said.Pat Conroy, a consumer products expert at accounting and consulting firm Deloitte & Touche USA, said any move by Necco to seek new markets outside its traditional seasonal push could work if the company doesn't try to redefine itself too fast."They are competing for the footprint in consumers' minds," Conroy said. "They've got a kind of brand image that's recognized, so they must have a clear basis for differentiating any new brands they are taking on."Krause, 47, a former Procter & Gamble executive who replaced longtime CEO Dominic Antonellis, now chairman, is leading the transition with a new executive team, including Hague.The management changes are part of a wider transformation at Necco. In 2003, the company moved out of a looming 1926 red brick factory near the Massachusetts Institute of Technology in Cambridge, Mass., to a new building in Revere. The old 500,000-square-foot facility, which sat next to a water tower with painted images of Necco Wafers, was sold to Swiss biotech company Novartis AG. Company officials said the old building was too expensive to renovate and too small to accommodate future consolidation plans. Privately held Necco was sold last year to a group of investors that is led by private-equity fund American Capital Strategies in Bethesda, Md.<br>
