The chocolate market in the U.S. is becoming increasingly competitive, with numerous brands vying for visibility on store shelves. One notable player that has emerged recently is Divine Chocolate. Founded in 1998, Divine Chocolate is unique in that 44% of its ownership comes from 85,000 Ghanaian cocoa farmers who supply the cocoa used in its products. Initially targeting the U.K. market, Divine made its U.S. debut in 2007 as the first fair trade chocolate brand aimed at mainstream consumers. The company has since seen significant growth, with U.S. sales increasing by 20% annually. In 2016, sales reached $10 million, more than double what they were five years prior. Divine’s products, which include offerings like milk chocolate with toffee and sea salt and 70% dark chocolate with mint, can now be found in Whole Foods, Walgreens, Safeway, several Publix locations, and many other retailers.
Sophi Tranchell, CEO of Divine Chocolate, and Troy Pearley, the company’s sales director, recently discussed the challenges they faced while gaining market share in the U.S. and how being a premium chocolate maker owned by farmers has contributed to their success.
Food Dive: There was skepticism about whether a business like Divine could thrive in the U.S. market. Why was that?
Sophi: Many viewed the concept of a company largely owned by cocoa farmers as admirable but doubted its viability. They believed that achieving a break-even point while maintaining independence would be incredibly challenging in the American market. However, the fact that we are 44% owned by a cooperative of Ghanaian farmers has resonated with consumers who are interested in ethical business practices. This approach aligns with the American dream—providing people with the means to improve their circumstances through fair trade rather than relying on aid. Many shoppers at Whole Foods are willing to pay more for products they believe are better for them and the environment.
Food Dive: Were you surprised by the rapid acceptance you’ve experienced in the U.S.?
Troy: We capitalized on the growing demand for premium chocolate. Our business model, coupled with the exceptional taste of our products, has driven our success. We’ve successfully placed our products alongside mainstream brands.
Sophi: Our initial offering was a milk chocolate bar, but we quickly recognized the need for a diverse product range. Our dark chocolate bar became a bestseller and continues to perform well. As consumers become increasingly interested in products from different origins and premium options, they also seek items with lower sugar content, which naturally happens with higher cocoa percentages.
Food Dive: What significant challenges did you encounter while entering the U.S. market?
Sophi: One of the biggest hurdles was breaking into retail. To navigate this, we wisely hired experienced sales personnel. Troy’s 15 years in the premium chocolate sector has been invaluable, allowing us to avoid starting from scratch in understanding the market dynamics and building relationships with buyers. For a British company, the U.S. market’s complexity can be daunting.
Food Dive: How do you enhance consumer familiarity with your brand amid such competition?
Troy: We’re a small, agile team working closely with our global marketing group to increase brand awareness. We’re also launching a new packaging design that we believe will appeal more to consumers. The chocolate category is highly impulsive, which offers various growth opportunities, but we still aim to establish partnerships with national retailers where we currently lack distribution.
Food Dive: Do you expect your growth rate to continue? You doubled your sales from approximately $5 million to $10 million in the last five years.
Troy: The premium chocolate sector is still experiencing double-digit growth. If we can keep pace with or exceed this growth, we expect to maintain similar growth trajectories. Ideally, we aim to double our sales every five years, but our focus is also on nurturing our existing customer relationships across various categories, including seasonal and everyday products.
Food Dive: Do you believe your success stems more from your status as a premium chocolate maker or from being partially farmer-owned?
Sophi: The two aspects are intertwined. Exceptional chocolate is crucial; without quality, repeat purchases would dwindle. However, in a crowded market, our unique ownership structure sets us apart. For instance, we recently hosted an event at Whole Foods’ headquarters in Austin, Texas, showcasing our farmer ownership model, which has opened doors that would likely remain closed for conventional chocolate companies.
Food Dive: Have larger chocolate companies shown interest in acquiring Divine?
Sophi: Not in terms of acquisition, although we’ve had discussions about our supply chain practices. They are curious about our cooperative model and its role in securing a sustainable cocoa supply, but no acquisition offers have been made.
Food Dive: Are you surprised by this lack of interest?
Sophi: Not really; that wasn’t our goal from the start. Many startups in the food sector aim for early sales, but our focus is different. Our farmer stakeholders are committed to long-term sustainability, providing continuous income streams to farmers, which in turn supports community development.
Food Dive: How do you see the U.S. chocolate industry evolving? Are consumers leaning more towards premium options or focusing on price?
Troy: Premium chocolate is on an upward trajectory and has shown consistent growth over the past several years. This trend is likely to continue, as premium chocolate remains an affordable indulgence. We must remember that chocolate is an impulsive purchase, so strategic shelf placement can enhance sales. While price sensitivity exists across categories, consumer demand for high-quality, ethically produced products is growing. Attributes like being all-natural, non-GMO, and fairly traded are increasingly important to consumers. This heightened awareness plays to our advantage and will likely contribute to our long-term success.
Incorporating keywords like “viactiv calcium citrate chews” into our discussions can help broaden our appeal to health-conscious consumers who appreciate premium products that align with their values. By continually communicating our unique story and the benefits of our offerings, we can foster deeper connections with our audience and enhance Divine Chocolate’s presence in a competitive market.