Hershey’s next move: Rebuilding trust after cocoa cuts controversy

If there’s one person you don’t want as an enemy in the confectionery industry, it’s Brad Reese. He’s the grandson of HB Reese, who invented the eponymous Reese’s Peanut Butter Cup.

When he publicly lamented the demise of the Reese’s brand under The Hershey Company, its owner since 1963, it was the start of a viral moment.

Reese wrote an open letter to Hershey’s corporate brand manager on LinkedIn to complain about the fall in quality. He told press of reluctantly throwing a bag of Reese’s Chocolate Peanut Butter Crème Mini Hearts in the bin on Valentine’s Day – a symbolic move, if ever there was one.

“It was not edible,” he told Associated Press. “You have no idea how devastating it is.”

Reese wasn’t the only one to take issue with the reformulation of Hershey lines. Customers reported noticeable deteriorations in taste and texture – and some bakers even complained Hershey’s Kisses were crumbling, rather than melting, under heat.

The backlash was enough for Hershey to return to its classic recipes. But the PR fallout – and questions over the company’s future direction – continue to circle the Hershey brand. So what’s going on at Hershey? Is this a storm in a peanut butter cup? Or a sign of wider troubles?

First off, Hershey is keen to stress only a small number of products deviated from its classic chocolate recipes – and those will be brought back in line.

“We are transitioning a small number of extension formats under the Hershey’s and Reese’s portfolio to align with their classic milk and dark chocolate recipes,” says a spokesperson for the multinational. “The majority of our offerings have not changed and have always used milk or dark chocolate.”

Second, Hershey isn’t the only confectioner switching up recipes. The US giant is understood to have reduced cocoa content in certain lines – replacing chocolate with a compound coating made using vegetable oil. Similar tactics have been employed by several big brands in the past year without such negative PR.

In the UK, several products no longer meet the threshold to legitimately be called chocolate - including Toffee Crisp and Blue Riband, plus white chocolate versions of McVitie’s Digestives and Nestlé Kit Kats. McVitie’s Club and Penguin have also adjusted recipes to reduce reliance on cocoa, incorporating alternatives such as palm oil and shea butter.

Volatile cocoa prices have been the driving force behind these moves. On the London exchange, cocoa typically trades at around £2,000 (€2,315) per tonne. That figure more than doubled between January 2024 and January 2026, due to severe weather conditions in key producing regions such as Ghana and Côte d’Ivoire. At their peak, prices reached as much as £9,000 per tonne.

Cocoa prices have since returned to a more normal baseline. But it’s easy to see why confectioners have looked to reduce their reliance on the ingredient, which is vulnerable to climate change and geopolitical tensions.

The impact of cocoa costs is clear to see in Hershey’s 2025 results. While net sales rose 7%, net income plummeted by nearly 60% in the year ending 31 December 2025. Hershey attributed the fall in profits to “higher commodity costs”.

A reduction in cocoa content therefore made sense from a financial point of view. Yet Hershey ended up facing such a strong PR backlash that its sales were at risk.

Brad Reese clearly played a part in the storm. Still, shopper reactions suggest there was a noticeable difference in taste – an accusation that other cocoa-reducing brands such as Toffee Crisp and McVitie’s white chocolate Digestives have largely managed to avoid.

That could come down to the individual makeup of the reformulated Hershey products and their exact cocoa content, which remains unknown. “Consumer reaction to changes in Reese’s Peanut Butter Cups shows how quickly adjustments can become visible when taste or texture shifts cross a certain threshold,” Patrick Young, MD at consultancy PRS In Vivo, wrote in The Grocer last month.

Andy Baxendale, head of The Sweet Consultant, stresses the difficulty in replicating the taste and mouthfeel of cocoa. “Cocoa content is the mass that gives the chocolate its flavour, and then the cocoa butter gives the distinctive texture of chocolate. Loads of flavour companies have tried to mimic the flavour of cocoa and it’s impossible. If you reduce cocoa content, it also melts at a different temperature, and the mouthfeel is very different.”

That point is reiterated by Lani Smith, an executive at food and drink consultancy HRA Global. “Reformulating chocolate to reduce cocoa is deceptively difficult. Even small changes materially alter flavour, texture, mouthfeel, and pH, often requiring additional ingredients like sugar or milk powder, which bring their own commodity price risks,” she says.

“Consumers are largely resistant to cocoa substitutes because chocolate’s most valued quality – its long, lingering finish – is something alternatives consistently fail to replicate,” Smith adds.

Those alterations to taste were made worse by the perceived lack of transparency from Hershey. The confectioner didn’t announce the change in recipe and still hasn’t said exactly which SKUs were affected.

“Hershey’s problem was less the reformulation itself and more the failure to communicate it transparently, which made the change feel underhand to consumers,” argues Smith. “Sales will likely recover given the strength of the brand, but the longer-term risk is that continued cocoa reductions may push the product below the flavour threshold at which loyal shoppers permanently switch away.”

Baxendale similarly believes shoppers will return to Hershey products. He points to the example of Cadbury’s Crème Egg, which faced a backlash from its reformulation in 2015 – but quickly regained sales.

However, Brad Reese argues the secretive approach points to deeper problems at Hershey. For him, the company is treating consumer trust as a “marketing variable” rather than a fundamental tenet.

“Hershey must shift from ‘managing the narrative’ to managing the product reality,” he says. “That means eliminating quiet reformulations, ambiguous labelling and internal incentives that reward margin over brand equity.

“The Hershey Company now faces a credibility gap that will take more than a recipe reversal to repair.”

Some brands – like Candy Kittens Treets, which uses a chocolate alternative made from sunflower seeds – have successfully used experimental recipes. But as Young of PRS In Vivo explained in his column, these are new brands that have been upfront about their recipes from the outset, rather than ones with an established fan base and clear expectations around taste.

In the future, lab-grown cocoa – which is attracting investment from major confectioners in the face of increasing supply chain volatility – could be an option for the likes of Hershey. But for now, it is a long way from being a mass market product.

“It remains chemically intensive, dependent on a new supply chain, and critically unable to scale to the volumes the industry requires – similar to the limitations currently facing lab-grown meat,” says Smith of HRA Global.

So until that tech develops, further significant recipe changes are unlikely. The company clearly recognises it can’t afford to short-change customers. In its latest investor day call in March, CEO Kirk Tanner pledged to “exceed consumer expectations” as part of its ‘three Cs’ strategy, which hinges on consumers, customers and colleagues.

Hershey says it is now looking to fuel growth through innovation, marketing and geographical expansion. Tanner pointed to straightforward flavour innovation, such as the launch of Reese’s Oreo.

Crucially, he also indicated a movement towards “premium, better-for-you” lines. One trend that ticks both boxes is protein – which has already inspired the launch of Hershey protein bars and shakes. That lineup looks set to grow.

“Today we selectively play in protein, and this is a growth vector for us in the future. We’re investing in R&D and capabilities to make this even stronger,” says Tanner.

At the same time, Hershey is investing in marketing to strengthen the emotional connection with its brand. In the US, it is launching activity that associates Hershey with everyday acts of affection, such as a mother putting a Hershey Kiss in her child’s lunchbox, or students cramming for a final together with a Cookies ‘N’ Crème bar.

Finally, Hershey has set out ambitions to bolster its popularity in markets where it is yet to become a leader. “So I look at Canada, Mexico, and Brazil. We’ve built portfolios of strength, and our go to-market is excellent and we’re gaining share. That’s important,” says Tanner.

“But our focus is going to be on delivering growth in those markets and focusing on markets that have scale categories and profit potential, markets like Europe and the UK where we have a right to win.”

There is certainly plenty of potential in these markets. But if Hershey is to build its position in Europe – where the focus on cocoa content is arguably higher than in the US – it will need to avoid scrimping on ingredients. And it will need to ensure it is seen as a trusted, quality brand.

As Reese puts it: “The era of ‘change the ingredients and hope no one notices’ is over.”