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Just Born, Inc.

 


Address:
1300 Stefko Boulevard
Bethlehem, Pennsylvania 18016
U.S.A.

Telephone: (610) 867-7568
Toll Free: 800-445-5787
Fax: (610) 867-3983
http://www.marshmallowpeeps.com

Statistics:
Private Company
Incorporated: 1923
Employees: 240
Sales: $24 million (1998 est.)
NAIC: 31134 Non-Chocolate Confectionary Manufacturing


Company Perspectives:


Today, Just Born is the premier provider of marshmallow confections in the U.S., with Marshmallow Peeps and Bunnies hailing as the top-selling non-chocolate Easter candy. Both Mike and Ike and Hot Tamales enjoy year-round popularity across all age groups.


Key Dates:


1923: Samuel Born opens first store in Brooklyn.
1928: Debut of Mike and Ike.
1932: Business relocates to Bethlehem, Pennsylvania.
1935: Just Born acquires Maillard.
1953: Just Born acquires Rodda.
1992: Grandsons of founder and founding partner become co-presidents.


Company History:

Just Born, Inc. is the number one manufacturer of marshmallow candies in the United States. It makes both Marshmallow Peeps and Marshmallow Bunnies, which are the nation's leading non-chocolate Easter candy. In addition to marshmallow confections, the company also produces several well-known candy brands, including Mike and Ike and Hot Tamales. Both the company's corporate headquarters and manufacturing facilities are located in Bethlehem, Pennsylvania.

Early History

Just Born sounds like it refers to the new chicks hatching out of marshmallow in its Marshmallow Peeps, but the name actually originated with the company's founder, Samuel Born. Born was a native Russian who emigrated to the United States in 1910. Apparently he had already been a candymaker in his homeland, and he brought the trade with him. His first fame in the United States was the invention in 1916 of the Born Sucker Machine, a mechanism for automatically inserting sticks into lollipops. For this marvel, San Francisco awarded Born the keys to the city.

In 1923, Born opened a small candy shop in Brooklyn, New York. Here he made his own candy and sold it retail. Because he made fresh candy every day, he hit on the idea of displaying some of the day's batch in the window with a sign reading 'Just Born.' This gave the name to his company, and also its early logo, which was a baby in a candy scale. Soon after he opened his store, Born invited two family members, his brothers-in-law Jack and Irv Shaffer, to become his business partners. Born was above all an inventor and entrepreneur, and he wanted his partners to handle the more mundane aspects of the new company. As sales grew and the small factory increased its output, Born turned to inventing chocolate novelties, and came up with two which are still common today. He is responsible for chocolate jimmies, the small chocolate sprinkles that go on ice cream cones, and for the kind of chocolate that is used as an ice cream coating. Another new Just Born product that persists today was Mike and Ike, which made its first appearance in 1928. These were small, soft-shelled fruit flavored candies somewhat like a skinny jellybean. The names Mike and Ike were apparently a popular 1920s pairing, and Born chose this for his new product. Also in 1928 Just Born debuted Hot Tamales. These were cinnamon flavored red hot candies. Both new items came in distinctive boxes.

Relocation and Expansion Through the 1950s

The 1920s were a time of general prosperity in the United States, and Just Born grew and expanded in its first decade. Even when the Great Depression hit with the stock market crash of 1929, Just Born continued to do well. But eventually it outgrew its New York headquarters. The company began to look around for a place to relocate to, and finally settled on Bethlehem, Pennsylvania. Bethlehem's advantages were that it had good rail connections, so it was easy to receive raw materials and ship products, the price on the land was acceptably low, the labor force was considered good, and the trolley to New York City stopped right in front of Just Born's new facility.

Three years after moving to Bethlehem, Just Born expanded again, through an acquisition. In 1935 the company bought Maillard Corporation, an esteemed maker of both chocolate and non-chocolate confections. Maillard made mints, jellies, crystallized fruits, and what was touted as 'the best bridge mix in the country,' as well as unique chocolates decorated by hand. Maillard had a reputation for elegant, upscale candy, and its products were marketed to fine department stores such as Macy's and Neiman-Marcus.

In 1946, Samuel Born's son Bob joined the company, getting the second generation of Borns into the family business. Shortly after, in 1953, the company made what was perhaps its most decisive acquisition. Just Born's principal candies, including Mike and Ike and Hot Tamales, were what are known as soft panned confections, made by a slow process that allowed multiple sugar layers to build up while remaining soft and flexible. Perhaps the best-known soft panned candy in the United States is the jelly bean, a fruit-flavored oblong most often seen around Easter. Consequently, when Just Born learned in 1953 that the Rodda Candy Company, a jelly bean maker in nearby Lancaster, Pennsylvania, was for sale, it seemed a natural fit of product lines, and Just Born made the acquisition. Though Rodda was best known for its jelly beans, the company also had a small sideline making another popular Easter candy, solid marshmallow chicks. At the time of the acquisition, Rodda made these so-called Marshmallow Peeps through a laborious process that involved squeezing the softened marshmallow by hand through pastry tubes to form the desired shape. The marshmallow chicks took 27 hours to make, and the eyes had to be painted on individually by hand. Bob Born showed he had inherited his father's knack for inventions when he was determined to mechanize the Marshmallow Peep manufacturing process. Convinced it could be done, he worked with his plant manager to come up with a viable automatic method that would reduce the costly and time-consuming hand work. Born was successful, and the company went on to become the leader in the Easter marshmallow market.

Changes in the 1980s

After making these acquisitions, Just Born operated several divisions under its corporate umbrella. The Maillard division continued to market its upscale candies; the Rodda division was responsible for the Easter candies jelly beans and Marshmallow Peeps, and under the name Just Born the company marketed its soft panned Mike and Ikes, Hot Tamales and several new ones. Just Born came up with another fruit-flavored candy in 1960, a grape treat similar to Mike and Ike. This was called Jolly Joes. Two years later, in 1962, the company put out a spearmint candy named Cool Kids. Around this time, the company halted production of chocolate candies to focus entirely on non-chocolate and marshmallow confections. The company was still in family hands, run by descendants of the original founders Samuel Born and Jack Shaffer. Though it had not grown to be a nationally prominent company in the ranks of Hershey or Mars, it had a settled niche, and its brands were sold across the country. But the company did little advertising, and had not made much of an effort to market itself more vividly.

By 1983, the third generation of Borns and Shaffers had taken leadership positions in the company. David Shaffer and Ross Born entered the company, sharing executive responsibility with their fathers. The company was in the minority in the candy industry as a private, family-run institution, but Just Born was not interested in selling out to a bigger company or finding outside management. Yet the company did change decisively under the younger generation's guidance. Beginning in 1985, Just Born changed its focus and became more concerned with its marketing. Ross Born described the company's old philosophy in a July 1989 interview with U.S. Distribution Journal as 'If we can make it, we can sell it.' He went on to explain that the company knew how to make candy, but it had no idea how to take advantage of marketing opportunities. Ross Born and David Shaffer hired a consultant to help the company market its products better. They also initiated consumer focus groups, so that they could gather feedback directly from consumers. Through information from the consultant and the focus groups, Just Born arrived at a four-year plan to increase its presence and reach out to potential customers. Soon the formerly quiet company was coming up with creative promotions, expanding its product lines, and changing its packaging and logo. It also sought talent from outside the company to head its sales and marketing operations, hiring a man with 25 years of such experience at General Foods. A new national sales manager had previously worked for Hershey and Willy Wonka.

Just Born used its consumer focus groups to help guide its packaging. In 1988 the firm came out with new, brighter boxes for Mike and Ikes, Jolly Joes, and Hot Tamales. Just Born also began offering different sized packages of these old standards, including very small boxes that could be given away as Halloween treats. By 1989, the new packaging alone was estimated by the company's sales manager to have boosted total volume by around 30 percent. Mike and Ikes also received major exposure when the company for the first time promoted them by putting sample packs in cereal boxes. Sample boxes of the fruit candies went to four million consumers in 1988, inside General Mills' sweet Cocoa Puffs cereal. The Cocoa Puffs boxes also featured Mike and Ikes advertising on the back.

The company deemed fruit candies a growing segment of the U.S. candy market, and worked to come up with new fruit flavors for Mike and Ike. Just Born also tried to free itself from its dependence on Easter as its major sales maker by producing marshmallow candies for Christmas and Halloween. These included marshmallow ghosts, pumpkins, and spooky cats, and for Christmas, trees and snowmen. The company estimated it could double its production, and in the late 1980s it made plans to install new machinery, at the cost of $5 million.

Acceleration in the 1990s

By the late 1980s, Just Born was producing approximately 250 million marshmallow chicks and bunnies and six million jelly beans every year. Its marshmallow division, Rodda, was the largest maker of marshmallow candies in the world. Just Born made not only standard Easter jelly beans, but was selling gourmet beans called Teenee Beanees through its Maillard division. These caught the marketing updraft created by Ronald Reagan's passion for jelly beans. Teenee Beanees were sold through upscale marketers, including the candy counters at Macy's and Neiman-Marcus. About 60 percent of Just Born's sales came through candy and tobacco distributors. With the changes instituted by Ross Born and David Shaffer in the mid-1980s, the company was once again on the upswing. These two became officially co-presidents of the company in 1992. Changes abounded. The design for the old favorite Marshmallow Peep was altered in 1991, with a new wingless shape. Peeps had been available in only three colors for ages: yellow, pink, and white. In 1995 Just Born brought out its first lavender Peeps. The new color apparently contributed to the product's growing sales, and in 1998 the company added another color, blue. This decision was not made lightly. Just Born used its consumer focus groups in order to determine if a new hue would sell. Blue was the prevailing choice of those polled. The company had worked diligently to build marketing momentum, and in the late 1990s its Marshmallow Peeps were the number one non-chocolate Easter candy year after year. Then in 1999 Just Born released television advertising for Peeps for the very first time. The ad featured a 15-second Broadway rendition of the song 'Rockin' Robin,' with a cast of computer-animated Peeps swing dancing on a glittering stage. By that time, sales of Peeps had swollen to over 600 million units a year, up from 250 million a decade earlier. The company also hoped its television campaign would strengthen brand awareness for Just Born's new marshmallow products, which included Valentine's Day specialties, Peeps Jellybeans, and Peeps Eggs.

Meanwhile, the fruit candy side of the company also continued to expand through marketing. In 1996 Just Born brought out new flavors for Mike and Ike, including tropical fruit. The next year saw the addition of Bodacious Berry. With the new flavors, Mike and Ike finally passed up Hot Tamales as the company's best seller. Just Born ventured into television again in 1999, through a cross-promotion with Atlantic Records. In this arrangement, Mike and Ikes and Hot Tamales packages featured several Atlantic Records performing artists on the back. A sweepstakes offered instant cash prizes as well as a chance to win a compact disc compilation of the Atlantic artists. The CD, called 'The Absolute Hits,' came with a coupon for a free box or bag of either Mike and Ikes or Hot Tamales. The sweepstakes and 'The Absolute Hits' were advertised on television in the spring of 1999. According to industry analysts cited in Brandweek for January 18, 1999, sales of Mike and Ikes grew tremendously in the late 1990s, surging over 18 percent in the last several years of the decade. Hot Tamales too grew by over eight percent in the same period, with total sales of $11 million in 1998. This new, more aggressive and creative marketing of Just Born's products transformed the small, family-run company into a modern and growing enterprise. As the decade came to a close, Just Born was certain that the markets for its products were still opening. The company planned to continue its course of expanded product lines.

Principal Divisions: Rodda; Maillard.

Principal Competitors: Ferrara Pan Candy Company; Herman Goelitz, Inc.; Ben Myerson Candy Co.





Further Reading:


Beirne, Mike, 'Just Born Candies Get Big Bang with Atlantic Records Cross-Promo,' Brandweek, January 18, 1998, p. 4.
'Blue Is Red-Hot, Even for Easter,' U.S. Distribution Journal, January-February, 1998, p. 50.
Broekel, Ray, The Great American Candy Bar Book, Boston: Houghton Mifflin, 1982, p. 126.
'Just Born Proves It's No Marshmallow,' U.S. Distribution Journal, July 1989, p. 54.
Lehrer, Jeremy, 'Peeps Make Some Noise,' Shoot, April 2, 1999, p. 5.

Source: International Directory of Company Histories, Vol. 32. St. James Press, 2000.




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