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Mondelēz International is cutting back on chocolate in some of its new launches and introducing more premium options as the maker of Milka and Toblerone continues to feel the impact of high cocoa prices, a top executive said.
Mondelēz, the world’s second-largest company in the $147 billion global chocolate market, said spot cocoa prices had fallen significantly from record highs reached at the end of 2024, but hedging measures it had put in place to protect the company were still weighing on its business.
Large companies like Mondelēz typically purchase their cocoa supplies almost a year before the finished product reaches store shelves. Therefore, barring any further unexpected volatility that could shake up cocoa markets, we are unlikely to benefit from lower commodity prices until 2027.
Mondelēz CEO Dirk Van de Put told analysts at the Consumer Analyst Group conference in New York last month that the snack giant was rethinking innovation and repositioning its brands to mitigate the impact of higher cocoa costs. Most of these actions are taking place in Europe and emerging markets, where approximately 95% of chocolate sales occur.
Changes include offering more bars filled with nougat, caramel, nuts and fruit. This requires less chocolate than solid blocks or tablets. Mondelēz is also expanding premium chocolate, a space where “consumers continue to seek innovative delights and are willing to pay more for them,” the executive said.
Van de Put pointed out that Mondelēz typically makes almost twice as much profit from premium chocolate as it does from mainstream chocolate. The company’s expanded collaboration with Biscoff, including the co-branded Cadbury Dairy Milk, Milka and Cote d’Or, is a key example of its premiumization strategy.
Mondelēz is also deepening its exposure beyond chocolate tablets to smaller products such as bite-sized snacks. The company is also looking to grow into retail channels, such as smaller discount stores.
Van de Put told Food Dive that the company is seeing some profits from falling cocoa prices and plans to invest more in advertising and marketing of its chocolate brands in 2026.
“We will recycle that margin, partly to improve the bottom line, but also reinvest a large portion into our brands, primarily in-store advertising,” he said.
Mondelēz is not the only chocolate company to cut cocoa costs by adding alternative ingredients.
Hush We also added more fillers and wafers. Some products point out that chocolate remains a major part of the business. Among Hershey’s recent innovations are a milk chocolate bar filled with crunchy waffle cone pieces and another product with a caramel filling.
