In 1900, Hershey released its first chocolate bar turning what once was a luxury into an affordable, accessible treat.<\/p>\n
Over the last 125 years, the candy company has continued that innovation, bringing items like Reese\u2019s, Twizzlers, and Jolly Rancher to our candy drawers. But now, it seems the retailer is ready to change tack.<\/p>\n
In recent years, Hershey has expanded into other categories, acquiring snack brands like Skinny Pop, Pirate\u2019s Booty, and One protein bars. Former CEO Michele Buck led much of that transition in the early 2020s.<\/p>\n
\u201cOur plan was to expand further into snacking, not diversify out of confections,\u201d she told the Harvard Business Review in 2022. \u201cWe wanted to build the portfolio in a way that would capitalize on our strengths and offer consumers more snacking occasions.\u201d<\/p>\n
Newly appointed CEO Kirk Tanner recently told investors he\u2019s committed to continue that growth path, further expanding Hershey\u2019s reach outside of the candy aisle.<\/p>\n
Functional foods are typically defined as those that offer specific benefits beyond basic nutrition. The phrase covers a wide range of ingredients and attributes that can affect everything from a consumer\u2019s mental health to their physical well-being.<\/p>\n
It\u2019s a space that\u2019s ripe for expansion, as consumers become increasingly focused on wellness.<\/p>\n
Functional nutrition is one of the fastest-growing segments of the $2 trillion wellness market, a recent study by McKinsey & Company reports. In 2025, about 50% of the U.S. population, and 66% of Gen Zers, purchased functional nutrition products.<\/p>\n
\u201cThis trend has been fueled by the shift toward food as preventative medicine, as consumers are becoming more aware of how food and beverage choices affect their health,\u201d McKinsey & Company\u2019s report said.<\/p>\n
\u201cRather than only thinking of healthy food as foods that are free from certain components, such as gluten or sugar, consumers are now looking for foods that include high-value components, such as protein, nootropics, or turmeric.\u201d<\/p>\n
Going forward, the consulting firm expects to see the most demand for products that support energy, gut health, and immunity.<\/p>\n Spotting an opportunity for growth, Hershey CEO Kirk Tanner recently told investors the confectionary company was eyeing ways to invest in the functional foods market.<\/p>\n \u201cWe\u2019re investing in the space so that we can continue to be relevant for consumers,\u201d he said in an interview at the company\u2019s recent investor day in New York City, Food Dive reports. \u201cTo be in the space, it\u2019s fast-paced, it\u2019s fast-moving\u2026You have to actually go faster than the rest of our portfolio.\u201d<\/p>\n<\/p><\/div>\n While he did not divulge specific details, Tanner did say that Hershey was \u201cexploring a lot of spaces\u201d within the functional foods market. Existing brands like Ice Breakers mints were highlighted as possible places the company may start adding those non-nutritive benefits.<\/p>\n More retail:<\/strong><\/p>\n With a focus on long-term growth and \u201can aspiration for how big we can build that business,\u201d he also noted that the company was considering acquisitions that would give them a presence in functional foods.<\/p>\n There is some precedent for that path \u2014 last year Hershey acquired LesserEvil, a \u201chealthy alternative\u201d snack brand that makes limited-ingredient popcorn and chips.<\/p>\n \u201c[Functional foods is] where consumers are going, and we want to be a part of that,\u201d Tanner said. \u201cIt just makes us a better company \u2026 and gives us more optionality in the future as well.\u201d<\/p>\n Chocolate fans should have no fear. Despite Hershey\u2019s excitement over snacking and functional foods, the company says it has no plans to scale down its core candy offerings.<\/p>\n \u201cThis is the year of Hershey, and we’re investing in Reese’s as well,\u201d Tanner told investors on Hershey\u2019s Q4 FY2025 earnings call. \u201cWe’ve got a full year planned on both Reese’s and Hershey. You’ll see innovation on both. There’s big innovation coming out on Hershey.\u201d<\/p>\n With the upcoming release of the Hershey biopic, set to coincide with the company\u2019s 250th anniversary, consumers are sure to see exciting releases in the confectionary category.<\/p>\n \u201cWe’ve got equipment ready to go to make more candy,\u201d CFO Steve Voskuil told investors.<\/p>\n<\/div>\n<\/div>