Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China's Consumers

Beijing, China (September 25, 2009) /ChinaNewswire.com/ — Thirty years ago, the vast majority of China's huge population had never eaten a piece of chocolate. Yet as Deng Xiaoping gradually transformed China from the early 1980s through the early 2000s and a poor, oppressed communist state became a powerful, modern market-driven socialist economy, hundreds of millions of China's 1.3 billion people turned into ravenous consumers of everything—but especially anything exotic. That meant a wide open market, and potential goldmine, for the makers of the sweet, creamy treat that Americans gobble up, in staggering quantities of about three billion pounds annually.

CHOCOLATE FORTUNES: The Battle for the Hearts, Minds, and Wallets of China's Consumers (AMACOM; October 13, 2009; $27.95 Hardcover) is the first inside, blow-by-blow account of the war waged among the five titans of chocolate—Hershey, Nestle, Cadbury, Mars, and Ferrero Rocher—for the taste buds and passions of China's new consumer class. A former executive for two of the "Big Five" chocolate companies in China, Lawrence L. Allen presents a gripping business story wrapped up in the intriguing tale of East meeting West through the introduction of an icon of the western world's decadence and self-indulgence. Throughout, Allen offers lessons for anyone raring to do business in this dynamic, complex, and continually evolving country, which is, almost by the day, acquiring the economic and political clout to play a preeminent role in shaping our global future. What's more, and equally riveting, he delves into the mystique of a confection with a universal ability to create emotional connections while steadily fueling cravings.

Over 100 million strong, the children of China's one-child-per-family policy, established in the late 1970s, would be the first generation of Chinese natives to grow up eating chocolate from a very early age. Once hooked, these "Little Emperors" would likely lead chocolate consumption patterns to mirror those of developed chocolate-loving nations within their lifetimes. CHOCOLATE FORTUNES traces how the world's top five chocolate producers competed in a high-stakes race to win the brand loyalty of China's youngest and most influential consumers. While each chocolate giant forged its own path to reaching the target consumer, they all faced the same daunting obstacles to manufacturing, marketing, distributing, and selling their foreign, fragile, and expensive product. With its lack of a stable, air-conditioned supply chain, few supermarkets beyond cities such as Shanghai, Beijing, and Guangzhou, and its cultural preference for eating rich "heaty" foods only in cold weather seasons, China proved far from the ideal nation for launching a chocolate revolution.

Focusing individually on the breakthrough strategies and major missteps of each chocolate contender, CHOCOLATE FORTUNES reveals:

How Hershey, maker of the great American chocolate bar, brought a much-need will to find a way in China, made significant strides in overcoming its less-than-stellar international track record, and eventually broke the hearts of China's chocolate lovers by withholding its Kisses;

How Nestle, the Swiss-based global food powerhouse, brought enormous resources and extensive experience in global markets to China, yet wound up confounding China's chocolate lovers by switching from less than its very best chocolate;

How Cadbury, the esteemed chocolate of the British empire, first weaned Chinese palates on their luscious Australia-made Dairy Milk Chocolate and then alienated discriminating fans by inadvertently replacing imported quality with a cheesy-tasting, China-made substitute;

How Ferrero Rocher, the noted Italian chocolatier, successfully leveraged its unique product—a delicate chocolate and hazelnut confection encased in an elegant gold foil wrapper—to appeal to the national Chinese habit of splurging on exotic gifts;

How Mars, an American family-owned company with a reputation as a tough street fighter, made a bold move by being the first foreign company to begin manufacturing chocolate in China and made an outstanding early impression on chocolate lovers with its Dove delights.

As the final chapter makes clear, the battle royal for China's chocolate loyalty continues, with fledgling local manufacturers now mixing it up with the foreign titans. Capturing the drama and tensions on the front lines of a still largely unclaimed consumer frontier, CHOCOLATE FORTUNES provides food for thought for everyone with a stake in the what one-fifth of the world's population consumes.

"Informative, cautionary and essential, this book is a must-read for executives currently doing business, or planning to, in this most volatile and critical market."
—Publishers Weekly

"No consumer goods company can call itself "Global" without having meaningful presence in China: a must-win market for long term survival! Lawrence Allen has the inside scoop on how our iconic chocolate brands fared within the rapid development of China's retail industry over the past thirty years. Chocolate Fortunes reveals lessons that aren't taught in business schools and that could apply to any consumer goods company that ever struggled with, or dreamed of success in the world's biggest market!"
—Michael Wong, Regional Vice President-Asia Pacific of WM Wrigley Jr. Co. (Retired)

"With a balanced focus on business, culture and history, Lawrence Allen explains successes and failures in adapting global strategies in China's complex market in a way that redefines "think global, act local." Chocolate Fortunes is a must-read for today's international executive seeking to understand China."
—William Tung, Vice President of International Sales and Operations of Columbia Sportswear

"Chocolate Fortunes provides a fascinating and entertaining account of chocolate companies' ventures into China and how they faced the opportunities and challenges there. With a clear understanding of the vital human element required to succeed in China, Lawrence Allen offers critical observations for any company engaged in or, about to explore the china market. It is required reading for our global team of professional consultants."
—Joanne and Scott Ulnick, Managing Partners of Strategic Market Research and Consulting Ducker Worldwide

About the author
Lawrence L. Allen is a senior international business executive, leadership consultant and author with a twenty-year track record building branded consumer product businesses in China for leading multinational companies. For seven years, Allen was a foot soldier on the front lines of China's "chocolate war," first as an executive with Hershey, and later Nestle. He is a graduate of Thunderbird School of Global Management, where he began his China studies and earned his MBA in International Business Management. He is a bi-cultural Mandarin Chinese speaker and lives Beijing, China.

Title: CHOCOLATE FORTUNES: The Battle for the Hearts, Minds, and Wallets of China's Consumers
Author: Lawrence L. Allen
Pub. Date: October 13, 2009
Price: US$27.95 Hardcover
ISBN: 978-0-8144-1432-3
Pages: 256

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Contact: Alice Northover at +1-212-903-7951/ anorthover@amanet.org