Godiva Strikes Gold
Get ready for the gold rush. On Sept. 29—a.k.a. "Gold Friday"—Godiva will unveil a new take on one of the great confectionery icons, the Godiva gold ballotin box of chocolates.
"Godiva's gold box is one of the most recognized pieces of packaging in the U.S., along with Tiffany's blue box and Bloomingdale's big bag," says Clay Gordon, a chocolate expert and editor of Chocophile.com. The makeover is part of a larger brand makeover but goes beyond mere repackaging—Godiva tweaked 23 of the recipes and added 11 new pieces.
Founded in 1926, Godiva dominates in the U.S. gourmet chocolate market, selling more than $200 million worth of confections each year. With medical studies trumping the health benefits of dark chocolate, the candy is a hot commodity. It's also one of the top emerging luxury trends. Americans spent $15.8 billion on chocolate confections in 2005, according to the Commerce Dept., up 3% from the year before.
But there are now more companies than ever fighting for those sweet-tooth dollars. Godiva's molded chocolates in the Belgian tradition must compete against European luxury brands such as Neuhaus and Leonidas. Then there are the boutique U.S. offerings—think Jacques Torres and Mariebelle—and with mass-market heavyweights such as MasterFoods and Russell Stover introducing upscale lines, "Godiva's brand image had gotten pretty stale," Gordon says.
To lure customers back, Godiva, which is owned by Campbell's Soup (CPB), implemented a revitalization plan three years ago. "As our business softened in 2001 and 2002, we stepped back and took a look at [the product line]," says Sharon Rothstein, Godiva's vice-president for global marketing & merchandise.
The company expanded its product lineup, adding two chocolate lines at different price points. The couture collection, known as G, hit the market in late 2003. Available in limited qualities at select Godiva stores and upscale retailers like Neiman Marcus and Saks Fifth Avenue, these beautiful chocolates feature American flavors like Bananas Foster and P.B. & Jam, and cost a whopping $80 for a box of 30, whereas the core 36-piece gold ballotin box sells for $38. It's a strange juxtaposition to have such a quintessentially American flavor costing so much, but the higher price point is due to the fact that each piece is finished by hand.
In April, 2005, Godiva introduced its Platinum line, with more modern pieces, including pairings of chocolate and spicy ginger. A 30-piece platinum box retails for $44. The lines aren't aimed at different consumers, but they create layers of exclusivity, Gordon says.
In addition, Godiva has overhauled its truffle collection, launched a sugar-free line, and, in a more radical brand extension, partnered with Coca-Cola (KO) to introduce a new line of premium blended drinks called Godiva Belgian Blends. Finally, many of Godiva's 275 boutiques in North America are getting a facelift, featuring airy, uncluttered spaces as well as tasting bars designed to give customers one-on-one interactions with staff. Walk into one of the updated stores in New York, and you'll see strawberries being dipped in chocolate.
Assembling a team of BusinessWeek staff that mirrors Godiva's core customer—women ages 25 to 40—we took a sneak bite of Godiva's new Gold collection. (That demographic, incidentally, consumes roughly eight servings each month, according to a report on premium chocolate by consumer-research firm Mintel.) A few men stopped by to offer up their opinions, as our testers conducted a side-by-side comparison of the old and new standard 36-piece one-pound gold ballotin box.
Everyone agreed that the beautiful new box, which is bigger and encased a thick textured gold paper, looks more luxurious. The old box had a cheap-looking foil cover and was wrapped in a thin cord. The new boxes are wrapped in thicker ribbon snap band, designed to help customers identify the different milk, dark, white, nut, caramel, and mint collections.
Inside the box, it's a different story. We actually preferred the layout of the old box, which showcases the company's delicate moldings—including pieces shaped in beautiful textured seashells and swirling hearts. While the new box separates pieces into different brown pockets, the old box features artfully arranged layers in bigger pockets. "This looks like something that your Aunt Mary would have on her coffee table," one taster said of the old box. "It's beautiful."
The new box goes for a modern feel. Pieces are decorated with colorful printed designs, and then there are the new flavors: a pecan-carmel duet (a layer of crunchy caramel over milk chocolate), a caramel-accented milk chocolate ganache, and pieces filled with sweet cherry, tangy raspberry, and refreshing mint.
SHOOTING FOR THE HIP.
So how did the new chocolates taste? Among the new pieces that got rave reviews, we liked the raspberry-caramel duet—a mix of raspberry caramel and dark chocolate—and the macadamia mosaic, which has a crunchy bite.
While the company saved the relaunch of its core Gold product lineup until last, the redesign has been under way for more than 18 months, Rothstein says. "This is the culmination of our efforts to revitalize and reinvent our brand," she adds. The launch wouldn't have worked the other way around, Gordon notes. "What they needed to do was to make Godiva hip and fashionable again," he says.
To that end, Desperate Housewives star Teri Hatcher emerged as Godiva's pitchwoman last Valentine's Day. The Gold launch will be supported by advertising in magazines such as Vanity Fair, InStyle, Vogue, Elle, and Harper's Bazaar, as well as outdoor advertising.
While the success of the Gold relaunch is too early to call, the company has already done a remarkable job of generating buzz with its other brand efforts—sales were up 6% in the past year. For Godiva, the new Gold collection could prove to be a gold mine.