Gum in lines, the pockets of most Americans and has been a staple in American culture for centuries.
For some, gum is all about flavor, and for others it's about fear of bad breath, curbing hunger, alleviating anxiety, or simply
they just like chewing it among all the various gum sizes, packaging and flavors.
One thing has remained constant.
The Wrigley's brand name in twenty twenty, the gum industry's market value hit eighteen point six billion dollars.
And since twenty fifteen, Wrigley's held about 26 percent of the global brand share for chewing gum and a 40 percent hold in the U.S..
The gum maker has dominated the chewing gum market since its start, spawning brands from juicy fruit to orbit to five gum.
So first chew chewing gum, then it would juicy fruit and spearmint, and on the heels of that document is selling their
juice, fruit, spearmint and Doublemint phrases that they're always sort of on the cutting edge of the latest flavor and
add in candy and gum that's always been a staple of growth and driving interest and getting people to to come back to the category to try that new
flavor orbit was really special, you know, in the past 20 years that everyone knows.
And still to this day, I say like, oh, I did this campaign for becoming people.
What you heard, it hasn't always been smooth sailing for Wrigley's the brand.
So its fair share of turbulence and faced years of declining public interest in chewing gum, an end to its status as a family run business and
an acquisition by one of the largest candy companies in the last five years, the gum industry's market value.
So a 12 percent drop and in 20 20 gums, most prominent players were negatively impacted by the covid-19 pandemic.
Gumee may never sort of get back to where it was in twenty nineteen, at least not in this intermediate future.
So how did Wrigley's hold its status for over a century and how has the brand managed to stay on top through declining sentiment for gum and a
pandemic slowing down gum sales in the U.S.?
Long before the use of aluminum foil wrappers, GM's history dates back some 9000 years ago when northern Europeans were cheap birch bark
tar. Over the centuries, gum has taken many forms and served various cultural and social purposes.
Civilizations like the Aztecs and Mayans would chew gum for medicinal and social reasons.
But by the mid eighteen hundreds, gum started to take its modern day shape.
The first commercial gum was made from Spruce Tree Resin, developed in 1840 by John Curtis.
But chewing gum was popularized and commercialized by William Wrigley Jr., who started as a soap salesman in Philadelphia.
By 1893, William Wrigley Junior launched Gum Brands, Juicy Fruit and Wrigley's Spearmint, both still popular today.
The key to Wrigley success was marketing and advertising in 1997 during a recession.
Wrigley took out a two hundred and fifty thousand dollar loan solely for advertising.
Since ad rates were so cheap and a year earlier, Bassem ad spending would have cost Rigley six times as much.
Sales of Wrigley's gum saw a jump of one hundred and seventy thousand dollars in 1987 to three million dollars in 1910.
Wrigley solidified itself as the nation's top selling gum brand, and by 1919, the William Wrigley Junior Company was trading on the New York Stock
Exchange. Wrigley sales revenue reached 23 million dollars in 1929, and the company fueled their advertising efforts to six million dollars in
1931. Wrigley is busy thinking about advertising and advertising, wanting to once again
finance its empire and ultimately was about William Wrigley in the garden, had
his name on it.
And you know what just worked?
By 1932, Wrigley was only 60 percent of the market.
Wrigley valued its advertising and marketing campaigns.
They were found on billboards, magazines, television and radio.
The advertising style kept in line with William Wrigley Junior's motto of Tell them quick and tell them often, an expression that carried through
much of the brand's history.
Doublemint juicy fruit and spearmint campaigns all advertise the importance of dental health, featuring kids with bright white smiles from
the 1930s to the 1950s.
Wrigley's brand advertise the peppermint flavor that relieves tension and soothes your nerves.
In the late 1950s, they've always been a really great marketing company.
If you could think back to just some of the A tagline you've seen for some other well-known brands that give extra get extra, the extra pep talks,
the real friend request this year, you know, some of the Doublemint commercials that I'm sure you could probably recite by heart.
So they've always done a really great job with marketing it.
The key to Wrigley success in its early days through the early 2000s was this hold on advertising.
Spending on advertising became a long standing tradition for Wrigley's, along with the other tradition of being a family run business.
In the early 2000s, Wrigley debuted one of the company's most iconic ad campaigns centered around British actress Vanessa Branch.
Was probably after the second wave that they knew this was going to really take off.
It did really well. The first round, which we shot three commercials originally, did really well.
And then they said, oh, it's doing so well.
Let's I think it was after about six months of those airing and then we did another round of two or three a.m..
Exactly. And then after that was when it had really become, you know, this kind of iconic thing for them.
In the 2000s, Rigley and other gun manufacturers hit a snag.
The overall sentiment for chewing gum shifted and the gun market began to see a decline in interest.
During that time, Wrigley's faced global competition from Cadbury and its gum business, including Trident and Dentyne, trying to sustain its hold.
Wrigley completed a deal to buy Kraft's candy division for one point forty six billion dollars in 2005.
This added outwards to the company's portfolio.
Sort of that mid to late 2000s is really where we started to see these ideas of the Clean Label Movement, right?
The rise of the kind barque, I think, is really along the same lines where we saw that really explode around that time.
And so I think just broader changes in snacking habits and how people were choosing to snack left the Rigley, the traditional Wrigley portfolio
challenge in terms of how to how to best move forward.
The Kraft deal wasn't enough.
And in 2006, William Wrigley Jr.
ended the family run tradition and resigned as CEO.
Wrigley was a self-contained family unit who stuck together for four generations,
sold products, sold it at a fair price every time the heat got a.
But in terms of that broader expansion, in terms of growing beyond where they were, it just
didn't happen.
That same year, Cadbury held ten point one percent of the confectionery market and there were rumors of a deal between Cadbury and Hershey, one
that would have secured the two as the top confectionery company in the world.
American billionaire Warren Buffett joined forces with Mars, one of the most prominent candy companies, to facilitate an acquisition for tens of
billions of dollars. Wrigley's market value reached seventeen point three dollars billion in 2008, which peaked Mars in Buffett's Berkshire
Hathaway's interest. You know, any time you bring on someone like a Mars that has just such a broad reach globally has the sort of resources that
they can to try to sort of bring these synergies together with their existing portfolio in the chocolate space and try to push that forward.
It probably was a time to do that, given the changes we were seeing in the consumer landscape.
Mars, MasterCard, Wrigley's for 23 billion dollars, allowing Mars to corner the chewing gum market at a time.
Wrigley's was already the gum industry sales leader with five point four dollars billion in sales in 2008.
Mars already had famous brands like Eminem's Snickers, Starburst and Twix.
But with the Wrigley's portfolio of Staple Gum Brands, the deal helped solidify Mars as the top confectionery company in the world.
Under the acquisition, rules became a separate standalone subsidiary of Mars, Wrigley shifted from being an American staple stock from 1919
to fall under Mars longstanding private umbrella.
On October six, 2008, six months after the deal's announcement, the William Wrigley Junior Company was delisted by the New York Stock Exchange.
I think that there was sort of that transition process where they said, yeah, we're going to bring you into the Mars family.
You're going to retain your sort of identity.
And then after after a period of time, they decided to eventually fold that in.
And 2016, Mars bought out Berkshire Hathaway's stake in Wrigley's to take full control of its subsidiary.
The gun market in the U.S.
started to dry up, and from 2009 to 2020, U.S.
gun sales dropped from four point one two billion dollars to three point one five billion dollars.
There are a lot of things that in that sort of broad release as an end of the family unit and one of them had to do
with the general view of two income people really go to that.
They get through the decade of declining gun sales.
Mar's focused on revitalizing another section of its portfolio in twenty seventeen, Mar's bought up health care provider V.K.
for nine point one billion dollars.
The deal was an effort to make Mars petcare and to the company's largest segment in sales, overtaking its candy and gum segments.
Petcare is now the focus of Mars before the pandemic.
I think it's kind of a different story when you look at sort of like twenty fifteen to twenty, nineteen and twenty twenty.
Before the pandemic, I would call the category sort of flat lining.
I think dollar sales were essentially flat between twenty fifteen and twenty nineteen volume sales, actual consumption was down over that span as
well. I think what we've seen is that for a variety of reasons, interest has really waned among that sort of younger consumer group.
Gun face declining public interest as younger consumer groups are a lot less interested in purchasing gum than generations before.
There's been very little change in innovation regarding gum, with younger consumers finding innovative snacks with bolder flavors replacing their
need for gum. Think about the GenZE consumers and for whatever reason, as they've come into the market, they have been much less interested in the
gum category than preceding generations were at that age.
However, the gum industry was dealt another blow when the covid-19 pandemic crippled industries.
The bottom line is that the category wasn't exactly on fire coming into twenty twenty for the pandemic and has really been quite stagnant, I would
say in both the US especially, and then even on a global scale, relatively speaking.
Founder of simply governing stated gum is an item that is used in social situations, such as going to a meeting or a party because of
covid-19 those activities have been declining.
So part of the decrease in sales is really because there is not as much demand from consumers, because the usage case has declined since March
20, federal and state ordered social distancing guidelines nearly wiped away gum social component.
And so, again, as we've been trapped at home, people aren't going to work.
People aren't going to schools.
It's been just a huge drop off in demand.
I think we're we're looking at a decline of like 14 percent on a volume basis in twenty twenty, which is again, it wasn't doing well coming into
twenty twenty, but it was you know, this is a whole new level of sort of declines here.
As for now, Mar's Wrigley maintains its hold on the U.S.
and global market with nearly 40 percent and twenty five point nine percent of the game categories branchy respectively.
CNBC reached out to Mars for a comment, but the company was not available for response.
After over a decade of declining growth in the U.S., stagnant growth globally and Mars is focused on its pet care business.
The famous gum brands future remains uncertain.
I think what you will see a bit of a comeback here in the coming years.
Once people do start going to school again, start going to workplaces, going to offices, they'll be out.
They'll be interacting with them and buying it.
Once again, it's not going to be an immediate snap back.
In fact, long term, it may never even get back to where it was.
Chewing gum itself is an enigma.
And I would Yeah that chewing gum would find its way more into more purposeful
Bennu. I'm not sure that any of those shifts is going to make chewing gum what it used to be,
because I'm not sure we really have any need for it, for it to stay alive.
It needs continue to be fun.