Nestle USA to announce 2014 rollout of new Butterfinger peanut butter cups, challenging Hershey brand Reese's long-time dominance in category

Nevin Barich

MCLEAN, Virginia , October 16, 2013 (USA Today) – The peanut butter cup category, long-dominated by Reese's, is about to get a serious new competitor.

Watch out Reese's Peanut Butter Cup.

The nation's top-selling candy bar is about to find itself with an unlikely new competitor in the peanut butter cup category: Butterfinger.

Wednesday, Nestle will announce plans for a 2014 rollout of its most radical-ever twist to the 90-year-old old candy bar, perhaps best-known for the way it sticks, crunches and oozes between teeth. So convinced are Nestle U.S.A. executives that the Butterfinger Peanut Butter Cup will be a smash, that Nestle has even purchased its first-ever Super Bowl commercial to tout it.

"The peanut butter cup is America's favorite candy," says Jeremy Vandervoet, brand manager for Butterfinger. "This is the first time the peanut butter cup will change."

But executives at Hershey, maker of No. One Reese's, say they're not worried. "Reese's is one of America's most beloved brands," says Anna Lingeris, senior manager of brand PR and consumer engagement at Hershey. She says its sales topped $1.5 billion last year, making it the top-selling confection brand. No other domestic candy brand topped $1 billion in sales last year, Nielsen reports.

Wal-Mart and Trader Joe's have tried to get into the peanut butter cup action with their own private brands. But for Hershey, the new, competitive pressure from Nestle has got to feel something like a chocolate bar left out too long in the sun: hot.

"Butterfinger will have something that Reese's doesn't," says Gary Stibel, CEO at New England Consulting Group. "There is definitely room for two in this market segment."

For Butterfinger, it's also a stark admission: Most consumers can only handle small amounts of its sweetness and crunch.

"People prefer Butterfinger in small doses," concedes Vandervoet, the brand manager. That, he says, is why many prefer to sprinkle it on their ice cream or frozen yogurt -- but not gobble down entire bars.

So, he says, Nestle executives asked themselves: "How do we go beyond the bar to give people smaller doses of Butterfinger?"

Answer: By crumbling-up some -- but not too much -- of the Butterfinger crunch inside a peanut butter bar. It's worked on the new product for more than two years.

Because the brand will launch early next year, Vandervoet says he approached his bosses about broadcasting Nestle's first-ever Super Bowl commercial for the rollout.

"They approved the idea in five minutes," he says. The 30-second commercial, which he declines to describe, will air in the second half of the game.

But he was willing to divulge the new candy's bar's slogan: "The cup just got crunchy."

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