Navigating around a freakishly-large fabric football in the entrance to the Mars UK headquarters and dodging Peter Shilton - who, bizarrely, is in the lobby publicising a sporting initiative - Fiona Dawson clutches a large furry M&M and gamely poses for some photos.
While her willingness to suffer for our art might come as a surprise given that Mars’ PR policy is politely referred to as “relentlessly low-key”, Dawson grins and bears her way through it before escaping to an open-plan office that looks a bit like what a primary school classroom would look like if the pupils designed it themselves.
Everything is red, yellow and blue – including the chairs. Dawson, like the rest of the management team, does not have her own office, and heads for a meeting room with a table decorated with M&Ms.
The open-plan layout actually has a calming effect, observes her communications boss. If everyone is yelling at each other, no one can focus on what they are doing. No doubt his theory was put to the test last year as Dawson suddenly found herself at the centre of a media storm over a seemingly innocuous decision by her purchasing team to switch from vegetarian to bovine rennet in one of the nation’s favourite chocolate bars.
While the resulting headlines (Veggies vow to boycott Mars bars - Daily Mail) brought some sleepless nights, the team acted in good faith, she stresses. “We’d had some problems guaranteeing supplies of vegetarian rennet [which is used as a processing aid and not labelled in the final product], so we switched to a more reliable [animal-based] source.
“With hindsight, that was a mistake, as some customers were very unhappy. But we recognised we’d got things wrong and worked incredibly hard to put them right. My commercial team was working 18-hour days to secure sustainable sources [of vegetarian rennet]. But time seems to stand still when you are facing a crisis. Well it seemed like one at the time, but you move on.”
Of course, bovine-based blues aside, things could have been worse. As Mars was agonising over its rennet supplies, its biggest rival was in the dock for causing a salmonella outbreak. Dawson naturally, is too polite to point this out.
Not surprisingly, she is also pretty circumspect about the merger with Wrigley, but reveals that it has not actually taken up a great deal of her time to date. “It’s very exciting, but the two businesses will be run as standalone operations (News, pxx). My focus will remain on driving growth in chocolate.”
So where is this growth going to come from? Low-sugar chocolate, for all the column inches it seems to generate, does not appear to be high on Dawson’s agenda: “People want to buy chocolate made from ingredients they have heard of. Consumers understand sugar.”
Flavanol-rich ‘functional’ chocolate, meanwhile, which Mars has been selling across the pond under the CocoaVia brand, is also low down the priority list for a UK launch in the immediate future, she hints. “The science behind it is amazing, but we’re focusing on maximising our core brands at the moment.”
And there is no question that this strategy is paying off. Mars grew confectionery sales by 8.5% in 2007 (ahead of market growth of 5.2%), growing 9.7% in everyday chocolate (bars, bite-size and blocks) and 8% in sugar, boosted by the launch of Starburst Choozers.
It has also pumped some serious cash into marketing, resurrecting Mr T from 1980s TV show The A-Team to get behind the Snickers brand and teaming up with the new Sex and the City movie with its Galaxy brand – clearly a personal favourite for Dawson. “I love it. It’s a real jewel in the crown, and is already worth just shy of £200M.”
She also has great hopes for the Seeds of Change brand, which has just launched into chocolate. But why should punters buy this instead of Green & Blacks? “Because it’s nicer!” she says. “Try the orange and fig – it’s fantastic!”
Bang for your NPD bucks
As for new products, “the holy grail is the one big innovation that really sticks,” says Dawson. “But there is also a role for continuous innovation, packaging innovations, reducing trans-fats or artificial colours, adding more fruit juice, changing portion sizes and so on. While there is an element of confectionery that’s high novelty, only a handful of new launches – of which Celebrations is one, has really stuck in the last 10 years. We’ve chosen to build on a limited number of core brands and leverage our advertising; that has been the formula that has driven our success.”
Like many rivals, Mars is also looking in new places for inspiration via ‘open innovation’, in which third parties are invited to pitch ideas and work with Mars to develop new concepts.
Dragon’s Den-style events whereby its own associates – and their children – are invited to pitch ideas to a panel have also delivered some promising leads, she says. “My son had an idea for a sweet that he was badgering me about for weeks. So he finally got his chance!”
As for brand extensions, they have their place, says Dawson, but if the new product doesn’t make the grade, it doesn’t matter what name is on the packet (as rival Nestlé discovered to its cost with Kit Kat Kubes). “We don’t have a huge track record of line extensions. We launched Mars Planets [which clocked up sales of a cool £17M in 2007], but that really is a completely new product.”
Given the number of confectioners that have packed their bags and set up production facilities in central and eastern Europe in recent years, what future does the Mars factory in Slough have? A bright one, insists Dawson. “We’ve invested £60M at Slough [which makes chocolate products] over the last three years in order to improve efficiencies, because we believe this site has a future.”
It actually makes a lot of sense to have a production base in the UK, says Dawson, who joined Mars in 1988 straight out of university and then progressed rapidly up the ranks in a series of commercial roles. “While wages are lower in eastern Europe, labour costs are actually a relatively small part of overall production costs.
“I also firmly believe in the creation of business units whereby you can link through the whole supply chain from input to output; we’re all here in one place. If I want to find out what’s happening in production, I just go downstairs. We’ve been in Slough for 75 years and we’ve got no intention of moving!”
The only way to make progress in the current climate of rising costs is to relentlessly drive cost out of the business, says Dawson, who also chairs the Food and Drink Federation’s sustainability and competitiveness group (News, pxxx). “Carbon costs money, so trying to reduce it is nothing new in one sense. However, once you start looking at your overall carbon footprint you do keep finding new opportunities that make a meaningful difference to the bottom line. Whether this is meaningful to consumers is a different question.”
As for whether shoppers feeling the pinch in the current economic climate will try and curb their chocolate cravings, Dawson thinks not “We’re selling low ticket items, and people still want to treat themselves.”
She adds: “I was listening to Gordon Brown on the radio and I actually think we’ve got to be careful that we keep a level head and don’t talk ourselves into a recession. Yes, raw material prices are going up, but that only translates to 2p on the retail price of a Mars bar.”
Perhaps the hardest part of the job is maintaining the work-life balance, says Dawson, who has two young children. “I’m very choiceful about what evening commitments I make. I generally do one or two a week, and they are usually customer-based or related to the FDF.” Sadly, the Sex and the City movie premiere in London was one invite she had to turn down, she says: “It was one of those trade offs I had to make from a family point of view.
“My children are without a shadow of a doubt the most important thing in my life, so spending time with them is my first priority. But I don’t know of any working mum or dad that isn’t constantly juggling and making trade offs. Even if you don’t have kids, you’re permanently checking and re-prioritising.”