Haribo is using mystery bags and pick-and-mix walls to turn its first US stores into Instagrammable marketing machines — Business Insider

RESOLVING THE LEDGER

Haribo is opening its first retail stores in the US, designed to help fuel its growth with American consumers. Haribo

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"Kids and grown-ups love it so," the ad jingle goes.

Now, the German sweets brand Haribo is betting Americans love it enough to make a trip to its first-ever dedicated US stores.

Opening next month in Central Valley, New York, and Wrentham, Massachusetts, each store is designed to be part marketing machine and part sales driver.

The locations are fitted out with pick-and-mix walls, in-store sampling, and "mystery bags" that encourage shoppers to film and share their unboxing moments on social media. They'll also have a very distinctive "gummi" smell.

"What we're trying to recreate is that feeling you had as a kid walking into a candy store for the first time," Haribo of America CEO Jon Hughes exclusively told CMO Insider.

Haribo is embracing a retail strategy popularized by brands such as M&M's, Lego, Nike, and Apple, whose destination stores are designed to generate buzz and strengthen consumers' affinity with the brand as much as to drive sales.

Haribo is kitting out its stores with pick-and-mix walls and collectibles. Haribo

Haribo's new stores come on the heels of the brand's growth in the US. Hughes said the company has raised its household penetration in the US to 40%, up from around 28% last year and 10% a decade ago. The company has increased its US head count to 440 people, from 200 three years ago.

Haribo thinks there's room to grow, but it faces stiff competition from well-established American brands.

David Mayer, senior partner at the marketing consultancy Lippincott, told me that while Haribo has good awareness and familiarity in the US, he doesn't think "it's yet at the level of some of the iconic US confectionery brands, like a Hershey or a Jelly Belly."

Hughes said the variety in its portfolio is what sets it apart from competitors. The company says on its website that it makes more than 1,000 products worldwide. Later this year, for example, it's rolling out its chewy, poppable Balla Bites candy range into the US.

"We have different products, textures, different treats, different flavors," Hughes said. "That's what makes us a little bit different, this notion of supporting these little moments of childlike happiness."

"Childlike happiness" is a common theme across Haribo's marketing, too.

The company still spends heavily on TV with its long-running "Kids Voices" campaign, first created by the UK ad agency Quiet Storm in 2014, in which adult actors' voices are replaced with those of children. A spokesperson for the TV ad measurement firm iSpot said Haribo consistently ranks among the top five TV ad spenders in the US candy and gum category, alongside Reese's, Hershey's, and Lindt.

It's also increasingly leaning on influencers, particularly as it prepares to open the new stores, Hughes said.

Mayer of Lippincott said US confectionery brands face challenges as they adapt to changing consumer trends, ranging from the ongoing downturn in physical convenience and drugstore shopping to the rise of GLP-1 drugs and a desire among shoppers for fewer processed ingredients .

Hughes said Haribo hasn't seen a significant drop-off in sales of sweet treats.

"People have been enjoying confectionery for hundreds of years," Hughes said. "I think that will continue."

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Haribo is using mystery bags and pick-and-mix walls to turn its first US stores into Instagrammable marketing machines — Business Insider | AIPROPX