Mondelēz International is making strategic changes in response to the impact of high cocoa prices, including reducing chocolate in new product launches and introducing more premium options. Dirk Van de Put, the CEO of Mondelēz, revealed that the company is rethinking its innovation strategy to navigate the challenges posed by elevated cocoa costs.
Despite the decrease in cocoa spot prices from their peak in late 2024, Mondelēz’s existing hedges are still affecting its financial performance. The company typically procures cocoa supplies almost a year in advance, meaning that any savings from lower commodity costs may not be realized until 2027.
Van de Put emphasized that Mondelēz is focusing on repositioning its brands and introducing new offerings, particularly in Europe and emerging markets where most of its chocolate sales occur. This includes shifting towards more filled bars that require less chocolate and expanding its premium chocolate range to cater to consumer preferences for indulgent products.
Furthermore, Mondelēz is diversifying its product portfolio by venturing into bite-size treats and exploring opportunities in retail channels like discount stores. The company is also ramping up its marketing efforts for its chocolate brands in response to the changing market dynamics.
While Mondelēz is adapting to the challenges posed by high cocoa prices, other chocolate companies like Hershey are also exploring alternative ingredients to mitigate costs. Hershey, for instance, has introduced products with added fillings and wafers while maintaining chocolate as a core component of its business.