Mar 19, 2023: Why is Toblerone removing the mountains from its packaging? How will this affect the company? Keep reading to know more!
When you hear the word "Toblerone," the majority of us probably think crisp milk chocolate pyramids wrapped in a long, yellow wrapper picturing a mountain in the Swiss Alps.
But, this image of Toblerone may soon shift, though only slightly. The renowned Matterhorn mountain and the claim that the bar is "of Switzerland" have been removed off the package by Mondelez, the US company that owns the Swiss bar. The Toblerone that Mondelez acquired in 1990 was made in Bern, the capital of Switzerland, for approximately 125 years.
Just in case you didn't know, Cadbury, one of the most iconic confectionery brands in the world has been a part of Mondelēz International since 2010.
Theodor Tobler, the company's founder, the characteristic pyramid shape that was modelled after the Swiss Alps, the Matterhorn image—signifies that everything about the chocolate is Swiss.
But, Mondelez has now found itself in a fix since global demand for their chocolates is exceeding expectations.
On the other side, Mondelez is also dealing with a significant increase in raw material costs, and the company is being forced to increase its pricing as a result of rising energy costs across most of Europe.
Mondelez had to come up with a strategy in order to meet the rising global demand while keeping prices manageable if it had to balance its profit margins. In order to satisfy demand, it made the decision to increase manufacturing capacity at Bern in June 2022, but it also made another decision that would not please the Swiss. To decrease costs, it relocated a portion of the toblerone factory to Slovakia (another country located in central Europe). By doing so, it was able to take advantage of the lower salaries in the area.
Nevertheless, Mondelez violated the swissness rule.
What does that mean?
In 2013, the Swiss discovered that consumers were prepared to pay extra for the Swiss label because they connected it with a higher standard of quality. In fact, prices for some luxury goods are 20–50% higher just because they possess the tag.
Swissness refers to the unique characteristics and values associated with Switzerland and its culture. It is often associated with quality, reliability, and precision. In business, Swissness is a legal concept that defines the criteria a product or service must meet to be considered Swiss-made.
In business, "Swissness" is a legal concept that defines the criteria a product or service must meet to be considered Swiss-made. These criteria include that at least 60% of the manufacturing costs must be incurred in Switzerland and the final product must undergo transformation in Switzerland itself in case of watches.
The labels on watches like Patek Philippe and Omega proudly stated "Swiss made of Switzerland and created in Switzerland," but there was a problem: these labels were being falsified. They discovered legal gaps in 1971 and took advantage of them. The law at the time stated plainly that at least 50% of the value of the components used to create the watch movement must originate in Switzerland.
What is the most important part of a watch - it's internal parts of course - because that is what makes it work, and not the strap, the casing the beautiful box which contains it.
So the watch manufacturer from Switzerland could make the entire mechanism in Switzerland but most of the other parts could originate from outside the area; the glass could come from China, the casing could be made in Taiwan and maybe the strap from India and the watch manufacturer could just put them together and sell them as "Swiss made" (of course after all quality checks) at the kind of premium price that "made in Switzerland" watch always charged. Higher margins for the Company but the customer is not getting what he thinks he's paying for.
The Swiss then decided to alter the laws. In 2017, it approved a rule requiring watchmakers to spend at least 60% of the total cost of manufacturing a watch in Switzerland. This requirement applies to the complete watch, including the glass, case, and strap, not just the mechanism. Also, the technology and and any advancements must take place in Switzerland. That task could not be assigned to anyone else. This rule, they decided, would make it truly Swiss Made and would safeguard the reputation of Switzerland.
While watches are being used here as an example, this swissness standard wasn't just applicable to watches; it felt as though the tag had been too severely devalued by that point. It would have a tonne of the things for which the Swiss were renowned.
The legislation states that for milk-based products like toblerone, not only must the milk come from Swiss cows, but the entire processing and manufacture must also take place in Switzerland. That is the reason why Toblerone's Slovakian bars will no longer be Swiss, and it is also the reason why their packaging is changing.
The legislation states that for milk-based products like Toblerone, not only must the milk come from Swiss cows, but the entire processing and manufacture must also take place in Switzerland. Basically, for foodstuffs to market themselves as “made in Switzerland”, 80% of the raw ingredients must be sourced from the country and the majority of processing take place there. For milk and milk-based products, the requirement is 100%, with exceptions for ingredients that cannot be sourced from Switzerland, such as cocoa.
That is the reason why Toblerone's Slovakian bars will no longer be Swiss, and it is also the reason why their packaging is changing.
“The packaging redesign introduces a modernised and streamlined mountain logo that aligns with the geometric and triangular aesthetic,” a Mondelēz spokesperson told the Aargauer Zeitung newspaper. Toblerone packaging will now read “established in Switzerland”, rather than “of Switzerland”.
Will Toblerone lose value in the eyes of its devoted devotees if the Swiss logo is removed? Will consumers be unwilling to pay a premium price for an imported bar of chocolate?