2011 Power 50: No. 41 John P. Bilbrey

Things got off to a bright start for John P. Bilbrey, the newly named chief executive officer of The Hershey Co., when he followed the news of his appointment with a projection that sales and profit growth would be at the high end of its expectations for the year.

The Hershey, Pa.-based company had named Bilbrey, the former chief operating officer of the candy maker, as its interim president and CEO in May following the departure of longtime CEO David West, who left to become CEO of Del Monte Foods Co. In June, it named Bilbrey the permanent CEO.

“J.P. has the experience, deep industry knowledge and the right skills to lead Hershey's growth as it continues to evolve into a global company,” said James E. Nevels, Hershey's chairman.

Bilbrey, with 30 years of CPG experience, had joined Hershey in 2003 as president of Hershey International, and before that had held executive positions at Mission Foods and Groupe Danone.

Analysts said his international experience could come in handy as the company competes against larger rivals Kraft and Mars.

“Bilbrey's resume includes numerous stints operating in international markets, which could aid this endeavor,” Erin Lash, an analyst with Chicago-based Morningstar, said in a research note after Bilbrey's appointment.

Richard George, professor of food marketing at St. Joseph University's Haub School of Business in Philadelphia, told SN that Hershey faces challenges both from evolving consumer preferences for healthful foods and from the growth of its rivals.

“The childhood obesity crisis is real and is comprehended by younger mothers who want to make certain their children grow up healthy, not overweight, and without the threat of diabetes,” he said.

In addition, the Mars-Wrigley merger and Kraft's acquisition of Cadbury have afforded those companies new expansion opportunities.

“The key priorities [for Bilbrey as the new CEO] should come from developing a long-term strategy to deal with these two foreboding challenges,” George said. “Sugar-free, reduced-fat and reduced-calorie products are essential to maintain current market share.

“Regarding the consolidated competition, Hershey needs to pursue merger or acquisition options that will lead them into emerging markets and growing categories.”

In the company's most recent conference call with analysts in April, Hershey projected confidence in continued sales and earnings growth, although increased prices are expected pressure sales volumes through the remainder of 2011.

Among the initiatives under way at the company are a Twizzlers “summer landmark” promotion, in which consumers can win a trip to the American landmark of their choice, and last month's launch of Hershey's Air Delight, an aerated chocolate bar that also has a Hershey's Kiss version.

In addition, Hershey last year unveiled Project Next Century, which involves the transition from its century-old plant in Hershey, Pa., to a newer facility in West Hershey. That effort is scheduled to be completed by 2014.