Stover’s Hearts

Cadbury introduced the first heart-shaped box of chocolates in 1822, but Russell Stover took the idea all the way to the bank, reports Claire Suddath in Bloomberg Businessweek (2/13/14). To be exact, Russell Stover expects to sell $175 million worth of its boxed chocolates – out of a total of $1.1 billion "Americans will spend on Valentine sweets this year." Russell Stover, who "was a real person," — a chemist, by trade — actually "made his fortune as one of the creators of the Eskimo Pie" in the 1920s. He didn’t get into the candy business until later, initially "selling the individually wrapped candies his wife Clara made in the kitchen of their Denver home."

By the time he "died in 1954, the company had almost 40 candy shops and sold chocolate to 2,000 department stores across the Midwest." Now a $600 million company, Stover is run by Tom Ward, whose father "owned the company… that made the paper boxes the Stovers used for their candies." The positioning has always been "affordable premium," says Paul Minger of Walgreens. "They sell something that looks premium but that’s priced much less than what other boxed chocolates go for. No one else really does that." Naturally, how the box looks is critical to what sells, which explains the success of Stover’s black-lace Valentine’s heart.

While some might find the look distasteful, the reality is that men buy 60% of the Valentine heart boxes, and they like black lace. It’s also a fact that the less money the guy makes, the more money he will spend on the chocolates because it’s the main gift, according to Stover CMO Mark Sesler. A wealthier fellow will spend most of his dollars on dinner and jewelry, and a small box of chocolates. Another insight is that the chocolates usually are not a surprise – Mark says men will get on the phone to confirm the favored filling. Russell Stover now makes all-coconut and all-nut boxes so they don’t screw up. (link)

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