Mondelēz International is reducing chocolate in some new launches and debuting more premium options as the Milka and Toblerone maker continues to feel the impact of high cocoa prices, its top executive said.
Mondelēz, the world’s second-largest player in the $147 billion global chocolate market, said that while cocoa spot prices have come down significantly from their record high in late 2024, hedges put in place to protect the company are still weighing on its business.
Large companies, such as Mondelēz, typically purchase cocoa supplies nearly a year in advance of when their finished products reach store shelves — so they likely won’t benefit from lower commodity costs until 2027, provided there isn’t more unexpected volatility to rattle the cocoa market.
Dirk Van de Put, Mondelēz’s CEO, told analysts at the Consumer Analysts Group of New York conference last month that the snacking giant is rethinking innovation and repositioning its brands to mitigate the impact of high cocoa costs. Many of these steps are taking place in Europe and emerging markets, where roughly 95% of its chocolate sales occur.
Changes include offering more bars filled with nougat, caramel, nuts and fruits — which require less chocolate than solid blocks or tablets. Mondelēz is also expanding its premium chocolate, a space “where consumers consistently seek innovative indulgence and are willing to pay more for it,” the executive said.
Van de Put noted that Mondelēz typically earns nearly double the revenue from premium chocolate compared to its mainstream counterpart. The company’s expanding collaboration with Biscoff — including co-branded Cadbury Dairy Milk, Milka and Cote d’Or — is a key example of its premiumization strategy.
In addition, Mondelēz is deepening its exposure beyond chocolate tablets into smaller offerings such as bite-size treats. The company is also looking to grow into retail channels like discount stores, where it isn’t as big of a player.
Van de Put told Food Dive that the company is seeing some small benefits as cocoa prices drop, and it plans to invest more in advertising and marketing for its chocolate brands in 2026.
“We’re going to reutilize that margin, partly to improve our profit, but also a big part to reinvest in our brands, largely on in-store and advertising,” he said.
Mondelēz is not the only chocolate company to reduce cocoa costs by adding alternative ingredients.
Hershey has also added more fillings and wafers to some of its products, though it notes that chocolate remains a major part of its business. Among Hershey’s recent innovations are a milk chocolate bar filled with crunchy waffle cone bits and another loaded with caramel filling.
